New Labor Cases

G.R. No.
170139, August 05, 2014

SAMEER OVERSEAS PLACEMENT AGENCY, INC., Petitioner, v. JOY C. CABILES, Respondent.
DECISION
LEONEN, J.:
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 Relations Commissions 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
cralawre d
Petitioner, Sameer Overseas Placement Agency, Inc., is a recruitment and placement agency.5Responding to an ad it
published, respondent, Joy C. Cabiles, submitted her application for a quality control job in Taiwan. 6
cralawred
Joys application was accepted.7 Joy was later asked to sign a one-year 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
cralawre d
Joy was deployed to work for Taiwan Wacoal, 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
cralawre d
Sameer Overseas Placement Agency claims that on July 14, 1997, a certain Mr. Huwang from Wacoal informed Joy, 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
cralawred
Joy claims that she was told that from June 26 to July 14, 1997, she only earned a total of NT$9,000. 15According to her,
Wacoal deducted NT$3,000 to cover her plane ticket to Manila. 16
cralawred
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
cralawre d
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 ?70,000.00.22 As evidence, it showed Official Receipt No. 14860 dated June 10, 1997,
bearing the amount of ?20,360.00.23 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
cralawre d
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
cralawre d
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 mere allegations.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
cralawred
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 proof to show that respondent was inefficient in her work and that she failed to comply
with company requirements.41 Furthermore, procedural due process was not observed in terminating respondent. 42
cralawred
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
cralawred
The National Labor Relations Commission awarded respondent only three (3) months worth of salary in the amount of
NT$46,080, the reimbursement of the NT$3,000 withheld from her, and attorneys fees of NT$300. 46
cralawred
The Commission denied the agencys motion for reconsideration 47 dated May 12, 2004 through a resolution48 dated July 2,
2004.
Aggrieved by the ruling, Sameer Overseas Placement Agency caused the filing of a petition 49 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:
chanRoble svirtualLawlibrary
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 partlyAFFIRMED in accordance with the foregoing
discussion, but subject to the caveat embodied in the last sentence. No costs.
SO ORDERED.53
Dissatisfied, Sameer Overseas Placement Agency filed this petition. 54
cralawre d
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 of her 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
cralawred
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
cralawred
Sameer Overseas Placement Agencys petition 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 an employee who is guilty of acts that are
inimical to the interest of the employer.61While 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.63 Workers
are entitled to substantive and procedural due process before termination. They may not be removed from employment
without a valid or just cause as determined by law and without going through the proper procedure.
Security of tenure for labor is guaranteed by our Constitution. 64
cralawre d
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 to make 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. Here in 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 self-organization, 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. They shall also participate in policy and decision-making processes affecting their rights and
benefits as may be provided by law.
....
chanroble slaw
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 pre-termination 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 not inform 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 of notice 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:
cralawla wlibrary
(a) Serious misconduct or willful disobedience by the employee of the lawful orders of his employer or representative in
connection with his work;
chanroble svirtuallawlibrary
(b) Gross and habitual neglect by the employee of his duties;
chanroblesvirtuallawlibrary
(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
ChanRoblesVirtualawlibrary
(e) Other causes analogous to the foregoing.
Petitioners allegation that respondent was inefficient in her work and negligent in her duties 69 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
cralawred
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 to the 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 of the 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
cralawred
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 adjust his 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 constantly attempt 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 communicate work standards that
would govern ones employment if [these are] to discharge in good faith [their] duty to adjudicate.73
cralawre d
In this case, petitioner merely alleged that respondent failed to comply with her foreign employers work requirements and
was inefficient in her work.74No 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 only failure on the part
of petitioner to comply with the requirement of the existence of just cause for termination. They patently show that the
employers did 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. 76One 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
cralawred
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 of the 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 of 1995, states that
overseas 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/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 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)
chanroble slaw
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 fees when the withholding
is unlawful.
The Court of Appeals affirmed the National Labor Relations Commissions decision to award respondent NT$46,080.00 or the
three-month 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
cralawred
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
cralawre d
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 provided under this section shall subject the responsible
officials to any or all of the following penalties:
cralawlawlibrary
(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 by Republic 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 moot and 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 so changed 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 that will reduce their hard-earned
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.91 Petitioner is also of the view
that the clause was already declared as constitutional in Serrano.92
cralawre d
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 as reinstated in Republic Act No. 10022, its contention is that it is
beyond judicial review.94
cralawre d
On the other hand, respondent argued that the clause was unconstitutional because it infringed on workers right to
contract.95
cralawred
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 change in
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 an
illegally 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
cralawred
In creating laws, the legislature has the power to make distinctions and classifications.99 In exercising such power, it has a
wide discretion.100
cralawre d
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 prescribes a reasonable classification. 104
cralawre d
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
cralawred
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 fixed-period 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 one-year 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
cralawre d
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
cralawre d
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
cralawred
We also noted in Serrano that before the passage of Republic Act No. 8042, the money claims of illegally terminated overseas
and local workers with fixed-term employment were computed in the same manner.112 Their money claims were computed
based on the unexpired portions of their contracts.113The 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
cralawre d
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
cralawre d
Observing the terminologies used in the 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
cralawre d
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 nor less than the
rights violated when a fixed-period overseas worker is illegally terminated. It is state policy to protect the rights of workers
without qualification 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 employees who can never
acquire regular employment status, unlike local workers 121 because it already justifies differentiated treatment in terms of
the computation of money claims.122
cralawred
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 classifications are 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
cralawre d
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 incentivized by 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 wrongful dismissal 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 of liability 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 taken from 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 be a 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 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.127
cralawred
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
cralawred
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
cralawred
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:
chanRoblesvirtualLa wlibrary
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:
cralawlawlibrary
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 rate of 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
cralawre d
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
annumfrom 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
cralawred
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
cralawre d
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
cannot repeal 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 overseas worker 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 awards of 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 of Wacoal 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
cralawre d
In overseas employment, the filing of money claims against the foreign employer is attended by practical and legal
complications. The distance of the foreign employer alone makes 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 workers attempt 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
cralawre d
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 one of 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 violations that 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
extent139 against the local agent, the overseas worker is assured of immediate and sufficient payment of what is due
them.140
cralawred
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 left without 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 local agencies jointly and severally liable with the foreign employer is that an 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 agencies must 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 most difficult reaches
of our planet to provide for their families. In Prieto v. NLRC:141
cralawre d
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, sub-human lodgings, insults and other forms of debasement, are only a few of the inhumane acts to which they
are subjected by their foreign employers, who probably feel they can do as they please in their own country. While these
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
chanrobleslaw
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 well.
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 attorneys 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.
G.R. No. 169247
June 2, 2014
MA. CONSOLACION M. NAHAS, doing business under the name and style PERSONNEL EMPLOYMENT AND
TECHNICAL RECRUITMENT AGENCY, Petitioner,
vs.
JUANITA L. OLARTE, Respondent.
DECISION
DEL CASTILLO, J.:
"A party will not be allowed to make a mockery of justice by taking inconsistent positions which, if allowed, would
result in brazen deception."
1
Assailed in this Petition for Review on Certiorari is the April 29, 2005 Decision of the Court of Appeals (CA) in CAG.R. SP No. 79028 which denied the Petition for Certiorari filed therewith and affirmed the February 28, 2003
Decision and June 30, 2003 Resolution of the National Labor Relations Commission (NLRC) in NLRC CA No.
032482-02. The NLRC dismissed the appeal from the Labor Arbiter's March 20, 2002 Decision in NLRC-NCR OFW
Case No. (L) 01-07-1411-00 which held Personnel Employment and Technical Recruitment Agency (PETRA), Royal
Dream International Agency (Royal Dream) and petitioner Ma. Consolacion M. Nahas (Nahas) jointly and severally
liable for the unpaid salaries, compensation for the unexpired portion of employment contract, moral and exemplary
damages and attorneys fees of respondent Juanita L. Olarte (Olarte).
