Sto. Tomas vs.

Salac
These consolidated cases pertain to the constitutionality of certain provisions of Republic Act 8042, otherwise known as the Migrant
Workers and Overseas Filipinos Act of 1995.
The Facts and the Case
On June 7, 1995 Congress enacted Republic Act (R.A.) 8042 or the Migrant Workers and Overseas Filipinos Act of 1995 that, for
among other purposes, sets the Governments policies on overseas employment and establishes a higher standard of protection
and promotion of the welfare of migrant workers, their families, and overseas Filipinos in distress.
G.R. 152642 and G.R. 152710
(Constitutionality of Sections 29 and 30, R.A. 8042)
Sections 29 and 30 of the Act1 commanded the Department of Labor and Employment (DOLE) to begin deregulating within one
year of its passage the business of handling the recruitment and migration of overseas Filipino workers and phase out within five
years the regulatory functions of the Philippine Overseas Employment Administration (POEA).
On January 8, 2002 respondents Rey Salac, Willie D. Espiritu, Mario Montenegro, Dodgie Belonio, Lolit Salinel, and Buddy
Bonnevie (Salac, et al.) filed a petition for certiorari, prohibition and mandamus with application for temporary restraining order
(TRO) and preliminary injunction against petitioners, the DOLE Secretary, the POEA Administrator, and the Technical Education
and Skills Development Authority (TESDA) Secretary-General before the Regional Trial Court (RTC) of Quezon City, Branch 96. 2
Salac, et al. sought to: 1) nullify DOLE Department Order 10 (DOLE DO 10) and POEA Memorandum Circular 15 (POEA MC 15);
2) prohibit the DOLE, POEA, and TESDA from implementing the same and from further issuing rules and regulations that would
regulate the recruitment and placement of overseas Filipino workers (OFWs); and 3) also enjoin them to comply with the policy of
deregulation mandated under Sections 29 and 30 of Republic Act 8042.
On March 20, 2002 the Quezon City RTC granted Salac, et al.s petition and ordered the government agencies mentioned to
deregulate the recruitment and placement of OFWs.3 The RTC also annulled DOLE DO 10, POEA MC 15, and all other orders,
circulars and issuances that are inconsistent with the policy of deregulation under R.A. 8042.
Prompted by the RTCs above actions, the government officials concerned filed the present petition in G.R. 152642 seeking to
annul the RTCs decision and have the same enjoined pending action on the petition.
On April 17, 2002 the Philippine Association of Service Exporters, Inc. intervened in the case before the Court, claiming that the
RTC March 20, 2002 Decision gravely affected them since it paralyzed the deployment abroad of OFWs and performing artists.
The Confederated Association of Licensed Entertainment Agencies, Incorporated (CALEA) intervened for the same purpose.4
On May 23, 2002 the Court5 issued a TRO in the case, enjoining the Quezon City RTC, Branch 96, from enforcing its decision.
In a parallel case, on February 12, 2002 respondents Asian Recruitment Council Philippine Chapter, Inc. and others (Arcophil, et
al.) filed a petition for certiorari and prohibition with application for TRO and preliminary injunction against the DOLE Secretary, the
POEA Administrator, and the TESDA Director-General,6 before the RTC of Quezon City, Branch 220, to enjoin the latter from
implementing the 2002 Rules and Regulations Governing the Recruitment and Employment of Overseas Workers and to cease and
desist from issuing other orders, circulars, and policies that tend to regulate the recruitment and placement of OFWs in violation of
the policy of deregulation provided in Sections 29 and 30 of R.A. 8042.
On March 12, 2002 the Quezon City RTC rendered an Order, granting the petition and enjoining the government agencies involved
from exercising regulatory functions over the recruitment and placement of OFWs. This prompted the DOLE Secretary, the POEA
Administrator, and the TESDA Director-General to file the present action in G.R. 152710. As in G.R. 152642, the Court issued on
May 23, 2002 a TRO enjoining the Quezon City RTC, Branch 220 from enforcing its decision.
On December 4, 2008, however, the Republic informed7 the Court that on April 10, 2007 former President Gloria Macapagal-Arroyo
signed into law R.A. 94228 which expressly repealed Sections 29 and 30 of R.A. 8042 and adopted the policy of close government
regulation of the recruitment and deployment of OFWs. R.A. 9422 pertinently provides:
xxxx
SEC. 1. Section 23, paragraph (b.1) of Republic Act No. 8042, otherwise known as the "Migrant Workers and Overseas Filipinos
Act of 1995" is hereby amended to read as follows:
(b.1) Philippine Overseas Employment Administration The Administration shall regulate private sector participation in the
recruitment and overseas placement of workers by setting up a licensing and registration system. It shall also formulate and
implement, in coordination with appropriate entities concerned, when necessary, a system for promoting and monitoring the
overseas employment of Filipino workers taking into consideration their welfare and the domestic manpower requirements.

In addition to its powers and functions, the administration shall inform migrant workers not only of their rights as workers but also of
their rights as human beings, instruct and guide the workers how to assert their rights and provide the available mechanism to
redress violation of their rights.
In the recruitment and placement of workers to service the requirements for trained and competent Filipino workers of foreign
governments and their instrumentalities, and such other employers as public interests may require, the administration shall deploy
only to countries where the Philippines has concluded bilateral labor agreements or arrangements: Provided, That such countries
shall guarantee to protect the rights of Filipino migrant workers; and: Provided, further, That such countries shall observe and/or
comply with the international laws and standards for migrant workers.
SEC. 2. Section 29 of the same law is hereby repealed.
SEC. 3. Section 30 of the same law is also hereby repealed.
xxxx
On August 20, 2009 respondents Salac, et al. told the Court in G.R. 152642 that they agree9 with the Republics view that the
repeal of Sections 29 and 30 of R.A. 8042 renders the issues they raised by their action moot and academic. The Court has no
reason to disagree. Consequently, the two cases, G.R. 152642 and 152710, should be dismissed for being moot and academic.
G.R. 167590
(Constitutionality of Sections 6, 7, and 9 of R.A. 8042)
On August 21, 1995 respondent Philippine Association of Service Exporters, Inc. (PASEI) filed a petition for declaratory relief and
prohibition with prayer for issuance of TRO and writ of preliminary injunction before the RTC of Manila, seeking to annul Sections 6,
7, and 9 of R.A. 8042 for being unconstitutional. (PASEI also sought to annul a portion of Section 10 but the Court will take up this
point later together with a related case.)
Section 6 defines the crime of "illegal recruitment" and enumerates the acts constituting the same. Section 7 provides the penalties
for prohibited acts. Thus:
SEC. 6. Definition. For purposes of this Act, illegal recruitment shall mean any act of canvassing, enlisting, contracting,
transporting, utilizing, hiring, procuring workers and includes referring, contract services, promising or advertising for employment
abroad, whether for profit or not, when undertaken by a non-license or non-holder of authority contemplated under Article 13(f) of
Presidential Decree No. 442, as amended, otherwise known as the Labor Code of the Philippines: Provided, That such non-license
or non-holder, who, in any manner, offers or promises for a fee employment abroad to two or more persons shall be deemed so
engaged. It shall likewise include the following acts, whether committed by any person, whether a non-licensee, non-holder,
licensee or holder of authority:
xxxx
SEC. 7. Penalties.
(a) Any person found guilty of illegal recruitment shall suffer the penalty of imprisonment of not less than six (6) years and
one (1) day but not more than twelve (12) years and a fine not less than two hundred thousand pesos (P200,000.00) nor
more than five hundred thousand pesos (P500,000.00).
(b) The penalty of life imprisonment and a fine of not less than five hundred thousand pesos (P500,000.00) nor more than
one million pesos (P1,000,000.00) shall be imposed if illegal recruitment constitutes economic sabotage as defined herein.
Provided, however, That the maximum penalty shall be imposed if the person illegally recruited is less than eighteen (18) years of
age or committed by a non-licensee or non-holder of authority.10
Finally, Section 9 of R.A. 8042 allowed the filing of criminal actions arising from "illegal recruitment" before the RTC of the province
or city where the offense was committed or where the offended party actually resides at the time of the commission of the offense.
The RTC of Manila declared Section 6 unconstitutional after hearing on the ground that its definition of "illegal recruitment" is vague
as it fails to distinguish between licensed and non-licensed recruiters11 and for that reason gives undue advantage to the nonlicensed recruiters in violation of the right to equal protection of those that operate with government licenses or authorities.
But "illegal recruitment" as defined in Section 6 is clear and unambiguous and, contrary to the RTCs finding, actually makes a
distinction between licensed and non-licensed recruiters. By its terms, persons who engage in "canvassing, enlisting, contracting,
transporting, utilizing, hiring, or procuring workers" without the appropriate government license or authority are guilty of illegal
recruitment whether or not they commit the wrongful acts enumerated in that section. On the other hand, recruiters who engage in
the canvassing, enlisting, etc. of OFWs, although with the appropriate government license or authority, are guilty of illegal
recruitment only if they commit any of the wrongful acts enumerated in Section 6.

The Manila RTC also declared Section 7 unconstitutional on the ground that its sweeping application of the penalties failed to make
any distinction as to the seriousness of the act committed for the application of the penalty imposed on such violation. As an
example, said the trial court, the mere failure to render a report under Section 6(h) or obstructing the inspection by the Labor
Department under Section 6(g) are penalized by imprisonment for six years and one day and a minimum fine of P200,000.00 but
which could unreasonably go even as high as life imprisonment if committed by at least three persons.
Apparently, the Manila RTC did not agree that the law can impose such grave penalties upon what it believed were specific acts
that were not as condemnable as the others in the lists. But, in fixing uniform penalties for each of the enumerated acts under
Section 6, Congress was within its prerogative to determine what individual acts are equally reprehensible, consistent with the
State policy of according full protection to labor, and deserving of the same penalties. It is not within the power of the Court to
question the wisdom of this kind of choice. Notably, this legislative policy has been further stressed in July 2010 with the enactment
of R.A. 1002212 which increased even more the duration of the penalties of imprisonment and the amounts of fine for the
commission of the acts listed under Section 7.
Obviously, in fixing such tough penalties, the law considered the unsettling fact that OFWs must work outside the countrys borders
and beyond its immediate protection. The law must, therefore, make an effort to somehow protect them from conscienceless
individuals within its jurisdiction who, fueled by greed, are willing to ship them out without clear assurance that their contracted
principals would treat such OFWs fairly and humanely.
As the Court held in People v. Ventura,13 the State under its police power "may prescribe such regulations as in its judgment will
secure or tend to secure the general welfare of the people, to protect them against the consequence of ignorance and incapacity as
well as of deception and fraud." Police power is "that inherent and plenary power of the State which enables it to prohibit all things
hurtful to the comfort, safety, and welfare of society." 14
The Manila RTC also invalidated Section 9 of R.A. 8042 on the ground that allowing the offended parties to file the criminal case in
their place of residence would negate the general rule on venue of criminal cases which is the place where the crime or any of its
essential elements were committed. Venue, said the RTC, is jurisdictional in penal laws and, allowing the filing of criminal actions at
the place of residence of the offended parties violates their right to due process. Section 9 provides:
SEC. 9. Venue. A criminal action arising from illegal recruitment as defined herein shall be filed with the Regional Trial Court of
the province or city where the offense was committed or where the offended party actually resides at the time of the commission of
the offense: Provided, That the court where the criminal action is first filed shall acquire jurisdiction to the exclusion of other courts:
Provided, however, That the aforestated provisions shall also apply to those criminal actions that have already been filed in court at
the time of the effectivity of this Act.
But there is nothing arbitrary or unconstitutional in Congress fixing an alternative venue for violations of Section 6 of R.A. 8042 that
differs from the venue established by the Rules on Criminal Procedure. Indeed, Section 15(a), Rule 110 of the latter Rules allows
exceptions provided by laws. Thus:
SEC. 15. Place where action is to be instituted. (a) Subject to existing laws, the criminal action shall be instituted and tried in the
court of the municipality or territory where the offense was committed or where any of its essential ingredients occurred. (Emphasis
supplied)
xxxx
Section 9 of R.A. 8042, as an exception to the rule on venue of criminal actions is, consistent with that laws declared policy15 of
providing a criminal justice system that protects and serves the best interests of the victims of illegal recruitment.
G.R. 167590, G.R. 182978-79,16 and G.R. 184298-9917
(Constitutionality of Section 10, last sentence of 2nd paragraph)
G.R. 182978-79 and G.R. 184298-99 are consolidated cases. Respondent spouses Simplicio and Mila Cuaresma (the Cuaresmas)
filed a claim for death and insurance benefits and damages against petitioners Becmen Service Exporter and Promotion, Inc.
(Becmen) and White Falcon Services, Inc. (White Falcon) for the death of their daughter Jasmin Cuaresma while working as staff
nurse in Riyadh, Saudi Arabia.
The Labor Arbiter (LA) dismissed the claim on the ground that the Cuaresmas had already received insurance benefits arising from
their daughters death from the Overseas Workers Welfare Administration (OWWA). The LA also gave due credence to the findings
of the Saudi Arabian authorities that Jasmin committed suicide.
On appeal, however, the National Labor Relations Commission (NLRC) found Becmen and White Falcon jointly and severally liable
for Jasmins death and ordered them to pay the Cuaresmas the amount of US$113,000.00 as actual damages. The NLRC relied on
the Cabanatuan City Health Offices autopsy finding that Jasmin died of criminal violence and rape.
Becmen and White Falcon appealed the NLRC Decision to the Court of Appeals (CA).18 On June 28, 2006 the CA held Becmen
and White Falcon jointly and severally liable with their Saudi Arabian employer for actual damages, with Becmen having a right of
reimbursement from White Falcon. Becmen and White Falcon appealed the CA Decision to this Court.

On April 7, 2009 the Court found Jasmins death not work-related or work-connected since her rape and death did not occur while
she was on duty at the hospital or doing acts incidental to her employment. The Court deleted the award of actual damages but
ruled that Becmens corporate directors and officers are solidarily liable with their company for its failure to investigate the true
nature of her death. Becmen and White Falcon abandoned their legal, moral, and social duty to assist the Cuaresmas in obtaining
justice for their daughter. Consequently, the Court held the foreign employer Rajab and Silsilah, White Falcon, Becmen, and the
latters corporate directors and officers jointly and severally liable to the Cuaresmas for: 1) P2,500,000.00 as moral damages; 2)
P2,500,000.00 as exemplary damages; 3) attorneys fees of 10% of the total monetary award; and 4) cost of suit.
On July 16, 2009 the corporate directors and officers of Becmen, namely, Eufrocina Gumabay, Elvira Taguiam, Lourdes Bonifacio
and Eddie De Guzman (Gumabay, et al.) filed a motion for leave to Intervene. They questioned the constitutionality of the last
sentence of the second paragraph of Section 10, R.A. 8042 which holds the corporate directors, officers and partners jointly and
solidarily liable with their company for money claims filed by OFWs against their employers and the recruitment firms. On
September 9, 2009 the Court allowed the intervention and admitted Gumabay, et al.s motion for reconsideration.
The key issue that Gumabay, et al. present is whether or not the 2nd paragraph of Section 10, R.A. 8042, which holds the
corporate directors, officers, and partners of recruitment and placement agencies jointly and solidarily liable for money claims and
damages that may be adjudged against the latter agencies, is unconstitutional.
In G.R. 167590 (the PASEI case), the Quezon City RTC held as unconstitutional the last sentence of the 2nd paragraph of Section
10 of R.A. 8042. It pointed out that, absent sufficient proof that the corporate officers and directors of the erring company had
knowledge of and allowed the illegal recruitment, making them automatically liable would violate their right to due process of law.
The pertinent portion of Section 10 provides:
SEC. 10. Money Claims. x x x
The liability of the principal/employer and the recruitment/placement agency for any and all claims under this section shall be joint
and several. This provision shall be incorporated in the contract for overseas employment and shall be a condition precedent for its
approval. The performance bond to be filed by the recruitment/placement agency, as provided by law, shall be answerable for all
money claims or damages that may be awarded to the workers. 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. (Emphasis supplied)
But the Court has already held, pending adjudication of this case, that the liability of corporate directors and officers is not
automatic. To make them jointly and solidarily liable with their company, there must be a finding that they were remiss in directing
the affairs of that company, such as sponsoring or tolerating the conduct of illegal activities.19 In the case of Becmen and White
Falcon,20 while there is evidence that these companies were at fault in not investigating the cause of Jasmins death, there is no
mention of any evidence in the case against them that intervenors Gumabay, et al., Becmens corporate officers and directors, were
personally involved in their companys particular actions or omissions in Jasmins case.
As a final note, R.A. 8042 is a police power measure intended to regulate the recruitment and deployment of OFWs. It aims to curb,
if not eliminate, the injustices and abuses suffered by numerous OFWs seeking to work abroad. The rule is settled that every
statute has in its favor the presumption of constitutionality. The Court cannot inquire into the wisdom or expediency of the laws
enacted by the Legislative Department. Hence, in the absence of a clear and unmistakable case that the statute is unconstitutional,
the Court must uphold its validity.
WHEREFORE, in G.R. 152642 and 152710, the Court DISMISSES the petitions for having become moot and academic.1wphi1
In G.R. 167590, the Court SETS ASIDE the Decision of the Regional Trial Court ofManila dated December 8, 2004 and
DECLARES Sections 6, 7, and 9 of Republic Act 8042 valid and constitutional.
In G.R. 182978-79 and G.R. 184298-99 as well as in G.R. 167590, the Court HOLDS the last sentence of the second paragraph of
Section 10 of Republic Act 8042 valid and constitutional. The Court, however, RECONSIDERS and SETS ASIDE the portion of its
Decision in G.R. 182978-79 and G.R. 184298-99 that held intervenors Eufrocina Gumabay, Elvira Taguiam, Lourdes Bonifacio, and
Eddie De Guzman jointly and solidarily liable with respondent Becmen Services Exporter and Promotion, Inc. to spouses Simplicia
and Mila Cuaresma for lack of a finding in those cases that such intervenors had a part in the act or omission imputed to their
corporation.
SO ORDERED.

Pp. vs. Panis

The basic issue in this case is the correct interpretation of Article 13(b) of P.D. 442, otherwise known as the Labor Code, reading as
follows:
(b) Recruitment and placement' refers to any act of canvassing, enlisting, contracting, transporting, hiring, or
procuring workers, and includes referrals, contract services, promising or advertising for employment, locally or

abroad, whether for profit or not: Provided, That any person or entity which, in any manner, offers or promises for
a fee employment to two or more persons shall be deemed engaged in recruitment and placement.
Four informations were filed on January 9, 1981, in the Court of First Instance of Zambales and Olongapo City alleging that Serapio
Abug, private respondent herein, "without first securing a license from the Ministry of Labor as a holder of authority to operate a
fee-charging employment agency, did then and there wilfully, unlawfully and criminally operate a private fee charging employment
agency by charging fees and expenses (from) and promising employment in Saudi Arabia" to four separate individuals named
therein, in violation of Article 16 in relation to Article 39 of the Labor Code. 1
Abug filed a motion to quash on the ground that the informations did not charge an offense because he was accused of illegally
recruiting only one person in each of the four informations. Under the proviso in Article 13(b), he claimed, there would be illegal
recruitment only "whenever two or more persons are in any manner promised or offered any employment for a fee. " 2
Denied at first, the motion was reconsidered and finally granted in the Orders of the trial court dated June 24 and September 17,
1981. The prosecution is now before us on certiorari. 3
The posture of the petitioner is that the private respondent is being prosecuted under Article 39 in relation to Article 16 of the Labor
Code; hence, Article 13(b) is not applicable. However, as the first two cited articles penalize acts of recruitment and placement
without proper authority, which is the charge embodied in the informations, application of the definition of recruitment and
placement in Article 13(b) is unavoidable.
The view of the private respondents is that to constitute recruitment and placement, all the acts mentioned in this article should
involve dealings with two or mre persons as an indispensable requirement. On the other hand, the petitioner argues that the
requirement of two or more persons is imposed only where the recruitment and placement consists of an offer or promise of
employment to such persons and always in consideration of a fee. The other acts mentioned in the body of the article may involve
even only one person and are not necessarily for profit.
Neither interpretation is acceptable. We fail to see why the proviso should speak only of an offer or promise of employment if the
purpose was to apply the requirement of two or more persons to all the acts mentioned in the basic rule. For its part, the petitioner
does not explain why dealings with two or more persons are needed where the recruitment and placement consists of an offer or
promise of employment but not when it is done through "canvassing, enlisting, contracting, transporting, utilizing, hiring or procuring
(of) workers.
As we see it, the proviso was intended neither to impose a condition on the basic rule nor to provide an exception thereto but
merely to create a presumption. The presumption is that the individual or entity is engaged in recruitment and placement whenever
he or it is dealing with two or more persons to whom, in consideration of a fee, an offer or promise of employment is made in the
course of the "canvassing, enlisting, contracting, transporting, utilizing, hiring or procuring (of) workers. "
The number of persons dealt with is not an essential ingredient of the act of recruitment and placement of workers. Any of the acts
mentioned in the basic rule in Article 13(b) win constitute recruitment and placement even if only one prospective worker is
involved. The proviso merely lays down a rule of evidence that where a fee is collected in consideration of a promise or offer of
employment to two or more prospective workers, the individual or entity dealing with them shall be deemed to be engaged in the
act of recruitment and placement. The words "shall be deemed" create that presumption.
This is not unlike the presumption in article 217 of the Revised Penal Code, for example, regarding the failure of a public officer to
produce upon lawful demand funds or property entrusted to his custody. Such failure shall beprima facie evidence that he has put
them to personal use; in other words, he shall be deemed to have malversed such funds or property. In the instant case, the word
"shall be deemed" should by the same token be given the force of a disputable presumption or of prima facie evidence of engaging
in recruitment and placement. (Klepp vs. Odin Tp., McHenry County 40 ND N.W. 313, 314.)
It is unfortunate that we can only speculate on the meaning of the questioned provision for lack of records of debates and
deliberations that would otherwise have been available if the Labor Code had been enacted as a statute rather than a presidential
decree. The trouble with presidential decrees is that they could be, and sometimes were, issued without previous public discussion
or consultation, the promulgator heeding only his own counsel or those of his close advisers in their lofty pinnacle of power. The not
infrequent results are rejection, intentional or not, of the interest of the greater number and, as in the instant case, certain esoteric
provisions that one cannot read against the background facts usually reported in the legislative journals.
At any rate, the interpretation here adopted should give more force to the campaign against illegal recruitment and placement,
which has victimized many Filipino workers seeking a better life in a foreign land, and investing hard- earned savings or even
borrowed funds in pursuit of their dream, only to be awakened to the reality of a cynical deception at the hands of theirown
countrymen.
WHEREFORE, the Orders of June 24, 1981, and September 17, 1981, are set aside and the four informations against the private
respondent reinstated. No costs.
SO ORDERED.

Pp. vs. Gallo

The Facts
Originally, accused-appellant Gallo and accused Fides Pacardo ("Pacardo") and Pilar Manta ("Manta"), together with Mardeolyn
Martir ("Mardeolyn") and nine (9) others, were charged with syndicated illegal recruitment and eighteen (18) counts of estafa
committed against eighteen complainants, including Edgardo V. Dela Caza ("Dela Caza"), Sandy Guantero ("Guantero") and Danilo
Sare ("Sare"). The cases were respectively docketed as Criminal Case Nos. 02-2062936 to 02-206311. However, records reveal
that only Criminal Case No. 02-206293, which was filed against accused-appellant Gallo, Pacardo and Manta for syndicated illegal
recruitment, and Criminal Case Nos. 02-206297, 02-206300 and 02-206308, which were filed against accused-appellant Gallo,
Pacardo and Manta for estafa, proceeded to trial due to the fact that the rest of the accused remained at large. Further, the other
cases, Criminal Case Nos. 02-206294 to 02-206296, 02-206298 to 02-206299, 02-206301 to 02-206307 and 02-206309 to 02206311 were likewise provisionally dismissed upon motion of Pacardo, Manta and accused-appellant for failure of the respective
complainants in said cases to appear and testify during trial.
It should also be noted that after trial, Pacardo and Manta were acquitted in Criminal Case Nos. 02-206293, 02-206297, 02-206300
and 02-206308 for insufficiency of evidence. Likewise, accused-appellant Gallo was similarly acquitted in Criminal Case Nos. 02206300, the case filed by Guantero, and 02-206308, the case filed by Sare. However, accused-appellant was found guilty beyond
reasonable doubt in Criminal Case Nos. 02-206293 and 02-206297, both filed by Dela Caza, for syndicated illegal recruitment and
estafa, respectively.
Thus, the present appeal concerns solely accused-appellants conviction for syndicated illegal recruitment in Criminal Case No. 02206293 and for estafa in Criminal Case No. 02-206297.
In Criminal Case No. 02-206293, the information charges the accused-appellant, together with the others, as follows:
The undersigned accuses MARDEOLYN MARTIR, ISMAEL GALANZA, NELMAR MARTIR, MARCELINO MARTIR, NORMAN
MARTIR, NELSON MARTIR, MA. CECILIA M. RAMOS, LULU MENDANES, FIDES PACARDO y JUNGCO, RODOLFO GALLO y
GADOT, PILAR MANTA y DUNGO, ELEONOR PANUNCIO and YEO SIN UNG of a violation of Section 6(a), (l) and (m) of Republic
Act 8042, otherwise known as the Migrant Workers and Overseas Filipino Workers Act of 1995, committed by a syndicate and in
large scale, as follows:
That in or about and during the period comprised between November 2000 and December, 2001, inclusive, in the City of Manila,
Philippines, the said accused conspiring and confederating together and helping with one another, representing themselves to have
the capacity to contract, enlist and transport Filipino workers for employment abroad, did then and there willfully and unlawfully, for
a fee, recruit and promise employment/job placement abroad to FERDINAND ASISTIN, ENTICE BRENDO, REYMOND G. CENA,
EDGARDO V. DELA CAZA, RAYMUND EDAYA, SANDY O. GUANTENO, RENATO V. HUFALAR, ELENA JUBICO, LUPO A.
MANALO, ALMA V. MENOR, ROGELIO S. MORON, FEDILA G. NAIPA, OSCAR RAMIREZ, MARISOL L. SABALDAN, DANILO
SARE, MARY BETH SARDON, JOHNNY SOLATORIO and JOEL TINIO in Korea as factory workers and charge or accept directly
or indirectly from said FERDINAND ASISTIN the amount of P45,000.00; ENTICE BRENDO P35,000.00; REYMOND G. CENA
P30,000.00; EDGARDO V. DELA CAZA P45,000.00; RAYMUND EDAYA P100,000.00; SANDY O. GUANTENO P35,000.00;
RENATO V. HUFALAR P70,000.00; ELENA JUBICO P30,000.00; LUPO A. MANALO P75,000.00; ALMA V. MENOR
P45,000.00; ROGELIO S. MORON P70,000.00; FEDILA G. NAIPA P45,000.00; OSCAR RAMIREZ P45,000.00; MARISOL L.
SABALDAN P75,000.00; DANILO SARE P100,000.00; MARY BETH SARDON P25,000.00; JOHNNY SOLATORIO
P35,000.00; and JOEL TINIO P120,000.00 as placement fees in connection with their overseas employment, which amounts are
in excess of or greater than those specified in the schedule of allowable fees prescribed by the POEA Board Resolution No. 02,
Series 1998, and without valid reasons and without the fault of the said complainants failed to actually deploy them and failed to
reimburse the expenses incurred by the said complainants in connection with their documentation and processing for purposes of
their deployment.3 (Emphasis supplied)
In Criminal Case No. 02-206297, the information reads:
That on or about May 28, 2001, in the City of Manila, Philippines, the said accused conspiring and confederating together and
helping with [sic] one another, did then and there willfully, unlawfully and feloniously defraud EDGARDO V. DELA CAZA, in the
following manner, to wit: the said accused by means of false manifestations and fraudulent representations which they made to the
latter, prior to and even simultaneous with the commission of the fraud, to the effect that they had the power and capacity to recruit
and employ said EDGARDO V. DELA CAZA in Korea as factory worker and could facilitate the processing of the pertinent papers if
given the necessary amount to meet the requirements thereof; induced and succeeded in inducing said EDGARDO V. DELA CAZA
to give and deliver, as in fact, he gave and delivered to said accused the amount of P45,000.00 on the strength of said
manifestations and representations, said accused well knowing that the same were false and untrue and were made [solely] for the
purpose of obtaining, as in fact they did obtain the said amount of P45,000.00 which amount once in their possession, with intent to
defraud said [EDGARDO] V. DELA CAZA, they willfully, unlawfully and feloniously misappropriated, misapplied and converted the
said amount of P45,000.00 to their own personal use and benefit, to the damage and prejudice of the said EDGARDO V. DELA
CAZA in the aforesaid amount of P45,000.00, Philippine currency.
CONTRARY TO LAW.4
When arraigned on January 19, 2004, accused-appellant Gallo entered a plea of not guilty to all charges.
On March 3, 2004, the pre-trial was terminated and trial ensued, thereafter.

During the trial, the prosecution presented as their witnesses, Armando Albines Roa, the Philippine Overseas Employment
Administration (POEA) representative and private complainants Dela Caza, Guanteno and Sare. On the other hand, the defense
presented as its witnesses, accused-appellant Gallo, Pacardo and Manta.
Version of the Prosecution
On May 22, 2001, Dela Caza was introduced by Eleanor Panuncio to accused-appellant Gallo, Pacardo, Manta, Mardeolyn, Lulu
Mendanes, Yeo Sin Ung and another Korean national at the office of MPM International Recruitment and Promotion Agency ("MPM
Agency") located in Malate, Manila.
Dela Caza was told that Mardeolyn was the President of MPM Agency, while Nelmar Martir was one of the incorporators. Also, that
Marcelino Martir, Norman Martir, Nelson Martir and Ma. Cecilia Ramos were its board members. Lulu Mendanes acted as the
cashier and accountant, while Pacardo acted as the agencys employee who was in charge of the records of the applicants. Manta,
on the other hand, was also an employee who was tasked to deliver documents to the Korean embassy.
Accused-appellant Gallo then introduced himself as a relative of Mardeolyn and informed Dela Caza that the agency was able to
send many workers abroad. Together with Pacardo and Manta, he also told Dela Caza about the placement fee of One Hundred
Fifty Thousand Pesos (PhP 150,000) with a down payment of Forty-Five Thousand Pesos (PhP 45,000) and the balance to be paid
through salary deduction.
Dela Caza, together with the other applicants, were briefed by Mardeolyn about the processing of their application papers for job
placement in Korea as a factory worker and their possible salary. Accused Yeo Sin Ung also gave a briefing about the business and
what to expect from the company and the salary.
With accused-appellants assurance that many workers have been sent abroad, as well as the presence of the two (2) Korean
nationals and upon being shown the visas procured for the deployed workers, Dela Caza was convinced to part with his money.
Thus, on May 29, 2001, he paid Forty-Five Thousand Pesos (PhP 45,000) to MPM Agency through accused-appellant Gallo who,
while in the presence of Pacardo, Manta and Mardeolyn, issued and signed Official Receipt No. 401.
Two (2) weeks after paying MPM Agency, Dela Caza went back to the agencys office in Malate, Manila only to discover that the
office had moved to a new location at Batangas Street, Brgy. San Isidro, Makati. He proceeded to the new address and found out
that the agency was renamed to New Filipino Manpower Development & Services, Inc. ("New Filipino"). At the new office, he talked
to Pacardo, Manta, Mardeolyn, Lulu Mendanes and accused-appellant Gallo. He was informed that the transfer was done for easy
accessibility to clients and for the purpose of changing the name of the agency.
Dela Caza decided to withdraw his application and recover the amount he paid but Mardeolyn, Pacardo, Manta and Lulu Mendanes
talked him out from pursuing his decision. On the other hand, accused-appellant Gallo even denied any knowledge about the
money.
After two (2) more months of waiting in vain to be deployed, Dela Caza and the other applicants decided to take action. The first
attempt was unsuccessful because the agency again moved to another place. However, with the help of the Office of Ambassador
Seeres and the Western Police District, they were able to locate the new address at 500 Prudential Building, Carriedo, Manila.
The agency explained that it had to move in order to separate those who are applying as entertainers from those applying as
factory workers. Accused-appellant Gallo, together with Pacardo and Manta, were then arrested.
The testimony of prosecution witness Armando Albines Roa, a POEA employee, was dispensed with after the prosecution and
defense stipulated and admitted to the existence of the following documents:
1. Certification issued by Felicitas Q. Bay, Director II, Licensing Branch of the POEA to the effect that "New Filipino
Manpower Development & Services, Inc., with office address at 1256 Batangas St., Brgy. San Isidro, Makati City, was a
licensed landbased agency whose license expired on December 10, 2001 and was delisted from the roster of licensed
agencies on December 14, 2001." It further certified that "Fides J. Pacardo was the agencys Recruitment Officer";
2. Certification issued by Felicitas Q. Bay of the POEA to the effect that MPM International Recruitment and Promotion is
not licensed by the POEA to recruit workers for overseas employment;
3. Certified copy of POEA Memorandum Circular No. 14, Series of 1999 regarding placement fee ceiling for landbased
workers.
4. Certified copy of POEA Memorandum Circular No. 09, Series of 1998 on the placement fee ceiling for Taiwan and
Korean markets, and
5. Certified copy of POEA Governing Board Resolution No. 02, series of 1998.
Version of the Defense
For his defense, accused-appellant denied having any part in the recruitment of Dela Caza. In fact, he testified that he also applied
with MPM Agency for deployment to Korea as a factory worker. According to him, he gave his application directly with Mardeolyn

because she was his town mate and he was allowed to pay only Ten Thousand Pesos (PhP 10,000) as processing fee. Further, in
order to facilitate the processing of his papers, he agreed to perform some tasks for the agency, such as taking photographs of the
visa and passport of applicants, running errands and performing such other tasks assigned to him, without salary except for some
allowance. He said that he only saw Dela Caza one or twice at the agencys office when he applied for work abroad. Lastly, that he
was also promised deployment abroad but it never materialized.
Ruling of the Trial Court
On March 15, 2007, the RTC rendered its Decision convicting the accused of syndicated illegal recruitment and estafa. The
dispositive portion reads:
WHEREFORE, judgment is hereby rendered as follows:
I. Accused FIDES PACARDO y JUNGO and PILAR MANTA y DUNGO are hereby ACQUITTED of the crimes charged in
Criminal Cases Nos. 02-206293, 02-206297, 02-206300 and 02-206308;
II. Accused RODOLFO GALLO y GADOT is found guilty beyond reasonable doubt in Criminal Case No. 02-206293 of the
crime of Illegal Recruitment committed by a syndicate and is hereby sentenced to suffer the penalty of life imprisonment
and to pay a fine of ONE MILLION (Php1,000,000.00) PESOS. He is also ordered to indemnify EDGARDO DELA CAZA of
the sum of FORTY-FIVE THOUSAND (Php45,000.00) PESOS with legal interest from the filing of the information on
September 18, 2002 until fully paid.
III. Accused RODOLFO GALLO y GADOT in Criminal Case No. 02-206297 is likewise found guilty and is hereby
sentenced to suffer the indeterminate penalty of FOUR (4) years of prision correccional as minimum to NINE (9) years of
prision mayor as maximum.
IV. Accused RODOLFO GALLO y GADOT is hereby ACQUITTED of the crime charged in Criminal Cases Nos. 02-206300
and 02-206308.
Let alias warrants for the arrest of the other accused be issued anew in all the criminal cases. Pending their arrest, the cases are
sent to the archives.
The immediate release of accused Fides Pacardo and Pilar Manta is hereby ordered unless detained for other lawful cause or
charge.
SO ORDERED.5
Ruling of the Appellate Court
On appeal, the CA, in its Decision dated December 24, 2008, disposed of the case as follows:
WHEREFORE, the appealed Decision of the Regional Trial Court of Manila, Branch 30, in Criminal Cases Nos. 02-206293 and 02206297, dated March 15, 2007, is AFFIRMED with the MODIFICATION that in Criminal Case No. 02-206297, for estafa, appellant
is sentenced to four (4) years of prision correccional to ten (10) years of prision mayor.
SO ORDERED.6
The CA held the totality of the prosecutions evidence showed that the accused-appellant, together with others, engaged in the
recruitment of Dela Caza. His actions and representations to Dela Caza can hardly be construed as the actions of a mere errand
boy.
As determined by the appellate court, the offense is considered economic sabotage having been committed by more than three (3)
persons, namely, accused-appellant Gallo, Mardeolyn, Eleonor Panuncio and Yeo Sin Ung. More importantly, a personal found
guilty of illegal recruitment may also be convicted of estafa.7 The same evidence proving accused-appellants commission of the
crime of illegal recruitment in large scale also establishes his liability for estafa under paragragh 2(a) of Article 315 of the Revised
Penal Code (RPC).
On January 15, 2009, the accused-appellant filed a timely appeal before this Court.
The Issues
Accused-appellant interposes in the present appeal the following assignment of errors:
I