2
Factual Antecedents
On August 27, 1999, Olarte was deployed as a domestic helper to Hail, Saudi Arabia for a contract term of two
years. Per her employment contract, she was to serve her employer, Fahad Abdulaziz Mohammed Al-Mijary
(Fahad) for a basic monthly salary of US$200.00. Fajads information sheet, on the other hand, provides that there
are two adults and three children living in his household and that no disabled or sick person is to be put under
Olartes care.
6
Upon arriving in Fahads home, Olarte was surprised that there were four children with one suffering from serious
disability. This notwithstanding, Olarte served Fahads family diligently. However, she was not paid her salaries. It
was only in December 1999 that she was given US$200.00 which was the only pay she received for the whole
duration that she worked for Fahad.
In the succeeding months, Olarte started feeling intense pain in her legs. Since she was not given immediate
medical attention, her condition became critical such that in February 2000 she had to be operated on due to water
retention in her leg bones. She was later diagnosed to be suffering from ostro-arthritis. Because of her condition,
Olarte requested Fahad to just allow her go home to the Philippines. But her pleas fell on deaf ears. At that point,
Fahad was already frequently maltreating her since she could no longer accomplish all the household chores due to
her illness.
Olarte finally saw an opportunity to escape from the abusive hands of her employer when she was allowed to go to
Riyadh, Saudi Arabia on June 16, 2000 and there sought refuge at the Philippine Embassy. Notwithstanding her
worsening condition, she could not be repatriated immediately because her passport was being withheld by Fahad
and had to stay for a while in the office of the Overseas Workers Welfare Administration (OWWA). When at last she
was able to return to the Philippines on August 21, 2000, Olarte had to be brought home from the airport by an
emergency ambulance.
Several months later, Olarte filed a Complaint for illegal dismissal, damages, attorneys fees and refund of
placement fees against her foreign employer Fahad and Nahas/PETRA/Royal Dream.
7
Ruling of the Labor Arbiter

In her pleadings, Olarte alleged that she went to the office of PETRA/Royal Dream at Room 401, Gochangco
Building, T.M. Kalaw, Ermita, Manila to apply for work abroad as a domestic helper. She was met and interviewed by
Nahas, the manager and owner of the said agencies, who instructed her to sign what appeared to be a contract of
employment for work as a domestic helper. Subsequently and upon completion of all the necessary papers, she was
deployed to Hail, Saudi Arabia in August 1999 and there experienced her horrible ordeal. As the ones responsible
for her deployment abroad, Olarte sought that Nahas, PETRA and Royal Dream be held jointly and severally
liablewith her foreign employer for all her claims.
8
In the Position Paper she filed for PETRA, Nahas acknowledged that she is the President/Manager of the said
agency. Nevertheless, she denied having a hand in Olartes deployment abroad. While she admitted that Olarte
indeed went to PETRAs office as a walk-in applicant sometime in May 1999, the latter allegedly withdrew her
application on the pretext that she would just go home to the province. To support this, Nahas purportedly attached
to the said pleading the alleged withdrawal request of Olarte as Annex "A." However, the said Annex "A" turned out
to be a filled-up bio-data form of Olarte bearing the letterhead of Royal Dream, the local agency which according to
Nahas was the one responsible for Olartes deployment.
9
10
In a Decision dated March 20,2002, the Labor Arbiter ruled that PETRA/Royal Dream/Nahas failed to discharge the
burden of proving that Olartes termination and repatriation were for just cause; and also rejected their claim against
liability after giving weight to the fact that Nahas admitted to have interviewed Olarte but failed to substantiate the
claim that the latter withdrew her application. The dispositive portion of the said Decision reads:
11
WHEREFORE, prescinding from the foregoing considerations, respondents Petra Agency/Royal [Dream]
International Services/Consolacion "Marla" Nahas are hereby jointly and severally ordered to pay the complainant
her unpaid salaries for eight (8) months in the amount of US$1,600.00; three (3) months salary of the unexpired
portion of the contract in the amount [of] US$600.00; moral damages in the amount of P100,000.00 and exemplary
damages amounting to P50,000.00 and attorneys fees equivalent to ten (10%) percent of the total monetary
awards.
SO ORDERED.
12
Nahas appealed to the NLRC.

Ruling of the National Labor Relations Commission
In her Memorandum of Appeal, Nahas recanted her earlier admission that Olarte went to PETRA as a walk-in
applicant sometime in May 1999, claiming that the same was a mistake. She asserted that Olarte could not have
possibly applied with PETRA during that time as the latter was issued a license by the POEA only on July 16, 1999.
Moreover, Fahad was not one of PETRAs accredited foreign employers.
13
To further avoid personal liability, Nahas denied involvement in Olartes deployment. She made a new allegation,
though, i.e., that if at all, her only involvement was that she interviewed Olarte when she was still connected with
Royal Dream as a mere employee. Even with this participation, she averred that she could not be made liable for
Olartes claims because she was neither the owner nor an officer of Royal Dream. Lastly, while Nahas was quick in
passing the buck to Royal Dream she nevertheless stressed that no summons was served upon the latter. Thus, the
Labor Arbiters Decision is not binding on it.
The NLRC, however, was not persuaded and disposed of the case in its Decision of February 28, 2003 as follows:
14
The facts of this case are never disputed by herein appellants, and as such they are now the law of the case.
Records will disclose, as admitted by the herein parties that it was with respondent PETRA that complainant applied
for overseas employment as domestic helper. It was respondent Nahas herself who interviewed complainant and in
all probability furnished her all the requisite[s] for her deployment. All along she (Nahas) represented [to be the
owner of] and [was connected] with both PETRA and Royal Dream to facilitate her deployment. In fact complainant
was successfully deployed by Royal Dream as represented to by Nahas. Obviously, complainants overseas
employment was made possible by respondent[]s agencies, thru the efforts of [respondent] Nahas.
While it was claimed by PETRA that the application of complainant was withdrawn, no evidence on [record] appear
to support it.
The same holds true with appellants[] claim that respondent Nahas was no longer connected with respondent Royal
Dream when complainant was deployed abroad.
The fact that complainant was finally deployed thru the intercession of [respondent] Nahas with the aid of both
respondent agencies, convinces us, as the Labor Arbiter ruled, that both agencies, indeed did so in recognition of
the formers authority.
Suffice it to [state] therefore that We find no cogent reason to deviate from the findings of the Labor Arbiter a quo,
and finding the same in order, [affirm] it en toto.
WHEREFORE, the instant appeal should be, as it is hereby dismissed for lack of merit.
SO ORDERED.
15
Nahas filed a Motion for Reconsideration which was denied in a Resolution dated June 30, 2003.Hence, the
recourse to the CA via a Petition for Certiorari.
16
17
Ruling of the Court of Appeals

Nahas advanced the same arguments she raised before the labor tribunals, but failed to convince the CA as in its
Decision dated April 29, 2005 it ruled in this wise:
18
Private respondent Olarte unequivocally declared at the [outset] that it was Nahas who interviewed her and
facilitated her application for work abroad as a domestic helper by instructing the former to sign the Contract of
Employment. Nahas, in her Position Paper, her Reply to Olartes Position Paper and her Rejoinder, admitted to
having interviewed Olarte for her application to work abroad. Though she quickly added that she did so only
because Olarte applied with PETRA first and that the latter eventually withdrew the same, Nahas subsequently
recanted this and instead admitted that her agency PETRA was only granted a license by the POEA on 16 July1999
or after Olarte accomplished and filed her application form with ROYAL on 18 May 1999. In the same vein, Nahas
likewise admitted being connected with ROYAL before and that she was the one who met and entertained Olarte
when the latter applied with ROYAL. While Nahas claim[s] that she is neither the proprietress nor one of the officers
of ROYAL at that time, her role or position with ROYAL was undeniably significant considering that she took charge
[of] interviewing Olarte and eventually made her sign the Contract of Employment. Clearly, Nahas exercised
discretion in determining who among the applicants of ROYAL should be accepted and deployed. It is also worthy to
point out that the accomplished bio-data of Olarte with the letterhead of ROYAL referred to earlier was attached by
no less than Nahas herself in her earlier pleading before the Labor Arbiter supposedly to show that Olarte withdrew
her application with PETRA. It would be uncanny for Nahas to have in her possession and custody such document,
if indeed she was but a mere staff of ROYAL or that she is no longer connected in any way with ROYAL, unless
there remains an intimate relationship between her and ROYALor that she once held an important position in the
same.
With the foregoing, We find nothing capricious or whimsical with the NLRCs finding and thus affirm Nahas liability in
accordance with Section 64 of the Omnibus Rules and Regulations Implementing the Migrant Workers and
Overseas Filipinos Act of1995 (RA 8024), to wit:
Section 64. Solidary Liability The liability of the principal/employer and the recruitment placement agency on any
and all claims under this Rule shall be [joint] and solidary. x x x.
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.
xxxx
WHEREFORE, the instant petition is DENIED and the assailed Decision of the NLRC dated 28 February2003 and
its Resolution of 30 June 2003 are hereby AFFIRMED.
SO ORDERED.
19
The Motion for Reconsideration thereto having been denied in the CA Resolution dated July 8, 2005, Nahas now
comes to this Court via the present Petition for Review on Certiorari.
20
21
The Parties Arguments

Nahas insists that it is Royal Dream which is solely responsible for Olartes deployment and thus should be the one
to answer for her claims. Be that as it may, she contends that Royal Dream was not served with summons; hence,
the proceedings in this case is not binding upon it. Nahas also refutes the CAs conclusion that since she
interviewed and caused Olarte to sign an employment contract, she held an important position in Royal Dream. She
maintains that she is a mere employee of Royal Dream and that interviewing and entertaining applicants per se do
not establish that she is a corporate officer, director or partner in said company who could be held solidarily liable.
Lastly, she avers that Olartes Complaint is bereft of allegations of attendant circumstances which warrant the grant
of moral and exemplary damages.
On the other hand, Olarte asserts that the argument that PETRA is different from Royal Dream is clearly an attempt
on the part of Nahas, PETRA and Royal Dream to evade liability. She stresses that it was Nahas, for and in behalf of
PETRA/Royal Dream, who performed the acts of recruitment which led to her deployment abroad; hence, all of
them should be held jointly and solidarily liable with their foreign principal.
Our Ruling
The Petition has no merit.
The Court is not a trier of facts; factual findings of the labor tribunals when affirmed by the CA are generally
accorded not only respect, but even finality, and are binding on this Court.
It must be stressed, at the outset, that the resolution of the issue of whether Nahas acted for and in behalf of PETRA
and/or Royal Dream in deploying Olarte abroad is a question of fact. "Well-settled is the rule that this Court is not a
trier of facts and this doctrine applies with greater force in labor cases. Questions of fact are for the labor tribunals to
resolve. Only errors of law are generally reviewed in petitions for review on certiorari criticizing decisions of the
CA." Also "[s]ettled is the rule that the findings of the [Labor Arbiter], when affirmed by the NLRC and the CA, are
binding on the Supreme Court, unless patently erroneous." In this case, the Labor Arbiter, the NLRC, and the CA
are one in their factual conclusion that Nahas, acting for and in behalf of PETRA and Royal Dream, interviewed
Olarte, caused her to sign an employment contract, and facilitated and made possible her deployment abroad. The
Court is, therefore, not duty-bound to inquire into the accuracy of this factual finding, particularly in this case where
there is no showing that it was arbitrary and bereft of any rational basis.
22
23
24
Nahas inconsistent positions militate against her case; her claim of lack of service of summonsupon Royal Dream is
likewise untenable.
The Court notes that in her quest to evade liability, Nahas introduced several conflicting assertions. Before the Labor
Arbiter, she admitted that Olarte indeed applied with PETRA and was interviewed by her but later withdrew the
application. While Nahas intended to support this position with a document showing that Olarte requested for the
withdrawal of her application, the same was, however, never submitted. What was instead unwittingly attached to
her Position Paper was Olartes accomplished bio-data bearing the letterhead of Royal Dream. This did not escape
the Labor Arbiters attention such that her March 20, 2002 Decision states:
x x x While [PETRA/Nahas] admits that complainant was a [walk]-in applicant, respondent [PETRA] Agencys claim
that[Olarte] subsequently withdrew her application has not been satisfactorily established by concrete evidence. x x
x [I]t is incumbent upon the party who asserts a fact [to prove the same].
More significantly, respondent Consolacion "Marla" Nahas never denied [Olartes claim] that it was [Nahas] who
interviewed her.
It is basic that mere [allegation]is neither equivalent to proof nor evidence.
25
Later in her Memorandum of Appeal with the NLRC, Nahas repudiated her earlier admission and averred that Olarte
did not at all apply with PETRA. While still maintaining that she interviewed Olarte, she now claimed to have done
so when she was still connected with Royal Dream as a mere employee.
1wphi1
It is quite obvious that Nahas started singing a different song, so to speak, after the Labor Arbiter did not buy her
claim that Olarte withdrew her application with PETRA due to her utter failure to support the same. And with her still
seeming inability to produce the alleged withdrawal request before the NLRC, the most convenient way out is for her
to claim that Olarte did not at all apply with PETRA. While Nahas attempted to bolster this new allegation by
averring that PETRA was issued a license only on July16, 1999 thereby making it impossible for Olarte to apply in
May 1999, the same, however, hardly convinces. Aside from the lack of any evidence showing the date of the
POEAs issuance of license to PETRA, the fact that it was yet to be issued a license does not preclude the
possibility that it was already accepting applicants on behalf of Royal Dream which at that time already possesses
the required license. This explains why the accomplished bio-data of Olarte dated May 18, 1999 bears the
letterhead of Royal Dream and also why the pertinent documents from POEA and OWWA reflect the said agency
as Olartes local agency.
26
Neither does the unsupported averment of Nahas before the NLRC that she was previously connected with Royal
Dream as a former employee help her cause. For one, she could have easily submitted a certificate of employment
from Royal Dream showing that she was a mere employee of the latter during the time material to this case. But she
failed to do so. It must be stressed "that he who alleges must prove."
27
Clearly, Nahas vacillating from one story to another and not being able to support them is nothing but a mere ruse
to evade the lawful claims of Olarte. This cannot be tolerated. It has been held that "[a] party will not be allowed to
make a mockery of justice by taking inconsistent positions which, if allowed, would result in brazen
deception." Inconsistent and unsupported as they are, the labor tribunals and the CA correctly rejected the
contentions of Nahas.
28
Anent the assertion that Royal Dream was not served with summons, it must be stressed that Olarte had
categorically declared at the outset that it was in the office of PETRA/Royal Dream at Room 401, Gochangco
Building, T.M. Kalaw, Ermita, Manila where she applied for work as domestic helper, was interviewed, and made to
sign an employment contract. This was effectively corroborated by Nahas herself when she admitted before the
Labor Arbiter that Olarte was a walk-in applicant in the said office. When finally deployed, the local agency
appearing in Olartes papers was Royal Dream. Hence, when Olarte was repatriated and later filed a Complaint, she
lodged it against Nahas and PETRA/Royal Dream and summons was served upon them at Room 401, Gochangco
Building, T.M., Kalaw, Ermita, Manila. Besides, to concede to this claim of Nahas would in effect allow her, PETRA
and Royal Dream to hide behind the cloak of corporate fiction in order to evade the rightful claims of Olarte. It bears
emphasizing that "the statutorily granted privilege of a corporate veil may be used only for legitimate
purposes." "[T]he corporate vehicle cannot be used as a shield to protect fraud or justify wrong," which clearly in
this case is what Nahas, PETRA and Royal Dream are attempting to achieve but which the Court cannot allow.