The court a quo gravely erred in finding the accused-appellant guilty of illegal recruitment committed by a syndicate
despite the failure of the prosecution to prove the same beyond reasonable doubt.
II
The court a quo gravely erred in finding the accused-appellant guilty of estafa despite the failure of the prosecution to
prove the same beyond reasonable doubt.
Our Ruling
The appeal has no merit.
Evidence supports conviction of the crime of Syndicated Illegal Recruitment
Accused-appellant avers that he cannot be held criminally liable for illegal recruitment because he was neither an officer nor an
employee of the recruitment agency. He alleges that the trial court erred in adopting the asseveration of the private complainant
that he was indeed an employee because such was not duly supported by competent evidence. According to him, even assuming
that he was an employee, such cannot warrant his outright conviction sans evidence that he acted in conspiracy with the officers of
the agency.
We disagree.
To commit syndicated illegal recruitment, three elements must be established: (1) the offender undertakes either any activity within
the meaning of "recruitment and placement" defined under Article 13(b), or any of the prohibited practices enumerated under Art.
34 of the Labor Code; (2) he has no valid license or authority required by law to enable one to lawfully engage in recruitment and
placement of workers;8 and (3) the illegal recruitment is committed by a group of three (3) or more persons conspiring or
confederating with one another.9 When illegal recruitment is committed by a syndicate or in large scale, i.e., if it is committed
against three (3) or more persons individually or as a group, it is considered an offense involving economic sabotage.10
Under Art. 13(b) of the Labor Code, "recruitment and placement" refers to "any act of canvassing, enlisting, contracting,
transporting, utilizing, hiring or procuring workers, and includes referrals, contract services, promising or advertising for
employment, locally or abroad, whether for profit or not".
After a thorough review of the records, we believe that the prosecution was able to establish the elements of the offense sufficiently.
The evidence readily reveals that MPM Agency was never licensed by the POEA to recruit workers for overseas employment.
Even with a license, however, illegal recruitment could still be committed under Section 6 of Republic Act No. 8042 ("R.A. 8042"),
otherwise known as the Migrants and Overseas Filipinos Act of 1995, viz:
Sec. 6. Definition. For purposes of this Act, illegal recruitment shall mean any act of canvassing, enlisting, contracting,
transporting, utilizing, hiring, or procuring workers and includes referring, contract services, promising or advertising for
employment abroad, whether for profit or not, when undertaken by a non-licensee or non-holder of authority contemplated under
Article 13(f) of Presidential Decree No. 442, as amended, otherwise known as the Labor Code of the Philippines: Provided, That
any such non-licensee or non-holder who, in any manner, offers or promises for a fee employment abroad to two or more persons
shall be deemed so engaged. It shall, likewise, include the following act, whether committed by any person, whether a nonlicensee, non-holder, licensee or holder of authority:
(a) To charge or accept directly or indirectly any amount greater than that specified in the schedule of allowable fees prescribed by
the Secretary of Labor and Employment, or to make a worker pay any amount greater than that actually received by him as a loan
or advance;
xxxx
(l) Failure to actually deploy without valid reason as determined by the Department of Labor and Employment; and
(m) Failure to reimburse expenses incurred by the worker in connection with his documentation and processing for purposes of
deployment and processing for purposes of deployment, in cases where the deployment does not actually take place without the
workers fault. Illegal recruitment when committed by a syndicate or in large scale shall be considered an offense involving
economic sabotage.
Illegal recruitment is deemed committed by a syndicate if carried out by a group of three (3) or more persons conspiring or
confederating with one another. It is deemed committed in large scale if committed against three (3) or more persons individually or
as a group.
The persons criminally liable for the above offenses are the principals, accomplices and accessories. In case of juridical persons,
the officers having control, management or direction of their business shall be liable.

In the instant case, accused-appellant committed the acts enumerated in Sec. 6 of R.A. 8042. Testimonial evidence presented by
the prosecution clearly shows that, in consideration of a promise of foreign employment, accused-appellant received the amount of
Php 45,000.00 from Dela Caza. When accused-appellant made misrepresentations concerning the agencys purported power and
authority to recruit for overseas employment, and in the process, collected money in the guise of placement fees, the former clearly
committed acts constitutive of illegal recruitment.11 Such acts were accurately described in the testimony of prosecution witness,
Dela Caza, to wit:
PROS. MAGABLIN
Q: How about this Rodolfo Gallo?
A: He was the one who received my money.
Q: Aside from receiving your money, was there any other representations or acts made by Rodolfo Gallo?
A: He introduced himself to me as relative of Mardeolyn Martir and he even intimated to me that their agency has sent so
many workers abroad.
xxxx
PROS. MAGABLIN
Q: Mr. Witness, as you claimed you tried to withdraw your application at the agency. Was there any instance that you were
able to talk to Fides Pacardo, Rodolfo Gallo and Pilar Manta?
A: Yes, maam.
Q: What was the conversation that transpired among you before you demanded the return of your money and documents?
A: When I tried to withdraw my application as well as my money, Mr. Gallo told me "I know nothing about your money"
while Pilar Manta and Fides Pacardo told me, why should I withdraw my application and my money when I was about to
be [deployed] or I was about to leave.
xxxx
Q: And what transpired at that office after this Panuncio introduced you to those persons whom you just mentioned?
A: The three of them including Rodolfo Gallo told me that the placement fee in that agency is Php 150,000.00 and then I
should deposit the amount of Php 45,000.00. After I have deposited said amount, I would just wait for few days
xxxx
Q: They were the one (sic) who told you that you have to pay Php 45,000.00 for deposit only?
A: Yes, maam, I was told by them to deposit Php 45,000.00 and then I would pay the remaining balance of
Php105,000.00, payment of it would be through salary deduction.
Q: That is for what Mr. Witness again?
A: For placement fee.
Q: Now did you believe to (sic) them?
A: Yes, maam.
Q: Why, why did you believe?
A: Because of the presence of the two Korean nationals and they keep on telling me that they have sent abroad several
workers and they even showed visas of the records that they have already deployed abroad.
Q: Aside from that, was there any other representations which have been made upon you or make you believe that they
can deploy you?
A: At first I was adamant but they told me "If you do not want to believe us, then we could do nothing." But once they
showed me the [visas] of the people whom they have deployed abroad, that was the time I believe them.

Q: So after believing on the representations, what did you do next Mr. Witness?
A: That was the time that I decided to give the money.
xxxx
PROS. MAGABLIN
Q: Do you have proof that you gave the money?
A: Yes, maam.
Q: Where is your proof that you gave the money?
A: I have it here.
PROS. MAGABLIN:
Witness is producing to this court a Receipt dated May 28, 2001 in the amount of Php45,000.00 which for purposes of
record Your Honor, may I request that the same be marked in the evidence as our Exhibit "F".
xxxx
PROS. MAGABLIN
Q: There appears a signature appearing at the left bottom portion of this receipt. Do you know whose signature is this?
A: Yes, maam, signature of Rodolfo Gallo.
PROS. MAGABLIN
Q: Why do you say that that is his signature?
A: Rodolfo Gallos signature Your Honor because he was the one who received the money and he was the one who filled
up this O.R. and while he was doing it, he was flanked by Fides Pacardo, Pilar Manta and Mardeolyn Martir.
xxxx
Q: So it was Gallo who received your money?
A: Yes, maam.
PROS. MAGABLIN
Q: And after that, what did this Gallo do after he received your money?
A: They told me maam just to call up and make a follow up with our agency.
xxxx
Q: Now Mr. Witness, after you gave your money to the accused, what happened with the application, with the promise of
employment that he promised?
A: Two (2) weeks after giving them the money, they moved to a new office in Makati, Brgy. San Isidro.
xxxx
Q: And were they able to deploy you as promised by them?
A: No, maam, they were not able to send us abroad.12
Essentially, Dela Caza appeared very firm and consistent in positively identifying accused-appellant as one of those who induced
him and the other applicants to part with their money. His testimony showed that accused-appellant made false misrepresentations
and promises in assuring them that after they paid the placement fee, jobs in Korea as factory workers were waiting for them and

that they would be deployed soon. In fact, Dela Caza personally talked to accused-appellant and gave him the money and saw him
sign and issue an official receipt as proof of his payment. Without a doubt, accused-appellants actions constituted illegal
recruitment.
Additionally, accused-appellant cannot argue that the trial court erred in finding that he was indeed an employee of the recruitment
agency. On the contrary, his active participation in the illegal recruitment is unmistakable. The fact that he was the one who issued
and signed the official receipt belies his profession of innocence.
This Court likewise finds the existence of a conspiracy between the accused-appellant and the other persons in the agency who
are currently at large, resulting in the commission of the crime of syndicated illegal recruitment.
In this case, it cannot be denied that the accused-appellent together with Mardeolyn and the rest of the officers and employees of
MPM Agency participated in a network of deception. Verily, the active involvement of each in the recruitment scam was directed at
one single purpose to divest complainants with their money on the pretext of guaranteed employment abroad. The prosecution
evidence shows that complainants were briefed by Mardeolyn about the processing of their papers for a possible job opportunity in
Korea, as well as their possible salary. Likewise, Yeo Sin Ung, a Korean national, gave a briefing about the business and what to
expect from the company. Then, here comes accused-appellant who introduced himself as Mardeolyns relative and specifically told
Dela Caza of the fact that the agency was able to send many workers abroad. Dela Caza was even showed several workers visas
who were already allegedly deployed abroad. Later on, accused-appellant signed and issued an official receipt acknowledging the
down payment of Dela Caza. Without a doubt, the nature and extent of the actions of accused-appellant, as well as with the other
persons in MPM Agency clearly show unity of action towards a common undertaking. Hence, conspiracy is evidently present.
In People v. Gamboa,13 this Court discussed the nature of conspiracy in the context of illegal recruitment, viz:
Conspiracy to defraud aspiring overseas contract workers was evident from the acts of the malefactors whose conduct before,
during and after the commission of the crime clearly indicated that they were one in purpose and united in its execution. Direct
proof of previous agreement to commit a crime is not necessary as it may be deduced from the mode and manner in which the
offense was perpetrated or inferred from the acts of the accused pointing to a joint purpose and design, concerted action and
community of interest. As such, all the accused, including accused-appellant, are equally guilty of the crime of illegal recruitment
since in a conspiracy the act of one is the act of all.
To reiterate, in establishing conspiracy, it is not essential that there be actual proof that all the conspirators took a direct part in
every act. It is sufficient that they acted in concert pursuant to the same objective.14
Estafa
The prosecution likewise established that accused-appellant is guilty of the crime of estafa as defined under Article 315 paragraph
2(a) of the Revised Penal Code, viz:
Art. 315. Swindling (estafa). Any person who shall defraud another by any means mentioned hereinbelow
xxxx
2. By means of any of the following false pretenses or fraudulent acts executed prior to or simultaneously with the commission of
the fraud:
(a) By using fictitious name, or falsely pretending to possess power, influence, qualifications, property, credit, agency, business or
imaginary transactions; or by means of other similar deceits.
The elements of estafa in general are: (1) that the accused defrauded another (a) by abuse of confidence, or (b) by means of
deceit; and (2) that damage or prejudice capable of pecuniary estimation is caused to the offended party or third person.15 Deceit is
the false representation of a matter of fact, whether by words or conduct, by false or misleading allegations, or by concealment of
that which should have been disclosed; and which deceives or is intended to deceive another so that he shall act upon it, to his
legal injury.
All these elements are present in the instant case: the accused-appellant, together with the other accused at large, deceived the
complainants into believing that the agency had the power and capability to send them abroad for employment; that there were
available jobs for them in Korea as factory workers; that by reason or on the strength of such assurance, the complainants parted
with their money in payment of the placement fees; that after receiving the money, accused-appellant and his co-accused went into
hiding by changing their office locations without informing complainants; and that complainants were never deployed abroad. As all
these representations of the accused-appellant proved false, paragraph 2(a), Article 315 of the Revised Penal Code is thus
applicable.1avvphi1
Defense of Denial Cannot Prevail over Positive Identification
Indubitably, accused-appellants denial of the crimes charged crumbles in the face of the positive identification made by Dela Caza
and his co-complainants as one of the perpetrators of the crimes charged. As enunciated by this Court in People v.

Abolidor,16 "[p]ositive identification where categorical and consistent and not attended by any showing of ill motive on the part of the
eyewitnesses on the matter prevails over alibi and denial."
The defense has miserably failed to show any evidence of ill motive on the part of the prosecution witnesses as to falsely testify
against him.
Therefore, between the categorical statements of the prosecution witnesses, on the one hand, and bare denials of the accused, on
the other hand, the former must prevail.17
Moreover, this Court accords the trial courts findings with the probative weight it deserves in the absence of any compelling reason
to discredit the same. It is a fundamental judicial dictum that the findings of fact of the trial court are not disturbed on appeal except
when it overlooked, misunderstood or misapplied some facts or circumstances of weight and substance that would have materially
affected the outcome of the case. We find that the trial court did not err in convicting the accused-appellant.
WHEREFORE, the appeal is DENIED for failure to sufficiently show reversible error in the assailed decision. The Decision dated
December 24, 2008 of the CA in CA-G.R. CR-H.C. No. 02764 is AFFIRMED.
No costs.
SO ORDERED.

Pp. vs. Chua

Before us is an appeal from the September 15, 2008 Decision1 of the Court of Appeals in CA-G.R. CR-H.C. No. 01006. The Court
of Appeals had affirmed with modification the Decision2 of the Regional Trial Court (RTC) of Manila, Bnmch 33, in Criminal Case
No. 03-217999-403. The RTC found appellant Melissa Chua, a.k.a. Clarita Ng Chua, guilty beyond reasonable doubt of illegal
recruitment in large scale and four counts of estafa. The Court of Appeals modified the penalty imposed upon appellant for each
count of estafa to an indeterminate penalty of imprisonment for 4 years and 2 months of prision correccional. as minimum, to 13
years of reclusion temporal, as maximum.
Appellant Melissa Chua was charged on May 6, 2003, with the crime of illegal recruitment in large scale in an Information3 which
alleged:
That on or about and during the period comprised between July 29, 2002 and August 20, 2002, both dates inclusive, in the City of
Manila, Philippines, the said accused, representing herself to have the capacity to contract, enlist and transport Filipino workers
overseas particularly to Taiwan, did then and there wilfully, unlawfully, for fee, recruit and promise employment/job placement to
REY P. TAJADAO, BILLY R. DANAN,4 ROYLAN A. URSULUM and ALBERTO A. AGLANAO without first having secured the
required license from the Department of Labor and Employment as required by law, and charge or accept directly or indirectly from
said complainants various amounts as placement fees in consideration for their overseas employment, which amounts are in
excess of or greater than that specified in the schedule of allowable fees prescribed by the POEA, and without valid reasons and
without the fault of said complainants, failed to actually deploy them and failed to reimburse expenses incurred in connection with
their documentation and processing for purposes of their deployment.
Contrary to law.
Appellant was also charged with four counts of estafa in separate Informations, which, save for the date and the names of private
complainants, uniformly read:
That on or about August 10, 2002, in the City of Manila, Philippines, the said accused did then and there wilfully, unlawfully and
feloniously defraud ALBERTO A. AGLANAO in the following manner, to wit: the said accused, by means of false manifestations and
fraudulent representation which she made to said ALBERTO A. AGLANAO prior to and even simultaneous with the commission of
the fraud, to the effect that she has the power and capacity to recruit and employ the latter in Taiwan as a factory worker and could
facilitate the processing of the pertinent papers if given the necessary amount to meet the requirements thereof, induced and
succeeded in inducing the said ALBERTO A. AGLANAO to give and deliver, as in fact he gave and delivered to the said accused
the amount of P 80,000.00 on the strength of the said manifestations and representations, said accused well knowing that the
same were false and fraudulent and were made solely to obtain, as in fact she did obtain the amount of P 80,000.00 which amount,
once in her possession, with intent to defraud, they willfully, unlawfully and feloniously misappropriated, misapplied and converted
the same to her own personal use and benefit, to the damage and prejudice of said ALBERTO A. AGLANAO in the aforesaid
amount of P 80,000.00, Philippine Currency.
Contrary to law.5
On arraignment, appellant pleaded not guilty to all charges. A joint trial of the cases ensued.
At the trial, private complainant Rey P. Tajadao testified that in August 2002, his fellow complainant, Alberto A. Aglanao, introduced
him to appellant Chua. By then, Aglanao had already submitted his application for employment abroad with appellant. Since
Tajadao was also interested to work overseas, he suggested that Tajadao apply as well.

Soon after, Tajadao met with appellant, who offered him a job as a factory worker in Taiwan for deployment within the month.
Appellant then required him to undergo medical examination and pay a placement fee of P 80,000. Chua assured Tajadao that
whoever pays the application fee the earliest can leave sooner. Thus, Tajadao delivered to appellant staggered payments
of P 40,000, P 35,000 and P 5,000 at the Golden Gate International (Golden Gate) Office in Paragon Tower, Ermita, Manila. Said
payments are evidenced by a voucher6 signed by appellant.
After completing payment, Tajadao was made to sign a contract containing stipulations as to salary and conditions of work. On
several occasions, thereafter, he returned to appellants office to follow-up on his application. After several visits, however, Tajadao
noticed that all the properties of Golden Gate in its Paragon Tower Office were already gone.
Tajadao filed a complaint for illegal recruitment against appellant before the Philippine Overseas Employment Agency (POEA). It
was only then that he learned that appellant Chua was not licensed to recruit workers for overseas employment.
Another private complainant, Billy R. Danan, testified that Chua also offered employment abroad but failed to deploy him. He
recalled meeting appellant on August 6, 2002 at the Golden Gate Office in Ermita, Manila. Danan inquired about the prospect of
finding work in Taiwan as a factory worker, and appellant confirmed there was a standing "job order." The latter advised Danan to
obtain a passport, undergo medical examination, secure an NBI clearance and prepare the amount of P 80,000.
On August 10, 2002, Danan paid appellant in full as evidenced by a cash voucher signed by the latter. A month passed, however,
and he was still unable to leave for Taiwan. Appellant informed Danan that his departure would be re-scheduled because Taiwan
had suspended admission of overseas workers until after the festival. After appellant advanced this explanation several times,
Danan decided to verify whether she was licensed to recruit.Upon learning otherwise, Danan lodged a complaint for illegal
recruitment against appellant with the POEA.
The third private complainant, Alberto Aglanao, testified that he met appellant Chua on August 5, 2002. Like Tajadao and Danan,
Aglanao applied for work as a factory worker in Taiwan. Appellant similarly assured Aglanao of employment abroad upon payment
of P 80,000. But despite payment7 of said amount on August 10, 2002, appellant failed to deploy Aglanao to Taiwan.
Roylan Ursulum,8 the fourth private complainant, testified that he too went to the Golden Gate Office in Ermita, Manila to seek
employment as a factory worker. He was introduced by Shirley Montano to appellant Chua. The latter told Ursulum that the first
applicants to pay the placement fee of P 80,000 shall be deployed ahead of the others. Thus, Ursulum obtained a loan of P 80,000
to cover the placement fee, which he allegedly gave appellant in two installments of P 40,000 each. As with the rest of the private
complainants, Ursulum never made it to Taiwan. Ursulum did not submit proof of payment but presented, instead, ten text
messages on his mobile phone supposedly sent by appellant. One of said text messages reads, "Siguro anong laking saya nyo pag
namatay na ko."
The prosecution likewise presented as witness Severino Maranan, Senior Labor Employment Officer of the POEA. Maranan
confirmed that appellant Chua was neither licensed nor authorized to recruit workers for overseas employment. In support, he
presented to the court a certification issued by the POEA to that effect.
In her defense, appellant Chua denies having recruited private complainants for overseas employment. According to appellant, she
was only a cashier at Golden Gate, which is owned by Marilen Callueng. However, she allegedly lost to a robbery her identification
card evidencing her employment with the agency. Appellant denied any knowledge of whether the agency was licensed to recruit
workers during her tenure as it has been delisted.
In a Decision dated March 28, 2005, the RTC of Manila, Branch 33, found appellant Melissa Chua, a.k.a. Clarita Ng Chua, guilty
beyond reasonable doubt of illegal recruitment in large scale and four counts of estafa. The fallo of the RTC decision reads:
WHEREFORE, the prosecution having established the guilt of the accused beyond reasonable doubt, judgment is hereby rendered
CONVICTING the accused as principal in the crime of illegal recruitment in large scale and estafa (four counts) and she is
sentenced to suffer the penalty of LIFE IMPRISONMENT and a fine of Five Hundred Thousand Pesos (Php500,000.00) for illegal
recruitment in large scale; and the indeterminate penalty of four (4) years and two (2) months of prision correccional, as minimum,
to Twelve (12) years of prision mayor as maximum for EACH count of Estafa.
The accused is also ordered to pay each of the complainant[s] the amount of P 80,000.00.
In the service of the sentence, the accused is credited with a x x x the full extent of her preventive imprisonment if she agrees in
writing to observe the same disciplinary rules imposed upon convicted prisoners; otherwise, only 4/5 of the time of such preventive
imprisonment shall be credited to her.
SO ORDERED.9
The trial court relied on the testimony of Severino Maranan, Senior Labor Employment Officer of the POEA, that appellant is not
licensed to recruit workers for overseas employment at the time she promised but failed to place the four private complainants for
work abroad. It accorded greater weight to the testimonies of private complainants who positively identified appellant as the person
who recruited them for employment in Taiwan and received the placement fees.
The court a quo likewise found appellant guilty beyond reasonable doubt of estafa for misrepresenting herself as having the power
and capacity to recruit and place private complainants as factory workers in Taiwan. Such misrepresentation, the trial court

stressed, induced private complainants to part with their money. The RTC brushed aside appellants defense that she was merely a
cashier of Golden Gate and that the same is owned by Marilen Callueng. It gave little weight to the receipts submitted by appellant
to prove that she turned over the placement fees to Callueng. The trial court observed nothing in said receipts indicating that the
money came from private complainants.
Dissatisfied, appellant Chua filed a Notice of Appeal10 on April 15, 2005.
By Decision dated September 15, 2008, the Court of Appeals affirmed with modification the RTC ruling. It modified the penalty for
each of the four counts of estafa by imposing upon appellant an indeterminate sentence of 4 years and 2 months of prision
correccional, as minimum, to 13 years of reclusion temporal, as maximum, for each count of estafa.
The appellate court held that the prosecution has established by proof beyond reasonable doubt that appellant had no license to
recruit at the time she promised employment to and received placement fees from private complainants. It dismissed appellants
defense that she was only a cashier of Golden Gate and that she remitted the placement fees to "the agencys treasurer." The
Court of Appeals explained that in order to hold a person liable for illegal recruitment, it is enough that he or she promised or
offered employment for a fee, as appellant did.
The appellate court held further that the same pieces of evidence which establish appellants commission of illegal recruitment also
affirm her liability for estafa. It pointed out that appellant defrauded private complainants when she misrepresented that they would
be hired abroad upon payment of the placement fee. The Court of Appeals perceived no ill motive on the part of private
complainants to testify falsely against appellant.
Lastly, the appellate court modified the penalty imposed by the trial court upon appellant Chua for each count of estafa. It raised the
maximum period of appellants indeterminate sentence from 12 years of prision mayor to 13 years of reclusion temporal.
On October 6, 2008, appellant Chua elevated the case to this Court byfiling a Notice of Appeal.11
In a Resolution12 dated July 1, 2009, we required the parties to file their respective supplemental briefs, if they so desire. On August
26, 2009, appellant Chua filed a Manifestation (In lieu of Supplemental Brief)13 by which she repleaded and adopted all the
defenses and arguments raised in her Appellants Brief.14 On September 3, 2009, the Office of the Solicitor
General, for the People, filed a Manifestation15 that it will no longer file a supplemental brief since it has discussed in its Appellees
Brief16 all the matters and issues raised in the Appellants Brief.
Before us, appellant Melissa Chua presents a lone assignment of error:
THE TRIAL COURT GRAVELY ERRED IN FINDING THE ACCUSED-APPELLANT GUILTY OF THE OFFENSE OF ILLEGAL
RECRUITMENT IN LARGE SCALE AND FOUR (4) COUNTS OF ESTAFA DESPITE THE INSUFFICIENCY OF THE EVIDENCE
FOR THE PROSECUTION.17
The Office of the Solicitor General, for the people, submits that it has established all the elements necessary to hold appellant Chua
liable for illegal recruitment in large scale and estafa. It cites the testimony of Severino Maranan, Senior Labor Employment Officer
of the POEA, and the certification issued by Felicitas Q. Bay, Director II of the POEA, to the effect that appellant was not authorized
to engage in recruitment activities.The OSG argues against appellants defense that she was only a cashier of Golden Gate on the
argument that her act of representing to the four private complainants that she could send them to Taiwan as factory workers
constitutes recruitment. It stresses that the crime of illegal recruitment in large scale is malum prohibitum; hence, mere commission
of the prohibited act is punishable and criminal intent is immaterial. Lastly, the OSG points out that appellant failed to show any ill
motive on the part of private complainants to testify falsely against her.
For her part, appellant Chua maintains that she was merely a cashier of Golden Gate International. She disowns liability for
allegedly "merely acting under the direction of her superiors"18 and for being "unaware that her acts constituted a crime."19 Appellant
begs the Court to review the factual findings of the court a quo.
The crime of illegal recruitment is defined and penalized under Sections 6 and 7 of Republic Act (R.A.) No. 8042, or the Migrant
Workers and Overseas Filipinos Act of 1995, as follows:
SEC. 6. Definition. For purposes of this Act, illegal recruitment shall mean any act of canvassing, enlisting, contracting,
transporting, utilizing, hiring, or procuring workers and includes referring, contract services, promising or advertising for
employment abroad, whether for profit or not, when undertaken by a non-licensee or non-holder of authority contemplated under
Article 13 (f) of Presidential Decree No. 442, as amended, otherwise known as the Labor Code of the Philippines: Provided, That
any such non-licensee or non-holder who, in any manner, offers or promises for a fee employment abroad to two or more persons
shall be deemed so engaged. It shall likewise include the following acts, x x x:
xxxx
Illegal recruitment is deemed committed by a syndicate if carried out by a group of three (3) or more persons conspiring or
confederating with one another. It is deemed committed in large scale if committed against three (3) or more persons individually or
as a group.

The persons criminally liable for the above offenses are the principals, accomplices and accessories. In case of juridical persons,
the officers having control, management or direction of their business shall be liable.
SEC. 7. Penalties.
(a) Any person found guilty of illegal recruitment shall suffer the penalty of imprisonment of not less than six (6) years and one (1)
day but not more than twelve (12) years and a fine of not less than Two hundred thousand pesos (P 200,000.00) nor more than
Five hundred thousand pesos (P 500,000.00).
(b) The penalty of life imprisonment and a fine of not less than Five hundred thousand pesos (P 500,000.00) nor more than One
million pesos (P 1,000,000.00) shall be imposed if illegal recruitment constitutes economic sabotage as defined herein.
Provided, however, That the maximum penalty shall be imposed if the person illegally recruited is less than eighteen (18) years of
age or committed by a non-licensee or non-holder of authority.
In order to hold a person liable for illegal recruitment, the following elements must concur: (1) the offender undertakes any of the
activities within the meaning of "recruitment and placement" under Article 13(b)20 of the Labor Code, or any of the prohibited
practices enumerated under Article
3421 of the Labor Code (now Section 6 of Republic Act No. 8042) and (2) the offender has no valid license or authority required by
law to enable him to lawfully engage in recruitment and placement of workers.22 In the case of illegal recruitment in large scale, a
third element is added: that the offender commits any of the acts of recruitment and placement against three or more persons,
individually or as a group.23 All three elements are present in the case at bar.
Inarguably, appellant Chua engaged in recruitment when she represented to private complainants that she could send them to
Taiwan as factory workers upon submission of the required documents and payment of the placement fee. The four private
complainants positively identified appellant as the person who promised them employment as factory workers in Taiwan for a fee
of P 80,000. More importantly, Severino Maranan the Senior Labor Employment Officer of the POEA, presented a Certification
dated December 5, 2002, issued by Director Felicitas Q. Bay, to the effect that appellant Chua is not licensed by the POEA to
recruit workers for overseas employment.
The Court finds no reason to deviate from the findings and conclusions of the trial court and appellate court. The prosecution
witnesses were positive and categorical in their testimonies that they personally met appellant and that the latter promised to send
them abroad for employment.
In fact, the substance of their testimonies corroborate each other on material points, such as the amount of the placement fee, the
country of destination and the nature of work. Without any evidence to show that private complainants were propelled by any ill
motive to testify falsely against appellant, we shall accord their testimonies full faith and credit. After all, the doctrinal rule is that
findings of fact made by the trial court, which had the opportunity to directly observe the witnesses and to determine the probative
value of the other testimonies, are entitled to great weight and respect because the trial court is in a better position to assess the
same, an opportunity not equally open to the appellate court.24 The absence of any showing that the trial court plainly overlooked
certain facts of substance and value that, if considered, might affect the result of the case, or that its assessment was arbitrary,
impels the Court to defer to the trial courts determination according credibility to the prosecution evidence.25
Appellant cannot escape liability by conveniently limiting her participation as a cashier of Golden Gate. The provisions of Article
13(b) of the Labor Code and Section 6 of R.A. No. 8042 are unequivocal that illegal recruitment may or may not be for profit. It is
immaterial, therefore, whether appellant remitted the placement fees to "the agencys treasurer" or appropriated them. The same
provision likewise provides that the persons criminally liable for illegal recruitment are the principals, accomplices and accessories.
Just the same, therefore, appellant can be held liable as a principal by direct participation since she personally undertook the
recruitment of private complainants without a license or authority to do so. Worth stressing, the Migrant Workers and Overseas
Filipinos Act of 1995 is a special law, a violation of which is malum prohibitum, not mala in se. Intent is thus, immaterial26and mere
commission of the prohibited act is punishable.
Furthermore, we agree with the appellate court that the same pieces of evidence which establish appellants liability for illegal
recruitment in large scale likewise confirm her culpability for estafa.
It is well-established in jurisprudence that a person may be charged and convicted for both illegal recruitment and estafa. The
reason therefor is not hard to discern: illegal recruitment is malum prohibitum, while estafa is mala in se. In the first, the criminal
intent of the accused is not necessary for conviction. In the second, such intent is imperative. Estafa under Article 315, paragraph
2(a) of the Revised Penal Code is committed by any person who defrauds another by using fictitious name, or falsely pretends to
possess power, influence, qualifications, property, credit, agency, business or imaginary transactions, or by means of similar deceits
executed prior to or simultaneously with the commission of fraud.27
The elements of estafa by means of deceit are the following: (a) that there must be a false pretense or fraudulent representation as
to his power, influence, qualifications, property, credit, agency, business or imaginary transactions; (b) that such false pretense or
fraudulent representation was made or executed prior to or simultaneously with the commission of the fraud; (c) that the offended
party relied on the false pretense, fraudulent act, or fraudulent means and was induced to part with his money or property; and (d)
that, as a result thereof, the offended party suffered damage.28

In this case, the prosecution has established that appellant defrauded the complaining witnesses by leading them to believe that
she has the capacity to send them to Taiwan for work, even as she does not have a license or authority for the purpose. Such
misrepresentation came before private complainants delivered P 80,000 as placement fee to appellant. Clearly, private
complainants would not have parted with their money were it not for such enticement by appellant. As a consequence of appellants
false pretenses, the private complainants suffered damages as the promised employment abroad never materialized and the
money they paid were never recovered.29
In an effort to exculpate herself, appellant presented in evidence 11 vouchers30 amounting to P 314,030, which was allegedly
received by Marilen Callueng, the supposed owner of Golden Gate. Notably, the dates on which said vouchers were issued and the
amounts purportedly remitted to Callueng by way thereof do not correspond with the placement fee given by private complainants
and the dates on which they paid the same to appellant. For instance, private complainants Aglanao and Danan delivered P 80,000
to appellant on August 10, 2002 but none of the vouchers presented by appellant was issued on said date. On August 20, 2002,
private complainant Tajadao paid P 40,000 to appellant but the latters voucher for said date covers only P 22,480. More
importantly, there is nothing in appellants vouchers to indicate that the amounts listed therein were received from private
complainants. On the other hand, while the vouchers presented by private complainants Aglanao, Danan and Tajadao do not bear
their names, they could not have come into possession of said form except through appellant. Hence, appellant admitted in open
court that she received P 80,000 from private complainants and that she was authorized to issue receipts, thus:
ATTY: BETIC:
Q: Were you authorized to issue receipts in behalf of that Agency?
A: yes, Sir.
xxxx
Q: Now, you said that you were employed with Golden Gate Agency owned and operated by Marilen Callueng, and as a cashier did
you happen to come across private complainants, Billy R. Da[n]an, Alberto Aglanao and Rey Tajadao?
A: Yes, Sir before they were asked to sign a contract they paid to me.
Q: Do you know how much were paid or given by the persons I have mentioned?
A: Eighty Thousand Pesos Only (P 80,000.00) Sir.
Q: Each?
A: Yes, Sir.31
Be that as it may, we take exception as regards private complainant Roylan Ursulum. The Court finds that the prosecution failed to
establish the presence of the third and fourth elements of estafa as regards the incident with Roylan Ursulum. While Ursulum
claims that he delivered to Chua two installments of P 40,000 each on July 29, 2002 and August 3, 2002, he failed to produce
receipts to substantiate the same. Instead, Ursulum relies on ten text messages allegedly sent by appellant as evidence of their
transaction. Out of said series of messages, Ursulum presented only one which reads, "Siguro anong laking saya nyo pag namatay
na ko." Notably, the prosecution did not present evidence to confirm whether said text message actually emanated from appellant.
Assuming arguendo that it did, still, said message alone does not constitute proof beyond reasonable doubt that appellant was able
to obtain P 80,000 from Ursulum as a result of her false pretenses.
Unlike in illegal recruitment where profit is immaterial, a conviction for estafa requires a clear showing that the offended party
parted with his money or property upon the offenders false pretenses, and suffered damage thereby. In every criminal prosecution,
the State must prove beyond reasonable doubt all the elements of the crime charged and the complicity or participation of the
accused.32 It is imperative, therefore, that damage as an element of estafa under Article 315, paragraph 2(a) be proved as
conclusively as the offense itself. The failure of the prosecution to discharge this burden concerning the estafa allegedly committed
against Ursulum warrants the acquittal of appellant on the said charge.
Now on the matter of the appropriate penalty. Under Section 6, R.A. No. 8042, illegal recruitment when committed in large scale
shall be considered as an offense involving economic sabotage. Accordingly, it shall be punishable by life imprisonment and a fine
of not less than P 500,000 nor more than P 1,000,000. The law provides further that the maximum penalty shall be imposed if
illegal recruitment is committed by a non-licensee or non-holder of authority.
In the case at bar, the trial court imposed upon appellant Chua the penalty of life imprisonment and a fine of P500,000. However,
considering that appellant is a non-licensee or non-holder of authority, we deem it proper to impose upon her the maximum penalty
of life imprisonment and fine of P 1,000,000.
Meanwhile, the penalty for estafa under Article 315 of the Revised Penal Code is prision correccional in its maximum period to
prision mayor in its minimum period, if the amount of the fraud is over P 12,000 but does not exceed P 22,000. If the amount
exceeds P 22,000, the penalty shall be imposed in its maximum period, adding one year for each additional P 10,000. But, the total
penalty imposed shall not exceed 20 years.