29
30
31
The propriety of the grant of moral and exemplary damages in favor of Olarte is being raised for the first time with
this Court.
Notably, Nahas did not question before the NLRC and the CA the Labor Arbiters grant of moral and exemplary
damages in favor of Olarte; hence, the Court need not belabor upon the same. "[P]oints of law, theories, issues, and
arguments not adequately brought to the attention of the lower court (or in this case, the appropriate quasi-judicial
administrative body) need not be considered by the reviewing court as they cannot be raised for the first time on
appeal x x x because this would be offensive to the basic rules of fair play, justice and due process."
32
As a final note, it is worth stating that recruitment agencies, as part of their bounden duty to protect the welfare of
the Filipino workers sent abroad from whom they take their profit, should in conscience not add to the misery of
maltreated and abused Filipino workers by denying them the reparation to which they are entitled. Instead, they
must "faithfully comply with their government prescribed responsibilities" and be the first to ensure the welfare of
the very people upon whose patronage their industry thrives.
33
34
35
WHEREFORE, the Petition is DENIED. The assailed Decision dated April 29, 2005 and Resolution dated July 8,
2005 of the Court of Appeals in CAG.R. SP No. 79028 are AFFIRMED.
SO ORDERED.
G.R. No. 205703, March 07, 2016
INDUSTRIAL PERSONNEL & MANAGEMENT SERVICES, INC. (IPAMS), SNC LAVALIN ENGINEERS &
CONTRACTORS, INC. AND ANGELITO C. HERNANDEZ, Petitioners, v. JOSE G. DE VERA AND ALBERTO B.
ARRIOLA, Respondents.
DECISION
MENDOZA, J.:
When can a foreign law govern an overseas employment contract? This is the fervent question that the Court shall resolve,
once and for all.
This petition for review on certiorari seeks to reverse and set aside the January 24, 2013 Decision 1 of the Court of Appeals
(CA) in CA-G.R. SP No. 118869, which modified the November 30, 2010 Decision 2of the National Labor Relations Commission
(NLRC) and its February 2, 2011 Resolution,3 in NLRC LAC Case No. 08-000572-10/NLRC Case No. NCR 09-13563-09, a case
for illegal termination of an Overseas Filipino Worker (OFW).
The Facts
Petitioner Industrial Personnel & Management Services, Inc. (IPAMS) is a local placement agency duly organized and existing
under Philippine laws, with petitioner Angelito C. Hernandez as its president and managing director. Petitioner SNC Lavalin
Engineers & Contractors, Inc. (SNC-Lavalin) is the principal of IPAMS, a Canadian company with business interests in several
countries. On the other hand, respondent Alberto Arriola (Arriola) is a licensed general surgeon in the Philippines.4
Employee's Position
Arriola was offered by SNC-Lavalin, through its letter,5 dated May 1, 2008, the position of Safety Officer in its Ambatovy
Project site in Madagascar. The position offered had a rate of CA$32.00 per hour for forty (40) hours a week with overtime
pay in excess of forty (40) hours. It was for a period of nineteen (19) months starting from June 9, 2008 to December 31,
2009.
Arriola was then hired by SNC-Lavalin, through its local manning agency, IPAMS, and his overseas employment contract was
processed with the Philippine Overseas Employment Agency (POEA)6 In a letter of understanding,7 dated June 5, 2008, SNCLavalin confirmed Arriola's assignment in the Ambatovy Project. According to Arriola, he signed the contract of employment
in the Philippines.8 On June 9, 2008, Arriola started working in Madagascar.
After three months, Arriola received a notice of pre-termination of employment, 9 dated September 9, 2009, from SNCLavalin. It stated that his employment would be pre-terminated effective September 11, 2009 due to diminishing workload in
the area of his expertise and the unavailability of alternative assignments. Consequently, on September 15, 2009, Arriola was
repatriated. SNC-Lavalin deposited in Arriola's bank account his pay amounting to Two Thousand Six Hundred Thirty Six
Dollars and Eight Centavos (CA$2,636.80), based on Canadian labor law.
Aggrieved, Arriola filed a complaint against the petitioners for illegal dismissal and non-payment of overtime pay, vacation
leave and sick leave pay before the Labor Arbiter (LA). He claimed that SNC-Lavalin still owed him unpaid salaries equivalent
to the three-month unexpired portion of his contract, amounting to, more or less, One Million Sixty-Two Thousand Nine
Hundred Thirty-Six Pesos (P1,062,936.00). He asserted that SNC-Lavalin never offered any valid reason for his early
termination and that he was not given sufficient notice regarding the same. Arriola also insisted that the petitioners must
prove the applicability of Canadian law before the same could be applied to his employment contract.
Employer's Position
The petitioners denied the charge of illegal dismissal against them. They claimed that SNC-Lavalin was greatly affected by
the global financial crises during the latter part of 2008. The economy of Madagascar, where SNC-Lavalin had business sites,
also slowed down. As proof of its looming financial standing, SNC-Lavalin presented a copy of a news item in the Financial
Post,10 dated March 5, 2009, showing the decline of the value of its stocks. Thus, it had no choice but to minimize its
expenditures and operational expenses. It re-organized its Health and Safety Department at the Ambatovy Project site and
Arriola was one of those affected.11
The petitioners also invoked EDI-Staffbuilders International, Inc. v. NLRC12 (EDI-Staffbuilders), pointing out that particular
labor laws of a foreign country incorporated in a contract freely entered into between an OFW and a foreign employer
through the latter's agent was valid. In the present case, as all of Arriola's employment documents were processed in
Canada, not to mention that SNC-Lavalin's office was in Ontario, the principle of lex loci celebrationis was applicable. Thus,
the petitioners insisted that Canadian laws governed the contract.
The petitioners continued that the pre-termination of Arriola's contract was valid for being consistent with the provisions of
both the Expatriate Policy and laws of Canada. The said foreign law did not require any ground for early termination of
employment, and the only requirement was the written notice of termination. Even assuming that Philippine laws should
apply, Arriola would still be validly dismissed because domestic law recognized retrenchment and redundancy as legal
grounds for termination.
In their Rejoinder,13 the petitioners presented a copy of the Employment Standards Act (ESA) of Ontario, which was duly
authenticated by the Canadian authorities and certified by the Philippine Embassy.
The LA Ruling
In a Decision,14 dated May 31, 2010, the LA dismissed Arriola's complaint for lack of merit. The LA ruled that the rights and
obligations among and between the OFW, the local recruiter/agent, and the foreign employer/principal were governed by the
employment contract pursuant to the EDI-Staffbuilders case. Thus, the provisions on termination of employment found in the
ESA, a foreign law which governed Arriola's employment contract, were applied. Given that SNC-Lavalin was able to produce
the duly authenticated ESA, the LA opined that there was no other conclusion but to uphold the validity of Arriola's dismissal
based on Canadian law. The fallo of the LA decision reads:
WHEREFORE, all the foregoing premises being considered, judgment is hereby rendered dismissing the complaint for lack of
merit.
SO ORDERED.15
Aggrieved, Arriola elevated the LA decision before the NLRC.

The NLRC Ruling
In its decision, dated November 30, 2010, the NLRC reversed the LA decision and ruled that Arriola was illegally dismissed by
the petitioners. Citing PNB v. Cabansag,16 the NLRC stated that whether employed locally or overseas, all Filipino workers
enjoyed the protective mantle of Philippine labor and social legislation, contract stipulations to the contrary notwithstanding.
Thus, the Labor Code of the Philippines and Republic Act (R.A.) No. 8042, or the Migrant Workers Act, as amended, should be
applied. Moreover, the NLRC added that the overseas employment contract of Arriola was processed in the POEA.
Applying the Philippine laws, the NLRC found that there was no substantial evidence presented by the petitioners to show any
just or authorized cause to terminate Arriola. The ground of financial losses by SNC-Lavalin was not supported by sufficient
and credible evidence. The NLRC concluded that, for being illegally dismissed, Arriola should be awarded CA$81,920.00
representing sixteen (16) months of Arriola's purported unpaid salary, pursuant to the Serrano v. Gallant17 doctrine. The
decretal portion of the NLRC decision states:
WHEREFORE, premises considered, judgment is hereby rendered finding complainant-appellant to have been illegally
dismissed. Respondents-appellees are hereby ordered to pay complainant-appellant the amount of CA$81,920.00, or its
Philippine Peso equivalent prevailing at the time of payment. Accordingly, the decision of the Labor Arbiter dated May 31,
2010 is hereby VACATED and SET ASIDE.
SO ORDERED.18
The petitioners moved for reconsideration, but their motion was denied by the NLRC in its resolution, dated February 2,
2011.
Undaunted, the petitioners filed a petition for certiorari before the CA arguing that it should be the ESA, or the Ontario labor
law, that should be applied in Arriola's employment contract. No temporary restraining order, however, was issued by the CA.
The Execution Proceedings
In the meantime, execution proceedings were commenced before the LA by Arriola. The LA granted the motion for execution
in the Order,19 dated August 8, 2011.
The petitioners appealed the execution order to the NLRC. In its Decision, 20 dated May 31, 2012, the NLRC corrected the
decretal portion of its November 30, 2010 decision. It decreased the award of backpay in the amount of CA$26,880.00 or
equivalent only to three (3) months and three (3) weeks pay based on 70-hours per week workload. The NLRC found that
when Arriola was dismissed on September 9, 2009, he only had three (3) months and three (3) weeks or until December 31,
2009 remaining under his employment contract.
Still not satisfied with the decreased award, IPAMS filed a separate petition for certiorari before the CA. In its decision, dated
July 25, 2013, the CA affirmed the decrease in Arriola's backpay because the unpaid period in his contract was just three (3)
months and three (3) weeks.
Unperturbed, IPAMS appealed before the Court and the case was docketed as G.R. No. 212031. The appeal, however, was
dismissed outright by the Court in its resolution, dated August 8, 2014, because it was belatedly filed and it did not comply
with Sections 4 and 5 of Rule 7 of the Rules of Court. Hence, it was settled in the execution proceedings that the award of
backpay to Arriola should only amount to three (3) months and three (3) weeks of his pay.
The CA Ruling
Returning to the principal case of illegal dismissal, in its assailed January 24, 2013 decision, the CA affirmed that Arriola was
illegally dismissed by the petitioners. The CA explained that even though an authenticated copy of the ESA was submitted, it
did not mean that the said foreign law automatically applied in this case. Although parties were free to establish stipulations
in their contracts, the same must remain consistent with law, morals, good custom, public order or public policy. The
appellate court wrote that the ESA allowed an employer to disregard the required notice of termination by simply giving the
employee a severance pay. The ESA could not be made to apply in this case for being contrary to our Constitution,
specifically on the right of due process. Thus, the CA opined that our labor laws should find application.
As the petitioners neither complied with the twin notice-rule nor offered any just or authorized cause for his termination
under the Labor Code, the CA held that Arriola's dismissal was illegal. Accordingly, it pronounced that Arriola was entitled to
his salary for the unexpired portion of his contract which is three (3) months and three (3) weeks salary. It, however,
decreased the award of backpay to Arriola because the NLRC made a wrong calculation. Based on his employment contract,
the backpay of Arriola should only be computed on a 40-hour per week workload, or in the amount of CA$19,200.00. The CA
disposed the case in this wise:
WHEREFORE, in view of the foregoing premises, the petition is PARTIALLY GRANTED. The assailed Order of the National Labor
Relations Commission in NLRC LAC No. 08-000572-10/NLRC Case No. NCR 09-13563-09 is MODIFIED in that private
respondent is only entitled to a monetary judgment equivalent to his unpaid salaries in the amount of CA$19,200.00 or its
Philippine Peso equivalent.
SO ORDERED.21
Hence, this petition, anchored on the following
ISSUES
I
WHETHER OR NOT RESPONDENT ARRIOLA WAS VALIDLY DISMISSED PURSUANT TO THE EMPLOYMENT
CONTRACT.
II
GRANTING THAT THERE WAS ILLEGAL DISMISSAL IN THE CASE AT BAR, WHETHER OR NOT THE SIX-WEEK ON,
TWO-WEEK OFF SCHEDULE SHOULD BE USED IN THE COMPUTATION OF ANY MONETARY AWARD.
III
GRANTING THAT THERE WAS ILLEGAL DISMISSAL, WHETHER OR NOT THE AMOUNT BEING CLAIMED BY
RESPONDENTS HAD ALREADY BEEN SATISFIED, OR AT THE VERY LEAST, WHETHER OR NOT THE AMOUNT OF
CA$2,636.80 SHOULD BE DEDUCTED FROM THE MONETARY AWARD. 22
The petitioners argue that the rights and obligations of the OFW, the local recruiter, and the foreign employer are governed
by the employment contract, citing EDI-Staffbuilders; that the terms and conditions of Arriola's employment are embodied in
the Expatriate Policy, Ambatovy Project - Site, Long Term, hence, the laws of Canada must be applied; that the ESA, or the
Ontario labor law, does not require any ground for the early termination of employment and it permits the termination
without any notice provided that a severance pay is given; that the ESA was duly authenticated by the Canadian authorities
and certified by the Philippine Embassy; that the NLRC Sixth Division exhibited bias and bad faith when it made a wrong
computation on the award of backpay; and that, assuming there was illegal dismissal, the CA$2,636.80, earlier paid to
Arriola, and his home leaves should be deducted from the award of backpay.
In his Comment,23 Arriola countered that foreign laws could not apply to employment contracts if they were contrary to law,
morals, good customs, public order or public policy, invoking Pakistan International Airlines Corporation v. Ople (Pakistan
International);24 that the ESA was not applicable because it was contrary to his constitutional right to due process; that the
petitioners failed to substantiate an authorized cause to justify his dismissal under Philippine labor law; and that the
petitioners could not anymore claim a deduction of CA$2,636.80 from the award of backpay because it was raised for the
first time on appeal.
In their Reply,25 the petitioners asserted that R.A. No. 8042 recognized the applicability of foreign laws on labor contracts;
that the Pakistan International case was superseded by EDI-Staffbuilders and other subsequent cases; and that SNC-Lavalin
suffering financial losses was an authorized cause to terminate Arriola's employment.
In his Memorandum,26 Arriola asserted that his employment contract was executed in the Philippines and that the alleged
authorized cause of financial losses by the petitioners was not substantiated by evidence.
In their Consolidated Memorandum,27 the petitioners reiterated that the ESA was applicable in the present case and that
recent jurisprudence recognized that the parties could agree on the applicability of foreign laws in their labor contracts.
The Court's Ruling
The petition lacks merit.
Application of foreign laws with labor contracts
At present, Filipino laborers, whether skilled or professional, are enticed to depart from the motherland in search of greener
pastures. There is a distressing reality that the offers of employment abroad are more lucrative than those found in our own
soils. To reap the promises of the foreign dream, our unsung heroes must endure homesickness, solitude, discrimination,
mental and emotional struggle, at times, physical turmoil, and, worse, death. On the other side of the table is the growing
number of foreign employers attracted in hiring Filipino workers because of their reasonable compensations and globallycompetitive skills and qualifications. Between the dominant foreign employers and the vulnerable and desperate OFWs,
however, there is an inescapable truth that the latter are in need of greater safeguard and protection.