The range of penalty provided for in Article 315 is composed of only two periods.1wphi1 Thus, to get the maximum period of the
indeterminate sentence, the total number of years included in the two periods should be divided into three equal periods of time,
forming one period for each of the three portions. The maximum, medium and minimum periods of the prescribed penalty are
therefore:
Minimum period - 4 years, 2 months and 1 day to 5 years, 5 months and 10 days
Medium period - 5 years, 5 months and 11 days to 6 years, 8 months and 20 days
Maximum period - 6 years, 8 months and 21 days to 8 years. 33
In this case, the amount by which appellant defrauded private complainants Aglanao, Danan and Tajadao is P80,000, which
exceeds P 22,000. Hence, the penalty should be imposed in the maximum period of 6 years, 8 months and 21 days to 8 years.
Since the total amount of fraud in this case exceeds the threshold amount of P22,000 by P 58,000, an additional penalty of five
years imprisonment should be imposed. Thus, the maximum period of appellant's indeterminate sentence should be 13 years of
reclusion temporal.
The minimum period of the indeterminate sentence, on the other hand, should be within the nmge ofpenaity next lower to that
prescribed by Article 315, paragraph 2(a) of the Revised Penal Code for the crime committed.The penalty next lower to prision
correccional maximum to prision mayor minimum is prision correccional minimum (6 months and 1 day to 2 years and 4 months) to
prision correccional medium (2 years, 4 months and 1 day to 4 years and 2 months). Thus, the appellate court correctly modified
the minirnum period of appellant's sentence to 4 years and 2 months of prision correccional.
WHEREFORE, the appeal is PARTLY GRANTED. Appellant Melissa Chua, a.k.a. Clarita Ng Chua is ACQUITTED of one count of
estafa filed by private complainant Roylan Ursulum in Criminal Case No. 03-21 7999-403.
The Decision dated September I5, 2008 of the Court of Appeals in CA-G.R. CR-H.C. No. 01006 is AFFIRMED with MODIFICATION
in that the appellant is ordered to pay a fine of P 1,000,000 and to indemnify each of the private complainants Alberto A. Aglanao,
Billy R. Danan and Rey P. Tajadao in the amount of P-80,000.
With costs against the accused-appellant.
SO ORDERED.

Pp. vs. Ocden

For Our consideration is an appeal from the Decision1 dated April 21, 2006 of the Court of Appeals in CA-G.R. CR.-H.C. No. 00044,
which affirmed with modification the Decision2 dated July 2, 2001 of the Regional Trial Court (RTC), Baguio City, Branch 60, in
Criminal Case No. 16315-R. The RTC found accused-appellant Dolores Ocden (Ocden) guilty of illegal recruitment in large scale,
as defined and penalized under Article 13(b), in relation to Articles 38(b), 34, and 39 of Presidential Decree No. 442, otherwise
known as the New Labor Code of the Philippines, as amended, in Criminal Case No. 16315-R; and of the crime of estafa under
paragraph 2(a), Article 315 of the Revised Penal Code, in Criminal Case Nos. 16316-R, 16318-R, and 16964-R.3 The Court of
Appeals affirmed Ocdens conviction in all four cases, but modified the penalties imposed in Criminal Case Nos. 16316-R, 16318-R,
and 16964-R,
The Amended Information4 for illegal recruitment in large scale in Criminal Case No. 16315-R reads:
That during the period from May to December, 1998, in the City of Baguio, Philippines, and within the jurisdiction of this Honorable
Court, the above-named accused, did then and there willfully, unlawfully and feloniously for a fee, recruit and promise employment
as factory workers in Italy to more than three (3) persons including, but not limited to the following: JEFFRIES C. GOLIDAN,
HOWARD C. GOLIDAN, KAREN M. SIMEON, JEAN S. MAXIMO, NORMA PEDRO, MARYLYN MANA-A, RIZALINA FERRER, and
MILAN DARING without said accused having first secured the necessary license or authority from the Department of Labor and
Employment.
Ocden was originally charged with six counts of estafa in Criminal Case Nos. 16316-R, 16318-R, 16350-R, 16369-R, 16964-R, and
16966-R.
The Information in Criminal Case No. 16316-R states:
That sometime during the period from October to December, 1998 in the City of Baguio, Philippines and within the jurisdiction of
this Honorable Court, the above-named accused, did then and there willfully, unlawfully and feloniously defraud JEFFRIES C.
GOLIDAN, by way of false pretenses, which are executed prior to or simultaneous with the commission of the fraud, as follows, to
wit: the accused knowing fully well that she is not (sic) authorized job recruiter for persons intending to secure work abroad
convinced said Jeffries C. Golidan and pretended that she could secure a job for him/her abroad, for and in consideration of the
sum of P70,000.00when in truth and in fact they could not; the said Jeffries C. Golidan deceived and convinced by the false
pretenses employed by the accused parted away the total sum of P70,000.00, in favor of the accused, to the damage and prejudice
of the said Jeffries C. Golidan in the aforementioned amount of SEVENTY THOUSAND PESOS (P70,000,00), Philippine Currency.5

The Informations in the five other cases for estafa contain substantially the same allegations as the one above-quoted, except for
the private complainants names, the date of commission of the offense, and the amounts defrauded, to wit:
Case No.

Name of the Private Complainant

Date of Commission of the Offense

Amount Defrauded

16318-R

Howard C. Golidan

Sometime during the period

from October to December 1998

P70,000.00

16350-R

Norma Pedro

Sometime in May, 1998

P65,000.00

16369-R

Milan O. Daring

Sometime during the period

from November 13, 1998 to
December 10, 1998

P70.000.00

16964-R

Rizalina Ferrer

Sometime in September

P70,000.00

16966-R

Marilyn Mana-a

Sometime in September 1998

P70,000.006

All seven cases against Ocden were consolidated on July 31, 2000 and were tried jointly after Ocden pleaded not guilty.
The prosecution presented three witnesses namely: Marilyn Mana-a (Mana-a) and Rizalina Ferrer (Ferrer), complainants; and Julia
Golidan (Golidan), mother of complainants Jeffries and Howard Golidan.
Mana-a testified that sometime in the second week of August 1998, she and Isabel Dao-as (Dao-as) went to Ocdens house in
Baguio City to apply for work as factory workers in Italy with monthly salaries of US$1,200.00. They were required by Ocden to
submit their bio-data and passports, pay the placement fee of P70,000.00, and to undergo medical examination.
Upon submitting her bio-data and passport, Mana-a paid Ocden P500.00 for her certificate of employment andP20,000.00 as down
payment for her placement fee. On September 8, 1998, Ocden accompanied Mana-a and 20 other applicants to Zamora Medical
Clinic in Manila for their medical examinations, for which each of the applicants paid P3,000.00. Mana-a also paid to
Ocden P22,000.00 as the second installment on her placement fee. When Josephine Lawanag (Lawanag), Mana-as sister,
withdrew her application, Lawanags P15,000.00 placement fee, already paid to Ocden, was credited to Mana-a.7
Mana-a failed to complete her testimony, but the RTC considered the same as no motion to strike the said testimony was filed.
Ferrer narrated that she and her daughter Jennilyn were interested to work overseas. About the second week of September 1998,
they approached Ocden through Fely Alipio (Alipio). Ocden showed Ferrer and Jennilyn a copy of a job order from Italy for factory
workers who could earn as much as $90,000.00 to $100,000.00.8 In the first week of October 1998, Ferrer and Jennilyn decided to
apply for work, so they submitted their passports and pictures to Ocden. Ferrer also went to Manila for medical examination, for
which she spent P3,500.00. Ferrer paid to Ocden on November 20, 1998 the initial amount of P20,000.00, and on December 8,
1998 the balance of her and Jennilyns placement fees. All in all, Ferrer paid Ocden P140,000.00, as evidenced by the receipts
issued by Ocden.9
Ferrer, Jennilyn, and Alipio were supposed to be included in the first batch of workers to be sent to Italy. Their flight was scheduled
on December 10, 1998. In preparation for their flight to Italy, the three proceeded to Manila. In Manila, they were introduced by
Ocden to Erlinda Ramos (Ramos). Ocden and Ramos then accompanied Ferrer, Jennilyn, and Alipio to the airport where they took
a flight to Zamboanga. Ocden explained to Ferrer, Jennilyn, and Alipio that they would be transported to Malaysia where their visa
application for Italy would be processed.
Sensing that they were being fooled, Ferrer and Jennilyn decided to get a refund of their money, but Ocden was nowhere to be
found. Ferrer would later learn from the Baguio office of the Philippine Overseas Employment Administration (POEA) that Ocden
was not a licensed recruiter.
Expecting a job overseas, Ferrer took a leave of absence from her work. Thus, she lost income amounting toP17,700.00,
equivalent to her salary for one and a half months. She also spent P30,000.00 for transportation and food expenses.10
According to Golidan, the prosecutions third witness, sometime in October 1998, she inquired from Ocden about the latters
overseas recruitment. Ocden informed Golidan that the placement fee was P70,000.00 for each applicant, that the accepted
applicants would be sent by batches overseas, and that priority would be given to those who paid their placement fees early. On
October 30, 1998, Golidan brought her sons, Jeffries and Howard, to Ocden. On the same date, Jeffries and Howard handed over
to Ocden their passports and P40,000.00 as down payment on their placement fees. On December 10, 1998, Jeffries and Howard
paid the balance of their placement fees amounting to P100,000.00. Ocden issued receipts for these two payments.11 Ocden then
informed Golidan that the first batch of accepted applicants had already left, and that Jeffries would be included in the second batch
for deployment, while Howard in the third batch.
In anticipation of their deployment to Italy, Jeffries and Howard left for Manila on December 12, 1998 and December 18, 1998,
respectively. Through a telephone call, Jeffries informed Golidan that his flight to Italy was scheduled on December 16, 1998.
However, Golidan was surprised to again receive a telephone call from Jeffries saying that his flight to Italy was delayed due to
insufficiency of funds, and that Ocden went back to Baguio City to look for additional funds. When Golidan went to see Ocden,
Ocden was about to leave for Manila so she could be there in time for the scheduled flights of Jeffries and Howard.

On December 19, 1998, Golidan received another telephone call from Jeffries who was in Zamboanga with the other applicants.
Jeffries informed Golidan that he was stranded in Zamboanga because Ramos did not give him his passport. Ramos was the one
who briefed the overseas job applicants in Baguio City sometime in November 1998. Jeffries instructed Golidan to ask Ocdens
help in looking for Ramos. Golidan, however, could not find Ocden in Baguio City.
On December 21, 1998, Golidan, with the other applicants, Mana-a and Dao-as, went to Manila to meet Ocden. When Golidan
asked why Jeffries was in Zamboanga, Ocden replied that it would be easier for Jeffries and the other applicants to acquire their
visas to Italy in Zamboanga. Ocden was also able to contact Ramos, who assured Golidan that Jeffries would be able to get his
passport. When Golidan went back home to Baguio City, she learned through a telephone call from Jeffries that Howard was now
likewise stranded in Zamboanga.
By January 1999, Jeffries and Howard were still in Zamboanga. Jeffries refused to accede to Golidans prodding for him and
Howard to go home, saying that the recruiters were already working out the release of the funds for the applicants to get to Italy.
Golidan went to Ocden, and the latter told her not to worry as her sons would already be flying to Italy because the same factory
owner in Italy, looking for workers, undertook to shoulder the applicants travel expenses. Yet, Jeffries called Golidan once more
telling her that he and the other applicants were still in Zamboanga.
Golidan went to Ocdens residence. This time, Ocdens husband gave Golidan P23,000.00 which the latter could use to fetch the
applicants, including Jeffries and Howard, who were stranded in Zamboanga. Golidan traveled again to Manila with Mana-a and
Dao-as. When they saw each other, Golidan informed Ocden regarding theP23,000.00 which the latters husband gave to her.
Ocden begged Golidan to give her the money because she needed it badly. Of the P23,000.00, Golidan retained P10,000.00, Daoas received P3,000.00, and Ocden got the rest. Jeffries was able to return to Manila on January 16, 1999. Howard and five other
applicants, accompanied by Ocden, also arrived in Manila five days later.
Thereafter, Golidan and her sons went to Ocdens residence to ask for a refund of the money they had paid to Ocden. Ocden was
able to return only P50,000.00. Thus, out of the total amount of P140,000.00 Golidan and her sons paid to Ocden, they were only
able to get back the sum of P60,000.00. After all that had happened, Golidan and her sons went to the Baguio office of the POEA,
where they discovered that Ocden was not a licensed recruiter.12
The defense presented the testimony of Ocden herself.
Ocden denied recruiting private complainants and claimed that she was also an applicant for an overseas job in Italy, just like them.
Ocden identified Ramos as the recruiter.
Ocden recounted that she met Ramos at a seminar held in St. Theresas Compound, Navy Base, Baguio City, sometime in June
1998. The seminar was arranged by Aida Comila (Comila), Ramoss sub-agent. The seminar was attended by about 60 applicants,
including Golidan. Ramos explained how one could apply as worker in a stuff toys factory in Italy. After the seminar, Comila
introduced Ocden to Ramos. Ocden decided to apply for the overseas job, so she gave her passport and pictures to Ramos.
Ocden also underwent medical examination at Zamora Medical Clinic in Manila, and completely submitted the required documents
to Ramos in September 1998.
After the seminar, many people went to Ocdens house to inquire about the jobs available in Italy. Since most of these people did
not attend the seminar, Ocden asked Ramos to conduct a seminar at Ocdens house. Two seminars were held at Ocdens house,
one in September and another in December 1998. After said seminars, Ramos designated Ocden as leader of the applicants. As
such, Ocden received her co-applicants applications and documents; accompanied her co-applicants to Manila for medical
examination because she knew the location of Zamora Medical Clinic; and accepted placement fees in the amount of P70,000.00
each from Mana-a and Ferrer and from Golidan, the amount of P140,000.00 (for Jeffries and Howard).
Ramos instructed Ocden that the applicants should each pay P250,000.00 and if the applicants could not pay the full amount, they
would have to pay the balance through salary deductions once they start working in Italy. Ocden herself paid Ramos P50,000.00 as
placement fee and executed a promissory note in Ramoss favor for the balance, just like any other applicant who failed to pay the
full amount. Ocden went to Malaysia with Ramoss male friend but she failed to get her visa for Italy.
Ocden denied deceiving Mana-a and Ferrer. Ocden alleged that she turned over to Ramos the money Mana-a and Ferrer gave her,
although she did not indicate in the receipts she issued that she received the money for and on behalf of Ramos.
Ocden pointed out that she and some of her co-applicants already filed a complaint against Ramos before the National Bureau of
Investigation (NBI) offices in Zamboanga City and Manila.13
On July 2, 2001, the RTC rendered a Decision finding Ocden guilty beyond reasonable doubt of the crimes of illegal recruitment in
large scale (Criminal Case No. 16315-R) and three counts of estafa (Criminal Case Nos. 16316-R, 16318-R, and 16964-R). The
dispositive portion of said decision reads:
WHEREFORE, premises considered, judgment is hereby rendered as follows:
1. In Criminal Case No. 16315-R, the Court finds the accused, DOLORES OCDEN, GUILTY beyond reasonable doubt of
the crime of Illegal Recruitment committed in large scale as defined and penalized under Article 13(b) in relation to Article
38(b), 34 and 39 of the Labor Code as amended by P.D. Nos. 1693, 1920, 2018 and R.A. 8042. She is hereby sentenced
to suffer the penalty of life imprisonment and to pay a fine of P100,000.00;

2. In Criminal Case No. 16316-R, the Court finds the accused, DOLORES OCDEN, GUILTY beyond reasonable doubt of
the crime of estafa and sentences her to suffer an indeterminate penalty ranging from two (2) years, eleven (11) months
and ten (10) days of prision correccional, as minimum, up to nine (9) years and nine (9) months of prision mayor, as
maximum, and to indemnify the complainant Jeffries Golidan the amount of P40,000.00;
3. In Criminal Case No. 16318-R, the Court finds the accused, DOLORES OCDEN, GUILTY beyond reasonable doubt of
the crime of estafa and sentences her to suffer an indeterminate penalty ranging from two (2) years, eleven (11) months
and ten (10) days of prision correccional, as minimum, up to nine (9) years and nine (9) months of prision mayor, as
maximum, and to indemnify Howard Golidan the amount ofP40,000.00;
4. In Criminal Case No. 16350-R, the Court finds the accused, DOLORES OCDEN, NOT GUILTY of the crime of estafa for
lack of evidence and a verdict of acquittal is entered in her favor;
5. In Criminal Case No. 16369-R, the Court finds the accused, DOLORES OCDEN, NOT GUILTY of the crime of estafa for
lack of evidence and a verdict of acquittal is hereby entered in her favor;
6. In Criminal Case No. 16964-R, the Court finds the accused, DOLORES OCDEN, GUILTY beyond reasonable doubt of
the crime of estafa and sentences her to suffer an indeterminate penalty of Four (4) years and Two (2) months of prision
correccional, as minimum, up to Twelve (12) years and Nine (9) months of reclusion temporal, as maximum, and to
indemnify Rizalina Ferrer the amount of P70,000.00; and
7. In Criminal Case No. 16966-R, the Court finds the accused, DOLORES OCDEN, NOT GUILTY of the crime of estafa for
insufficiency of evidence and a verdict of acquittal is hereby entered in her favor.
In the service of her sentence, the provisions of Article 70 of the Penal Code shall be observed.14
Aggrieved by the above decision, Ocden filed with the RTC a Notice of Appeal on August 15, 2001.15 The RTC erroneously sent the
records of the cases to the Court of Appeals, which, in turn, correctly forwarded the said records to us.
In our Resolution16 dated May 6, 2002, we accepted the appeal and required the parties to file their respective briefs. In the same
resolution, we directed the Superintendent of the Correctional Institute for Women to confirm Ocdens detention thereat.
Ocden filed her Appellant's Brief on August 15, 2003,17 while the People, through the Office of the Solicitor General, filed its
Appellee's Brief on January 5, 2004.18
Pursuant to our ruling in People v. Mateo,19 we transferred Ocdens appeal to the Court of Appeals. On April 21, 2006, the appellate
court promulgated its Decision, affirming Ocdens conviction but modifying the penalties imposed upon her for the three counts of
estafa, viz:
[T]he trial court erred in the imposition of accused-appellants penalty.
Pursuant to Article 315 of the RPC, the penalty for estafa is prision correccional in its maximum period to prision mayor in its
minimum period. If the amount of the fraud exceeds P22,000.00, the penalty provided shall be imposed in its maximum period (6
years, 8 months and 21 days to 8 years), adding 1 year for each additionalP10,000.00; but the total penalty which may be imposed
shall not exceed 20 years.
Criminal Case Nos. 16316-R and 16318-R involve the amount of P40,000.00 each. Considering that P18,000.00 is the excess
amount, only 1 year should be added to the penalty in its maximum period or 9 years. Also, in Criminal Case No. 16964-R, the
amount involved is P70,000.00. Thus, the excess amount is P48,000.00 and only 4 years should be added to the penalty in its
maximum period.
WHEREFORE, the instant appeal is DISMISSED. The assailed Decision, dated 02 July 2001, of the Regional Trial Court (RTC) of
Baguio City, Branch 60 is hereby AFFIRMED with the following MODIFICATIONS:
1. In Criminal Case No. 16316-R, accused-appellant is sentenced to 2 years, 11 months, and 10 days of prision
correccional, as minimum to 9 years of prision mayor, as maximum and to indemnify Jeffries Golidan the amount
of P40,000.00;
2. In Criminal Case No. 16318-R, accused-appellant is sentenced to 2 years, 11 months, and 10 days of prision
correccional, as minimum to 9 years of prision mayor, as maximum and to indemnify Howard Golidan the amount
of P40,000.00; and
3. In Criminal Case No. 16964-R, accused-appellant is sentenced to 4 years and 2 months of prision correccional, as
minimum to 12 years of prision mayor, as maximum and to indemnify Rizalina Ferrer the amount of P70,000.00.20
Hence, this appeal, in which Ocden raised the following assignment of errors:

I
THE TRIAL COURT ERRED IN CONVICTING ACCUSED-APPELLANT OF ILLEGAL RECRUITMENT COMMITTED IN
LARGE SCALE ALTHOUGH THE CRIME WAS NOT PROVEN BEYOND REASONABLE DOUBT.
II
THE TRIAL COURT ERRED IN CONVICTING ACCUSED-APPELLANT OF ESTAFA IN CRIMINAL CASES NOS. 16316R, 16318-R AND 16[9]64-R.21
After a thorough review of the records of the case, we find nothing on record that would justify a reversal of Ocdens conviction.
Illegal recruitment in large scale
Ocden contends that the prosecution failed to prove beyond reasonable doubt that she is guilty of the crime of illegal recruitment in
large scale. Other than the bare allegations of the prosecution witnesses, no evidence was adduced to prove that she was a nonlicensee or non-holder of authority to lawfully engage in the recruitment and placement of workers. No certification attesting to this
fact was formally offered in evidence by the prosecution.
Ocdens aforementioned contentions are without merit.
Article 13, paragraph (b) of the Labor Code defines and enumerates the acts which constitute recruitment and placement:
(b) "Recruitment and placement" refers to any act of canvassing, enlisting, contracting, transporting, utilizing, hiring, or procuring
workers, and includes referrals, contract services, promising for advertising for employment locally or abroad, whether for profit or
not: Provided, That any person or entity which, in any manner, offers or promises for a fee employment to two or more persons
shall be deemed engaged in recruitment and placement.
The amendments to the Labor Code introduced by Republic Act No. 8042, otherwise known as the Migrant Workers and Overseas
Filipinos Act of 1995, broadened the concept of illegal recruitment and provided stiffer penalties, especially for those that constitute
economic sabotage, i.e., illegal recruitment in large scale and illegal recruitment committed by a syndicate. Pertinent provisions of
Republic Act No. 8042 are reproduced below:
SEC. 6. Definition. - For purposes of this Act, illegal recruitment shall mean any act of canvassing, enlisting, contracting,
transporting, utilizing, hiring, or procuring workers and includes referring, contract services, promising or advertising for
employment abroad, whether for profit or not, when undertaken by a non-licensee or non-holder of authority contemplated under
Article 13(f) of Presidential Decree No. 442, as amended, otherwise known as the Labor Code of the Philippines: Provided, That
any such non-licensee or non-holder who, in any manner, offers or promises for a fee employment abroad to two or more persons
shall be deemed so engaged. It shall likewise include the following acts, whether committed by any person, whether a nonlicensee, non-holder, licensee or holder of authority:
(a) To charge or accept directly or indirectly any amount greater than that specified in the schedule of allowable fees
prescribed by the Secretary of Labor and Employment, or to make a worker pay any amount greater than that actually
received by him as a loan or advance;
(b) To furnish or publish any false notice or information or document in relation to recruitment or employment;
(c) To give any false notice, testimony, information or document or commit any act of misrepresentation for the purpose of
securing a license or authority under the Labor Code;
(d) To induce or attempt to induce a worker already employed to quit his employment in order to offer him another unless
the transfer is designed to liberate a worker from oppressive terms and conditions of employment;
(e) To influence or attempt to influence any person or entity not to employ any worker who has not applied for employment
through his agency;
(f) To engage in the recruitment or placement of workers in jobs harmful to public health or morality or to the dignity of the
Republic of the Philippines;
(g) To obstruct or attempt to obstruct inspection by the Secretary of Labor and Employment or by his duly authorized
representative;
(h) To fail to submit reports on the status of employment, placement vacancies, remittance of foreign exchange earnings,
separation from jobs, departures and such other matters or information as may be required by the Secretary of Labor and
Employment;

(i) To substitute or alter to the prejudice of the worker, employment contracts approved and verified by the Department of
Labor and Employment 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 Department of Labor and Employment;
(j) For an officer or agent of a recruitment or placement agency to become an officer or member of the Board of any
corporation engaged in travel agency or to be engaged directly or indirectly in the management of a travel agency;
(k) To withhold or deny travel documents from applicant workers before departure for monetary or financial considerations
other than those authorized under the Labor Code and its implementing rules and regulations;
(l) Failure to actually deploy without valid reason as determined by the Department of Labor and Employment; and
(m) Failure to reimburse expenses incurred by the worker in connection with his documentation and processing for
purposes of deployment, in cases where the deployment does not actually take place without the worker's fault. Illegal
recruitment when committed by a syndicate or in large scale shall be considered an offense involving economic sabotage.
Illegal recruitment is deemed committed by a syndicate if carried out by a group of three (3) or more persons conspiring or
confederating with one another. It is deemed committed in large scale if committed against three (3) or more persons individually or
as a group.
xxxx
Sec. 7. Penalties.
(a) Any person found guilty of illegal recruitment shall suffer the penalty of imprisonment of not less than six (6) years and
one (1) day but not more than twelve (12) years and a fine of Two hundred thousand pesos (P200,000.00) nor more than
Five hundred thousand pesos (P500,000.00).
(b) The penalty of life imprisonment and a fine of not less than Five hundred thousand pesos (P500,000.00) nor more than
One million pesos (P1,000,000.00) shall be imposed if illegal recruitment constitutes economic sabotage as defined
herein.
Provided, however, That the maximum penalty shall be imposed if the person illegally recruited is less than eighteen (18) years of
age or committed by a non-licensee or non-holder of authority. (Emphasis ours.)
It is well-settled that to prove illegal recruitment, it must be shown that appellant gave complainants the distinct impression that he
had the power or ability to send complainants abroad for work such that the latter were convinced to part with their money in order
to be employed.22 As testified to by Mana-a, Ferrer, and Golidan, Ocden gave such an impression through the following acts: (1)
Ocden informed Mana-a, Ferrer, and Golidan about the job opportunity in Italy and the list of necessary requirements for
application; (2) Ocden required Mana-a, Ferrer, and Golidans sons, Jeffries and Howard, to attend the seminar conducted by
Ramos at Ocdens house in Baguio City; (3) Ocden received the job applications, pictures, bio-data, passports, and the certificates
of previous employment (which was also issued by Ocden upon payment of P500.00), of Mana-a, Ferrer, and Golidans sons,
Jeffries and Howard; (4) Ocden personally accompanied Mana-a, Ferrer, and Golidans sons, Jeffries and Howard, for their medical
examinations in Manila; (5) Ocden received money paid as placement fees by Mana-a, Ferrer, and Golidans sons, Jeffries and
Howard, and even issued receipts for the same; and (6) Ocden assured Mana-a, Ferrer, and Golidans sons, Jeffries and Howard,
that they would be deployed to Italy.
It is not necessary for the prosecution to present a certification that Ocden is a non-licensee or non-holder of authority to lawfully
engage in the recruitment and placement of workers. Section 6 of Republic Act No. 8042 enumerates particular acts which would
constitute illegal recruitment "whether committed by any person, whether a non-licensee, non-holder, licensee or holder of
authority." Among such acts, under Section 6(m) of Republic Act No. 8042, is the "[f]ailure to reimburse expenses incurred by the
worker in connection with his documentation and processing for purposes of deployment, in cases where the deployment does not
actually take place without the workers fault."
Since illegal recruitment under Section 6(m) can be committed by any person, even by a licensed recruiter, a certification on
whether Ocden had a license to recruit or not, is inconsequential. Ocden committed illegal recruitment as described in said
provision by receiving placement fees from Mana-a, Ferrer, and Golidans two sons, Jeffries and Howard, evidenced by receipts
Ocden herself issued; and failing to reimburse/refund to Mana-a, Ferrer, and Golidans two sons the amounts they had paid when
they were not able to leave for Italy, through no fault of their own.
Ocden questions why it was Golidan who testified for private complainants Jeffries and Howard. Golidan had no personal
knowledge of the circumstances proving illegal recruitment and could not have testified on the same. Also, Jeffries and Howard
already executed an affidavit of desistance. All Golidan wants was a reimbursement of the placement fees paid.
Contrary to Ocdens claims, Golidan had personal knowledge of Ocdens illegal recruitment activities, which she could competently
testify to. Golidan herself had personal dealings with Ocden as Golidan assisted her sons, Jeffries and Howard, in completing the
requirements for their overseas job applications, and later on, in getting back home from Zamboanga where Jeffries and Howard
were stranded, and in demanding a refund from Ocden of the placement fees paid. That Golidan is seeking a reimbursement of the
placement fees paid for the failed deployment of her sons Jeffries and Howard strengthens, rather than weakens, the prosecutions

case. Going back to illegal recruitment under Section 6(m) of Republic Act No. 8042, failure to reimburse the expenses incurred by
the worker when deployment does not actually take place, without the workers fault, is illegal recruitment.
The affidavit of desistance purportedly executed by Jeffries and Howard does not exonerate Ocden from criminal liability when the
prosecution had successfully proved her guilt beyond reasonable doubt. In People v. Romero,23we held that:
The fact that complainants Bernardo Salazar and Richard Quillope executed a Joint Affidavit of Desistance does not serve to
exculpate accused-appellant from criminal liability insofar as the case for illegal recruitment is concerned since the Court looks with
disfavor the dropping of criminal complaints upon mere affidavit of desistance of the complainant, particularly where the
commission of the offense, as is in this case, is duly supported by documentary evidence.
Generally, the Court attaches no persuasive value to affidavits of desistance, especially when it is executed as an afterthought. It
would be a dangerous rule for courts to reject testimonies solemnly taken before the courts of justice simply because the witnesses
who had given them, later on, changed their mind for one reason or another, for such rule would make solemn trial a mockery and
place the investigation of truth at the mercy of unscrupulous witness.
Complainants Bernardo Salazar and Richard Quillope may have a change of heart insofar as the offense wrought on their person is
concerned when they executed their joint affidavit of desistance but this will not affect the public prosecution of the offense itself. It
is relevant to note that "the right of prosecution and punishment for a crime is one of the attributes that by a natural law belongs to
the sovereign power instinctly charged by the common will of the members of society to look after, guard and defend the interests
of the community, the individual and social rights and the liberties of every citizen and the guaranty of the exercise of his rights."
This cardinal principle which states that to the State belongs the power to prosecute and punish crimes should not be overlooked
since a criminal offense is an outrage to the sovereign State.24
In her bid to exculpate herself, Ocden asserts that she was also just an applicant for overseas employment; and that she was
receiving her co-applicants job applications and other requirements, and accepting her co-applicants payments of placement fees,
because she was designated as the applicants leader by Ramos, the real recruiter.
Ocdens testimony is self-serving and uncorroborated. Ocdens denial of any illegal recruitment activity cannot stand against the
prosecution witnesses positive identification of her in court as the person who induced them to part with their money upon the
misrepresentation and false promise of deployment to Italy as factory workers. Besides, despite several opportunities given to
Ocden by the RTC, she failed to present Ramos, who Ocden alleged to be the real recruiter and to whom she turned over the
placement fees paid by her co-applicants.
Between the categorical statements of the prosecution witnesses, on the one hand, and the bare denial of Ocden, on the other, the
former must perforce prevail. An affirmative testimony is far stronger than a negative testimony especially when the former comes
from the mouth of a credible witness. Denial, same as an alibi, if not substantiated by clear and convincing evidence, is negative
and self-serving evidence undeserving of weight in law. It is considered with suspicion and always received with caution, not only
because it is inherently weak and unreliable but also because it is easily fabricated and concocted.25
Moreover, in the absence of any evidence that the prosecution witnesses were motivated by improper motives, the trial courts
assessment of the credibility of the witnesses shall not be interfered with by this Court.26 It is a settled rule that factual findings of
the trial courts, including their assessment of the witnesses credibility, are entitled to great weight and respect by the Supreme
Court, particularly when the Court of Appeals affirmed such findings. After all, the trial court is in the best position to determine the
value and weight of the testimonies of witnesses. The absence of any showing that the trial court plainly overlooked certain facts of
substance and value that, if considered, might affect the result of the case, or that its assessment was arbitrary, impels the Court to
defer to the trial courts determination according credibility to the prosecution evidence.27
Ocden further argues that the prosecution did not sufficiently establish that she illegally recruited at least three persons, to
constitute illegal recruitment on a large scale. Out of the victims named in the Information, only Mana-a and Ferrer testified in court.
Mana-a did not complete her testimony, depriving Ocden of the opportunity to cross-examine her; and even if Mana-as testimony
was not expunged from the record, it was insufficient to prove illegal recruitment by Ocden. Although Ferrer testified that she and
Mana-a filed a complaint for illegal recruitment against Ocden, Ferrers testimony is competent only as to the illegal recruitment
activities committed by Ocden against her, and not against Mana-a. Ocden again objects to Golidans testimony as hearsay, not
being based on Golidans personal knowledge.
Under the last paragraph of Section 6, Republic Act No. 8042, illegal recruitment shall be considered an offense involving economic
sabotage if committed in a large scale, that is, committed against three or more persons individually or as a group.
In People v. Hu,28 we held that a conviction for large scale illegal recruitment must be based on a finding in each case of illegal
recruitment of three or more persons, whether individually or as a group. While it is true that the law does not require that at least
three victims testify at the trial, nevertheless, it is necessary that there is sufficient evidence proving that the offense was committed
against three or more persons. In this case, there is conclusive evidence that Ocden recruited Mana-a, Ferrer, and Golidans sons,
Jeffries and Howard, for purported employment as factory workers in Italy. As aptly observed by the Court of Appeals:
Mana-as testimony, although not completed, sufficiently established that accused-appellant promised Mana-a a job placement in a
factory in Italy for a fee with accused-appellant even accompanying her for the required medical examination. Likewise, Julia
Golidans testimony adequately proves that accused-appellant recruited Jeffries and Howard Golidan for a job in Italy, also for a
fee. Contrary to the accused-appellants contention, Julia had personal knowledge of the facts and circumstances surrounding the
charges for illegal recruitment and estafa filed by her sons. Julia was not only privy to her sons recruitment but also directly

transacted with accused-appellant, submitting her sons requirements and paying the placement fees as evidenced by a receipt
issued in her name. Even after the placement did not materialize, Julia acted with her sons to secure the partial reimbursement of
the placement fees.29
And even though only Ferrer and Golidan testified as to Ocdens failure to reimburse the placements fees paid when the
deployment did not take place, their testimonies already established the fact of non-reimbursement as to three persons, namely,
Ferrer and Golidans two sons, Jeffries and Howard.
Section 7(b) of Republic Act No. 8042 prescribes a penalty of life imprisonment and a fine of not less thanP500,000.00 nor more
than P1,000,000.00 if the illegal recruitment constitutes economic sabotage. The RTC, as affirmed by the Court of Appeals,
imposed upon Ocden the penalty of life imprisonment and a fine of onlyP100,000.00. Since the fine of P100,000 is below the
minimum set by law, we are increasing the same toP500,000.00.
Estafa
We are likewise affirming the conviction of Ocden for the crime of estafa. The very same evidence proving Ocdens liability for
illegal recruitment also established her liability for estafa.
It is settled that a person may be charged and convicted separately of illegal recruitment under Republic Act No. 8042 in relation to
the Labor Code, and estafa under Article 315, paragraph 2(a) of the Revised Penal Code. We explicated in People v. Yabut30 that:
In this jurisdiction, it is settled that a person who commits illegal recruitment may be charged and convicted separately of illegal
recruitment under the Labor Code and estafa under par. 2(a) of Art. 315 of the Revised Penal Code. The offense of illegal
recruitment is malum prohibitum where the criminal intent of the accused is not necessary for conviction, while estafa is malum in
se where the criminal intent of the accused is crucial for conviction. Conviction for offenses under the Labor Code does not bar
conviction for offenses punishable by other laws. Conversely, conviction for estafa under par. 2(a) of Art. 315 of the Revised Penal
Code does not bar a conviction for illegal recruitment under the Labor Code. It follows that ones acquittal of the crime of estafa will
not necessarily result in his acquittal of the crime of illegal recruitment in large scale, and vice versa.31
Article 315, paragraph 2(a) of the Revised Penal Code defines estafa as:
Art. 315. Swindling (estafa). - Any person who shall defraud another by any of the means mentioned hereinbelow x x x:
xxxx
2. By means of any of the following false pretenses or fraudulent acts executed prior to or simultaneously with the commission of
the fraud:
(a) By using fictitious name, or falsely pretending to possess power, influence, qualifications, property, credit, agency,
business or imaginary transactions; or by means of other similar deceits.
The elements of estafa are: (a) that the accused defrauded another by abuse of confidence or by means of deceit, and (b) that
damage or prejudice capable of pecuniary estimation is caused to the offended party or third person.32
Both these elements are present in the instant case. Ocden represented to Ferrer, Golidan, and Golidans two sons, Jeffries and
Howard, that she could provide them with overseas jobs. Convinced by Ocden, Ferrer, Golidan, and Golidans sons paid
substantial amounts as placement fees to her. Ferrer and Golidans sons were never able to leave for Italy, instead, they ended up
in Zamboanga, where, Ocden claimed, it would be easier to have their visas to Italy processed. Despite the fact that Golidans
sons, Jeffries and Howard, were stranded in Zamboanga for almost a month, Ocden still assured them and their mother that they
would be able to leave for Italy. There is definitely deceit on the part of Ocden and damage on the part of Ferrer and Golidans
sons, thus, justifying Ocdens conviction for estafa in Criminal Case Nos. 16316-R, 16318-R, and 16964-R.
The penalty for estafa depends on the amount of defraudation. According to Article 315 of the Revised Penal Code:
Art. 315. Swindling (estafa). Any person who shall defraud another by any of the means mentioned hereinbelow shall be
punished by:
1st. The penalty of prision correccional in its maximum period to prision mayor in its minimum period, if the amount of the fraud is
over 12,000 pesos but does not exceed 22,000 pesos; and if such amount exceeds the latter sum, the penalty provided in this
paragraph shall be imposed in its maximum period, adding one year for each additional 10,000 pesos; but the total penalty which
may be imposed shall not exceed twenty years. In such cases, and in connection with the accessory penalties which may be
imposed and for the purpose of the other provisions of this Code, the penalty shall be termed prision mayor or reclusion temporal,
as the case may be.
The prescribed penalty for estafa under Article 315 of the Revised Penal Code, when the amount of fraud is overP22,000.00, is
prision correccional maximum to prision mayor minimum, adding one year to the maximum period for each additional P10,000.00,
provided that the total penalty shall not exceed 20 years.