In order to afford the full protection of labor to our OFWs, the State has vigorously enacted laws, adopted regulations and
policies, and established agencies to ensure that their needs are satisfied and that they continue to work in a humane living
environment outside of the country. Despite these efforts, there are still issues left unsolved in the realm of overseas
employment. One existing question is posed before the Court -when should an overseas labor contract be governed by a
foreign law? To answer this burning query, a review of the relevant laws and jurisprudence is warranted.
R.A. No. 8042, or the Migrant Workers Act, was enacted to institute the policies on overseas employment and to establish a
higher standard of protection and promotion of the welfare of migrant workers. 28 It emphasized that while recognizing the
significant contribution of Filipino migrant workers to the national economy through their foreign exchange remittances, the
State does not promote overseas employment as a means to sustain economic growth and achieve national
development.29Although it acknowledged claims arising out of law or contract involving Filipino workers, 30 it does not
categorically provide that foreign laws are absolutely and automatically applicable in overseas employment contracts.
The issue of applying foreign laws to labor contracts was initially raised before the Court in Pakistan International. It was
stated in the labor contract therein (1) that it would be governed by the laws of Pakistan, (2) that the employer have the
right to terminate the employee at any time, and (3) that the one-month advance notice in terminating the employment
could be dispensed with by paying the employee an equivalent one-month salary. Therein, the Court elaborated on the
parties' right to stipulate in labor contracts, to wit:
A contract freely entered into should, of course, be respected, as PIA argues, since a contract is the law between the parties.
The principle of party autonomy in contracts is not, however, an absolute principle. The rule in Article 1306, of our Civil Code
is that the contracting parties may establish such stipulations as they may deem convenient, "provided they are not
contrary to law, morals, good customs, public order or public policy." Thus, counterbalancing the principle of
autonomy of contracting parties is the equally general rule that provisions of applicable law, especially provisions relating to
matters affected with public policy, are deemed written into the contract. Put a little differently, the governing principle is that
parties may not contract away applicable provisions of law especially peremptory provisions dealing with matters heavily
impressed with public interest. The law relating to labor and employment is clearly such an area and parties are not
at liberty to insulate themselves and their relationships from the impact of labor laws and regulations by simply
contracting with each other. x x x31
[Emphases Supplied]
In that case, the Court held that the labor relationship between OFW and the foreign employer is "much affected with public
interest and that the otherwise applicable Philippine laws and regulations cannot be rendered illusory by the parties agreeing
upon some other law to govern their relationship."32 Thus, the Court applied the Philippine laws, instead of the Pakistan laws.
It was also held that the provision in the employment contract, where the employer could terminate the employee at any
time for any ground and it could even disregard the notice of termination, violates the employee's right to security of tenure
under Articles 280 and 281 of the Labor Code.
In EDI-Staffbuilders, the case heavily relied on by the petitioners, it was reiterated that, "[i]n formulating the contract, the
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." 33 In that case, the overseas contract specifically stated
that Saudi Labor Laws would govern matters not provided for in the contract. The employer, however, failed to prove the said
foreign law, hence, the doctrine of processual presumption came into play and the Philippine labor laws were applied.
Consequently, the Court did not discuss any longer whether the Saudi labor laws were contrary to Philippine labor laws.
The case of Becmen Service Exporter and Promotion, Inc. v. Spouses Cuaresma,34 though not an illegal termination case,
elucidated on the effect of foreign laws on employment. It involved a complaint for insurance benefits and damages arising
from the death of a Filipina nurse from Saudi Arabia. It was initially found therein that there was no law in Saudi Arabia that
provided for insurance arising from labor accidents. Nevertheless, the Court concluded that the employer and the recruiter in
that case abandoned their legal, moral and social obligation to assist the victim's family in obtaining justice for her death,
and so her family was awarded P5,000,000.00 for moral and exemplary damages.
In ATCI Overseas Corporation v. Echin35 (ATCI Overseas), the private recruitment agency invoked the defense that the
foreign employer was immune from suit and that it did not sign any document agreeing to be held jointly and solidarily liable.
Such defense, however, was rejected because R.A. No. 8042 precisely afforded the OFWs with a recourse against the local
agency and the foreign employer to assure them of an immediate and sufficient payment of what was due. Similar to EDIStaffbuilders, the local agency therein failed to prove the Kuwaiti law specified in the labor contract, pursuant to Sections 24
and 25 of Rule 132 of the Revised Rules of Court.
Also, in the recent case of Sameer Overseas Placement Agency, Inc. v. Cabiles36 (Sameer Overseas), it was declared that the
security of tenure for labor was guaranteed by our Constitution and employees were not stripped of the same when they
moved to work in other jurisdictions. Citing PCL Shipping Phils., Inc. v. NLRC37 (PCL Shipping), the Court held that the
principle of lex loci contractus (the law of the place where the contract is made) governed in this jurisdiction. As it was
established therein that the overseas labor contract was executed in the Philippines, the Labor Code and the fundamental
procedural rights were observed. It must be noted that no foreign law was specified in the employment contracts in both
cases.
Lastly, in Saudi Arabian Airlines (Saudia) v. Rebesencio38, the employer therein asserted the doctrine of forum non
conveniens because the overseas employment contracts required the application of the laws of Saudi Arabia, and so, the
Philippine courts were not in a position to hear the case. In striking down such argument, the Court held that while a
Philippine tribunal was called upon to respect the parties' choice of governing law, such respect must not be so permissive as
to lose sight of considerations of law, morals, good customs, public order, or public policy that underlie the contract central to
the controversy. As the dispute in that case related to the illegal termination of the employees due to their pregnancy, then it
involved a matter of public interest and public policy. Thus, it was ruled that Philippine laws properly found application and
that Philippine tribunals could assume jurisdiction.
Based on the foregoing, the general rule is that Philippine laws apply even to overseas employment contracts. This rule is
rooted in the constitutional provision of Section 3, Article XIII that the State shall afford full protection to labor, whether local
or overseas. Hence, even if the OFW has his employment abroad, it does not strip him of his rights to security of tenure,
humane conditions of work and a living wage under our Constitution. 39
As an exception, the parties may agree that a foreign law shall govern the employment contract. A synthesis of the existing
laws and jurisprudence reveals that this exception is subject to the following requisites:
1.
That it is expressly stipulated in the overseas employment contract that a specific foreign law shall govern;
2.
That the foreign law invoked must be proven before the courts pursuant to the Philippine rules on evidence;
3.
That the foreign law stipulated in the overseas employment contract must not be contrary to law, morals,
good customs, public order, or public policy of the Philippines; and
4.
That the overseas employment contract must be processed through the POEA.
The Court is of the view that these four (4) requisites must be complied with before the employer could invoke the
applicability of a foreign law to an overseas employment contract. With these requisites, the State would be able to abide by
its constitutional obligation to ensure that the rights and well-being of our OFWs are fully protected. These conditions would
also invigorate the policy under R.A. No. 8042 that the State shall, at all times, uphold the dignity of its citizens whether in
country or overseas, in general, and the Filipino migrant workers, in particular.40 Further, these strict terms are pursuant to
the jurisprudential doctrine that "parties may not contract away applicable provisions of law especially peremptory provisions
dealing with matters heavily impressed with public interest," 41 such as laws relating to labor. At the same time, foreign
employers are not at all helpless to apply their own laws to overseas employment contracts provided that they faithfully
comply with these requisites.
If the first requisite is absent, or that no foreign law was expressly stipulated in the employment contract which was
executed in the Philippines, then the domestic labor laws shall apply in accordance with the principle of lex loci contractus.
This is based on the cases of Sameer Overseas and PCL Shipping.