Applying the Indeterminate Sentence Law, we take the minimum term from the penalty next lower than the minimum prescribed by
law, or anywhere within prision correccional minimum and medium (i.e., from 6 months and 1 day to 4 years and 2
months).33 Consequently, both the RTC and the Court of Appeals correctly fixed the minimum term in Criminal Case Nos. 16316-R
and 16318-R at 2 years, 11 months, and 10 days of prision correccional; and in Criminal Case No. 16964-R at 4 years and 2
months of prision correccional, since these are within the range of prision correccional minimum and medium.1avvphi1
As for the maximum term under the Indeterminate Sentence Law, we take the maximum period of the prescribed penalty, adding 1
year of imprisonment for every P10,000.00 in excess of P22,000.00, provided that the total penalty shall not exceed 20 years. To
compute the maximum period of the prescribed penalty, the time included in prision correccional maximum to prision mayor
minimum shall be divided into three equal portions, with each portion forming a period. Following this computation, the maximum
period for prision correccional maximum to prision mayor minimum is from 6 years, 8 months, and 21 days to 8 years. The
incremental penalty, when proper, shall thus be added to anywhere from 6 years, 8 months, and 21 days to 8 years, at the
discretion of the court.34
In computing the incremental penalty, the amount defrauded shall be substracted by P22,000.00, and the difference shall be
divided by P10,000.00. Any fraction of a year shall be discarded as was done starting with People v. Pabalan.35
In Criminal Case Nos. 16316-R and 16318-R, brothers Jeffries and Howard Golidan were each defrauded of the amount
of P40,000.00, for which the Court of Appeals sentenced Ocden to an indeterminate penalty of 2 years, 11 months, and 10 days of
prision correccional as minimum, to 9 years of prision mayor as maximum. Upon review, however, we modify the maximum term of
the indeterminate penalty imposed on Ocden in said criminal cases. Since the amount defrauded exceeds P22,000.00
by P18,000.00, 1 year shall be added to the maximum period of the prescribed penalty (anywhere between 6 years, 8 months, and
21 days to 8 years). There being no aggravating circumstance, we apply the lowest of the maximum period, which is 6 years, 8
months, and 21 days. Adding the one year incremental penalty, the maximum term of Ocdens indeterminate sentence in these two
cases is only 7 years, 8 months, and 21 days of prision mayor.
In Criminal Cases No. 19694-R, Ferrer was defrauded of the amount of P70,000.00, for which the Court of Appeals sentenced
Ocden to an indeterminate penalty of 4 years and 2 months of prision correccional, as minimum, to 12 years of prision mayor, as
maximum. Upon recomputation, we also have to modify the maximum term of the indeterminate sentence imposed upon Ocden in
Criminal Case No. 19694-R. Given that the amount defrauded exceeds P22,000.00 by P48,000.00, 4 years shall be added to the
maximum period of the prescribed penalty (anywhere between 6 years, 8 months, and 21 days to 8 years). There likewise being no
aggravating circumstance in this case, we add the 4 years of incremental penalty to the lowest of the maximum period, which is 6
years, 8 months, and 21 days. The maximum term, therefor, of Ocdens indeterminate sentence in Criminal Case No. 19694-R is
only 10 years, 8 months, and 21 days of prision mayor.
WHEREFORE, the instant appeal of accused-appellant Dolores Ocden is DENIED. The Decision dated April 21, 2006 of the Court
of Appeals in CA-G.R. CR.-H.C. No. 00044 is AFFIRMED with MODIFICATION to read as follows:
1. In Criminal Case No. 16315-R, the Court finds the accused, Dolores Ocden, GUILTY beyond reasonable doubt of the
crime of Illegal Recruitment committed in large scale as defined and penalized under Article 13(b) in relation to Articles
38(b), 34 and 39 of the Labor Code, as amended. She is hereby sentenced to suffer the penalty of life imprisonment and
to pay a fine of P500,000.00;
2. In Criminal Case No. 16316-R, the Court finds the accused, Dolores Ocden, GUILTY beyond reasonable doubt of the
crime of estafa and sentences her to an indeterminate penalty of 2 years, 11 months, and 10 days of prision correccional,
as minimum, to 7 years, 8 months, and 21 days of prision mayor, as maximum, and to indemnify Jeffries Golidan the
amount of P40,000.00;
3. In Criminal Case No. 16318-R, the Court finds the accused, Dolores Ocden, GUILTY beyond reasonable doubt of the
crime of estafa and sentences her to an indeterminate penalty of 2 years, 11 months, and 10 days of prision correccional,
as minimum, to 7 years, 8 months, and 21 days of prision mayor, as maximum, and to indemnify Howard Golidan the
amount of P40,000.00; and
4. In Criminal Case No. 16964-R, the Court finds the accused, Dolores Ocden, GUILTY beyond reasonable doubt of the
crime of estafa and sentences her to an indeterminate penalty of 4 years and 2 months of prision correccional, as
minimum, to 10 years, 8 months, and 21 days of prision mayor, as maximum, and to indemnify Rizalina Ferrer the amount
of P70,000.00.
SO ORDERED.

Pp. vs. Velasco

The several accused in illegal recruitment committed in large scale against whom the State establishes a conspiracy are each
equally criminally and civilly liable. It follows, therefore, that as far as civil liability is concerned each is solidarily liable to the victims
of the illegal recruitment for the reimbursement of the sums collected from them, regardless of the extent of the participation of the
accused in the illegal recruitment.
The Case

Accused-appellant Maricar B. Inovero seeks the review and reversal of the decision promulgated on August 26, 2010,1 whereby the
Court of Appeals (CA) affirmed her conviction for illegal recruitment committed in large scale amounting to economic sabotage
under the judgment rendered on January 14, 2008 by the Regional Trial Court (RTC), Branch 133, in Makati City.2
Antecedents
On March 17, 2004, the Office of the City Prosecutor of Makati City filed in the RTC two informations3 charging Inovero, Ma. Harleta
Velasco y Briones, Marissa Diala and Berna Paulino with illegal recruitment as defined and penalized under Section 6 of Republic
Act No. 8042 (Migrant Workers Act of 1995), and 11 informations4charging the same accused with estafa as defined and penalized
under Article315, paragraph 2(a) of the Revised Penal Code. Only Inovero was arrested and prosecuted, the other accused having
remained at large.
Six cases charging estafa (Criminal Case No. 04-1565, Criminal Case No. 1568, Criminal Case No. 1570, Criminal Case No. 1571
and Criminal Case No. 1572 and Criminal Case No. 1573) and one of the two charging illegal recruitment (Criminal Case No. 041563) were provisionally dismissed because of the failure of the complainants to prosecute.5 The seven cases were later
permanently dismissed after the complainants did not revive them within two years, as provided in Section 8,6 Rule 117 of the Rules
of Court.
Trial on the merits ensued as to the remaining cases (Criminal Case No. 04-1562, for illegal recruitment; and Criminal Case No. 041564; Criminal Case No. 04-1566; Criminal Case No. 04-1567; Criminal Case No. 1569 and Criminal Case No. 04-1574, for
estafa).7
The CA recounted the transactions between the complainants and the accused, including Inovero, in the following manner:
Regarding Criminal Case No. 04-1562, the prosecution presented the five (5) private complainants as witnesses to prove the crime
of Illegal Recruitment, namely: Novesa Baful ("Baful"), Danilo Brizuela ("Brizuela"), Rosanna Aguirre ("Aguirre"), Annaliza Amoyo
("Amoyo"), and Teresa Marbella ("Marbella"), and Mildred Versoza ("Versoza") from the Philippine Overseas Employment
Administration ("POEA").
Baful testified that on May 20, 2003 she, together with her sister-in-law, went to Harvel International Talent Management and
Promotion ("HARVEL") at Unit 509 Cityland Condominium, Makati City upon learning that recruitment for caregivers to Japan was
on-going there. On said date, she allegedly met Inovero; Velasco, and Diala, and saw Inovero conducting a briefing on the
applicants. She also testified that Diala, the alleged talent manager, directed her to submit certain documents, and to pay Two
Thousand Five Hundred Pesos (P2,500.00) as training fee, as well as Thirty Thousand Pesos (P30,000.00) as placement and
processing fees. Diala also advised her to undergo physical examination.
On June 6, 2003, after complying with the aforesaid requirements and after paying Diala the amounts of Eighteen Thousand Pesos
(P18,000.00) and Ten Thousand pesos (P10,000.00), Baful was promised deployment within two (2) to three (3) months. She
likewise testified that Inovero briefed her and her co-applicants on what to wear on the day of their departure. However, she was
never deployed. Finally, she testified that she found out that HARVEL was not licensed to deploy workers for overseas
employment.
Brizuela, another complainant, testified that he went to HARVELs office in Makati on February 7, 2003 to inquire on the
requirements and hiring procedure for a caregiver in Japan. There, Diala told him the amount required as processing fee and the
documents to be submitted. And when he submitted on March 7, 2003 the required documents and payments, it was, this time,
Paulino who received them. He claimed that he underwent training and medical examination; he likewise attended an orientation
conducted by Inovero at which time, he and his batchmates were advised what clothes to wear on the day of their departure; he
was assured of deployment on the first week of June 2003, however, on the eve of his supposed "pre-departure orientation
seminar," Paulino texted him that the seminar was cancelled because Inovero, who had the applicants money, did not show up. He
testified that he was not deployed. Neither was his money returned, as promised.
On cross-examination, Brizuela testified that Inovero was the one who conducted the orientation, and represented to all the
applicants that most of the time, she was in the Japanese Embassy expediting the applicants visa.
Aguirre, the third complainant to testify, alleged that she went to HARVEL on May 22, 2003, to apply as caregiver in Japan; there,
Diala informed her that Inovero was oneof the owners of HARVEL and Velasco was its President; she paid Thirty Five Thousand
Pesos (P35,000.00), and submitted her documents, receipt of which was acknowledged by Diala; despite her undergoing medical
examination and several training seminars, she was however not deployed to Japan. Worse, she found out that HARVEL was not
licensed to recruit workers.
Amoyo, the fourth complainant, testified that she went to HARVELs office on May 28, 2003 to apply as caregiver in Japan, and
Diala required her to submit certain documents, to undergo training and medical examination, and to pay Thirty Five Thousand
Pesos (P35,000.00) as placement and processing fees. However, after complying with said requirements, she was never deployed
as promised.
Marbella was the last complainant to testify. She alleged that she applied for the position of janitress at HARVEL sometime in
December 2002; just like the rest of the complainants, she was required to submit certain documents and to pay a total amount of
Twenty Thousand pesos (P20,000.00) as processing fee; after paying said fee, Diala and Inovero promised her and the other

applicants that they will be deployed in three (3) months or in June 2003; however, the promised deployment never materialized;
she later found out that HARVEL was not even licensed to recruit workers.
[Mildred] Versoza, on the other hand, is a Labor and Employment Officer at the POEA Licensing Branch. She testified that she
prepared a Certification certifying that neither HARVEL nor Inovero was authorized to recruit workers for overseas employment as
per records at their office.
In her defense, Inovero denied the allegations hurled against her. As summarized in the assailed Decision, she claimed that she is
the niece of accused Velasco, the owner of HARVEL, but denied working there. Explaining her presence in HARVEL, she alleged
that she worked for her uncle, Velascos husband, as an office assistant, hence, for at least two or three times a week, she had to
go to HARVEL on alleged errands for her uncle. She also testified that her alleged errands mainly consisted of serving food and
refreshments during orientations at HARVEL. Inovero likewise denied receiving any money from the complainants, nor issuing
receipts therefor.8
Judgment of the RTC
On January 14, 2008, the RTC rendered judgment acquitting Inovero of five counts of estafabut convicting her in Criminal Case No.
04-1562 of illegal recruitment committed in large scale as defined and penalized by Section 6 and Section 7 of Republic Act No.
8042 (Migrant Workers and Overseas Filipinos Act of 1995), disposing thusly:
WHEREFORE, judgment is hereby rendered in the aforestated cases as follows:
In Criminal Case No. 04-1562, accused Maricar Inovero is found guilty beyond reasonable doubt of the crime of Illegal Recruitment
in large scale defined and penalized under Sections 6 and 7, II, of Republic Act No. 8042 otherwise known as the Migrant Workers
and Overseas Filipinos Act of 1995, and is hereby sentenced to suffer the penalty of life imprisonment. She is likewise ordered to
pay a fine of Five Hundred Thousand Pesos (P500,000.00).
Criminal Case No. 04-1563 also for illegal recruitment in large scale is hereby ordered dismissed to its finality for failure of
complainants Alvin De Leon, Roderick Acuna, Agosto Vale and Marina Viernes to revive said case despite the lapse of two years
from its provisional dismissal.
Criminal Cases No. 04-1564, 1566, 1567, 1569, 1571 and 1574 are hereby ordered DISMISSED for failure of the prosecution to
adduce sufficient evidence to prove all the elements of the said offense.
Criminal Cases Nos. 1565, 1568, 1570, 1572 and 1573 also for estafa [are] hereby ordered dismissed to its finality for failure of
complainants Agosto Vale, Alvin De Leon, Roselyn Saruyda, Roderick Acuna and Marina Viernes to revive said cases despite the
lapse of two (2) years from its provisional dismissal.
Considering that the accused is a detention prisoner, she shall be credited in the service of her sentence with the full time during
which she has undergone preventive imprisonment if she agrees voluntarily to abide by the same disciplinary rules imposed upon
convicted prisoners, otherwise, with four-fifths thereof.
Meanwhile, considering that the accused Ma. Harleta B. Velasco, Marissa Diala and Berna Paulino are still at large, let alias
warrants of arrest be issued against them. In the meantime, let the cases filed against them be archived, which shall be revived
upon their apprehension.
SO ORDERED.9
Decision of the CA
Inovero appealed, contending that:
THE TRIAL COURT GRAVELY ERRED IN FINDING ACCUSEDAPPELLANT GUILTY OF THE CRIME CHARGED DESPITE THE
PROSECUTIONS FAILURE TO ESTABLISH [HER] GUILT BEYOND REASONABLE DOUBT.10
On August 26, 2010, the CA affirmed the conviction, viz:
WHEREFORE, the instant appeal is DISMISSED. The January 14, 2008 Decision of the RTC is AFFIRMED.
SO ORDERED.11
Issue
In this appeal, Inovero insists that the CA erred in affirming her conviction by the RTC because she had not been an employee of
Harvel at any time; that she could be faulted only for her association with the supposed illegal recruiters; that in all stages of the
complainants recruitment for overseas employment by Harvel, they had transacted only and directly with Diala; and that the

certification from the POEA to the effect she was not a licensed recruiter was not a positive proof that she engaged in illegal
recruitment.
Ruling of the Court
The appeal lacks merit.
In its assailed decision, the CA affirmed the entire findings of fact of the RTC, stating:
The essential elements of illegal recruitment committed in large scale are: (1) that the accused engaged in acts of recruitment and
placement of workers as defined under Article 13(b) of the Labor Code, or in any prohibited activities under Article 34 of the same
Code; (2) that the accused had not complied with the guidelines issued by the Secretary of Labor and Employment with respect to
the requirement to secure a license or authority to recruit and deploy workers; and (3) that the accused committed the unlawful acts
against 3 or more persons. In simplest terms, illegal recruitment is committed by persons who, without authority from the
government, give the impression that they have the power to send workers abroad for employment purposes. In Our view, despite
Inoveros protestations that she did not commit illegal recruitment, the following circumstances contrarily convince Us that she was
into illegal recruitment.
First, private complainants Baful and Brizuela commonly testified that Inovero was the one who conducted orientations/briefings on
them; informed them, among others, on how much their salary would be as caregivers in Japan; and what to wear when they finally
will be deployed. Second, when Diala introduced her (Inovero) to private complainant Amoyo as one of the owners of HARVEL,
Inovero did not bother to correct said representation. Inoveros silence is clearly an implied acquiescence to said representation.
Third, Inovero, while conducting orientation on private complainant Brizuela, represented herself as the one expediting the release
of applicants working visa for Japan.
Fourth, in a Certification issued and attested to by POEAs Versoza Inovero had no license nor authority to recruit for overseas
employment.
Based on the foregoing, there is therefore no doubt that the RTC correctly found that Inovero committed illegal recruitment in large
scale by giving private complainants the impression that she can send them abroad for employment purposes, despite the fact that
she had no license or authority to do so.12
It is basic that the Court, not being a trier of facts, must of necessity rely on the findings of fact by the trial court which are
conclusive and binding once affirmed by the CA on intermediate review. The bindingness of the trial courts factual findings is by
virtue of its direct access to the evidence. The direct access affords the trial court the unique advantage to observe the witnesses
demeanor while testifying, and the personal opportunity to test the accuracy and reliability of their recollections of past events, both
of which are very decisive in a litigation like this criminal prosecution for the serious crime of illegal recruitment committed in large
scale where the parties have disagreed on the material facts. The Court leaves its confined precinct of dealing only with legal
issues in order to deal with factual ones only when the appellant persuasively demonstrates a clear error in the appreciation of the
evidence by both the trial and the appellate courts. This demonstration was not done herein by the appellant. Hence, the Court
upholds the CAs affirmance of the factual findings by the trial court.
All that Inoveros appeal has offered was her denial of complicity in the illegal recruitment of the complainants. But the complainants
credibly described and affirmed her specific acts during the commission of the crime of illegal recruitment. Their positive assertions
were far trustworthier than her mere denial.
Denial, essentially a negation of a fact, does not prevail over an affirmative assertion of the fact.1wphi1 Thus, courts both trial
and appellate have generally viewed the defense of denial in criminal cases with considerable caution, if not with outright
rejection. Such judicial attitude comes from the recognition that denial is inherently weak and unreliable by virtue of its being an
excuse too easy and too convenient for the guilty to make. To be worthy of consideration at all, denial should be substantiated by
clear and convincing evidence. The accused cannot solely rely on her negative and self-serving negations, for denial carries no
weight in law and has no greater evidentiary value than the testimony of credible witnesses who testify on affirmative matters.13 It is
no different here.
We concur with the RTC and the CA that Inovero was criminally liable for the illegal recruitment charged against her. Strong and
positive evidence demonstrated beyond reasonable doubt her having conspired with her co-accused in the recruitment of the
complainants. The decision of the CA amply recounted her overt part in the conspiracy. Under the law, there is a conspiracy when
two or more persons come to an agreement concerning the commission of a felony, and decide to commit it.14
The complainants paid varying sums for placement, training and processing fees, respectively as follows: (a) Baful P28,500.00;
(b) Brizuela P38,600.00; (c) Aguirre P38,600.00; (d) Amoyo P39,000.00; and (e) Marbella P20,250.00. However, the RTC
and the CA did not adjudicate Inoveros personal liability for them in their judgments. Their omission needs to be corrected,
notwithstanding that the complainants did not appeal, for not doing so would be patently unjust and contrary to law. The Court,
being the ultimate reviewing tribunal, has not only the authority but also the duty to correct at any time a matter of law and justice. It
is, indeed, a basic tenet of our criminal law that every person criminally liable is also civilly liable.15 Civil liability includes restitution,
reparation of the damage caused, and indemnification for consequential damages.16 To enforce the civil liability, the Rules of Court
has deemed to be instituted with the criminal action the civil action for the recovery of civil liability arising from the offense charged
unless the offended party waives the civil action, or reserves the right to institute the civil action separately, or institutes the civil

action prior to the criminal action.17 Considering that the crime of illegal recruitment, when it involves the transfer of funds from the
victims to the accused, is inherently in fraud of the former, civil liability should include the return of the amounts paid as placement,
training and processing fees.18 Hence, Inovero and her co-accused were liable to indemnify the complainants for all the sums paid.
That the civil liability should be made part of the judgment by the RTC and the CA was not disputable. The Court pointed out in
Bacolod v. People19 that it was "imperative that the courts prescribe the proper penalties when convicting the accused, and
determine the civil liability to be imposed on the accused, unless there has been a reservation of the action to recover civil liability
or a waiver of its recovery," because:
It is not amiss to stress that both the RTC and the CA disregarded their express mandate under Section 2, Rule 120 of the Rules of
Court to have the judgment, if it was of conviction, state: "(1) the legal qualification of the offense constituted by the acts committed
by the accused and the aggravating or mitigating circumstances which attended its commission; (2) the participation of the accused
in the offense, whether as principal, accomplice, or accessory after the fact; (3) the penalty imposed upon the accused; and (4) the
civil liability or damages caused by his wrongful act or omission to be recovered from the accused by the offended party, if there is
any, unless the enforcement of the civil liability by a separate civil action has been reserved or waived." Their disregard compels us
to act as we now do lest the Court be unreasonably seen as tolerant of their omission. That the Spouses Cogtas did not
themselves seek the correction of the omission by an appeal is no hindrance to this action because the Court, as the final reviewing
tribunal, has not only the authority but also the duty to correct at any time a matter of law and justice.
We also pointedly remind all trial and appellate courts to avoid omitting reliefs that the parties are properly entitled to by law or in
equity under the established facts. Their judgments will not be worthy of the name unless they thereby fully determine the rights
and obligations of the litigants. It cannot be otherwise, for only by a full determination of such rights and obligations would they be
true to the judicial office of administering justice and equity for all. Courts should then be alert and cautious in their rendition of
judgments of conviction in criminal cases. They should prescribe the legal penalties, which is what the Constitution and the law
require and expect them to do. Their prescription of the wrong penalties will be invalid and ineffectual for being done without
jurisdiction or in manifest grave abuse of discretion amounting to lack of jurisdiction. They should also determine and set the civil
liability ex delicto of the accused, in order to do justice to the complaining victims who are always entitled to them. The Rules of
Court mandates them to do so unless the enforcement of the civil liability by separate actions has been reserved or waived.20
What was the extent of Inoveros civil liability?
The nature of the obligation of the co-conspirators in the commission of the crime requires solidarity, and each debtor may be
compelled to pay the entire obligation.21 As a co-conspirator, then, Inoveros civil liability was similar to that of a joint tortfeasor
under the rules of the civil law. Joint tortfeasors are those who command, instigate, promote, encourage, advise, countenance,
cooperate in, aid or abet the commission of a tort, or who approve of it after it is done, if done for their benefit.22 They are also
referred to as those who act together in committing wrong or whose acts, if independent of each other, unite in causing a single
injury.23 Under Article 2194 of the Civil Code, joint tortfeasors are solidarily liable for the resulting damage. In other words, joint
tortfeasors are each liable as principals, to the same extent and in the same manner as if they had performed the wrongful act
themselves. As regards the extent of their respective liabilities, the Court expressed in Far Eastern Shipping Company v. Court of
Appeals:24
x x x. Where several causes producing an injury are concurrent and each is an efficient cause without which the injury would not
have happened, the injury may be attributed to all or any of the causes and recovery may be had against any or all of the
responsible persons although under the circumstances of the case, it may appear that one of them was more culpable, and that the
duty owed by them to the injured person was not same. No actors negligence ceases to be a proximate cause merely because it
does not exceed the negligence of other acts. Each wrongdoer is responsible for the entire result and is liable as though his acts
were the sole cause of the injury.
There is no contribution between joint tort-feasors whose liability is solidary since both of them are liable for the total damage.
Where the concurrent or successive negligent acts or omissions of two or more persons, although acting independently, are in
combination the direct and proximate cause of a single injury to a third person, it is impossible to determine in what proportion each
contributed to the injury and either of them is responsible for the whole injury. x x x
It would not be an excuse for any of the joint tortfeasors to assert that her individual participation in the wrong was insignificant as
compared to those of the others.25 Joint tortfeasors are not liable pro rata. The damages cannot be apportioned among them,
except by themselves. They cannot insist upon an apportionment, for the purpose of each paying an aliquot part. They are jointly
and severally liable for the whole amount.26 Hence, Inoveros liability towards the victims of their illegal recruitment was solidary,
regardless of whether she actually received the amounts paid or not, and notwithstanding that her co-accused, having escaped
arrest until now, have remained untried.
Under Article 2211 of the Civil Code, interest as part of the damages may be adjudicated in criminal proceedings in the discretion of
the court. The Court believes and holds that such liability for interest attached to Inovero as a measure of fairness to the
complainants. Thus, Inovero should pay interest of 6% per annum on the sums paid by the complainants to be reckoned from the
finality of this judgment until full payment.27
WHEREFORE, the Court AFFIRMS the decision promulgated on August 26, 2010, subject to the MODIFICATION that appellant
Maricar B. Inovero is ordered to pay by way of actual damages to each of the complainants the amounts paid by them for
placement, training and processing fees, respectively as follows:
(a) Noveza Baful - P28,500.00;

(b) Danilo Brizuela - P38,600.00;

(c) Rosanna Aguirre - P38,600.00;
(d) Annaliza Amoyo - P39,000.00; and
(e) Teresa Marbella - P20,250.00.
plus interest on such amounts at the rate of six percent (6%) per annum from the finality of this judgment until fully paid.
Inovero shall further pay the costs of suit.
SO ORDERED.

Salazar vs. Achacoso

This concerns the validity of the power of the Secretary of Labor to issue warrants of arrest and seizure under Article 38 of the
Labor Code, prohibiting illegal recruitment.
The facts are as follows:
xxx xxx xxx
1. On October 21, 1987, Rosalie Tesoro of 177 Tupaz Street, Leveriza, Pasay City, in a sworn statement filed
with the Philippine Overseas Employment Administration (POEA for brevity) charged petitioner Hortencia
Salazar, viz:
04. T: Ano ba ang dahilan at ikaw ngayon ay narito at
nagbibigay ng salaysay.
S: Upang ireklamo sa dahilan ang aking PECC Card ay
ayaw ibigay sa akin ng dati kong manager. Horty
Salazar 615 R.O. Santos, Mandaluyong, Mla.
05. T: Kailan at saan naganap and ginawang panloloko sa
iyo ng tao/mga taong inireklamo mo?
S. Sa bahay ni Horty Salazar.
06. T: Paano naman naganap ang pangyayari?
S. Pagkagaling ko sa Japan ipinatawag niya ako. Kinuha
ang PECC Card ko at sinabing hahanapan ako ng
booking sa Japan. Mag 9 month's na ako sa Phils. ay
hindi pa niya ako napa-alis. So lumipat ako ng ibang
company pero ayaw niyang ibigay and PECC Card
ko.
2. On November 3, 1987, public respondent Atty. Ferdinand Marquez to whom said complaint was assigned, sent
to the petitioner the following telegram:
YOU ARE HEREBY DIRECTED TO APPEAR BEFORE FERDIE MARQUEZ POEA ANTI
ILLEGAL RECRUITMENT UNIT 6TH FLR. POEA BLDG. EDSA COR. ORTIGAS AVE.
MANDALUYONG MM ON NOVEMBER 6, 1987 AT 10 AM RE CASE FILED AGAINST YOU.
FAIL NOT UNDER PENALTY OF LAW.
4. On the same day, having ascertained that the petitioner had no license to operate a recruitment agency, public
respondent Administrator Tomas D. Achacoso issued his challenged CLOSURE AND SEIZURE ORDER NO.
1205 which reads:
HORTY SALAZAR
No. 615 R.O. Santos St.
Mandaluyong, Metro Manila
Pursuant to the powers vested in me under Presidential Decree No. 1920 and Executive Order No. 1022, I
hereby order the CLOSURE of your recruitment agency being operated at No. 615 R.O. Santos St.,

Mandaluyong, Metro Manila and the seizure of the documents and paraphernalia being used or intended to be
used as the means of committing illegal recruitment, it having verified that you have
(1) No valid license or authority from the Department of Labor and Employment to recruit and
deploy workers for overseas employment;
(2) Committed/are committing acts prohibited under Article 34 of the New Labor Code in
relation to Article 38 of the same code.
This ORDER is without prejudice to your criminal prosecution under existing laws.
Done in the City of Manila, this 3th day of November, 1987.
5. On January 26, 1988 POEA Director on Licensing and Regulation Atty. Estelita B. Espiritu issued an office
order designating respondents Atty. Marquez, Atty. Jovencio Abara and Atty. Ernesto Vistro as members of a
team tasked to implement Closure and Seizure Order No. 1205. Doing so, the group assisted by Mandaluyong
policemen and mediamen Lito Castillo of the People's Journal and Ernie Baluyot of News Today proceeded to the
residence of the petitioner at 615 R.O. Santos St., Mandaluyong, Metro Manila. There it was found that petitioner
was operating Hannalie Dance Studio. Before entering the place, the team served said Closure and Seizure
order on a certain Mrs. Flora Salazar who voluntarily allowed them entry into the premises. Mrs. Flora Salazar
informed the team that Hannalie Dance Studio was accredited with Moreman Development (Phil.). However,
when required to show credentials, she was unable to produce any. Inside the studio, the team chanced upon
twelve talent performers practicing a dance number and saw about twenty more waiting outside, The team
confiscated assorted costumes which were duly receipted for by Mrs. Asuncion Maguelan and witnessed by Mrs.
Flora Salazar.
6. On January 28, 1988, petitioner filed with POEA the following letter:
Gentlemen:
On behalf of Ms. Horty Salazar of 615 R.O. Santos, Mandaluyong, Metro Manila, we respectfully request that the
personal properties seized at her residence last January 26, 1988 be immediately returned on the ground that
said seizure was contrary to law and against the will of the owner thereof. Among our reasons are the following:
1. Our client has not been given any prior notice or hearing, hence the Closure and Seizure
Order No. 1205 dated November 3, 1987 violates "due process of law" guaranteed under Sec.
1, Art. III, of the Philippine Constitution.
2. Your acts also violate Sec. 2, Art. III of the Philippine Constitution which guarantees right of
the people "to be secure in their persons, houses, papers, and effects against unreasonable
searches and seizures of whatever nature and for any purpose."
3. The premises invaded by your Mr. Ferdi Marquez and five (5) others (including 2 policemen)
are the private residence of the Salazar family, and the entry, search as well as the seizure of
the personal properties belonging to our client were without her consent and were done with
unreasonable force and intimidation, together with grave abuse of the color of authority, and
constitute robbery and violation of domicile under Arts. 293 and 128 of the Revised Penal
Code.
Unless said personal properties worth around TEN THOUSAND PESOS (P10,000.00) in all
(and which were already due for shipment to Japan) are returned within twenty-four (24) hours
from your receipt hereof, we shall feel free to take all legal action, civil and criminal, to protect
our client's interests.
We trust that you will give due attention to these important matters.
7. On February 2, 1988, before POEA could answer the letter, petitioner filed the instant petition; on even date,
POEA filed a criminal complaint against her with the Pasig Provincial Fiscal, docketed as IS-88-836. 1
On February 2, 1988, the petitioner filed this suit for prohibition. Although the acts sought to be barred are alreadyfait accompli,
thereby making prohibition too late, we consider the petition as one for certiorari in view of the grave public interest involved.
The Court finds that a lone issue confronts it: May the Philippine Overseas Employment Administration (or the Secretary of Labor)
validly issue warrants of search and seizure (or arrest) under Article 38 of the Labor Code? It is also an issue squarely raised by the
petitioner for the Court's resolution.
Under the new Constitution, which states:

. . . no search warrant or warrant of arrest shall issue except upon probable cause to be determined personally
by the judge after examination under oath or affirmation of the complainant and the witnesses he may produce,
and particularly describing the place to be searched and the persons or things to be seized. 2
it is only a judge who may issue warrants of search and arrest. 3 In one case, it was declared that mayors may not exercise this
power:
xxx xxx xxx
But it must be emphasized here and now that what has just been described is the state of the law as it was in
September, 1985. The law has since been altered. No longer does the mayor have at this time the power to
conduct preliminary investigations, much less issue orders of arrest. Section 143 of the Local Government Code,
conferring this power on the mayor has been abrogated, renderedfunctus officio by the 1987 Constitution which
took effect on February 2, 1987, the date of its ratification by the Filipino people. Section 2, Article III of the 1987
Constitution pertinently provides that "no search warrant or warrant of arrest shall issue except upon probable
cause to be determined personally by the judge after examination under oath or affirmation of the complainant
and the witnesses he may produce, and particularly describing the place to be searched and the person or things
to be seized." The constitutional proscription has thereby been manifested that thenceforth, the function of
determining probable cause and issuing, on the basis thereof, warrants of arrest or search warrants, may be
validly exercised only by judges, this being evidenced by the elimination in the present Constitution of the phrase,
"such other responsible officer as may be authorized by law" found in the counterpart provision of said 1973
Constitution, who, aside from judges, might conduct preliminary investigations and issue warrants of arrest or
search warrants. 4
Neither may it be done by a mere prosecuting body:
We agree that the Presidential Anti-Dollar Salting Task Force exercises, or was meant to exercise, prosecutorial
powers, and on that ground, it cannot be said to be a neutral and detached "judge" to determine the existence of
probable cause for purposes of arrest or search. Unlike a magistrate, a prosecutor is naturally interested in the
success of his case. Although his office "is to see that justice is done and not necessarily to secure the conviction
of the person accused," he stands, invariably, as the accused's adversary and his accuser. To permit him to issue
search warrants and indeed, warrants of arrest, is to make him both judge and jury in his own right, when he is
neither. That makes, to our mind and to that extent, Presidential Decree No. 1936 as amended by Presidential
Decree No. 2002, unconstitutional. 5
Section 38, paragraph (c), of the Labor Code, as now written, was entered as an amendment by Presidential Decrees Nos. 1920
and 2018 of the late President Ferdinand Marcos, to Presidential Decree No. 1693, in the exercise of his legislative powers under
Amendment No. 6 of the 1973 Constitution. Under the latter, the then Minister of Labor merely exercised recommendatory powers:
(c) The Minister of Labor or his duly authorized representative shall have the power to recommend the arrest and
detention of any person engaged in illegal recruitment. 6
On May 1, 1984, Mr. Marcos promulgated Presidential Decree No. 1920, with the avowed purpose of giving more teeth to the
campaign against illegal recruitment. The Decree gave the Minister of Labor arrest and closure powers:
(b) The Minister of Labor and Employment shall have the power to cause the arrest and detention of such nonlicensee or non-holder of authority if after proper investigation it is determined that his activities constitute a
danger to national security and public order or will lead to further exploitation of job-seekers. The Minister shall
order the closure of companies, establishment and entities found to be engaged in the recruitment of workers for
overseas employment, without having been licensed or authorized to do so. 7
On January 26, 1986, he, Mr. Marcos, promulgated Presidential Decree No. 2018, giving the Labor Minister search and seizure
powers as well:
(c) The Minister of Labor and Employment or his duly authorized representatives shall have the power to cause
the arrest and detention of such non-licensee or non-holder of authority if after investigation it is determined that
his activities constitute a danger to national security and public order or will lead to further exploitation of jobseekers. The Minister shall order the search of the office or premises and seizure of documents, paraphernalia,
properties and other implements used in illegal recruitment activities and the closure of companies,
establishment and entities found to be engaged in the recruitment of workers for overseas employment, without
having been licensed or authorized to do so. 8
The above has now been etched as Article 38, paragraph (c) of the Labor Code.
The decrees in question, it is well to note, stand as the dying vestiges of authoritarian rule in its twilight moments.
We reiterate that the Secretary of Labor, not being a judge, may no longer issue search or arrest warrants. Hence, the authorities
must go through the judicial process. To that extent, we declare Article 38, paragraph (c), of the Labor Code, unconstitutional and of
no force and effect.