If the second requisite is lacking, or that the foreign law was not proven pursuant to Sections 24 and 25 of Rule 132 of the
Revised Rules of Court, then the international law doctrine of processual presumption operates. The said doctrine declares
that "[w]here a foreign law is not pleaded or, even if pleaded, is not proved, the presumption is that foreign law is the same
as ours."42 This was observed in the cases ofEDI-Staffbuilders and ATCI Overseas.
If the third requisite is not met, or that the foreign law stipulated is contrary to law, morals, good customs, public order or
public policy, then Philippine laws govern. This finds legal bases in the Civil Code, specifically: (1) Article 17, which provides
that laws which have, for their object, public order, public policy and good customs shall not be rendered ineffective by laws
of a foreign country; and (2) Article 1306, which states that the stipulations, clauses, terms and conditions in a contract must
not be contrary to law, morals, good customs, public order, or public policy. The said doctrine was applied in the case
of Pakistan International.
Finally, if the fourth requisite is missing, or that the overseas employment contract was not processed through the POEA,
then Article 18 of the Labor Code is violated. Article 18 provides that no employer may hire a Filipino worker for overseas
employment except through the boards and entities authorized by the Secretary of Labor. In relation thereto, Section 4 of
R.A. No. 8042, as amended, declares that the State shall only allow the deployment of overseas Filipino workers in countries
where the rights of Filipino migrant workers are protected. Thus, the POEA, through the assistance of the Department of
Foreign Affairs, reviews and checks whether the countries have existing labor and social laws protecting the rights of
workers, including migrant workers.43 Unless processed through the POEA, the State has no effective means of assessing the
suitability of the foreign laws to our migrant workers. Thus, an overseas employment contract that was not scrutinized by the
POEA definitely cannot be invoked as it is an unexamined foreign law.
In other words, lacking any one of the four requisites would invalidate the application of the foreign law, and the Philippine
law shall govern the overseas employment contract.
As the requisites of the applicability of foreign laws in overseas labor contract have been settled, the Court can now discuss
the merits of the case at bench.
A judicious scrutiny of the records of the case demonstrates that the petitioners were able to observe the second requisite, or
that the foreign law must be proven before the court pursuant to the Philippine rules on evidence. The petitioners were able
to present the ESA, duly authenticated by the Canadian authorities and certified by the Philippine Embassy, before the LA.
The fourth requisite was also followed because Arriola's employment contract was processed through the POEA. 44
Unfortunately for the petitioners, those were the only requisites that they complied with. As correctly held by the CA, even
though an authenticated copy of the ESA was submitted, it did not mean that said foreign law could be automatically applied
to this case. The petitioners miserably failed to adhere to the two other requisites, which shall be discussed in seratim.
The foreign law was not expressly specified in the employment contract
The petitioners failed to comply with the first requisite because no foreign law was expressly stipulated in the overseas
employment contract with Arriola. In its pleadings, the petitioners did not directly cite any specific provision or stipulation in
the said labor contract which indicated the applicability of the Canadian labor laws or the ESA. They failed to show on the
face of the contract that a foreign law was agreed upon by the parties. Rather, they simply asserted that the terms and
conditions of Arriola's employment were embodied in the Expatriate Policy, Ambatovy Project - Site, Long Term. 45 Then, they
emphasized provision 8.20 therein, regarding interpretation of the contract, which provides that said policy would be
governed and construed with the laws of the country where the applicable SNC-Lavalin, Inc. office was located. 46 Because of
this provision, the petitioners insisted that the laws of Canada, not of Madagascar or the Philippines, should apply. Then, they
finally referred to the ESA.
It is apparent that the petitioners were simply attempting to stretch the overseas employment contract of Arriola, by
implication, in order that the alleged foreign law would apply. To sustain such argument would allow any foreign employer to
improperly invoke a foreign law even if it is not anymore reasonably contemplated by the parties to control the overseas
employment. The OFW, who is susceptible by his desire and desperation to work abroad, would blindly sign the labor contract
even though it is not clearly established on its face which state law shall apply. Thus, a better rule would be to obligate the
foreign employer to expressly declare at the onset of the labor contract that a foreign law shall govern it. In that manner, the
OFW would be informed of the applicable law before signing the contract.
Further, it was shown that the overseas labor contract was executed by Arriola at his residence in Batangas and it was
processed at the POEA on May 26, 2008.47 Considering that no foreign law was specified in the contract and the same was
executed in the Philippines, the doctrine of lex loci celebrationis applies and the Philippine laws shall govern the overseas
employment of Arriola.
The foreign law invoked is contrary to the Constitution and the Labor Code
Granting arguendo that the labor contract expressly stipulated the applicability of Canadian law, still, Arriola's employment
cannot be governed by such foreign law because the third requisite is not satisfied. A perusal of the ESA will show that some
of its provisions are contrary to the Constitution and the labor laws of the Philippines.
First, the ESA does not require any ground for the early termination of employment. 48 Article 54 thereof only provides that no
employer should terminate the employment of an employee unless a written notice had been given in advance. 49 Necessarily,
the employer can dismiss any employee for any ground it so desired. At its own pleasure, the foreign employer is endowed
with the absolute power to end the employment of an employee even on the most whimsical grounds.
Second, the ESA allows the employer to dispense with the prior notice of termination to an employee. Article 65(4) thereof
indicated that the employer could terminate the employment without notice by simply paying the employee a severance pay
computed on the basis of the period within which the notice should have been given. 50 The employee under the ESA could be
immediately dismissed without giving him the opportunity to explain and defend himself.
The provisions of the ESA are patently inconsistent with the right to security of tenure. Both the Constitution 51 and the Labor
Code52 provide that this right is available to any employee. In a host of cases, the Court has upheld the employee's right to
security of tenure in the face of oppressive management behavior and management prerogative. Security of tenure is a right
which cannot be denied on mere speculation of any unclear and nebulous basis. 53
Not only do these provisions collide with the right to security of tenure, but they also deprive the employee of his
constitutional right to due process by denying him of any notice of termination and the opportunity to be heard. 54 Glaringly,
these disadvantageous provisions under the ESA produce the same evils which the Court vigorously sought to prevent in the
cases of Pakistan International and Sameer Overseas. Thus, the Court concurs with the CA that the ESA is not applicable in
this case as it is against our fundamental and statutory laws.
In fine, as the petitioners failed to meet all the four (4) requisites on the applicability of a foreign law, then the Philippine
labor laws must govern the overseas employment contract of Arriola.
No authorized cause for dismissal was proven
Article 279 of our Labor Code has construed security of tenure to mean that the employer shall not terminate the services of
an employee except for a just cause or when authorized by law.55 Concomitant to the employer's right to freely select and
engage an employee is the employer's right to discharge the employee for just and/or authorized causes. To validly effect
terminations of employment, the discharge must be for a valid cause in the manner required by law. The purpose of these
two-pronged qualifications is to protect the working class from the employer's arbitrary and unreasonable exercise of its right
to dismiss.56
Some of the authorized causes to terminate employment under the Labor Code would be installation of labor-saving devices,
redundancy, retrenchment to prevent losses and the closing or cessation of operation of the establishment or
undertaking.57 Each authorized cause has specific requisites that must be proven by the employer with substantial evidence
before a dismissal may be considered valid.