The Solicitor General's reliance on the case of Morano v. Vivo 9 is not well-taken. Vivo involved a deportation case, governed by
Section 69 of the defunct Revised Administrative Code and by Section 37 of the Immigration Law. We have ruled that in deportation
cases, an arrest (of an undesirable alien) ordered by the President or his duly authorized representatives, in order to carry out a
final decision of deportation is valid. 10 It is valid, however, because of the recognized supremacy of the Executive in matters
involving foreign affairs. We have held: 11
xxx xxx xxx
The State has the inherent power to deport undesirable aliens (Chuoco Tiaco vs. Forbes, 228 U.S. 549, 57 L. Ed.
960, 40 Phil. 1122, 1125). That power may be exercised by the Chief Executive "when he deems such action
necessary for the peace and domestic tranquility of the nation." Justice Johnson's opinion is that when the Chief
Executive finds that there are aliens whose continued presence in the country is injurious to the public interest,
"he may, even in the absence of express law, deport them". (Forbes vs. Chuoco Tiaco and Crossfield, 16 Phil.
534, 568, 569; In re McCulloch Dick, 38 Phil. 41).
The right of a country to expel or deport aliens because their continued presence is detrimental to public welfare
is absolute and unqualified (Tiu Chun Hai and Go Tam vs. Commissioner of Immigration and the Director of NBI,
104 Phil. 949, 956). 12
The power of the President to order the arrest of aliens for deportation is, obviously, exceptional. It (the power to order arrests) can
not be made to extend to other cases, like the one at bar. Under the Constitution, it is the sole domain of the courts.
Moreover, the search and seizure order in question, assuming, ex gratia argumenti, that it was validly issued, is clearly in the nature
of a general warrant:
Pursuant to the powers vested in me under Presidential Decree No. 1920 and Executive Order No. 1022, I
hereby order the CLOSURE of your recruitment agency being operated at No. 615 R.O. Santos St.,
Mandaluyong, Metro Manila and the seizure of the documents and paraphernalia being used or intended to be
used as the means of committing illegal recruitment, it having verified that you have
(1) No valid license or authority from the Department of Labor and Employment to recruit and
deploy workers for overseas employment;
(2) Committed/are committing acts prohibited under Article 34 of the New Labor Code in
relation to Article 38 of the same code.
This ORDER is without prejudice to your criminal prosecution under existing laws.

13

We have held that a warrant must identify clearly the things to be seized, otherwise, it is null and void, thus:
xxx xxx xxx
Another factor which makes the search warrants under consideration constitutionally objectionable is that they
are in the nature of general warrants. The search warrants describe the articles sought to be seized in this wise:
1) All printing equipment, paraphernalia, paper, ink, photo equipment, typewriters, cabinets,
tables, communications/ recording equipment, tape recorders, dictaphone and the like used
and/or connected in the printing of the "WE FORUM" newspaper and any and all
documents/communications, letters and facsimile of prints related to the "WE FORUM"
newspaper.
2) Subversive documents, pamphlets, leaflets, books, and other publications to promote the
objectives and purposes of the subversive organizations known as Movement for Free
Philippines, Light-a-Fire Movement and April 6 Movement; and
3) Motor vehicles used in the distribution/circulation of the "WE FORUM" and other subversive
materials and propaganda, more particularly,
1) Toyota-Corolla, colored yellow with Plate No. NKA 892;
2) DATSUN, pick-up colored white with Plate No. NKV 969;
3) A delivery truck with Plate No. NBS 542;
4) TOYOTA-TAMARAW, colored white with Plate No. PBP 665; and
5) TOYOTA Hi-Lux, pick-up truck with Plate No. NGV 472 with marking "Bagong Silang."

In Stanford v. State of Texas, the search warrant which authorized the search for "books, records, pamphlets,
cards, receipts, lists, memoranda, pictures, recordings and other written instruments concerning the Communist
Parties of Texas, and the operations of the Community Party in Texas," was declared void by the U.S. Supreme
Court for being too general. In like manner, directions to "seize any evidence in connection with the violation of
SDC 13-3703 or otherwise" have been held too general, and that portion of a search warrant which authorized
the seizure of any "paraphernalia which could be used to violate Sec. 54-197 of the Connecticut General Statutes
(the statute dealing with the crime of conspiracy)" was held to be a general warrant, and therefore invalid. The
description of the articles sought to be seized under the search warrants in question cannot be characterized
differently.
In the Stanford case, the U.S. Supreme court calls to mind a notable chapter in English history; the era of
disaccord between the Tudor Government and the English Press, when "Officers of the Crown were given roving
commissions to search where they pleased in order to suppress and destroy the literature of dissent both
Catholic and Puritan." Reference herein to such historical episode would not be relevant for it is not the policy of
our government to suppress any newspaper or publication that speaks with "the voice of non-conformity" but
poses no clear and imminent danger to state security.14
For the guidance of the bench and the bar, we reaffirm the following principles:
1. Under Article III, Section 2, of the l987 Constitution, it is only judges, and no other, who may issue warrants of
arrest and search:
2. The exception is in cases of deportation of illegal and undesirable aliens, whom the President or the
Commissioner of Immigration may order arrested, following a final order of deportation, for the purpose of
deportation.
WHEREFORE, the petition is GRANTED. Article 38, paragraph (c) of the Labor Code is declared UNCONSTITUTIONAL and null
and void. The respondents are ORDERED to return all materials seized as a result of the implementation of Search and Seizure
Order No. 1205.
No costs.
SO ORDERED.

Abosta Ship Management vs. Hilario

Abosta Ship Management Corporation (petitioner) filed a Petition for Review on Certiorari1 under Rule 45 of the 1997 Rules of Civil
Procedure assailing the Court of Appeals (CA) Decision2 dated 3 December 2010 and Resolution3 dated 11 February 2011 in CAG.R. SP No. 110745.
The antecedents of this case are as follows:
On 24 October 2002, an employment contract was executed by petitioner, on behalf of its foreign principal Panstar Shipping Co.,
Ltd., and respondent. In this contract, the latter was hired as a bosun (boatswain) of the foreign vessel Grand Mark for a period of
nine months, with a monthly salary of USD566.4 The contract was duly approved by the Philippine Overseas Employment Agency
(POEA) on 25 October 2002.5
On 27 November 2002, upon reporting to the office of petitioner, respondent was informed that the latters deployment had been
postponed due to shifting demands of the foreign principal. It appears, though, that the foreign principal decided to promote an able
seaman on board the vessel instead of hiring respondent. Petitioner thus requested respondent to wait for another two to three
months for a vacancy to occur.6 In the meantime, respondent was allowed tomake cash advances7 as financial assistance.
Eventually, on 28 January 2003, respondent filed a Complaint with the POEA against petitioner for violation of Section 2(r), Rule I,
Part VI of the 2002 POEA Rules by failing to deploy respondent within the prescribed period without any valid reason. Respondent
likewise filed a Complaint with the Labor Arbiter on 6 February 2003 based on the same ground and sought actual, moral and
exemplary damages and attorneys fees.
Petitioner moved for the dismissal of the Complaint, alleging that the Labor Arbiter had no jurisdiction over the matter, as jurisdiction
was supposedly lodged with the POEA. However, the Labor Arbiter denied the motion, stating that the action for damages arising
from employment relations was clearly within its jurisdiction.
On 13 February 2004, the National Labor Relations Commission (NLRC) granted petitioners appeal and reversed the Labor
Arbiters Order. The NLRC held that considering no employer-employee relationship existed between the parties, the POEA had
jurisdiction over the case. The claim for non-deployment was administrative in character, and sanctions may be imposed by the
POEA.8
Respondent consequently filed a Petition for Certiorari with the CA questioning the ruling of the NLRC.

On 17 March 2006, the CA granted the Petition. It pointed out that Section 10 of the Labor Code provides that the jurisdiction of the
Labor Arbiter includes claims arising by virtue of any law or contract involving Filipino workers for overseas deployment, including
claims for actual, moral, exemplary and other forms of damages. Meanwhile, the POEA has jurisdiction over pre-employment cases
that are administrative in character. Thus, respondents Complaint was reinstated.9
After the parties submitted their respective Position Papers, the Labor Arbiter ordered petitioner to pay respondent his salary for
nine months in the amount of USD 10,071. The Labor Arbiter found that the contract executed between the parties and the nonfulfillment thereof entitled respondent to his salary for the whole duration of the contract. However, the arbiter did not find bad faith,
which would have merited the award of moral damages.10
This Decision prompted petitioner to appeal to the NLRC. On 11 March 2009, it held that respondents non-deployment was due to
a valid exercise of the foreign principals management prerogative, which should be given due respect. Thus, the NLRC dismissed
the Complaint, but ordered petitioner "to comply with our directive to deploy respondent as soon as possible or face the inevitable
consequences."11
Dissatisfied with the NLRCs ruling,respondent filed a Petition for Certiorari with the CA. On 3 December 2010, it granted the
Petition and held that the NLRC committed grave abuse of discretion by holding that the able seamans promotion was a valid
management prerogative. The CA further ruled that since respondent had already been hired for the same position, then there was
no longer any vacant position to which to promote the able seaman. Moreover, under the POEA Rules, petitioner assumed joint and
solidary liability with its foreign principal, and was thus liable to respondent. It thus found the NLRCs Decision to be contrary to law
and prevailing jurisprudence. Finally, the CA ruled that NLRCs Order for petitioner "to deploy respondent as soon as possible or
face inevitable consequences" was "nonsensical" considering that the controversy arose from way back in 2002, and that the
assailed Order was issued in 2009.12 The CA likewise denied the Motion for Reconsideration filed by petitioner. Hence, this Petition.
ASSIGNMENT OF ERRORS
Petitioner raises the following errors allegedly committed by the CA:
The Honorable Court of Appeals committed grave reversible error when it ruled that complainant is entitled to actual damages in
the light of Paul v. Santiago case, the doctrine of stare decis [sic] being inapplicable in the instant case as to the issue of award of
actual damages.
The Honorable NLRC did not commit grave abuse of discretion when it ruled differently from Santiago case [on] the issue of actual
damages contrary to erroneous decision of the Court of Appeals that NLRC committed grave abuse of discretion in disregarding
Santiago case on the issue of actual damages.
The Honorable Court of Appeals committed reversible error when it disregarded the factual findings of the NLRC, that, if properly
considered, would justify petitioners use of management prerogative.
The Honorable Court of Appeals committed reversible error in reinstating the award of actual damages despite the want of any
factual and legal basis and again in missapplying [sic] Datumancase in the instant case.13
THE COURTS RULING
The issue boils down to whether the CA committed serious errors of law.
We rule in the negative.
There is no dispute that the parties entered into a contract of employment on 24 October 2002, and that petitioner failed to deploy
respondent. The controversy arose from the act of the foreign principal in promoting another person, an act that effectively
disregarded the contract dated 24 October 2002 entered into between petitioner, on behalf of its foreign principal, and respondent.
There was a clear breach of contract when petitioner failed to deploy respondent in accordance with the POEA approved contract.
The Court is left with the issue of whether such breach would entitle respondent to the payment of actual damages for the failureof
petitioner to comply with the latters obligations in accordance with the employment contract.
It is the contention of petitioner that respondents non-deployment was due to the foreign principals management prerogative to
promote an able seaman. Supposedly, this exercise of management prerogative is a valid and justifiable reason that would negate
any liabilityfor damages.
We do not agree.
Based on a communication sent by a certain M.K. Jin dated 10 October 2002,14 the foreign principal had already chosen
respondent from among the other candidates as BSN (bosun or boatswain). Pursuant to this communication, petitioner entered into
an employment contract and hired respondent on 24 October 2002. Subsequent communications, though, show that the foreign
principal approved a different candidate for the position of BSN.15
Thus, petitioner did notdeploy respondent.

There was an apparent violation of the contract at the time that the foreign principal decided to promote another person as
expressed in its communications dated 10 November 2002 and 14 November 2002. The vacancy for the position of boatswain
ceased to exist upon the execution of the contract between petitioner and respondent on 24 October 2002, a contract subsequently
approved by the POEA on 25 October 2002. Clearly, there was no vacancy when the foreign principal changed its mind, since the
position of boatswain had already been filled up by respondent.
The contract was already perfected on the date of its execution, which occurred when petitioner and respondent agreed on the
object and the cause, as well as on the rest of the terms and conditions therein. Naturally, contemporaneous with the perfection of
the employment contract was the birth of certain rights and obligations, a breach of which may give rise to a cause of action against
the erring party.16 Also, the POEA Standard Contract must be recognized and respected. Thus, neither the manning agent nor the
employer can simply prevent a seafarer from being deployed without a valid reason.17
True, the promotion and choice of personnel is an exercise of management prerogative.1wphi1 In fact, this Court has upheld
management prerogatives, so long as they are exercised in good faith for the advancement of the employers interest, and not for
the purpose of defeating or circumventing the rights of the employees under special laws or under valid agreements.18 However,
there are limitations on the exercise of management prerogatives, such as existing laws and the principle of equity and substantial
justice.19
Under the principle of equity and substantial justice, change of mind was not a valid reason for the non-deployment of respondent.
He lost the opportunity to apply for other positions in other agencies when he signed the contract of employment with petitioner.
Simply put, that contract was binding on the parties and may not later be disowned simply because of a change of mind of either
one of them.
The unilateral and unreasonable failure to deploy respondent constitutes breach of contract, which gives rise to a liability to pay
actual damages. The sanctions provided for non-deployment do not end with the suspension or cancellation of license or the
imposition of a fine and the return of all documents at no cost to the worker. They do not forfend a seafarer from instituting an
action for damages against the employer or agency that has failed to deploy him.20
Considering that it was petitioner who entered into the contract of employment with respondent for and on behalf of the foreign
principal, it has the primary obligation to ensure the implementation of that contract. Furthermore, in line with the policy of the state
to protect and alleviate the plight of the working class, Section 1, paragraph f (3) of Rule II of the POEA Rules and
Regulations,21 clearly provides that the private employment agency shall assume joint and solidary liability with the employer.
Indeed, this Court has consistently held that private employment agencies are held jointly and severally liable with the foreignbased employer for any violation of the recruitment agreement or contract of employment. 22 This joint and solidary liability imposed
by law on recruitment agencies and foreign employers is meant to assure the aggrieved worker of immediate and sufficient
payment of what is due him.23
In sum, the failure to deploy respondent was an exercise of a management prerogative that went beyond its limits and resulted in a
breach of contract. In tum, petitioner's breach gave rise to respondent's cause of action to claim actual damages for the pecuniary
loss suffered by the latter in the form of the loss of nine months' worth of salary as provided in the POEA-approved contract of
employment.
WHEREFORE, premises considered, the instant Petition is DENIED.
SO ORDERED.

Santiago vs. C.F. Sharp Crew Management

At the heart of this case involving a contract between a seafarer, on one hand, and the manning agent and the foreign principal, on
the other, is this erstwhile unsettled legal quandary: whether the seafarer, who was prevented from leaving the port of Manila and
refused deployment without valid reason but whose POEA-approved employment contract provides that the employer-employee
relationship shall commence only upon the seafarers actual departure from the port in the point of hire, is entitled to relief?
This treats of the petition for review filed by Paul V. Santiago (petitioner) assailing the Decision and Resolution of the Court of
Appeals dated 16 October 2003 and 19 February 2004, respectively, in CA-G.R. SP No. 68404.1
Petitioner had been working as a seafarer for Smith Bell Management, Inc. (respondent) for about five (5) years. 2On 3 February
1998, petitioner signed a new contract of employment with respondent, with the duration of nine (9) months. He was assured of a
monthly salary of US$515.00, overtime pay and other benefits. The following day or on 4 February 1998, the contract was
approved by the Philippine Overseas Employment Administration (POEA). Petitioner was to be deployed on board the "MSV
Seaspread" which was scheduled to leave the port of Manila for Canada on 13 February 1998.
A week before the scheduled date of departure, Capt. Pacifico Fernandez, respondents Vice President, sent a facsimile message
to the captain of "MSV Seaspread," which reads:
I received a phone call today from the wife of Paul Santiago in Masbate asking me not to send her husband to MSV
Seaspread anymore. Other callers who did not reveal their identity gave me some feedbacks that Paul Santiago this time
if allowed to depart will jump ship in Canada like his brother Christopher Santiago, O/S who jumped ship from the C.S.
Nexus in Kita-kyushu, Japan last December, 1997.

We do not want this to happen again and have the vessel penalized like the C.S. Nexus in Japan.
Forewarned is forearmed like his brother when his brother when he was applying he behaved like a Saint but in his heart
he was a serpent. If you agree with me then we will send his replacement.
Kindly advise.3
To this message the captain of "MSV Seaspread" replied:
Many thanks for your advice concerning P. Santiago, A/B. Please cancel plans for him to return to Seaspread.4
On 9 February 1998, petitioner was thus told that he would not be leaving for Canada anymore, but he was reassured that he might
be considered for deployment at some future date.
Petitioner filed a complaint for illegal dismissal, damages, and attorney's fees against respondent and its foreign principal, Cable
and Wireless (Marine) Ltd.5 The case was raffled to Labor Arbiter Teresita Castillon-Lora, who ruled that the employment contract
remained valid but had not commenced since petitioner was not deployed. According to her, respondent violated the rules and
regulations governing overseas employment when it did not deploy petitioner, causing petitioner to suffer actual damages
representing lost salary income for nine (9) months and fixed overtime fee, all amounting to US$7, 209.00.
The labor arbiter held respondent liable. The dispositive portion of her Decision dated 29 January 1999 reads:
WHEREFORE, premises considered, respondent is hereby Ordered to pay complainant actual damages in the amount of
US$7,209.00 plus 10% attorney's fees, payable in Philippine peso at the rate of exchange prevailing at the time of
payment.
All the other claims are hereby DISMISSED for lack of merit.
SO ORDERED.6
On appeal by respondent, the National Labor Relations Commission (NLRC) ruled that there is no employer-employee relationship
between petitioner and respondent because under the Standard Terms and Conditions Governing the Employment of Filipino
Seafarers on Board Ocean Going Vessels (POEA Standard Contract), the employment contract shall commence upon actual
departure of the seafarer from the airport or seaport at the point of hire and with a POEA-approved contract. In the absence of an
employer-employee relationship between the parties, the claims for illegal dismissal, actual damages, and attorneys fees should
be dismissed.7 On the other hand, the NLRC found respondents decision not to deploy petitioner to be a valid exercise of its
management prerogative.8 The NLRC disposed of the appeal in this wise:
WHEREFORE, in the light of the foregoing, the assailed Decision dated January 29, 1999 is hereby AFFIRMED in so far
as other claims are concerned and with MODIFICATION by VACATING the award of actual damages and attorneys fees
as well as excluding Pacifico Fernandez as party respondent.
SO ORDERED.9
Petitioner moved for the reconsideration of the NLRCs Decision but his motion was denied for lack of merit.10 He elevated the case
to the Court of Appeals through a petition for certiorari.
In its Decision11 dated 16 October 2003, the Court of Appeals noted that there is an ambiguity in the NLRCs Decision when it
affirmed with modification the labor arbiters Decision, because by the very modification introduced by the Commission (vacating
the award of actual damages and attorneys fees), there is nothing more left in the labor arbiters Decision to affirm.12
According to the appellate court, petitioner is not entitled to actual damages because damages are not recoverable by a worker
who was not deployed by his agency within the period prescribed in
the POEA Rules.13 It agreed with the NLRCs finding that petitioners non-deployment was a valid exercise of respondents
management prerogative.14 It added that since petitioner had not departed from the Port of Manila, no employer-employee
relationship between the parties arose and any claim for damages against the so-called employer could have no leg to stand on.15
Petitioners subsequent motion for reconsideration was denied on 19 February 2004.16
The present petition is anchored on two grounds, to wit:
A. The Honorable Court of Appeals committed a serious error of law when it ignored [S]ection 10 of Republic Act [R.A.]
No. 8042 otherwise known as the Migrant Workers Act of 1995 as well as Section 29 of the Standard Terms and
Conditions Governing the Employment of Filipino Seafarers On-Board Ocean-Going Vessels (which is deemed
incorporated under the petitioners POEA approved Employment Contract) that the claims or disputes of the Overseas
Filipino Worker by virtue of a contract fall within the jurisdiction of the Labor Arbiter of the NLRC.

B. The Honorable Court of Appeals committed a serious error when it disregarded the required quantum of proof in labor
cases, which is substantial evidence, thus a total departure from established jurisprudence on the matter.17
Petitioner maintains that respondent violated the Migrant Workers Act and the POEA Rules when it failed to deploy him within thirty
(30) calendar days without a valid reason. In doing so, it had unilaterally and arbitrarily prevented the consummation of the POEAapproved contract. Since it prevented his deployment without valid basis, said deployment being a condition to the consummation
of the POEA contract, the contract is deemed consummated, and therefore he should be awarded actual damages, consisting of
the stipulated salary and fixed overtime pay.18 Petitioner adds that since the contract is deemed consummated, he should be
considered an employee for all intents and purposes, and thus the labor arbiter and/or the NLRC has jurisdiction to take
cognizance of his claims.19
Petitioner additionally claims that he should be considered a regular employee, having worked for five (5) years on board the same
vessel owned by the same principal and manned by the same local agent. He argues that respondents act of not deploying him
was a scheme designed to prevent him from attaining the status of a regular employee.20
Petitioner submits that respondent had no valid and sufficient cause to abandon the employment contract, as it merely relied upon
alleged phone calls from his wife and other unnamed callers in arriving at the conclusion that he would jump ship like his brother.
He points out that his wife had executed an affidavit21 strongly denying having called respondent, and that the other alleged callers
did not even disclose their identities to respondent.22Thus, it was error for the Court of Appeals to adopt the unfounded conclusion
of the NLRC, as the same was not based on substantial evidence.23
On the other hand, respondent argues that the Labor Arbiter has no jurisdiction to award petitioners monetary claims. His
employment with respondent did not commence because his deployment was withheld for a valid reason. Consequently, the labor
arbiter and/or the NLRC cannot entertain adjudication of petitioners case much less award damages to him. The controversy
involves a breach of contractual obligations and as such is cognizable by civil courts.24 On another matter, respondent claims that
the second issue posed by petitioner involves a recalibration of facts which is outside the jurisdiction of this Court.25
There is some merit in the petition.
There is no question that the parties entered into an employment contract on 3 February 1998, whereby petitioner was contracted
by respondent to render services on board "MSV Seaspread" for the consideration of US$515.00 per month for nine (9) months,
plus overtime pay. However, respondent failed to deploy petitioner from the port of Manila to Canada. Considering that petitioner
was not able to depart from the airport or seaport in the point of hire, the employment contract did not commence, and no
employer-employee relationship was created between the parties.26
However, a distinction must be made between the perfection of the employment contract and the commencement of the employeremployee relationship. The perfection of the contract, which in this case coincided with the date of execution thereof, occurred
when petitioner and respondent agreed on the object and the cause, as well as the rest of the terms and conditions therein. The
commencement of the employer-employee relationship, as earlier discussed, would have taken place had petitioner been actually
deployed from the point of hire. Thus, even before the start of any employer-employee relationship, contemporaneous with the
perfection of the employment contract was the birth of certain rights and obligations, the breach of which may give rise to a cause
of action against the erring party. Thus, if the reverse had happened, that is the seafarer failed or refused to be deployed as agreed
upon, he would be liable for damages.
Moreover, while the POEA Standard Contract must be recognized and respected, neither the manning agent nor the employer can
simply prevent a seafarer from being deployed without a valid reason.
Respondents act of preventing petitioner from departing the port of Manila and boarding "MSV Seaspread" constitutes a breach of
contract, giving rise to petitioners cause of action. Respondent unilaterally and unreasonably reneged on its obligation to deploy
petitioner and must therefore answer for the actual damages he suffered.
We take exception to the Court of Appeals conclusion that damages are not recoverable by a worker who was not deployed by his
agency. The fact that the POEA Rules27 are silent as to the payment of damages to the affected seafarer does not mean that the
seafarer is precluded from claiming the same. The sanctions provided for non-deployment do not end with the suspension or
cancellation of license or fine and the return of all documents at no cost to the worker. They do not forfend a seafarer from
instituting an action for damages against the employer or agency which has failed to deploy him.
The POEA Rules only provide sanctions which the POEA can impose on erring agencies. It does not provide for damages and
money claims recoverable by aggrieved employees because it is not the POEA, but the NLRC, which has jurisdiction over such
matters.
Despite the absence of an employer-employee relationship between petitioner and respondent, the Court rules that the NLRC has
jurisdiction over petitioners complaint. The jurisdiction of labor arbiters is not limited to claims arising from employer-employee
relationships. Section 10 of R.A. No. 8042 (Migrant Workers Act), provides that:
Sec. 10. Money Claims. Notwithstanding any provision of law to the contrary, the Labor Arbiters of the National Labor
Relations Commission (NLRC) shall have the original and exclusive jurisdiction to hear and decide, within ninety (90)
calendar days after the filing of the complaint, the claims arising out of an 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. x x x [Emphasis supplied]
Since the present petition involves the employment contract entered into by petitioner for overseas employment, his claims are
cognizable by the labor arbiters of the NLRC.
Article 2199 of the Civil Code provides that one is entitled to an adequate compensation only for such pecuniary loss suffered by
him as he has duly proved. Respondent is thus liable to pay petitioner actual damages in the form of the loss of nine (9) months
worth of salary as provided in the contract. He is not, however, entitled to overtime pay. While the contract indicated a fixed
overtime pay, it is not a guarantee that he would receive said amount regardless of whether or not he rendered overtime work.
Even though petitioner was "prevented without valid reason from rendering regular much less overtime service,"28 the fact remains
that there is no certainty that petitioner will perform overtime work had he been allowed to board the vessel. The amount of
US$286.00 stipulated in the contract will be paid only if and when the employee rendered overtime work. This has been the tenor of
our rulings in the case of Stolt-Nielsen Marine Services (Phils.), Inc. v. National Labor Relations Commission29 where we discussed
the matter in this light:
The contract provision means that the fixed overtime pay of 30% would be the basis for computing the overtime pay if and
when overtime work would be rendered. Simply stated, the rendition of overtime work and the submission of sufficient
proof that said work was actually performed are conditions to be satisfied before a seaman could be entitled to overtime
pay which should be computed on the basis of 30% of the basic monthly salary. In short, the contract provision guarantees
the right to overtime pay but the entitlement to such benefit must first be established. Realistically speaking, a seaman, by
the very nature of his job, stays on board a ship or vessel beyond the regular eight-hour work schedule. For the employer
to give him overtime pay for the extra hours when he might be sleeping or attending to his personal chores or even just
lulling away his time would be extremely unfair and unreasonable.30
The Court also holds that petitioner is entitled to attorneys fees in the concept of damages and expenses of litigation. Attorney's
fees are recoverable when the defendant's act or omission has compelled the plaintiff to incur expenses to protect his interest.31 We
note that respondents basis for not deploying petitioner is the belief that he will jump ship just like his brother, a mere suspicion that
is based on alleged phone calls of several persons whose identities were not even confirmed. Time and again, this Court has
upheld management prerogatives so long as they are exercised in good faith for the advancement of the employers interest and
not for the purpose of defeating or circumventing the rights of the employees under special laws or under valid
agreements.32Respondents failure to deploy petitioner is unfounded and unreasonable, forcing petitioner to institute the suit below.
The award of attorneys fees is thus warranted.
However, moral damages cannot be awarded in this case. While respondents failure to deploy petitioner seems baseless and
unreasonable, we cannot qualify such action as being tainted with bad faith, or done deliberately to defeat petitioners rights, as to
justify the award of moral damages. At most, respondent was being overzealous in protecting its interest when it became too hasty
in making its conclusion that petitioner will jump ship like his brother.
We likewise do not see respondents failure to deploy petitioner as an act designed to prevent the latter from attaining the status of
a regular employee. Even if petitioner was able to depart the port of Manila, he still cannot be considered a regular employee,
regardless of his previous contracts of employment with respondent. InMillares v. National Labor Relations Commission,33 the Court
ruled that seafarers are considered contractual employees and cannot be considered as regular employees under the Labor Code.
Their employment is governed by the contracts they sign every time they are rehired and their employment is terminated when the
contract expires. The exigencies of their work necessitates that they be employed on a contractual basis.34
WHEREFORE, petition is GRANTED IN PART. The Decision dated 16 October 2003 and the Resolution dated 19 February 2004 of
the Court of Appeals are REVERSED and SET ASIDE. The Decision of Labor Arbiter Teresita D. Castillon-Lora dated 29 January
1999 is REINSTATED with the MODIFICATION that respondent CF Sharp Crew Management, Inc. is ordered to pay actual or
compensatory damages in the amount of US$4,635.00
representing salary for nine (9) months as stated in the contract, and attorneys fees at the reasonable rate of 10% of the
recoverable amount.
SO ORDERED.

Stolt-Nielsen vs. Mediguillo

The facts as gathered by this Court follow:
On 6 March 1995, Sulpecio Madequillo (respondent) filed a complaint before the Adjudication Office of the Philippine Overseas
Employment Administration (POEA) against the petitioners for illegal dismissal under a first contract and for failure to deploy under
a second contract. In his complaint-affidavit,4 respondent alleged that:
1.

On 6 November 1991(First Contract), he was hired by Stolt-Nielsen Marine Services, Inc on behalf of its principal ChungGai Ship Management of Panama as Third Assistant Engineer on board the vessel "Stolt Aspiration" for a period of nine
(9) months;

2.

He would be paid with a monthly basic salary of $808.00 and a fixed overtime pay of $404.00 or a total of $1,212.00 per
month during the employment period commencing on 6 November 1991;

3.

On 8 November 1991, he joined the vessel MV "Stolt Aspiration";

4.

On February 1992 or for nearly three (3) months of rendering service and while the vessel was at Batangas, he was
ordered by the ships master to disembark the vessel and repatriated back to Manila for no reason or explanation;

5.

Upon his return to Manila, he immediately proceeded to the petitioners office where he was transferred employment with
another vessel named MV "Stolt Pride" under the same terms and conditions of the First Contract;

6.

On 23 April 1992, the Second Contract was noted and approved by the POEA;

7.

The POEA, without knowledge that he was not deployed with the vessel, certified the Second Employment Contract on 18
September 1992.

8.

Despite the commencement of the Second Contract on 21 April 1992, petitioners failed to deploy him with the vessel MV
"Stolt Pride";

9.

He made a follow-up with the petitioner but the same refused to comply with the Second Employment Contract.

10. On 22 December 1994, he demanded for his passport, seamans book and other employment documents. However, he
was only allowed to claim the said documents in exchange of his signing a document;
11. He was constrained to sign the document involuntarily because without these documents, he could not seek employment
from other agencies.
He prayed for actual, moral and exemplary damages as well as attorneys fees for his illegal dismissal and in view of the
Petitioners bad faith in not complying with the Second Contract.
The case was transferred to the Labor Arbiter of the DOLE upon the effectivity of the Migrant Workers and Overseas Filipinos Act of
1995.
The parties were required to submit their respective position papers before the Labor Arbiter. However, petitioners failed to submit
their respective pleadings despite the opportunity given to them.5
On 21 July 2000, Labor Arbiter Vicente R. Layawen rendered a judgment6 finding that the respondent was constructively dismissed
by the petitioners. The dispositive portion reads:
WHEREFORE, premises considered, judgment is hereby rendered, declaring the respondents guilty of constructively dismissing
the complainant by not honoring the employment contract. Accordingly, respondents are hereby ordered jointly and solidarily to pay
complainant the following:
1.

$12,537.00 or its peso equivalent at the time of payment.7

The Labor Arbiter found the first contract entered into by and between the complainant and the respondents to have been novated
by the execution of the second contract. In other words, respondents cannot be held liable for the first contract but are clearly and
definitely liable for the breach of the second contract.8 However, he ruled that there was no substantial evidence to grant the prayer
for moral and exemplary damages.9
The petitioners appealed the adverse decision before the National Labor Relations Commission assailing that they were denied
due process, that the respondent cannot be considered as dismissed from employment because he was not even deployed yet and
the monetary award in favor of the respondent was exorbitant and not in accordance with law.10
On 28 February 2003, the NLRC affirmed with modification the Decision of the Labor Arbiter. The dispositive portion reads:
WHEREFORE, premises considered, the decision under review is hereby, MODIFIED BY DELETING the award of overtime pay in
the total amount of Three Thousand Six Hundred Thirty Six US Dollars (US $3,636.00).
In all other respects, the assailed decision so stands as, AFFIRMED.11
Before the NLRC, the petitioners assailed that they were not properly notified of the hearings that were conducted before the Labor
Arbiter. They further alleged that after the suspension of proceedings before the POEA, the only notice they received was a copy of
the decision of the Labor Arbiter.12
The NLRC ruled that records showed that attempts to serve the various notices of hearing were made on petitioners counsel on
record but these failed on account of their failure to furnish the Office of the Labor Arbiter a copy of any notice of change of
address. There was also no evidence that a service of notice of change of address was served on the POEA.13

The NLRC upheld the finding of unjustified termination of contract for failure on the part of the petitioners to present evidence that
would justify their non-deployment of the respondent.14 It denied the claim of the petitioners that the monetary award should be
limited only to three (3) months for every year of the unexpired term of the contract. It ruled that the factual incidents material to the
case transpired within 1991-1992 or before the effectivity of Republic Act No. 8042 or the Migrant Workers and Overseas Filipinos
Act of 1995 which provides for such limitation.15
However, the NLRC upheld the reduction of the monetary award with respect to the deletion of the overtime pay due to the nondeployment of the respondent.16
The Partial Motion for Reconsideration filed by the petitioners was denied by the NLRC in its Resolution dated 27 July 2005.17
The petitioners filed a Petition for Certiorari before the Court of Appeals alleging grave abuse of discretion on the part of NLRC
when it affirmed with modification the ruling of the Labor Arbiter. They prayed that the Decision and Resolution promulgated by the
NLRC be vacated and another one be issued dismissing the complaint of the respondent.
Finding no grave abuse of discretion, the Court of Appeals AFFIRMED the Decision of the labor tribunal.
The Courts Ruling
The following are the assignment of errors presented before this Court:
I.
THE COURT A QUO ERRED IN FINDING THAT THE SECOND CONTRACT NOVATED THE FIRST CONTRACT.
1.

THERE WAS NO NOVATION OF THE FIRST CONTRACT BY THE SECOND CONTRACT; THE ALLEGATION OF
ILLEGAL DISMISSAL UNDER THE FIRST CONTRACT MUST BE RESOLVED SEPARATELY FROM THE ALLEGATION
OF FAILURE TO DEPLOY UNDER THE SECOND CONTRACT.

2.

THE ALLEGED ILLEGAL DISMISSAL UNDER THE FIRST CONTRACT TRANSPIRED MORE THAN THREE (3) YEARS
AFTER THE CASE WAS FILED AND THEREFORE HIS CASE SHOULD HAVE BEEN DISMISSED FOR BEING
BARRED BY PRESCRIPTION.
II.

THE COURT A QUO ERRED IN RULING THAT THERE WAS CONSTRUCTIVE DISMISSAL UNDER THE SECOND CONTRACT.
1.

IT IS LEGALLY IMPOSSIBLE TO HAVE CONSTRUCTIVE DISMISSAL WHEN THE EMPLOYMENT HAS NOT YET
COMMENCED.

2.

ASSUMING THERE WAS OMISSION UNDER THE SECOND CONTRACT, PETITIONERS CAN ONLY BE FOUND AS
HAVING FAILED IN DEPLOYING PRIVATE RESPONDENT BUT WITH VALID REASON.
III.

THE COURT A QUO ERRED IN FAILING TO FIND THAT EVEN ASSUMING THERE WAS BASIS FOR HOLDING PETITIONER
LIABLE FOR "FAILURE TO DEPLOY" RESPONDENT, THE POEA RULES PENALIZES SUCH OMISSION WITH A MERE
"REPRIMAND."18
The petitioners contend that the first employment contract between them and the private respondent is different from and
independent of the second contract subsequently executed upon repatriation of respondent to Manila.
We do not agree.
Novation is the extinguishment of an obligation by the substitution or change of the obligation by a subsequent one which
extinguishes or modifies the first, either by changing the object or principal conditions, or, by substituting another in place of the
debtor, or by subrogating a third person in the rights of the creditor. In order for novation to take place, the concurrence of the
following requisites is indispensable:
1. There must be a previous valid obligation,
2. There must be an agreement of the parties concerned to a new contract,
3. There must be the extinguishment of the old contract, and
4. There must be the validity of the new contract.19

In its ruling, the Labor Arbiter clarified that novation had set in between the first and second contract. To quote:
xxx [T]his office would like to make it clear that the first contract entered into by and between the complainant and the respondents
is deemed to have been novated by the execution of the second contract. In other words, respondents cannot be held liable for the
first contract but are clearly and definitely liable for the breach of the second contract.20
This ruling was later affirmed by the Court of Appeals in its decision ruling that:
Guided by the foregoing legal precepts, it is evident that novation took place in this particular case. The parties impliedly
extinguished the first contract by agreeing to enter into the second contract to placate Medequillo, Jr. who was unexpectedly
dismissed and repatriated to Manila. The second contract would not have been necessary if the petitioners abided by the terms and
conditions of Madequillo, Jr.s employment under the first contract. The records also reveal that the 2nd contract extinguished the
first contract by changing its object or principal. These contracts were for overseas employment aboard different vessels. The first
contract was for employment aboard the MV "Stolt Aspiration" while the second contract involved working in another vessel, the MV
"Stolt Pride." Petitioners and Madequillo, Jr. accepted the terms and conditions of the second contract. Contrary to petitioners
assertion, the first contract was a "previous valid contract" since it had not yet been terminated at the time of Medequillo, Jr.s
repatriation to Manila. The legality of his dismissal had not yet been resolved with finality. Undoubtedly, he was still employed under
the first contract when he negotiated with petitioners on the second contract. As such, the NLRC correctly ruled that petitioners
could only be held liable under the second contract.21
We concur with the finding that there was a novation of the first employment contract.
We reiterate once more and emphasize the ruling in Reyes v. National Labor Relations Commission,22 to wit:
x x x [F]indings of quasi-judicial bodies like the NLRC, and affirmed by the Court of Appeals in due course, are conclusive on this
Court, which is not a trier of facts.
xxxx
x x x Findings of fact of administrative agencies and quasi-judicial bodies, which have acquired expertise because their
jurisdiction is confined to specific matters, are generally accorded not only respect, but finality when affirmed by the
Court of Appeals. Such findings deserve full respect and, without justifiable reason, ought not to be altered, modified or reversed.
(Emphasis supplied)23
With the finding that respondent "was still employed under the first contract when he negotiated with petitioners on the second
contract",24 novation became an unavoidable conclusion.
Equally settled is the rule that factual findings of labor officials, who are deemed to have acquired expertise in matters within their
jurisdiction, are generally accorded not only respect but even finality by the courts when supported by substantial evidence, i.e., the
amount of relevant evidence which a reasonable mind might accept as adequate to justify a conclusion.25 But these findings are not
infallible. When there is a showing that they were arrived at arbitrarily or in disregard of the evidence on record, they may be
examined by the courts.26 In this case, there was no showing of any arbitrariness on the part of the lower courts in their findings of
facts. Hence, we follow the settled rule.
We need not dwell on the issue of prescription. It was settled by the Court of Appeals with its ruling that recovery of damages under
the first contract was already time-barred. Thus:
Accordingly, the prescriptive period of three (3) years within which Medequillo Jr. may initiate money claims under the 1st contract
commenced on the date of his repatriation. xxx The start of the three (3) year prescriptive period must therefore be reckoned on
February 1992, which by Medequillo Jr.s own admission was the date of his repatriation to Manila. It was at this point in time that
Medequillo Jr.s cause of action already accrued under the first contract. He had until February 1995 to pursue a case for illegal
dismissal and damages arising from the 1st contract. With the filing of his Complaint-Affidavit on March 6, 1995, which was clearly
beyond the prescriptive period, the cause of action under the 1st contract was already time-barred.27
The issue that proceeds from the fact of novation is the consequence of the non-deployment of respondent.
The petitioners argue that under the POEA Contract, actual deployment of the seafarer is a suspensive condition for the
commencement of the employment.28 We agree with petitioners on such point. However, even without actual deployment, the
perfected contract gives rise to obligations on the part of petitioners.
A contract is a meeting of minds between two persons whereby one binds himself, with respect to the other, to give something or to
render some service.29 The contracting parties may establish such stipulations, clauses, terms and conditions as they may deem
convenient, provided they are not contrary to law, morals, good customs, public order, or public policy.30
The POEA Standard Employment Contract provides that employment shall commence "upon the actual departure of the seafarer
from the airport or seaport in the port of hire."31 We adhere to the terms and conditions of the contract so as to credit the valid prior
stipulations of the parties before the controversy started. Else, the obligatory force of every contract will be useless. Parties are

bound not only to the fulfillment of what has been expressly stipulated but also to all the consequences which, according to their
nature, may be in keeping with good faith, usage and law.32
Thus, even if by the standard contract employment commences only "upon actual departure of the seafarer", this does not mean
that the seafarer has no remedy in case of non-deployment without any valid reason. Parenthetically, the contention of the
petitioners of the alleged poor performance of respondent while on board the first ship MV "Stolt Aspiration" cannot be sustained to
justify the non-deployment, for no evidence to prove the same was presented.33
We rule that distinction must be made between the perfection of the employment contract and the commencement of the employeremployee relationship. The perfection of the contract, which in this case coincided with the date of execution thereof, occurred
when petitioner and respondent agreed on the object and the cause, as well as the rest of the terms and conditions therein. The
commencement of the employer-employee relationship, as earlier discussed, would have taken place had petitioner been actually
deployed from the point of hire. Thus, even before the start of any employer-employee relationship, contemporaneous with the
perfection of the employment contract was the birth of certain rights and obligations, the breach of which may give rise to a cause
of action against the erring party. Thus, if the reverse had happened, that is the seafarer failed or refused to be deployed as agreed
upon, he would be liable for damages.34
Further, we do not agree with the contention of the petitioners that the penalty is a mere reprimand.
The POEA Rules and Regulations Governing Overseas Employment35 dated 31 May 1991 provides for the consequence and
penalty against in case of non-deployment of the seafarer without any valid reason. It reads:
Section 4. Workers Deployment. An agency shall deploy its recruits within the deployment period as indicated below:
xxx
b. Thirty (30) calendar days from the date of processing by the administration of the employment contracts of seafarers.
Failure of the agency to deploy a worker within the prescribed period without valid reasons shall be a cause
for suspension or cancellation of license or fine. In addition, the agency shall return all documents at no cost to the
worker.(Emphasis and underscoring supplied)
The appellate court correctly ruled that the penalty of reprimand36 provided under Rule IV, Part VI of the POEA Rules and
Regulations Governing the Recruitment and Employment of Land-based Overseas Workers is not applicable in this case. The
breach of contract happened on February 1992 and the law applicable at that time was the 1991 POEA Rules and Regulations
Governing Overseas Employment. The penalty for non-deployment as discussed is suspension or cancellation of license or fine.
Now, the question to be dealt with is how will the seafarer be compensated by reason of the unreasonable non-deployment of the
petitioners?
The POEA Rules Governing the Recruitment and Employment of Seafarers do not provide for the award of damages to be given in
favor of the employees. The claim provided by the same law refers to a valid contractual claim for compensation or benefits arising
from employer-employee relationship or for any personal injury, illness or death at levels provided for within the terms and
conditions of employment of seafarers. However, the absence of the POEA Rules with regard to the payment of damages to the
affected seafarer does not mean that the seafarer is precluded from claiming the same. The sanctions provided for non-deployment
do not end with the suspension or cancellation of license or fine and the return of all documents at no cost to the worker. As earlier
discussed, they do not forfend a seafarer from instituting an action for damages against the employer or agency which has failed to
deploy him.37
We thus decree the application of Section 10 of Republic Act No. 8042 (Migrant Workers Act) which provides for money claims by
reason of a contract involving Filipino workers for overseas deployment.lavvphil The law provides:
Sec. 10. Money Claims. Notwithstanding any provision of law to the contrary, the Labor Arbiters of the National Labor Relations
Commission (NLRC) shall have the original and exclusive jurisdiction to hear and decide, within ninety (90) calendar days after the
filing of the complaint, the claims arising out of an 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. x x x
(Underscoring supplied)
Following the law, the claim is still cognizable by the labor arbiters of the NLRC under the second phrase of the provision.
Applying the rules on actual damages, Article 2199 of the New Civil Code provides that one is entitled to an adequate
compensation only for such pecuniary loss suffered by him as he has duly proved. Respondent is thus liable to pay petitioner actual
damages in the form of the loss of nine (9) months worth of salary as provided in the contract.38 This is but proper because of the
non-deployment of respondent without just cause.
WHEREFORE, the appeal is DENIED. The 31 January 2007 Decision of the Court of Appeals in CA-G.R. SP. No. 91632 is
hereby AFFIRMED. The Petitioners are hereby ordered to pay Sulpecio Medequillo, Jr., the award of actual damages equivalent to
his salary for nine (9) months as provided by the Second Employment Contract.

SO ORDERED.

Serrano vs. Gallant Maritime Services

FACTS:
Petitioner Antonio Serrano was hired by respondents Gallant Maritime Services, Inc. and Marlow Navigation Co., Inc., under a
POEA-approved contract of employment for 12 months, as Chief Officer, with the basic monthly salary of US$1,400, plus
$700/month overtime pay, and 7 days paid vacation leave per month.
On March 19, 1998, the date of his departure, Serrano was constrained to accept a downgraded employment contract for the
position of Second Officer with a monthly salary of US$1,000 upon the assurance and representation of respondents that he would
be Chief Officer by the end of April 1998.
Respondents did not deliver on their promise to make Serrano Chief Officer. Hence, Serrano refused to stay on as second Officer
and was repatriated to the Philippines on May 26, 1998, serving only two (2) months and seven (7) days of his contract, leaving an
unexpired portion of nine (9) months and twenty-three (23) days.
Serrano filed with the Labor Arbiter (LA) a Complaint against respondents for constructive dismissal and for payment of his money
claims in the total amount of US$26,442.73 (based on the computation of $2590/month from June 1998 to February 199, $413.90
for March 1998, and $1640 for March 1999) as well as moral and exemplary damages.
The LA declared the petitioner's dismissal illegal and awarded him US$8,770, representing his salaray for three (3) months of the
unexpired portion of the aforesaid contract of employment, plus $45 for salary differential and for attorney's fees equivalent to 10%
of the total amount; however, no compensation for damages as prayed was awarded.
On appeal, the NLRC modified the LA decision and awarded Serrano $4669.50, representing three (3) months salary at
$1400/month, plus 445 salary differential and 10% for attorney's fees. This decision was based on the provision of RA 8042, which
was made into law on July 15, 1995.
Serrano filed a Motion for Partial Reconsideration, but this time he questioned the constitutionality of the last clause in the 5th
paragraph of Section 10 of RA 8042, which reads:
Sec. 10. Money Claims. - x x x In case of termination of overseas employment without just, valid or authorized
cause as defined by law or contract, the workers shall be entitled to the full reimbursement of his placement fee
with interest of twelve percent (12%) per annum, plus his salaries for the unexpired portion of his employment
contract or for three (3) months for every year of the unexpired term, whichever is less.

The NLRC denied the Motion; hence, Serrano filed a Petition for Certiorari with the Court of Appeals (CA), reiterating the
constitutional challenge against the subject clause. The CA affirmed the NLRC ruling on the reduction of the applicable salary rate,
but skirted the constitutional issue raised by herein petitioner Serrano.

ISSUES:

1. Whether or not the subject clause violates Section 10, Article III of the Constitution on non-impairment of contracts;
2. Whether or not the subject clause violate Section 1, Article III of the Constitution, and Section 18, Article II and Section 3, Article
XIII on labor as a protected sector.

HELD:

On the first issue.

The answer is in the negative. Petitioner's claim that the subject clause unduly interferes with the stipulations in his contract on the
term of his employment and the fixed salary package he will receive is not tenable.
Section 10, Article III of the Constitution provides: No law impairing the obligation ofcontracts shall be passed.

The prohibition is aligned with the general principle that laws newly enacted have only a prospective operation, and cannot affect
acts or contracts already perfected; however, as to laws already in existence, their provisions are read into contracts and deemed a
part thereof.Thus, the non-impairment clause under Section 10, Article II is limited in application to laws about to be enacted that
would in any way derogate from existing acts or contracts by enlarging, abridging or in any manner changing the intention of the
parties thereto.

As aptly observed by the OSG, the enactment of R.A. No. 8042 in 1995 preceded the execution of the employment contract
between petitioner and respondents in 1998. Hence, it cannot be argued that R.A. No. 8042, particularly the subject clause,
impaired the employment contract of the parties. Rather, when the parties executed their 1998 employment contract, they were
deemed to have incorporated into it all the provisions of R.A. No. 8042.

But even if the Court were to disregard the timeline, the subject clause may not be declared unconstitutional on the ground that it
impinges on the impairment clause, for the law was enacted in the exercise of the police power of the State to regulate a business,
profession or calling, particularly the recruitment and deployment of OFWs, with the noble end in view of ensuring respect for the
dignity and well-being of OFWs wherever they may be employed.Police power legislations adopted by the State to promote the
health, morals, peace, education, good order, safety, and general welfare of the people are generally applicable not only to future
contracts but even to those already in existence, for all private contracts must yield to the superior and legitimate measures taken
by the State to promote public welfare.

On the second issue.

The answer is in the affirmative.

Section 1, Article III of the Constitution guarantees: No person shall be deprived of life, liberty, or property without due process of
law nor shall any person be denied the equal protection of the law.

Section 18, Article II and Section 3, Article XIII accord all members of the labor sector, without distinction as to place of deployment,
full protection of their rights and welfare.

To Filipino workers, the rights guaranteed under the foregoing constitutional provisions translate to economic security and parity: all
monetary benefits should be equally enjoyed by workers of similar category, while all monetary obligations should be borne by
them in equal degree; none should be denied the protection of the laws which is enjoyed by, or spared the burden imposed on,
others in like circumstances.

Such rights are not absolute but subject to the inherent power of Congress to incorporate, when it sees fit, a system of classification
into its legislation; however, to be valid, the classification must comply with these requirements: 1) it is based on substantial
distinctions; 2) it is germane to the purposes of the law; 3) it is not limited to existing conditions only; and 4) it applies equally to all
members of the class.

There are three levels of scrutiny at which the Court reviews the constitutionality of a classification embodied in a law: a) the
deferential or rational basis scrutiny in which the challenged classification needs only be shown to be rationally related to serving a
legitimate state interest; b) the middle-tier or intermediate scrutiny in which the government must show that the challenged
classification serves an important state interest and that the classification is at least substantially related to serving that interest;
and c) strict judicial scrutiny in which a legislative classification which impermissibly interferes with the exercise of a fundamental
right or operates to the peculiar disadvantage of a suspect class is presumed unconstitutional, and the burden is upon the
government to prove that the classification is necessary to achieve a compelling state interest and that it is the least restrictive
meansto protect such interest.

Upon cursory reading, the subject clause appears facially neutral, for it applies to all OFWs.However, a closer examination reveals
that the subject clause has a discriminatory intent against, and an invidious impact on, OFWs at two levels:
First, OFWs with employment contracts of less than one year vis--vis OFWs with employment contracts of one
year or more;
Second, among OFWs with employment contracts of more than one year; and
Third, OFWs vis--vis local workers with fixed-period employment;

In sum, prior to R.A. No. 8042, OFWs and local workers with fixed-term employment who were illegally discharged were treated
alike in terms of the computation of their money claims: they were uniformly entitled to their salaries for the entire unexpired
portions of their contracts. But with the enactment of R.A. No. 8042, specifically the adoption of the subject clause, illegally
dismissed OFWs with an unexpired portion of one year or more in their employment contract have since been differently treated in
that their money claims are subject to a 3-month cap, whereas no such limitation is imposed on local workers with fixed-term
employment.

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.

There being a suspect classification involving a vulnerable sector protected by the Constitution, the Court now subjects the
classification to a strict judicial scrutiny, and determines whether it serves a compelling state interest through the least restrictive
means.

What constitutes compelling state interest is measured by the scale of rights and powers arrayed in the Constitution and calibrated
by history. It is akin to the paramount interest of the state for which some individual liberties must give way, such as the public
interest in safeguarding health or maintaining medical standards, or in maintaining access to information on matters of public
concern.

In the present case, the Court dug deep into the records but found no compelling state interest that the subject clause may possibly
serve.

In fine, the Government has failed to discharge its burden of proving the existence of a compelling state interest that would justify
the perpetuation of the discrimination against OFWs under the subject clause.

Assuming that, as advanced by the OSG, the purpose of the subject clause is to protect the employment of OFWs by mitigating the
solidary liability of placement agencies, such callous and cavalier rationale will have to be rejected. There can never be a
justification for any form of government action that alleviates the burden of one sector, but imposes the same burden on another
sector, especially when the favored sector is composed of private businesses such as placement agencies, while the
disadvantaged sector is composed of OFWs whose protection no less than the Constitution commands. The idea that private
business interest can be elevated to the level of a compelling state interest is odious.

Moreover, even if the purpose of the subject clause is to lessen the solidary liability of placement agencies vis-a-vis their foreign
principals, there are mechanisms already in place that can be
employed to achieve that purpose without infringing on the constitutional rights of OFWs.

The POEA Rules and Regulations Governing the Recruitment and Employment of Land-Based Overseas Workers, dated February
4, 2002, imposes administrative disciplinary measures on erring foreign employers who default on their contractual obligations to
migrant workers and/or their Philippine agents. These disciplinary measures range from temporary disqualification to preventive
suspension. The POEA Rules and Regulations Governing the Recruitment and Employment of Seafarers, dated May 23, 2003,
contains similar administrative disciplinary measures against erring foreign employers.

Resort to these administrative measures is undoubtedly the less restrictive means of aiding local placement agencies in enforcing
the solidary liability of their foreign principals.

Thus, the subject clause in the 5th paragraph of Section 10 of R.A. No. 8042 is violative of the right of petitioner and other OFWs to
equal protection.

The subject clause or for three months for every year of the unexpired term, whichever is less in the 5 th paragraph of Section 10 of
Republic Act No. 8042 is DECLAREDUNCONSTITUTIONAL
Note:
When the Court is called upon to exercise its power of judicial review of theacts of its co-equals, such as the Congress, it
does so only when these conditions obtain: (1) that there is an actual case or controversy involving a conflict of rights susceptible of
judicial determination; (2) that the constitutional question is raised by a proper party and at the earliest opportunity; and (3) that the
constitutional question is the very lis mota of the case,otherwise the Court will dismiss the case or decide the same on some other
ground.
As discussed earlier, prior to R.A. No. 8042, a uniform system of computation of the monetary awards of illegally dismissed OFWs
was in place. This uniform system was applicable even to local workers with fixed-term employment.

Article 605 of the Code of Commerce provides:

Article 605. If the contracts of the captain and members of the crew with the agent should be for a definite period
or voyage, they cannot be discharged until the fulfillment of their contracts, except for reasons of insubordination

in serious matters, robbery, theft, habitual drunkenness, and damage caused to the vessel or to its cargo by
malice or manifest or proven negligence.

Article 605 was applied to Madrigal Shipping Company, Inc. v. Ogilvie, in which the Court held the shipping company liable for the
salaries and subsistence allowance of its illegally dismissed employees for the entire unexpired portion of their employment
contracts.

While Article 605 has remained good law up to the present, Article 299 of the Code of Commerce was replaced by Art. 1586 of the
Civil Code of 1889, to wit:
Article 1586. Field hands, mechanics, artisans, and other laborers hired for a certain time and for a certain
work cannot leave or be dismissed without sufficient cause, before the fulfillment of the contract.

Sameer Overseas Placement vs. Cabiles

This case involves an overseas Filipino worker with shattered dreams. It is our duty, given the facts and the law, to approximate
justice for her.
We are asked to decide a petition for review1 on certiorari assailing the Court of Appeals decision2 dated June 27, 2005. This
decision partially affirmed the National Labor RelationsCommissions resolution dated March 31, 2004,3 declaring respondents
dismissal illegal, directing petitioner to pay respondents three-month salary equivalent to New Taiwan Dollar (NT$) 46,080.00, and
ordering it to reimburse the NT$3,000.00 withheld from respondent, and pay her NT$300.00 attorneys fees.4
Petitioner, Sameer Overseas Placement Agency, Inc., is a recruitment and placement agency.5 Responding to an ad it published,
respondent, Joy C. Cabiles, submitted her application for a quality control job in Taiwan. 6
Joys application was accepted.7 Joy was later asked to sign a oneyear employment contract for a monthly salary of
NT$15,360.00.8 She alleged that Sameer Overseas Agency required her to pay a placement fee of P70,000.00 when she signed
the employment contract.9
Joy was deployed to work for TaiwanWacoal, Co. Ltd. (Wacoal) on June 26, 1997.10 She alleged that in her employment contract,
she agreed to work as quality control for one year.11 In Taiwan, she was asked to work as a cutter.12
Sameer Overseas Placement Agencyclaims that on July 14, 1997, a certain Mr. Huwang from Wacoal informedJoy, without prior
notice, that she was terminated and that "she should immediately report to their office to get her salary and passport."13 She was
asked to "prepare for immediate repatriation."14
Joy claims that she was told that from June 26 to July 14, 1997, she only earned a total of NT$9,000.15 According to her, Wacoal
deducted NT$3,000 to cover her plane ticket to Manila.16
On October 15, 1997, Joy filed a complaint17 with the National Labor Relations Commission against petitioner and Wacoal. She
claimed that she was illegally dismissed.18 She asked for the return of her placement fee, the withheld amount for repatriation costs,
payment of her salary for 23 months as well as moral and exemplary damages.19 She identified Wacoal as Sameer Overseas
Placement Agencys foreign principal.20
Sameer Overseas Placement Agency alleged that respondent's termination was due to her inefficiency, negligence in her duties,
and her "failure to comply with the work requirements [of] her foreign [employer]." 21 The agency also claimed that it did not ask for a
placement fee of P70,000.00.22 As evidence, it showedOfficial Receipt No. 14860 dated June 10, 1997, bearing the amount
of P20,360.00.23 Petitioner added that Wacoal's accreditation with petitioner had already been transferred to the Pacific Manpower
& Management Services, Inc. (Pacific) as of August 6, 1997.24 Thus, petitioner asserts that it was already substituted by Pacific
Manpower.25
Pacific Manpower moved for the dismissal of petitioners claims against it.26 It alleged that there was no employer-employee
relationship between them.27 Therefore, the claims against it were outside the jurisdiction of the Labor Arbiter.28 Pacific Manpower
argued that the employment contract should first be presented so that the employers contractual obligations might be identified.29 It
further denied that it assumed liability for petitioners illegal acts.30
On July 29, 1998, the Labor Arbiter dismissed Joys complaint.31 Acting Executive Labor Arbiter Pedro C.Ramos ruled that her
complaint was based on mereallegations.32 The Labor Arbiter found that there was no excess payment of placement fees, based on
the official receipt presented by petitioner.33 The Labor Arbiter found unnecessary a discussion on petitioners transfer of obligations
to Pacific34 and considered the matter immaterial in view of the dismissal of respondents complaint.35

Joy appealed36 to the National Labor Relations Commission.

In a resolution37 dated March 31, 2004, the National Labor Relations Commission declared that Joy was illegally dismissed.38 It
reiterated the doctrine that the burden of proof to show that the dismissal was based on a just or valid cause belongs to the
employer.39 It found that Sameer Overseas Placement Agency failed to prove that there were just causes for termination.40 There
was no sufficient proofto show that respondent was inefficient in her work and that she failed to comply with company
requirements.41 Furthermore, procedural dueprocess was not observed in terminating respondent.42
The National Labor Relations Commission did not rule on the issue of reimbursement of placement fees for lack of jurisdiction.43 It
refused to entertain the issue of the alleged transfer of obligations to Pacific.44 It did not acquire jurisdiction over that issue because
Sameer Overseas Placement Agency failed to appeal the Labor Arbiters decision not to rule on the matter.45
The National Labor Relations Commission awarded respondent only three (3) months worth of salaryin the amount of NT$46,080,
the reimbursement of the NT$3,000 withheld from her, and attorneys fees of NT$300.46
The Commission denied the agencys motion for reconsideration47 dated May 12, 2004 through a resolution48dated July 2, 2004.
Aggrieved by the ruling, Sameer Overseas Placement Agency caused the filing of a petition49 for certiorari with the Court of Appeals
assailing the National Labor Relations Commissions resolutions dated March 31, 2004 and July 2, 2004.
The Court of Appeals50 affirmed the decision of the National Labor Relations Commission with respect to the finding of illegal
dismissal, Joys entitlement to the equivalent of three months worth of salary, reimbursement of withheld repatriation expense, and
attorneys fees.51 The Court of Appeals remanded the case to the National Labor Relations Commission to address the validity of
petitioner's allegations against Pacific.52 The Court of Appeals held, thus: Although the public respondent found the dismissal of the
complainant-respondent illegal, we should point out that the NLRC merely awarded her three (3) months backwages or the amount
of NT$46,080.00, which was based upon its finding that she was dismissed without due process, a finding that we uphold, given
petitioners lack of worthwhile discussion upon the same in the proceedings below or before us. Likewise we sustain NLRCs
finding in regard to the reimbursement of her fare, which is squarely based on the law; as well as the award of attorneys fees.
But we do find it necessary to remand the instant case to the public respondent for further proceedings, for the purpose of
addressing the validity or propriety of petitioners third-party complaint against the transferee agent or the Pacific Manpower &
Management Services, Inc. and Lea G. Manabat. We should emphasize that as far as the decision of the NLRC on the claims of
Joy Cabiles, is concerned, the same is hereby affirmed with finality, and we hold petitioner liable thereon, but without prejudice to
further hearings on its third party complaint against Pacific for reimbursement.
WHEREFORE, premises considered, the assailed Resolutions are hereby partly AFFIRMED in accordance with the foregoing
discussion, but subject to the caveat embodied inthe last sentence. No costs.
SO ORDERED.53
Dissatisfied, Sameer Overseas Placement Agency filed this petition.54
We are asked to determine whether the Court of Appeals erred when it affirmed the ruling of the National Labor Relations
Commission finding respondent illegally dismissed and awarding her three months worth of salary, the reimbursement of the cost
ofher repatriation, and attorneys fees despite the alleged existence of just causes of termination.
Petitioner reiterates that there was just cause for termination because there was a finding of Wacoal that respondent was inefficient
in her work.55
Therefore, it claims that respondents dismissal was valid.56
Petitioner also reiterates that since Wacoals accreditation was validly transferred to Pacific at the time respondent filed her
complaint, it should be Pacific that should now assume responsibility for Wacoals contractual obligations to the workers originally
recruited by petitioner.57
Sameer Overseas Placement Agencyspetition is without merit. We find for respondent.
I
Sameer Overseas Placement Agency failed to show that there was just cause for causing Joys dismissal. The employer, Wacoal,
also failed to accord her due process of law.
Indeed, employers have the prerogative to impose productivity and quality standards at work.58 They may also impose reasonable
rules to ensure that the employees comply with these standards.59 Failure to comply may be a just cause for their
dismissal.60 Certainly, employers cannot be compelled to retain the services of anemployee who is guilty of acts that are inimical to
the interest of the employer.61 While the law acknowledges the plight and vulnerability of workers, it does not "authorize the
oppression or self-destruction of the employer."62 Management prerogative is recognized in law and in our jurisprudence.

This prerogative, however, should not be abused. It is "tempered with the employees right to security of tenure." 63Workers are
entitled to substantive and procedural due process before termination. They may not be removed from employment without a
validor just cause as determined by law and without going through the proper procedure.
Security of tenure for labor is guaranteed by our Constitution.64
Employees are not stripped of their security of tenure when they move to work in a different jurisdiction. With respect to the rights of
overseas Filipino workers, we follow the principle of lex loci contractus.Thus, in Triple Eight Integrated Services, Inc. v. NLRC,65 this
court noted:
Petitioner likewise attempts to sidestep the medical certificate requirement by contending that since Osdana was working in Saudi
Arabia, her employment was subject to the laws of the host country. Apparently, petitioner hopes tomake it appear that the labor
laws of Saudi Arabia do not require any certification by a competent public health authority in the dismissal of employees due to
illness.
Again, petitioners argument is without merit.
First, established is the rule that lex loci contractus (the law of the place where the contract is made) governs in this jurisdiction.
There is no question that the contract of employment in this case was perfected here in the Philippines. Therefore, the Labor Code,
its implementing rules and regulations, and other laws affecting labor apply in this case.Furthermore, settled is the rule that the
courts of the forum will not enforce any foreign claim obnoxious to the forums public policy. Herein the Philippines, employment
agreements are more than contractual in nature. The Constitution itself, in Article XIII, Section 3, guarantees the special protection
of workers, to wit:
The State shall afford full protection to labor, local and overseas, organized and unorganized, and promote full employment and
equality of employment opportunities for all.
It shall guarantee the rights of all workers to selforganization, collective bargaining and negotiations, and peaceful concerted
activities, including the right to strike in accordance with law. They shall be entitled to security of tenure, humane conditions of work,
and a living wage. Theyshall also participate in policy and decision-making processes affecting their rights and benefits as may be
provided by law.
....
This public policy should be borne in mind in this case because to allow foreign employers to determine for and by themselves
whether an overseas contract worker may be dismissed on the ground of illness would encourage illegal or arbitrary pretermination
of employment contracts.66 (Emphasis supplied, citation omitted)
Even with respect to fundamental procedural rights, this court emphasized in PCL Shipping Philippines, Inc. v. NLRC,67 to wit:
Petitioners admit that they did notinform private respondent in writing of the charges against him and that they failed to conduct a
formal investigation to give him opportunity to air his side. However, petitioners contend that the twin requirements ofnotice and
hearing applies strictly only when the employment is within the Philippines and that these need not be strictly observed in cases of
international maritime or overseas employment.
The Court does not agree. The provisions of the Constitution as well as the Labor Code which afford protection to labor apply to
Filipino employees whether working within the Philippines or abroad. Moreover, the principle of lex loci contractus (the law of the
place where the contract is made) governs in this jurisdiction. In the present case, it is not disputed that the Contract of
Employment entered into by and between petitioners and private respondent was executed here in the Philippines with the
approval of the Philippine Overseas Employment Administration (POEA). Hence, the Labor Code together with its implementing
rules and regulations and other laws affecting labor apply in this case.68 (Emphasis supplied, citations omitted)
By our laws, overseas Filipino workers (OFWs) may only be terminated for a just or authorized cause and after compliance with
procedural due process requirements.
Article 282 of the Labor Code enumerates the just causes of termination by the employer. Thus:
Art. 282. Termination by employer. An employer may terminate an employment for any of the following causes:
(a) Serious misconduct or willful disobedience by the employee of the lawful orders of his employer or representative in
connection with his work;
(b) Gross and habitual neglect by the employee of his duties;
(c) Fraud or willful breach by the employee of the trust reposed in him by his employer or duly authorized representative;

(d) Commission of a crime or offense by the employee against the person of his employer or any immediate member of
his family or his duly authorized representatives; and
(e) Other causes analogous to the foregoing.
Petitioners allegation that respondentwas inefficient in her work and negligent in her duties69 may, therefore, constitute a just cause
for termination under Article 282(b), but only if petitioner was able to prove it.
The burden of proving that there is just cause for termination is on the employer. "The employer must affirmatively show rationally
adequate evidence that the dismissal was for a justifiable cause."70 Failure to show that there was valid or just cause for termination
would necessarily mean that the dismissal was illegal.71
To show that dismissal resulting from inefficiency in work is valid, it must be shown that: 1) the employer has set standards of
conduct and workmanship against which the employee will be judged; 2) the standards of conduct and workmanship must have
been communicated tothe employee; and 3) the communication was made at a reasonable time prior to the employees
performance assessment.
This is similar to the law and jurisprudence on probationary employees, which allow termination ofthe employee only when there is
"just cause or when [the probationary employee] fails to qualify as a regular employee in accordance with reasonable standards
made known by the employer to the employee at the time of his [or her] engagement."72
However, we do not see why the application of that ruling should be limited to probationary employment. That rule is basic to the
idea of security of tenure and due process, which are guaranteed to all employees, whether their employment is probationary or
regular.
The pre-determined standards that the employer sets are the bases for determining the probationary employees fitness, propriety,
efficiency, and qualifications as a regular employee. Due process requires that the probationary employee be informed of such
standards at the time of his or her engagement so he or she can adjusthis or her character or workmanship accordingly. Proper
adjustment to fit the standards upon which the employees qualifications will be evaluated will increase ones chances of being
positively assessed for regularization by his or her employer.
Assessing an employees work performance does not stop after regularization. The employer, on a regular basis, determines if an
employee is still qualified and efficient, based on work standards. Based on that determination, and after complying with the due
process requirements of notice and hearing, the employer may exercise its management prerogative of terminating the employee
found unqualified.
The regular employee must constantlyattempt to prove to his or her employer that he or she meets all the standards for
employment. This time, however, the standards to be met are set for the purpose of retaining employment or promotion. The
employee cannot be expected to meet any standard of character or workmanship if such standards were not communicated to him
or her. Courts should remain vigilant on allegations of the employers failure to communicatework standards that would govern
ones employment "if [these are] to discharge in good faith [their] duty to adjudicate."73
In this case, petitioner merely alleged that respondent failed to comply with her foreign employers work requirements and was
inefficient in her work.74 No evidence was shown to support such allegations. Petitioner did not even bother to specify what
requirements were not met, what efficiency standards were violated, or what particular acts of respondent constituted inefficiency.
There was also no showing that respondent was sufficiently informed of the standards against which her work efficiency and
performance were judged. The parties conflict as to the position held by respondent showed that even the matter as basic as the
job title was not clear.
The bare allegations of petitioner are not sufficient to support a claim that there is just cause for termination. There is no proof that
respondent was legally terminated.
Petitioner failed to comply with
the due process requirements
Respondents dismissal less than one year from hiring and her repatriation on the same day show not onlyfailure on the partof
petitioner to comply with the requirement of the existence of just cause for termination. They patently show that the employersdid
not comply with the due process requirement.
A valid dismissal requires both a valid cause and adherence to the valid procedure of dismissal.75 The employer is required to give
the charged employee at least two written notices before termination.76 One of the written notices must inform the employee of the
particular acts that may cause his or her dismissal.77 The other notice must "[inform] the employee of the employers
decision."78 Aside from the notice requirement, the employee must also be given "an opportunity to be heard."79
Petitioner failed to comply with the twin notices and hearing requirements. Respondent started working on June 26, 1997. She was
told that she was terminated on July 14, 1997 effective on the same day and barely a month from her first workday. She was also

repatriated on the same day that she was informed of her termination. The abruptness of the termination negated any finding that
she was properly notified and given the opportunity to be heard. Her constitutional right to due process of law was violated.
II
Respondent Joy Cabiles, having been illegally dismissed, is entitled to her salary for the unexpired portion ofthe employment
contract that was violated together with attorneys fees and reimbursement of amounts withheld from her salary.
Section 10 of Republic Act No. 8042,otherwise known as the Migrant Workers and Overseas Filipinos Act of1995, states
thatoverseas workers who were terminated without just, valid, or authorized cause "shall be entitled to the full reimbursement of his
placement fee with interest of twelve (12%) per annum, plus his salaries for the unexpired portion of his employment contract or for
three (3) months for every year of the unexpired term, whichever is less."
Sec. 10. MONEY CLAIMS. Notwithstanding any provision of law to the contrary, the Labor Arbiters of the National Labor
Relations Commission (NLRC) shall have the original and exclusive jurisdiction to hear and decide, within ninety (90) calendar days
after filing of the complaint, the claims arising out of an 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.
The liability of the principal/employer and the recruitment/placement agency for any and all claims under this section shall be joint
and several. This provisions [sic] shall be incorporated in the contract for overseas employment and shall be a condition precedent
for its approval. The performance bond to be filed by the recruitment/placementagency, as provided by law, shall be answerable for
all money claims or damages that may be awarded to the workers. 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 orpartnership for the aforesaid claims and damages.
Such liabilities shall continue during the entire period or duration of the employment contract and shall not be affected by any
substitution, amendment or modification made locally or in a foreign country of the said contract.
Any compromise/amicable settlement or voluntary agreement on money claims inclusive of damages under this section shall be
paid within four (4) months from the approval of the settlement by the appropriate authority.
In case of termination of overseas employment without just, valid or authorized cause as defined by law or contract, the workers
shall be entitled to the full reimbursement of his placement fee with interest of twelve (12%) per annum, plus his salaries for the
unexpired portion of his employment contract or for three (3) months for every year of the unexpired term, whichever is less.
....
(Emphasis supplied)
Section 15 of Republic Act No. 8042 states that "repatriation of the worker and the transport of his [or her] personal belongings shall
be the primary responsibility of the agency which recruited or deployed the worker overseas." The exception is when "termination of
employment is due solely to the fault of the worker,"80 which as we have established, is not the case. It reads: 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 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.
....
The Labor Code81 also entitles the employee to 10% of the amount of withheld wages as attorneys feeswhen the withholding is
unlawful.
The Court of Appeals affirmedthe National Labor Relations Commissions decision to award respondent NT$46,080.00 or the
threemonth equivalent of her salary, attorneys fees of NT$300.00, and the reimbursement of the withheld NT$3,000.00 salary,
which answered for her repatriation.
We uphold the finding that respondent is entitled to all of these awards. The award of the three-month equivalent of respondents
salary should, however, be increased to the amount equivalent to the unexpired term of the employment contract.
In Serrano v. Gallant Maritime Services, Inc. and Marlow Navigation Co., Inc.,82 this court ruled that the clause "or for three (3)
months for every year of the unexpired term, whichever is less"83 is unconstitutional for violating the equal protection clause and
substantive due process.84
A statute or provision which was declared unconstitutional 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."85

We are aware that the clause "or for three (3) months for every year of the unexpired term, whichever is less"was reinstated in
Republic Act No. 8042 upon promulgation of Republic Act No. 10022 in 2010. Section 7 of Republic Act No. 10022 provides:
Section 7.Section 10 of Republic Act No. 8042, as amended, is hereby amended to read as follows:
SEC. 10. Money Claims. Notwithstanding any provision of law to the contrary, the Labor Arbiters of the National Labor Relations
Commission (NLRC) shall have the original and exclusive jurisdiction to hear and decide, within ninety (90) calendar days after the
filing of the complaint, the claims arising out of an 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 damage. Consistent with
this mandate, the NLRC shall endeavor to update and keep abreast with the developments in the global services industry.
The liability of the principal/employer and the recruitment/placement agency for any and all claims under this section shall be joint
and several. This provision shall be incorporated in the contract for overseas employment and shall be a condition precedent for its
approval. The performance bond to de [sic] filed by the recruitment/placement agency, as provided by law, shall be answerable for
all money claims or damages that may be awarded to the workers. 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.
Such liabilities shall continue during the entire period or duration of the employment contract and shall not be affected by any
substitution, amendment or modification made locally or in a foreign country of the said contract.
Any compromise/amicable settlement or voluntary agreement on money claims inclusive of damages under this section shall be
paid within thirty (30) days from approval of the settlement by the appropriate authority.
In case of termination of overseas employment without just, valid or authorized cause as defined by law or contract, or any
unauthorized deductions from the migrant workers salary, the worker shall be entitled to the full reimbursement if [sic] his
placement fee and the deductions made with interest at twelve percent (12%) per annum, plus his salaries for the unexpired portion
of his employment contract or for three (3) months for every year of the unexpired term, whichever is less.
In case of a final and executory judgement against a foreign employer/principal, it shall be automatically disqualified, without further
proceedings, from participating in the Philippine Overseas Employment Program and from recruiting and hiring Filipino workers
until and unless it fully satisfies the judgement award.
Noncompliance with the mandatory periods for resolutions of case providedunder this section shall subject the responsible officials
to any or all of the following penalties:
(a) The salary of any such official who fails to render his decision or resolution within the prescribed period shall be, or
caused to be, withheld until the said official complies therewith;
(b) Suspension for not more than ninety (90) days; or
(c) Dismissal from the service with disqualification to hold any appointive public office for five (5) years.
Provided, however,That the penalties herein provided shall be without prejudice to any liability which any such official may have
incured [sic] under other existing laws or rules and regulations as a consequence of violating the provisions of this paragraph.
(Emphasis supplied)
Republic Act No. 10022 was promulgated on March 8, 2010. This means that the reinstatement of the clause in Republic Act No.
8042 was not yet in effect at the time of respondents termination from work in 1997.86 Republic Act No. 8042 before it was
amended byRepublic Act No. 10022 governs this case.
When a law is passed, this court awaits an actual case that clearly raises adversarial positions in their proper context before
considering a prayer to declare it as unconstitutional.
However, we are confronted with a unique situation. The law passed incorporates the exact clause already declared as
unconstitutional, without any perceived substantial change in the circumstances.
This may cause confusion on the part of the National Labor Relations Commission and the Court of Appeals.At minimum, the
existence of Republic Act No. 10022 may delay the execution of the judgment in this case, further frustrating remedies to assuage
the wrong done to petitioner.
Hence, there is a necessity to decide this constitutional issue.
Moreover, this court is possessed with the constitutional duty to "[p]romulgate rules concerning the protection and enforcement of
constitutional rights."87 When cases become mootand academic, we do not hesitate to provide for guidance to bench and bar in
situations where the same violations are capable of repetition but will evade review. This is analogous to cases where there are
millions of Filipinos working abroad who are bound to suffer from the lack of protection because of the restoration of an identical
clause in a provision previously declared as unconstitutional.

In the hierarchy of laws, the Constitution is supreme. No branch or office of the government may exercise its powers in any manner
inconsistent with the Constitution, regardless of the existence of any law that supports such exercise. The Constitution cannot be
trumped by any other law. All laws must be read in light of the Constitution. Any law that is inconsistent with it is a nullity.
Thus, when a law or a provision of law is null because it is inconsistent with the Constitution,the nullity cannot be cured by
reincorporation or reenactment of the same or a similar law or provision. A law or provision of law that was already declared
unconstitutional remains as such unless circumstances have sochanged as to warrant a reverse conclusion.
We are not convinced by the pleadings submitted by the parties that the situation has so changed so as to cause us to reverse
binding precedent.
Likewise, there are special reasons of judicial efficiency and economy that attend to these cases. The new law puts our overseas
workers in the same vulnerable position as they were prior to Serrano. Failure to reiterate the very ratio decidendi of that case will
result in the same untold economic hardships that our reading of the Constitution intended to avoid. Obviously, we cannot
countenance added expenses for further litigation thatwill reduce their hardearned wages as well as add to the indignity of having
been deprived of the protection of our laws simply because our precedents have not been followed. There is no constitutional
doctrine that causes injustice in the face of empty procedural niceties. Constitutional interpretation is complex, but it is never
unreasonable.
Thus, in a resolution88 dated October 22, 2013, we ordered the parties and the Office of the Solicitor General to comment on the
constitutionality of the reinstated clause in Republic Act No. 10022.
In its comment,89 petitioner argued that the clause was constitutional.90 The legislators intended a balance between the employers
and the employees rights by not unduly burdening the local recruitment agency.91Petitioner is also of the view that the clause was
already declared as constitutional in Serrano.92
The Office of the Solicitor General also argued that the clause was valid and constitutional.93 However, since the parties never
raised the issue of the constitutionality of the clause asreinstated in Republic Act No. 10022, its contention is that it is beyond
judicial review.94
On the other hand, respondentargued that the clause was unconstitutional because it infringed on workers right to contract.95
We observe that the reinstated clause, this time as provided in Republic Act. No. 10022, violates the constitutional rights to equal
protection and due process.96 Petitioner as well as the Solicitor General have failed to show any compelling changein the
circumstances that would warrant us to revisit the precedent.
We reiterate our finding in Serrano v. Gallant Maritime that limiting wages that should be recovered by anillegally dismissed
overseas worker to three months is both a violation of due process and the equal protection clauses of the Constitution.
Equal protection of the law is a guarantee that persons under like circumstances and falling within the same class are treated alike,
in terms of "privileges conferred and liabilities enforced."97 It is a guarantee against "undue favor and individual or class privilege, as
well as hostile discrimination or the oppression of inequality." 98
In creating laws, the legislature has the power "to make distinctions and classifications."99
In exercising such power, it has a wide discretion.100
The equal protection clause does not infringe on this legislative power.101 A law is void on this basis, only if classifications are made
arbitrarily.102 There is no violation of the equal protection clause if the law applies equally to persons within the same class and if
there are reasonable grounds for distinguishing between those falling within the class and those who do not fall within the
class.103 A law that does not violate the equal protection clause prescribesa reasonable classification.104
A reasonable classification "(1) must rest on substantial distinctions; (2) must be germane to the purposes of the law; (3) must not
be limited to existing conditions only; and (4) must apply equally to all members of the same class."105
The reinstated clause does not satisfy the requirement of reasonable classification.
In Serrano, we identified the classifications made by the reinstated clause. It distinguished between fixed-period overseas workers
and fixedperiod local workers.106 It also distinguished between overseas workers with employment contracts of less than one year
and overseas workers with employment contracts of at least one year.107 Within the class of overseas workers with at least oneyear employment contracts, there was a distinction between those with at least a year left in their contracts and those with less than
a year left in their contracts when they were illegally dismissed.108
The Congress classification may be subjected to judicial review. In Serrano, there is a "legislative classification which impermissibly
interferes with the exercise of a fundamental right or operates to the peculiar disadvantage of a suspect class."109

Under the Constitution, labor is afforded special protection.110 Thus, this court in Serrano, "[i]mbued with the same sense of
obligation to afford protection to labor, . . . employ[ed] the standard of strict judicial scrutiny, for it perceive[d] in the subject clause a
suspect classification prejudicial to OFWs."111
We also noted in Serranothat before the passage of Republic Act No. 8042, the money claims of illegally terminated overseas and
local workers with fixed-term employment werecomputed in the same manner.112 Their money claims were computed based onthe
"unexpired portions of their contracts."113 The adoption of the reinstated clause in Republic Act No. 8042 subjected the money
claims of illegally dismissed overseas workers with an unexpired term of at least a year to a cap of three months worth of their
salary.114 There was no such limitation on the money claims of illegally terminated local workers with fixed-term employment. 115
We observed that illegally dismissed overseas workers whose employment contracts had a term of less than one year were
granted the amount equivalent to the unexpired portion of their employment contracts.116 Meanwhile, illegally dismissed overseas
workers with employment terms of at least a year were granted a cap equivalent to three months of their salary for the unexpired
portions of their contracts.117
Observing the terminologies used inthe clause, we also found that "the subject clause creates a sub-layer of discrimination among
OFWs whose contract periods are for more than one year: those who are illegally dismissed with less than one year left in their
contracts shall be entitled to their salaries for the entire unexpired portion thereof, while those who are illegally dismissed with one
year or more remaining in their contracts shall be covered by the reinstated clause, and their monetary benefits limited to their
salaries for three months only."118
We do not need strict scrutiny to conclude that these classifications do not rest on any real or substantial distinctions that would
justify different treatments in terms of the computation of money claims resulting from illegal termination.
Overseas workers regardless of their classifications are entitled to security of tenure, at least for the period agreed upon in their
contracts. This means that they cannot be dismissed before the end of their contract terms without due process. If they were
illegally dismissed, the workers right to security of tenure is violated.
The rights violated when, say, a fixed-period local worker is illegally terminated are neither greater than norless than the rights
violated when a fixed-period overseas worker is illegally terminated. It is state policy to protect the rights of workers
withoutqualification as to the place of employment.119 In both cases, the workers are deprived of their expected salary, which they
could have earned had they not been illegally dismissed. For both workers, this deprivation translates to economic insecurity and
disparity.120 The same is true for the distinctions between overseas workers with an employment contract of less than one year and
overseas workers with at least one year of employment contract, and between overseas workers with at least a year left in their
contracts and overseas workers with less than a year left in their contracts when they were illegally dismissed.
For this reason, we cannot subscribe to the argument that "[overseas workers] are contractual employeeswho can never acquire
regular employment status, unlike local workers"121 because it already justifies differentiated treatment in terms ofthe computation of
money claims.122
Likewise, the jurisdictional and enforcement issues on overseas workers money claims do not justify a differentiated treatment in
the computation of their money claims.123 If anything, these issues justify an equal, if not greater protection and assistance to
overseas workers who generally are more prone to exploitation given their physical distance from our government.
We also find that the classificationsare not relevant to the purpose of the law, which is to "establish a higher standard of protection
and promotion of the welfare of migrant workers, their families and overseas Filipinos in distress, and for other
purposes."124 Further, we find specious the argument that reducing the liability of placement agencies "redounds to the benefit of
the [overseas] workers."125
Putting a cap on the money claims of certain overseas workers does not increase the standard of protection afforded to them. On
the other hand, foreign employers are more incentivizedby the reinstated clause to enter into contracts of at least a year because it
gives them more flexibility to violate our overseas workers rights. Their liability for arbitrarily terminating overseas workers is
decreased at the expense of the workers whose rights they violated. Meanwhile, these overseas workers who are impressed with
an expectation of a stable job overseas for the longer contract period disregard other opportunities only to be terminated earlier.
They are left with claims that are less than what others in the same situation would receive. The reinstated clause, therefore,
creates a situation where the law meant to protect them makes violation of rights easier and simply benign to the violator.
As Justice Brion said in his concurring opinion in Serrano:
Section 10 of R.A. No. 8042 affects these well-laid rules and measures, and in fact provides a hidden twist affecting the
principal/employers liability. While intended as an incentive accruing to recruitment/manning agencies, the law, as worded, simply
limits the OFWs recovery in wrongfuldismissal situations. Thus, it redounds to the benefit of whoever may be liable, including the
principal/employer the direct employer primarily liable for the wrongful dismissal. In this sense, Section 10 read as a grant of
incentives to recruitment/manning agencies oversteps what it aims to do by effectively limiting what is otherwise the full liability of
the foreign principals/employers. Section 10, in short, really operates to benefit the wrong party and allows that party, without
justifiable reason, to mitigate its liability for wrongful dismissals. Because of this hidden twist, the limitation ofliability under Section
10 cannot be an "appropriate" incentive, to borrow the term that R.A. No. 8042 itself uses to describe the incentive it envisions
under its purpose clause.

What worsens the situation is the chosen mode of granting the incentive: instead of a grant that, to encourage greater efforts at
recruitment, is directly related to extra efforts undertaken, the law simply limits their liability for the wrongful dismissals of already
deployed OFWs. This is effectively a legally-imposed partial condonation of their liability to OFWs, justified solely by the laws intent
to encourage greater deployment efforts. Thus, the incentive,from a more practical and realistic view, is really part of a scheme to
sell Filipino overseas labor at a bargain for purposes solely of attracting the market. . . .
The so-called incentive is rendered particularly odious by its effect on the OFWs the benefits accruing to the
recruitment/manning agencies and their principals are takenfrom the pockets of the OFWs to whom the full salaries for the
unexpired portion of the contract rightfully belong. Thus, the principals/employers and the recruitment/manning agencies even profit
from their violation of the security of tenure that an employment contract embodies. Conversely, lesser protection is afforded the
OFW, not only because of the lessened recovery afforded him or her by operation of law, but also because this same lessened
recovery renders a wrongful dismissal easier and less onerous to undertake; the lesser cost of dismissing a Filipino will always bea
consideration a foreign employer will take into account in termination of employment decisions. . . .126
Further, "[t]here can never be a justification for any form of government action that alleviates the burden of one sector, but imposes
the same burden on another sector, especially when the favored sector is composed of private businesses suchas placement
agencies, while the disadvantaged sector is composed ofOFWs whose protection no less than the Constitution commands. The
idea thatprivate business interest can be elevated to the level of a compelling state interest is odious."127
Along the same line, we held that the reinstated clause violates due process rights. It is arbitrary as it deprives overseas workers of
their monetary claims without any discernable valid purpose.128
Respondent Joy Cabiles is entitled to her salary for the unexpired portion of her contract, in accordance with Section 10 of Republic
Act No. 8042. The award of the three-month equivalence of respondents salary must be modified accordingly. Since she started
working on June 26, 1997 and was terminated on July 14, 1997, respondent is entitled to her salary from July 15, 1997 to June 25,
1998. "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 OFWs security of tenure which an employment contract
embodies and actually profit from such violation based on an unconstitutional provision of law."129
III
On the interest rate, the Bangko Sentral ng Pilipinas Circular No. 799 of June 21, 2013, which revised the interest rate for loan or
forbearance from 12% to 6% in the absence of stipulation,applies in this case. The pertinent portions of Circular No. 799, Series of
2013, read: The Monetary Board, in its Resolution No. 796 dated 16 May 2013, approved the following revisions governing the rate
of interest in the absence of stipulation in loan contracts, thereby amending Section 2 of Circular No. 905, Series of 1982:
Section 1. The rate of interest for the loan or forbearance of any money, goods or credits and the rate allowed in judgments, in the
absence of an express contract as to such rateof interest, shall be six percent (6%) per annum.
Section 2. In view of the above, Subsection X305.1 of the Manual of Regulations for Banks and Sections 4305Q.1, 4305S.3 and
4303P.1 of the Manual of Regulations for Non-Bank Financial Institutions are hereby amended accordingly.
This Circular shall take effect on 1 July 2013.
Through the able ponencia of Justice Diosdado Peralta, we laid down the guidelines in computing legal interest in Nacar v. Gallery
Frames:130
II. With regard particularly to an award of interest in the concept of actual and compensatory damages, the rate of interest, as well
as the accrual thereof, is imposed, as follows:
1. When the obligation is breached, and it consists in the payment of a sum of money, i.e., a loan or forbearance of money,
the interest due should be that which may have been stipulated in writing. Furthermore, the interest due shall itself earn
legal interest from the time it is judicially demanded. In the absence of stipulation, the rate of interest shall be 6% per
annum to be computed from default, i.e., from judicial or extrajudicial demand under and subject to the provisions of Article
1169 of the Civil Code.
2. When an obligation, not constituting a loan or forbearance of money, is breached, an interest on the amount of
damages awarded may be imposed at the discretion of the court at the rate of 6% per annum. No interest, however, shall
be adjudged on unliquidated claims or damages, except when or until the demand can be established with reasonable
certainty. Accordingly, where the demand is established with reasonable certainty, the interest shall begin to run from the
time the claim is made judicially or extrajudicially (Art. 1169, Civil Code), but when such certainty cannot be so reasonably
established at the time the demand is made, the interest shall begin to run only from the date the judgment of the court is
made (at which time the quantification of damages may be deemed to have been reasonably ascertained). The actual
base for the computation of legal interest shall, in any case, be on the amount finally adjudged. 3. When the judgment of
the court awarding a sum of money becomes final and executory, the rate of legal interest, whether the case falls under
paragraph 1 or paragraph 2, above, shall be 6% per annum from such finality until its satisfaction, this interim period being
deemed to be by then an equivalent to a forbearance of credit.

And, in addition to the above, judgments that have become final and executory prior to July 1, 2013, shall not be disturbed and
shall continue to be implemented applying the rate of interest fixed therein.131
Circular No. 799 is applicable only in loans and forbearance of money, goods, or credits, and in judgments when there is no
stipulation on the applicable interest rate. Further, it is only applicable if the judgment did not become final and executory before
July 1, 2013.132
We add that Circular No. 799 is not applicable when there is a law that states otherwise. While the Bangko Sentral ng Pilipinas has
the power to set or limit interest rates,133 these interest rates do not apply when the law provides that a different interest rate shall
be applied. "[A] Central Bank Circular cannot repeal a law. Only a law can repeal another law."134
For example, Section 10 of Republic Act No. 8042 provides that unlawfully terminated overseas workers are entitled to the
reimbursement of his or her placement fee with an interest of 12% per annum. Since Bangko Sentral ng Pilipinas circulars
cannotrepeal Republic Act No. 8042, the issuance of Circular No. 799 does not have the effect of changing the interest on awards
for reimbursement of placement fees from 12% to 6%. This is despite Section 1 of Circular No. 799, which provides that the 6%
interest rate applies even to judgments.
Moreover, laws are deemed incorporated in contracts. "The contracting parties need not repeat them. They do not even have to be
referred to. Every contract, thus, contains not only what has been explicitly stipulated, but the statutory provisions that have any
bearing on the matter."135 There is, therefore, an implied stipulation in contracts between the placement agency and the
overseasworker that in case the overseas worker is adjudged as entitled to reimbursement of his or her placement fees, the
amount shall be subject to a 12% interest per annum. This implied stipulation has the effect of removing awards for reimbursement
of placement fees from Circular No. 799s coverage.
The same cannot be said for awardsof salary for the unexpired portion of the employment contract under Republic Act No. 8042.
These awards are covered by Circular No. 799 because the law does not provide for a specific interest rate that should apply.
In sum, if judgment did not become final and executory before July 1, 2013 and there was no stipulation in the contract providing for
a different interest rate, other money claims under Section 10 of Republic Act No. 8042 shall be subject to the 6% interest per
annum in accordance with Circular No. 799.
This means that respondent is also entitled to an interest of 6% per annum on her money claims from the finality of this judgment.
IV
Finally, we clarify the liabilities ofWacoal as principal and petitioner as the employment agency that facilitated respondents
overseas employment.
Section 10 of the Migrant Workers and Overseas Filipinos Act of 1995 provides that the foreign employer and the local employment
agency are jointly and severally liable for money claims including claims arising out of an employer-employee relationship and/or
damages. This section also provides that the performance bond filed by the local agency shall be answerable for such money
claims or damages if they were awarded to the employee.
This provision is in line with the states policy of affording protection to labor and alleviating workers plight.136
In overseas employment, the filing of money claims against the foreign employer is attended by practical and legal
complications.1wphi1 The distance of the foreign employer alonemakes it difficult for an overseas worker to reach it and make it
liable for violations of the Labor Code. There are also possible conflict of laws, jurisdictional issues, and procedural rules that may
be raised to frustrate an overseas workersattempt to advance his or her claims.
It may be argued, for instance, that the foreign employer must be impleaded in the complaint as an indispensable party without
which no final determination can be had of an action.137
The provision on joint and several liability in the Migrant Workers and Overseas Filipinos Act of 1995 assures overseas workers that
their rights will not be frustrated with these complications. The fundamental effect of joint and several liability is that "each of the
debtors is liable for the entire obligation."138 A final determination may, therefore, be achieved even if only oneof the joint and
several debtors are impleaded in an action. Hence, in the case of overseas employment, either the local agency or the foreign
employer may be sued for all claims arising from the foreign employers labor law violations. This way, the overseas workers are
assured that someone the foreign employers local agent may be made to answer for violationsthat the foreign employer may
have committed.
The Migrant Workers and Overseas Filipinos Act of 1995 ensures that overseas workers have recourse in law despite the
circumstances of their employment. By providing that the liability of the foreign employer may be "enforced to the full
extent"139 against the local agent,the overseas worker is assured of immediate and sufficientpayment of what is due them.140
Corollary to the assurance of immediate recourse in law, the provision on joint and several liability in the Migrant Workers and
Overseas Filipinos Act of 1995 shifts the burden of going after the foreign employer from the overseas worker to the local
employment agency. However, it must be emphasized that the local agency that is held to answer for the overseas workers money

claims is not leftwithout remedy. The law does not preclude it from going after the foreign employer for reimbursement of whatever
payment it has made to the employee to answer for the money claims against the foreign employer.
A further implication of making localagencies jointly and severally liable with the foreign employer is thatan additional layer of
protection is afforded to overseas workers. Local agencies, which are businesses by nature, are inoculated with interest in being
always on the lookout against foreign employers that tend to violate labor law. Lest they risk their reputation or finances, local
agenciesmust already have mechanisms for guarding against unscrupulous foreign employers even at the level prior to overseas
employment applications.
With the present state of the pleadings, it is not possible to determine whether there was indeed a transfer of obligations from
petitioner to Pacific. This should not be an obstacle for the respondent overseas worker to proceed with the enforcement of this
judgment. Petitioner is possessed with the resources to determine the proper legal remedies to enforce its rights against Pacific, if
any.
V
Many times, this court has spoken on what Filipinos may encounter as they travel into the farthest and mostdifficult reaches of our
planet to provide for their families. In Prieto v. NLRC:141
The Court is not unaware of the many abuses suffered by our overseas workers in the foreign land where they have ventured,
usually with heavy hearts, in pursuit of a more fulfilling future. Breach of contract, maltreatment, rape, insufficient nourishment, subhuman lodgings, insults and other forms of debasement, are only a few of the inhumane acts towhich they are subjected by their
foreign employers, who probably feel they can do as they please in their own country. Whilethese workers may indeed have
relatively little defense against exploitation while they are abroad, that disadvantage must not continue to burden them when they
return to their own territory to voice their muted complaint. There is no reason why, in their very own land, the protection of our own
laws cannot be extended to them in full measure for the redress of their grievances.142
But it seems that we have not said enough.
We face a diaspora of Filipinos. Their travails and their heroism can be told a million times over; each of their stories as real as any
other. Overseas Filipino workers brave alien cultures and the heartbreak of families left behind daily. They would count the minutes,
hours, days, months, and years yearning to see their sons and daughters. We all know of the joy and sadness when they come
home to see them all grown up and, being so, they remember what their work has cost them. Twitter accounts, Facetime, and
many other gadgets and online applications will never substitute for their lost physical presence.
Unknown to them, they keep our economy afloat through the ebb and flow of political and economic crises. They are our true
diplomats, they who show the world the resilience, patience, and creativity of our people. Indeed, we are a people who contribute
much to the provision of material creations of this world.
This government loses its soul if we fail to ensure decent treatment for all Filipinos. We default by limiting the contractual wages
that should be paid to our workers when their contracts are breached by the foreign employers. While we sit, this court will ensure
that our laws will reward our overseas workers with what they deserve: their dignity.
Inevitably, their dignity is ours as weil.
WHEREFORE, the petition is DENIED. The decision of the Court of Appeals is AFFIRMED with modification. Petitioner Sameer
Overseas Placement Agency is ORDERED to pay respondent Joy C. Cabiles the amount equivalent to her salary for the unexpired
portion of her employment contract at an interest of 6% per annum from the finality of this judgment. Petitioner is also ORDERED to
reimburse respondent the withheld NT$3,000.00 salary and pay respondent attorney's fees of NT$300.00 at an interest of 6% per
annum from the finality of this judgment.
The clause, "or for three (3) months for every year of the unexpired term, whichever is less" in Section 7 of Republic Act No. 10022
amending Section 10 of Republic Act No. 8042 is declared unconstitutional and, therefore, null and void.
SO ORDERED.

Becmen Service Exporter and Promotions, Inc. vs. Sps. Cuaresma

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
Jasmins 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 anapparent 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)
Jasmins 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, Jasmins 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), Jasmins 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 Jasmins death.8
In their complaint, the Cuaresmas claim that Jasmins death was work-related, having occurred at the employers premises;9 that
under Jasmins 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 Jasmins 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 attorneys 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 Jasmins 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 Becmens 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, Jasmins 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 physicians report as well
as the KSA police report, finding the same to be inconclusive. It declared that Jasmins death was the result of an "accident"
occurring within the employers 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
Jasmins 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 NLRCs findings that Jasmins 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
employers 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 Jasmins 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
Jasmins 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 JASMINS 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 JASMINS 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 DECEASEDS 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 Jasmins 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 Jasmins 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 Jasmins 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 employers sphere
of inquiry.
While the "employers 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 employers
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 arepatently
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 Jasmins 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 Becmens 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 Jasmins family in obtaining justice for her death, they immediately gave up on Jasmins 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 Jasmins fate to oblivion. It appears from the record that to
this date, no follow up of Jasmins case was ever made at all by them, and they seem to have expediently treated Jasmins 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 Jasmins sake and to restore honor to her name.
Indeed, their nonchalant and uncaring attitude may be seen from how Jasmins remains were repatriated. No official representative
from Rajab or Becmen was kind enough to make personal representations with Jasmins parents, if only to extend their
condolences or sympathies; instead, a mere colleague, nurse Jessie Fajardo, was designated to accompany Jasmins body home.
Of all lifes tragedies, the death of ones own child must be the most painful for a parent. Not knowing why or how Jasmins life was
snuffed out makes the pain doubly unbearable for Jasmins parents, and further aggravated by Rajab, Becmen, and White Falcons
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 Falcons indifference to Jasmins 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 Jasmins 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 Jasmins 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 Jasmins 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 Jasmins
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 Jasmins 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 Jasmins 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 2327 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 Jasmins case on their own: they caused another autopsy on
Jasmins 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 Jasmins 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 seamans 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 Falcons 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 Jasmins 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 employees all these are contrary to morals, good customs and public policy, and constitute taking
advantage of the poor employee and her familys 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 Becmens
material interest despite evidence to the contrary is against the moral law and runs contrary to the good custom of not
denouncing ones 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 Falcons assumption of Becmens liability does not automatically result in Becmens 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) Attorneys fees equivalent to ten percent (10%) of the total monetary award; and,
4) Costs of suit.
SO ORDERED.

Sunace International Manpower Services vs. NLRC

Petitioner, Sunace International Management Services (Sunace), a corporation duly organized and existing under the laws of the
Philippines, deployed to Taiwan Divina A. Montehermozo (Divina) as a domestic helper under a 12-month contract effective
February 1, 1997.1 The deployment was with the assistance of a Taiwanese broker, Edmund Wang, President of Jet Crown
International Co., Ltd.
After her 12-month contract expired on February 1, 1998, Divina continued working for her Taiwanese employer, Hang Rui Xiong,
for two more years, after which she returned to the Philippines on February 4, 2000.
Shortly after her return or on February 14, 2000, Divina filed a complaint2 before the National Labor Relations Commission (NLRC)
against Sunace, one Adelaide Perez, the Taiwanese broker, and the employer-foreign principal alleging that she was jailed for three
months and that she was underpaid.
The following day or on February 15, 2000, Labor Arbitration Associate Regina T. Gavin issued Summons3 to the Manager of
Sunace, furnishing it with a copy of Divinas complaint and directing it to appear for mandatory conference on February 28, 2000.
The scheduled mandatory conference was reset. It appears to have been concluded, however.
On April 6, 2000, Divina filed her Position Paper4 claiming that under her original one-year contract and the 2-year extended
contract which was with the knowledge and consent of Sunace, the following amounts representing income tax and savings were
deducted:
Year
1997
1998
1999

Deduction for Income Tax

NT10,450.00
NT9,500.00
NT13,300.00

Deduction for Savings

NT23,100.00
NT36,000.00
NT36,000.00;5

and while the amounts deducted in 1997 were refunded to her, those deducted in 1998 and 1999 were not. On even date, Sunace,
by its Proprietor/General Manager Maria Luisa Olarte, filed its Verified Answer and Position Paper,6 claiming as follows,
quoted verbatim:
COMPLAINANT IS NOT ENTITLED FOR THE REFUND OF HER 24 MONTHS SAVINGS
3. Complainant could not anymore claim nor entitled for the refund of her 24 months savings as she already took back her saving
already last year and the employer did not deduct any money from her salary, in accordance with a Fascimile Message from the
respondent SUNACEs employer, Jet Crown International Co. Ltd., a xerographic copy of which is herewith attached as ANNEX
"2" hereof;
COMPLAINANT IS NOT ENTITLED TO REFUND OF HER 14 MONTHS TAX AND PAYMENT OF ATTORNEYS FEES
4. There is no basis for the grant of tax refund to the complainant as the she finished her one year contract and hence, was not
illegally dismissed by her employer. She could only lay claim over the tax refund or much more be awarded of damages such as
attorneys fees as said reliefs are available only when the dismissal of a migrant worker is without just valid or lawful cause as
defined by law or contract.
The rationales behind the award of tax refund and payment of attorneys fees is not to enrich the complainant but to compensate
him for actual injury suffered. Complainant did not suffer injury, hence, does not deserve to be compensated for whatever kind of
damages.
Hence, the complainant has NO cause of action against respondent SUNACE for monetary claims, considering that she has been
totally paid of all the monetary benefits due her under her Employment Contract to her full satisfaction.

6. Furthermore, the tax deducted from her salary is in compliance with the Taiwanese law, which respondent SUNACE has no
control and complainant has to obey and this Honorable Office has no authority/jurisdiction to intervene because the power to tax is
a sovereign power which the Taiwanese Government is supreme in its own territory. The sovereign power of taxation of a state is
recognized under international law and among sovereign states.
7. That respondent SUNACE respectfully reserves the right to file supplemental Verified Answer and/or Position Paper to
substantiate its prayer for the dismissal of the above case against the herein respondent. AND BY WAY OF x x x x (Emphasis and underscoring supplied)
Reacting to Divinas Position Paper, Sunace filed on April 25, 2000 an ". . . answer to complainants position paper"7 alleging that
Divinas 2-year extension of her contract was without its knowledge and consent, hence, it had no liability attaching to any claim
arising therefrom, and Divina in fact executed a Waiver/Quitclaim and Release of Responsibility and an Affidavit of Desistance,
copy of each document was annexed to said ". . . answer to complainants position paper."
To Sunaces ". . . answer to complainants position paper," Divina filed a 2-page reply,8 without, however, refuting Sunaces
disclaimer of knowledge of the extension of her contract and without saying anything about the Release, Waiver and Quitclaim and
Affidavit of Desistance.
The Labor Arbiter, rejected Sunaces claim that the extension of Divinas contract for two more years was without its knowledge and
consent in this wise:
We reject Sunaces submission that it should not be held responsible for the amount withheld because her contract was extended
for 2 more years without its knowledge and consent because as Annex "B"9 shows, Sunace and Edmund Wang have not stopped
communicating with each other and yet the matter of the contracts extension and Sunaces alleged non-consent thereto has not
been categorically established.
What Sunace should have done was to write to POEA about the extension and its objection thereto, copy furnished the
complainant herself, her foreign employer, Hang Rui Xiong and the Taiwanese broker, Edmund Wang.
And because it did not, it is presumed to have consented to the extension and should be liable for anything that resulted thereform
(sic).10 (Underscoring supplied)
The Labor Arbiter rejected too Sunaces argument that it is not liable on account of Divinas execution of a Waiver and Quitclaim
and an Affidavit of Desistance. Observed the Labor Arbiter:
Should the parties arrive at any agreement as to the whole or any part of the dispute, the same shall be reduced to writing and
signed by the parties and their respective counsel (sic), if any, before the Labor Arbiter.
The settlement shall be approved by the Labor Arbiter after being satisfied that it was voluntarily entered into by the parties and
after having explained to them the terms and consequences thereof.
A compromise agreement entered into by the parties not in the presence of the Labor Arbiter before whom the case is pending shall
be approved by him, if after confronting the parties, particularly the complainants, he is satisfied that they understand the terms and
conditions of the settlement and that it was entered into freely voluntarily (sic) by them and the agreement is not contrary to law,
morals, and public policy.
And because no consideration is indicated in the documents, we strike them down as contrary to law, morals, and public policy.11
He accordingly decided in favor of Divina, by decision of October 9, 2000,12 the dispositive portion of which reads:
Wherefore, judgment is hereby rendered ordering respondents SUNACE INTERNATIONAL SERVICES and its owner ADELAIDA
PERGE, both in their personal capacities and as agent of Hang Rui Xiong/Edmund Wang to jointly and severally pay complainant
DIVINA A. MONTEHERMOZO the sum of NT91,950.00 in its peso equivalent at the date of payment, as refund for the amounts
which she is hereby adjudged entitled to as earlier discussed plus 10% thereof as attorneys fees since compelled to litigate,
complainant had to engage the services of counsel.
SO ORDERED.13 (Underescoring supplied)
On appeal of Sunace, the NLRC, by Resolution of April 30, 2002,14 affirmed the Labor Arbiters decision.
Via petition for certiorari,15 Sunace elevated the case to the Court of Appeals which dismissed it outright by Resolution of November
12, 2002,16 the full text of which reads:
The petition for certiorari faces outright dismissal.

The petition failed to allege facts constitutive of grave abuse of discretion on the part of the public respondent amounting to lack of
jurisdiction when the NLRC affirmed the Labor Arbiters finding that petitioner Sunace International Management Services impliedly
consented to the extension of the contract of private respondent Divina A. Montehermozo. It is undisputed that petitioner was
continually communicating with private respondents foreign employer (sic). As agent of the foreign principal, "petitioner cannot
profess ignorance of such extension as obviously, the act of the principal extending complainant (sic) employment contract
necessarily bound it." Grave abuse of discretion is not present in the case at bar.
ACCORDINGLY, the petition is hereby DENIED DUE COURSE and DISMISSED.17
SO ORDERED.
(Emphasis on words in capital letters in the original; emphasis on words in small letters and underscoring supplied)
Its Motion for Reconsideration having been denied by the appellate court by Resolution of January 14, 2004,18Sunace filed the
present petition for review on certiorari.
The Court of Appeals affirmed the Labor Arbiter and NLRCs finding that Sunace knew of and impliedly consented to the extension
of Divinas 2-year contract. It went on to state that "It is undisputed that [Sunace] was continually communicating with
[Divinas] foreign employer." It thus concluded that "[a]s agent of the foreign principal, petitioner cannot profess ignorance of such
extension as obviously, the act of the principal extending complainant (sic) employment contract necessarily bound it."
Contrary to the Court of Appeals finding, the alleged continuous communication was with the Taiwanese brokerWang, not with the
foreign employer Xiong.
The February 21, 2000 telefax message from the Taiwanese broker to Sunace, the only basis of a finding of continuous
communication, reads verbatim:

xxxx
Regarding to Divina, she did not say anything about her saving in police station. As we contact with her employer, she
took back her saving already last years. And they did not deduct any money from her salary. Or she will call back her
employer to check it again. If her employer said yes! we will get it back for her.
Thank you and best regards.
(Sgd.)
Edmund Wang
President19

The finding of the Court of Appeals solely on the basis of the above-quoted telefax message, that Sunace continually
communicated with the foreign "principal" (sic) and therefore was aware of and had consented to the execution of the extension of
the contract is misplaced. The message does not provide evidence that Sunace was privy to the new contract executed after the
expiration on February 1, 1998 of the original contract. That Sunace and the Taiwanese broker communicated regarding Divinas
allegedly withheld savings does not necessarily mean that Sunace ratified the extension of the contract. As Sunace points out in its
Reply20 filed before the Court of Appeals,
As can be seen from that letter communication, it was just an information given to the petitioner that the private respondent had
t[aken] already her savings from her foreign employer and that no deduction was made on her salary. It contains nothing about the
extension or the petitioners consent thereto.21
Parenthetically, since the telefax message is dated February 21, 2000, it is safe to assume that it was sent to enlighten Sunace who
had been directed, by Summons issued on February 15, 2000, to appear on February 28, 2000 for a mandatory conference
following Divinas filing of the complaint on February 14, 2000.
Respecting the Court of Appeals following dictum:
As agent of its foreign principal, [Sunace] cannot profess ignorance of such an extension as obviously, the act of its principal
extending [Divinas] employment contract necessarily bound it,22
it too is a misapplication, a misapplication of the theory of imputed knowledge.
The theory of imputed knowledge ascribes the knowledge of the agent, Sunace, to the principal, employer Xiong,not the other
way around.23 The knowledge of the principal-foreign employer cannot, therefore, be imputed to its agent Sunace.

There being no substantial proof that Sunace knew of and consented to be bound under the 2-year employment contract extension,
it cannot be said to be privy thereto. As such, it and its "owner" cannot be held solidarily liable for any of Divinas claims arising from
the 2-year employment extension. As the New Civil Code provides,
Contracts take effect only between the parties, their assigns, and heirs, except in case where the rights and obligations arising from
the contract are not transmissible by their nature, or by stipulation or by provision of law.24
Furthermore, as Sunace correctly points out, there was an implied revocation of its agency relationship with its foreign principal
when, after the termination of the original employment contract, the foreign principal directly negotiated with Divina and entered into
a new and separate employment contract in Taiwan. Article 1924 of the New Civil Code reading
The agency is revoked if the principal directly manages the business entrusted to the agent, dealing directly with third persons.
thus applies.
In light of the foregoing discussions, consideration of the validity of the Waiver and Affidavit of Desistance which Divina executed in
favor of Sunace is rendered unnecessary.
WHEREFORE, the petition is GRANTED. The challenged resolutions of the Court of Appeals are herebyREVERSED and SET
ASIDE. The complaint of respondent Divina A. Montehermozo against petitioner isDISMISSED.
SO ORDERED.

APQ Ship Management vs. Casenas

This petition for review on certiorari under Rule 45 of the Rules of Court seeks to review, reverse and set aside the January 24,
2011 Decision1 and the June 1, 2011 Resolution2 of the Court of Appeals (CA). in CA-GR. SP No. 112997, which annulled and set
aside the October 14, 2009 Decision of the National Labor Relations Commission (NLRCJ in NLRC LAC No. 04-000220-09, where
respondent Angelito L. Caseas (Caseas) was seeking disability and other benefits against petitioner APQ Shipmanagement Co.,
Ltd. (APQ) and petitioner-principal APQ Crew Management USA, Inc. (Crew Management).3
It appears from the records that in June 2004, Casenas was hired by APQ, acting for and in behalf of its principal, Crew
Management, as Chief Mate for vessel MV Perseverance for a period of eight (8) months starting from June 16, 2004 to February
16, 2005,with a basic monthly salary of US$840.00, for forty-eight (48) hours a week, with US$329.00 as overtime pay.
In his Position Paper,4 Casenas further alleged that on June 16, 2004, he left Manila to join his assigned vessel in Miami, Florida,
USA, though the vessel could not leave the Florida port because of its incomplete documents for operation; that consequently, he
was transferred to another vessel, MV HAITIEN PRIDE, which was in Haiti, although again because of incomplete documents, the
vessel could not leave the port and remained at Cap Haitien; that together with the rest of the vessel's officers and crew, he was left
to fend for himself; that they were not provided food and water and had to fish for their own food and were not paid their salaries;
that he suffered extreme stress and anxiety because of the uncertainty of the situation; that his employment contract was extended
by APQ from the original eight (8) months to twenty-six (26) months; that the vessel eventually left for Bahamas; that he felt he
became weaker and got tired easily; that despite his unpaid wages and weakened condition, he performed his duties as Chief Mate
diligently; that in August 2006, he began to suffer shortness of breath, headache and chest pains; that he was then brought to the
Grand Bahamas Health Services and was diagnosed with hypertension and was given medicines; that he was then repatriated due
to his condition and he arrived in the Philippines on August 30, 2006; that within three (3) days thereafter, he reported to APQ for
post-employment medical examination where the company-designated physician later diagnosed him with Ischemic Heart Disease;
that a certain Dr. Ariel G. Domingo likewise examined him, confirming and certifying that he was suffering from Essential
Hypertension and Ischemic Heart Disease; that he was declared "unfit for sea service"; that as a result, he was not able to work for
more than 120 days from his repatriation; that another medical examination was conducted by Dr. Lina R. Cero, showing that he
was suffering from Essential Hypertension with Cariomegally Ischemic Heart Disease and Indirect Inguinal Hernia Right; that he
was then advised to take his maintenance medications for life; that APQ refused to provide him further medical attention, thus, he
incurred medical expenses in the amount of 6,390.00 by November 2006; that he demanded payment of permanent total disability
benefits, sickness allowance and medical expenses to which he was entitled under the POEA Standard Employment Contract
(POEA-SEC), but APQ refused to pay; that he, together with other crew members, sent a series of letters and e-mails to the
representatives of the shipowners regarding their unpaid wages, but despite efforts, APQ still refused to pay their salaries; that
demands for payment were also made to the president of APQ, but the same were refused; and that ultimately, he was compelled
to seek redress and filed a complaint for permanent total disability benefits, reimbursement of medical expenses, sickness
allowance, non-payment of salaries representing the extended portion of the employment contract, damages, and attorney's fees.
APQ, on the other hand, alleged in its Position Paper5 that upon expiration of the contract, Caseas refused to return to the
Philippines until he finally did on August 30, 2006;6 that thereafter, Caseas demanded payment of his wages, overtime and
vacation pay for the alleged extended portion of the contract; that it could not be held liable for claims pertaining to the extended
portion of the contract for it did not consent to it; that, in fact, as early as January 2005, it had been making arrangements, through
American Airlines/American Eagle, for Caseas repatriation at the end of his contract in February 2005; that Caseas was fully
paid of his wages and other benefits for the duration of his 8-month contract; and that Caseas suffered illness after the expiration
of the contract, hence, it could not be made liable to pay him any benefits for his injury/illness. 7

Caseas, however, disputed the position of APQ, claiming that his contract of employment was duly extended.8He denied that APQ
had been making arrangements for his repatriation as early as January 2005. To prove that his contract was extended, he
submitted the following documents:
1. Deck Logbook, dated 14 August 2006;
2. Report of Mr. Steve Mastroropolous, dated 16 May 2006;
3. Letter, dated 24 April 2006 of Mr. Alex P. Quillope, President of the respondent APQ to OWWA, admitting that there was
no food and water for the crew of MV "HAITIEN PRIDE."9
APQ countered that the abovementioned documents did not prove mutual consent of the parties as provided in Caseas
employment contract. His contract expired on August 1, 2005 and, thus, he had no legal basis to claim any salary after the said
period.10 Caseas became ill in August 2006 or more than one (1) year after the expiration of his employment contract.11
Labor Arbiter Decision
On November 20, 2008, the Labor Arbiter (LA)rendered the Decision12 dismissing Caseas' complaint. He was of the view that the
employment contract was not extended pursuant to the terms and conditions of the contract. Caseas failed to prove mutual
consent of the parties to the extension of the contract. He rendered services on MV Haitien Pride from August 1, 2005 to April 30,
2006, after the expiration of his contract with APQ on board the vessel MV Perseverance on February 15, 2005.
The LA pointed out that the illness/disease suffered by Caseas was sustained while serving on board MVCap Haitien Pride, which
was outside the period of his contractual employment. Thus, Caseas' claims could not be awarded.
NLRC Resolution
On June 22, 2009, the NLRC resolved the appeal by reversing and setting aside the LA decision. Based on the records, it found
that the employment contract was extended. The illness, Essential Hypertension, suffered by Caseas was a compensable disease
under Section 32-A, No. 20 of the POEA-SEC. Hence, NLRC ruled that Caseas was entitled to his claims because the illness was
sustained within the duration of his employment contract.
On October 14, 2009, the NLRC, acting on the motion for reconsideration filed by APQ, reconsidered and set aside the June 22,
2009 NLRC Resolution. It explained that the documentary evidence presented only proved the extension of contract but not the
consent given to it by APQ. Caseas failed to present the new contract duly signed by APQ or Crew Management, or any proof that
they consented to the extension. The NLRC explained that Caseas directly dealt with the shipowner to the exclusion of APQ and
Crew Management, hence, his recourse was against the shipowner. Thus, APQ could not be held liable for the unpaid salaries, as
well as the permanent disability benefits, because these were claims that accrued after the expiration of the employment contract.
Caseas moved for a reconsideration, but the NLRC denied his motion in its Resolution, dated November 27, 2009.
CA Decision
Caseas filed a petition for certiorari under Rule 65 before the CA, assailing the October 14, 2009 decision and the November 27,
2009 resolution of the NLRC. On January 24, 2011, the CA granted the petition and nullified and set aside the questioned NLRC
decision and resolution.
The CA reinstated the earlier June 22, 2009 NLRC Resolution. In so ruling, the CA cited the case of Place well International
Services Corporation v. Camote,13 where it was written:
xxx a subsequently executed side agreement of an overseas contract worker with the foreign employer is void, simply because it is
against our existing laws, morals and public policy. The subsequent agreement cannot supersede the terms of the standard
employment contract approved by the POEA. Assuming arguendo that petitioner entered into an agreement with the foreign
principal for an extension of his contract of employment, sans approval by the POEA, the contract that governs petitioner's
employment is still the POEA-SEC until his repatriation. As far as Philippine law is concerned, petitioner's contract of employment
with respondents was concluded only at the time of his repatriation on August 30, 2006.
Further, the CA explained that a declaration from the company designated physician as to the fitness or unfitness of a seafarer to
continue his sea-duties is sanctioned by Section 20(B)(3) of the POEA-SEC. There being no declaration made by the companydesignated physician within the 120-day period as to the fitness of Caseas, the CA opined that he was undoubtedly entitled to
disability benefits.
APQ filed a motion for reconsideration, while Caseas filed his Comment/Opposition. On June 1, 2011, the CA denied the motion
for lack of merit.
Hence, this petition.

GROUNDS
THE HONORABLE COURT OF APPEALS ERRED IN REVERSING AND SETTING ASIDE THE DECISION AND RESOLUTION
OF THE NLRC DATED 14 OCTOBER 2009 AND 27 NOVEMBER 2009, AND REINSTATING THE NLRCS RESOLUTION DATED
22 JUNE 2009, CONSIDERING THAT:
A. PRIVATE RESPONDENTS CONTRACT OF EMPLOYMENT WAS NEVER EXTENDED BY THE COMPANY NOR BY
THE PRINCIPAL
B. PRIVATE RESPONDENTS CLAIM FOR DISABILITY BENEFITS, SICKNESS ALLOWANCE AND UNPAID WAGES
ALL ACCRUED AFTER THE EXPIRATION OF THE CONTRACT OF EMPLOYMENT 14
The pivotal issue for resolution is whether or not the employment contract of Caseas was extended with the consent of APQ/Crew
Management.
The Court rules in the affirmative.
At the outset, it is to be emphasized that the Court is not a trier of facts and, thus, its jurisdiction is limited only to reviewing errors of
law. The rule, however, admits of certain exceptions, one of which is where the findings of fact of the lower tribunals and the
appellate court are contradictory. Such is the case here. Thus, the Court is constrained to review and resolve the factual issue in
order to settle the controversy.
Employment contracts of seafarers on board foreign ocean-going vessels are not ordinary contracts. They are regulated and an
imprimatur by the State is necessary. While the seafarer and his employer are governed by their mutual agreement, the POEA
Rules and Regulations require that the POEA-SEC be integrated in every seafarers contract.15 In this case, there is no dispute that
Caseas employment contract was duly approved by the POEA and that it incorporated the provisions of the POEA-SEC.
As earlier stated, the controversy started when Caseas claimed sickness and disability benefits as well as unpaid wages from the
petitioners upon his return to the Philippines. The petitioners, on the other hand, refused to pay, arguing that Caseas sickness
was contracted after his employment contract expired.
Regarding the issue of extension and its corresponding consequences, two cases were cited by the parties in their pleadings. The
first was Sunace International Management Services, Inc. v. NLRC16 (Sunace)and the second was Placewell International Services
Corporation v. Camote17 (Placewell).
In Sunace, the Court ruled that the theory of imputed knowledge ascribed the knowledge of the agent to the principal, not the other
way around. The knowledge of the principal-foreign employer could not, therefore, be imputed to its agent. As there was no
substantial proof that Sunace knew of, and consented to be bound under, the 2-year employment contract extension, it could not be
said to be privy thereto. As such, it and its owner were not held solidarily liable for any of the complainants claims arising from the
2-year employment extension.18
In Placewell, the Court concluded that the original POEA-approved employment contract subsisted and, thus, the solidary liability of
the agent with the principal continued. It ruled that:
R.A. 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. Thus, we held in Chavez v. BontoPerez,19 that the subsequently executed side agreement of an overseas contract worker with her foreign employer which reduced
her 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 her standard employment contract approved by the POEA.
xxx
Moreover, we find that there was no proper dismissal of respondent by SAAD; the "termination" of respondent was clearly a ploy to
pressure him to agree to a lower wage rate for continued employment. Thus, the original POEA-approved employment contract of
respondent subsists despite the so-called new agreement with SAAD. Consequently, the solidary liability of petitioner with SAAD for
respondents money claims continues in accordance with Section 10 of R.A. 8042.20
APQs primary argument revolves around the fact of expiration of Caseas employment contract, which it claims was not extended
as it was without its consent. While the contract stated that any extension must be made by mutual consent of the parties, it,
however, incorporated Department Order (DO)No. 4 and Memorandum Circular No. 09, both series of 2000, which provided for the
Standard Terms and Conditions Governing the Employment of Filipino Seafarers on Board Ocean Going Vessels. Sections 2 and
18 thereof provide:
SECTION 2. COMMENCEMENT/ DURATION OF CONTRACT

A. The Employment contract between the employer and the seafarer shall commence upon actual departure of the
seafarer from the airport or seaport in the point of hire and with a POEA approved contract. It shall be effective until the
seafarers date of arrival at the point of hire upon termination of his employment pursuant to Section 18 of this Contract.
B. The period of employment shall be for a period mutually agreed upon by the seafarer and the employer but not to
exceed 12 months. Any extension of the contract shall be subject to the mutual consent of both parties.
xxx
SECTION 18. TERMINATION OF EMPLOYMENT
A. The employment of the seafarer shall cease when the seafarer completes his period of contractual service aboard the
vessel, signs off from the vessel and arrives at the point of hire.
B. The employment of the seafareris also terminated when the seafarer arrives at the point of hire for any of the following
reasons:
1. When the seafarer signs off and is disembarked for medical reasons pursuant to Section 20 (B)[5] of this
Contract.
xxx
[Emphases supplied]
It is to be observed that both provisions require the seafarer to arrive at the point of hire as it signifies the completion of the
employment contract, and not merely its expiration. Similarly, a seafarers employment contract is terminated even before the
contract expires as soon as he arrives at the point of hire and signs off for medical reasons, due to shipwreck, voluntary resignation
or for other just causes. In a nutshell, there are three (3) requirements necessary for the complete termination of the employment
contract: 1]termination due to expiration or other reasons/causes; 2]signing off from the vessel; and 3]arrival at the point of hire. In
this case, there was no clear showing that Caseas signed off from the vessel upon the expiration of his employment contract,
which was in February or April 2005. He did not arrive either in Manila, his point of hire, because he was still on board the vessel
MV Haitien Pride on the supposed date of expiration of his contract. It was only on August 14, 2006 that he signed off21 from MV
Haitien Pride and arrived in Manila on August 30, 2006.
In Interorient Maritime Enterprises, Inc. v. NLRC,22 the Court held that the obligations and liabilities of the local agency and its
foreign principal do not end upon the expiration of the contracted period as they were duty bound to repatriate the seaman to the
point of hire to effectively terminate the contract of employment.23
APQ avers that Caseas transferred from MV Perseverance to MV Haitien Pride, which was not the ship specifically mentioned in
his contract. Section 15 of the POEA-SEC guides the Court on this. It reads:
Section 15. Transfer Clause The seafarer agrees to be transferred at any port to any vessel owned or operated, manned or
managed by the same employer, provided it is accredited to the same manning agent and provided further that the position of the
seafarer and the rate of his wages and terms of services are in no way inferior and the total period of employment shall not exceed
that originally agreed upon.
Any form of transfer shall be documented and made available when necessary.
APQ did not argue that MV Haitien Pride was not operated or managed by Crew Management. It did not claim either that said
vessel was not accredited by it. The logical conclusion, therefore, is that MV Haitien Pride was operated/managed by Crew
Management and accredited by APQ.
Thus, Caseas transfer should have been documented and made part of its records for future purposes, but no documentation has
been shown.
Even assuming arguendo that MV Haitien Pride was not related in any way with either Crew Management or APQ, it is with more
reason that the transfer should have been properly documented pursuant to the above provision because it necessitated the
termination of his employment contract and his repatriation to the Philippines, pursuant to Section 26(A) of the POEA-SEC. The
said provision specifically provides that:
Section 26. Change of Principal.
A. When there is change of principal of the vessel necessitating the termination of employment of the seafarer before the
date indicated in the Contract, the seafarer shall be entitled to earned wages, repatriation at employers expense and one
month basic pay as termination pay.

B. If by mutual agreement, the seafarer continues his service on board the same vessel, such service shall be treated as a
new contract. The seafarer shall be entitled to earned wages only.
C. In case arrangement has been made for the seafarer to join another vessel to complete his contract, the seafarer shall
be entitled to basic wage until the date joining the other vessel.
Meanwhile, Caseas claimed that his transfer was due to the fact that MV Perseverance could not leave port because of
incomplete documents for its operation. This was not disputed. To the mind of the Court, having incomplete documents for the
vessels operation renders it unseaworthy. While seaworthiness is commonly equated with the physical aspect and condition of the
vessel for voyage as its ability to withstand the rigors of the sea, it must not be forgotten that a vessel should be armed with the
necessary documents required by the maritime rules and regulations, both local and international. It has been written that vessel
seaworthiness further extends to cover the documents required to ensure that the vessel can enter and leave ports without
problems.24
Accordingly, Caseas contract should have been terminated and he should have been repatriated to the Philippines because a
seafarer cannot be forced to sail with an unseaworthy vessel, pursuant to Section 24 of the POEA-SEC.25 There was, however, no
showing that his contract was terminated by reason of such transfer. It is necessary to reiterate that MV Haitien Pride appears to be
manned by, and accredited with, the same principal/ agency. His joining the said vessel could only mean that it was for the purpose
of completing his contract as the transfer was made well within the period of his employment contract on board MV Perseverance.
APQ further claims that that there was an agreement between Caseas and the shipowner, but there was no concrete proof
adduced to show that indeed a new agreement for the extension of the contract was ever made. Granting that a new agreement for
the extension was made, the acts of APQ and Crew Management proved that there was implied consent to the extension.
APQ attempts to impress upon the Court that Caseas contract already expired and that he had a new employer during the alleged
extension of the contract by relying on the December 16, 2005 Letter of the POEA. APQ alleged in its Memorandum 26 that:
In a letter dated 16 December 2005 letter, the POEA confirmed that the Contract expired on April 2005 but he was not allowed
repatriation by the owner of the Vessel, his new employer [See Annex "6" of Comment attached as Annex "z" of this Petition.] A
perusal of the said letter, however, discloses that nowhere was it stated that Caseas was allowed repatriation by the owner of the
vessel, his new employer. What was clearly stated therein was that Caseas was not allowed repatriation by his employer for some
reason. Insofar as Philippine law is concerned, the employer referred to in the said letter remains to be the foreign
principal/manning agency as stated in the POEA-approved employment contract.
Finally, there was no showing as to why Caseas was not repatriated to the Philippines upon the expiration of his contract. It was
expressly provided therein that the contract was for eight (8) months, plus or minus two (2) months, that is, until February 2005 or
at most, April 2005.
On its claim of lack of consent, APQ insists that as proof of its intention not to extend Caseas contract, it already arranged his
plane ticket as early as January & February 2005, in anticipation of the expiration of the contract, attaching the e-mail copy of the
American Airlines E-ticket &
Itinerary.
Again, a scrutiny of the records reveals otherwise. The e-mail and eticket consistently relied upon by the petitioners clearly showed
that the eticket was issued on January 18, 2006, which flight was scheduled on January 23 (Monday) bound for Miami and January
25 (Wednesday) bound for Manila. There were two (2) other e-tickets arranged for Caseas which showed a flight schedule on
February 8 (Wednesday) and February 15 (Wednesday), both bound for Manila from Miami. These e-mails and etickets were sent
by Crew Management to APQ viafax. Crew Management also executed the letter,27 dated February 24, 2006, addressed to
DOLEOWWA in response to the report of the wife of Caseas to DOLE regarding his repatriation. Crew Management stated in said
letter, copy furnished APQ, that it had already issued an air ticket to Caseas, but he failed to claim it. The same letter assured the
DOLE-OWWA of its arranging the payment of wages and repatriation of the crew members on-board MV Haitien Pride, as well as
its arranging another plane ticket for Caseas, if necessary. Thus, these communications reveal that APQ had actual knowledge
that Caseas continued working on board the said vessel after February/April 2005. Despite such knowledge, APQ neither posed
any objection to the extension of the contract nor make any effort to protect itself from any responsibility that might arise from the
extension, if it did not indeed intend to extend the employment contract. Tokeep on notifying a person/party who was not anymore
privy to any contract at all makes no sense. Also, APQ sent OWWA another letter,28 dated April 24, 2006, giving information on the
status of MV Haitien Pride. The same letter confirmed that APQ and Crew Management had constant communication with each
other regarding the said vessel and its crew. Alex P. Quillope, APQs President, even stated in the same letter that:
Soon as I receive any information from them, I will at once inform your good office as I have then already prepared my travel again
to Miami, Florida once MV Haitien Pride be on her sailing to Miami.29
APQ cannot now feign ignorance of any extension of the contract and claim that it did not consent to it.1wphi1 As it had
knowledge of the extended contract, APQ is solidarily liable with Crew Management for Caseas claims. Caseas is, therefore,
entitled to the unpaid wages during the extended portion of his contract.
As to his claim for medical and other benefits, there is no dispute that the symptoms of Caseas illness began to manifest during
the term of his employment contract. The fact that the manifestations of the illness only came about in August 2006 will not bar a

conclusion that he contracted the ailment while the contract was subsisting. The overall state and condition that he was exposed to
over time was the very cause of his illness. Thus, the CA was correct in reinstating the NLRC resolution awarding sickness
allowance as well as disability benefits in favor of Caseas. Section 20(B)(3) of the 2000 POEA Standard Terms and Conditions
Governing the Employment of Filipino Seafarers on Board Ocean Going Vessels provides:
B. COMPENSATION AND BENEFITS FOR INJURY OR ILLNESS
xxx
3. Upon sign-off from the vessel for medical treatment, the seafarer is entitled to sickness allowance equivalent to his basic wage
until he is declared fit to work or the degree of permanent disability has been assessed by the company-designated physician but in
no case shall this period exceed one hundred twenty (120) days.
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. 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 doctors decision shall be
final and binding on both parties.
xxx
In Magsaysay Maritime Corporation vs. NLRC,30 citing Vergara vs. Hammonia Maritime Services, Inc.,31the Court reiterated that the
seafarer, upon sign-off from his vessel, must report to the company-designated physician within three (3) days from arrival for
diagnosis and treatment. For the duration of the treatment but in no case to exceed 120 days, the seaman is on temporary total
disability as he is totally unable to work. He receives his basic wage during this period 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 days initial period is exceeded and no such declaration is made
because the seafarer requires further medical attention, then 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 partial or total disability already exists.
The seaman may, of course, also be declared fit to work at any time such declaration is justi1ied by his medical condition.32
In this case, Casenas immediately reported to APQ for the required post-employment medical examination upon his return to the
Philippines. He was referred to the company-designated physician, who diagnosed him to be suffering from lschemic Heart
Disease, which was a manifestation of organ damage.33 Caseas likewise consulted two (2) other physicians who certified him to
be suffering from Essential Hypertension aside from Ischemic Heart Disease.34 From the time of Caseas' diagnosis by the
company-designated physician, he was under the state of temporary total disability, which lasted for at least 120 days as provided
by law. Such period could be extended up to 240 days, if further medical attention was required.
There was, however, no showing of any justification to extend said period. As the law requires, within 120 days from the time he
was diagnosed of his illness, the company-designated physician must make a declaration as to the fitness or unfitness of Caseas
As correctly observed by the CA, however, the 120 day period lapsed without such a declaration being made.35 Caseas is now
deemed to be in a state of permanent total disability and, thus, clearly entitled to the total disability benefits provided by law.
WHEREFORE, the petition is DENIED.
SO ORDERED.

Sealanes Marine vs. Dela Torre