Here, the petitioners assert that the economy of Madagascar weakened due to the global financial crisis. Consequently, SNCLavalin's business also slowed down. To prove its sagging financial standing, SNC-Lavalin presented a copy of a news item in
the Financial Post, dated March 5, 2009. They insist that SNC-Lavalin had no choice but to minimize its expenditures and
operational expenses.58 In addition, the petitioners argued that the government of Madagascar prioritized the employment of
its citizens, and not foreigners. Thus, Arriola was terminated because there was no more job available for him. 59
The Court finds that Arriola was not validly dismissed. The petitioners simply argued that they were suffering from financial
losses and Arriola had to be dismissed. It was not even clear what specific authorized cause, whether retrenchment or
redundancy, was used to justify Arriola's dismissal. Worse, the petitioners did not even present a single credible evidence to
support their claim of financial loss. They simply offered an unreliable news article which deserves scant consideration as it is
undoubtedly hearsay. Time and again the Court has ruled that in illegal dismissal cases like the present one, the onus of
proving that the employee was dismissed and that the dismissal was not illegal rests on the employer, and failure to
discharge the same would mean that the dismissal is not justified and, therefore, illegal. 60
As to the amount of backpay awarded, the Court finds that the computation of the CA was valid and proper based on the
employment contract of Arriola. Also, the issue of whether the petitioners had made partial payments on the backpay is a
matter best addressed during the execution process.
chanroble slaw
WHEREFORE, the petition is DENIED. The January 24, 2013 Decision of the Court of Appeals in CA-G.R. SP No. 118869
is AFFIRMED in toto.
SO ORDERED.
G.R. No. 195666

PEOPLE OF THE PHILIPPINES, Plaintiff-Appellee,
vs.
FE ABELLA y BUHAIN, Accused-Appellant.
DECISION
LEONARDO-DE CASTRO, J.:
For Our consideration is an appeal from the Decision dated September 30, 2010 of the Court of Appeals in CA-G.R.
CR.-H.C. No. 03974, which affirmed with modification the Decision dated March 26, 2009 of the Regional Trial
Court (RTC), Manila City, Branch 52, in Criminal Case No. 04-225062, which found accused-appellant Fe
Abella yBuhain (Abella) guilty of Illegal Recruitment in Large Scale.
1
The Information reads:

3
That in or about and during the period comprised between October 8, 2003 and March 18, 2004, inclusive, in the
City of Manila, Philippines, the said accused conspiring and confederating with another whose true name, real
identity and present whereabouts is still unknown, and mutually helping each other, representing herself to have the
capacity to contract, enlist and transport Filipino workers for employment abroad, did then and there willfully,
unlawfully, and feloniously for a fee, recruit and promise employment/job placement to the following persons:
Mary Jean Mateo y Sanchez
Grace Marcelino y dela Pea
Nobella Castro y Fernandez
Imelda Miguel y Factor
Lolita Pansoy y Garcia
Ester Castro y Pamisttan
Janice Belvis y Morales
Ruby Badua y Cabacungan
Visitacion Rosete y Cedron
Generoso Gumpal y Bangloy
Fernando Callang y Buhanget
Joselito Danver Huta y Catao
as Laundrywomen/Laundrymen and Waiter in Istanbul, Turkey and Dubai, without first having secured the required
license or authority from the Department of Labor and Employment, charged or accept directly or indirectly from said
complainants amounts which are in excess of or greater than those specified in the schedule of allowable fees
prescribed by the Department of Labor and Employment under Memorandum Order No. 5, Series of 1985 and
having failed to deploy aforesaid complainants, continuously fails to reimburse despite demands, the expenses they
incurred in connection with the documentation and processing for their deployment.
Upon arraignment, Abella, assisted by counsel, pleaded not guilty to the offense charge.
In the course of the trial, the prosecution presented Imelda F. Miguel (Miguel), Grace P. Marcelino (Marcelino),
Fernando B. Callang (Callang), Mildred Versoza (Versoza), and Senior Police Officer (SPO) 1 Jaime Bunag (Bunag)
as witnesses.
Miguel testified that she came to know Abella through Zeny Agpalza (Agpalza) and Lina Mateo (Mateo), who
informed her that Abella could help her get work abroad. Interested, Miguel met Abella at the latters office, bearing
the name Rofema Business Consultancy (RBC), at 1807 Nakpil St., Barangay 697, Malate, Manila. During their
meeting, Abella offered Miguel work as a laundrywoman in Istanbul, Turkey, with a salary of $600.00 to $700.00 but
Miguel must undergo training in laundry service and pay a placement fee of P100,000.00. Miguel, however, was
able to raise and pay only P30,000.00 as placement fee on November 17, 2003 for which Abella issued a cash
voucher signed by Abella herself in Miguels presence. Miguel also claimed that she underwent training in laundry
service for five days at the Executive Technical Consultants Trade Test and Training Center, valued at P5,000.00,
which was sponsored by Abella. Miguel was issued a certification after said training. Abella discussed with Miguel
the details of the latters job abroad and provided Miguel with a photocopy of their written agreement, together with
the certificate evidencing registration by Abella of the business name of RBC. Until the day that Miguel gave her
testimony before the RTC, Abella, contrary to her representation and promise, was not able to deploy Miguel as a
laundrywoman in Istanbul, Turkey, and neither did Abella return the placement fee of P30,000.00 which Miguel had
paid.
4
Marcelino narrated that she came to know Abella through Rosette Danao (Danao). Danao first recruited Marcelino to
work as a domestic helper in Saipan, but later turned over Marcelinos application to Agpalza who was in charge of
those applying for jobs in Turkey. Danao and Agpalza both referred to Abella as their Manager. Marcelino paid a
total of P50,000.00 for the processing of her papers in four installments: P10,000.00 on November 24, 2003;
P15,000.00 on December 3, 2003; P10,000.00 on December 23, 2003, and P15,000.00 on January 15, 2004, all
personally received by Abella either at the RBC office or at McDonalds, Ermita, and evidenced by vouchers signed
by Abella. Nothing happened to Marcelinos application and the amounts she had paid to Abella were not returned to
her.
6
According to Callang, he was recruited by Danao, Abellas agent, who brought him to the RBC office in Malate,
Manila. At the RBC office, Abella told Callang of the job order for laundryman in Istanbul, Turkey with a monthly
salary of $600.00 and for which the placement fee was P65,000.00. Callang paid to Abella P10,000.00 on
November 17, 2003; P10,000.00 on December 23, 2003; and P20,000.00 on January 9, 2004, for a total of
P40,000.00, evidenced by a voucher signed by Abella in Callangs presence. The first two payments were made at
the RBC office while the last payment was at McDonalds, Ermita. Callang was not deployed for employment
abroad, neither was he able to recover the amount he paid to Abella.
8
Versoza was an employee at the Licensing Division of the Philippine Overseas Employment Administration (POEA).
Versoza recounted that upon the instruction of Yolanda Paragua (Paragua), Officer-in-Charge (OIC) of the POEA
Licensing Division, she verified from the database and other records of their office whether Abella/RBC had license
to recruit workers for employment abroad. Versoza found out that Abella/RBC had no such license and she
prepared a Certification to that effect, which was signed by OIC Paragua in her presence. In compliance with
thesubpoena duces tecum issued by the RTC, Versoza personally appeared before the trial court to identify OIC
Paraguas signature on the Certification.
9
SPO1 Bunag was the investigator assigned to the case and affirmed on the witness stand that he was the one who
took down the private complainants Sinumpang Salaysay Pag-aresto, and prepared Abellas Booking Sheet and
Arrest Report and letter of referral for inquest dated March 19, 2004.
Only Abella herself testified for the defense.
Before Abella took the witness stand, her counsel, Atty. Rodrigo Marias, moved that the following private
complainants: Mary Jean S. Mateo, Nobella F. Castro, Lolito G. Pansoy, Ester P. Castro, Janice M. Belvis, Ruby C.
Badua, Generoso B. Gumpal, and Joselito Danver C. Huta, be provisionally dropped as such from the Information
for their repeated failure to appear and testify in support of their complaints. Without objection from Assistant City
Prosecutor Francisco L. Salomon, the RTC granted the defenses motion, thus, leaving Miguel, Marcelino, and
Callang as private complainants.
10
Abella anchored her defense on denial. Abella alleged that she had been working as a cashier since November 11,
2004 at RBC, a travel agency registered with the Department of Trade and Industry. As cashier at RBC, Abellas
main duty was to receive payments from clients for which she issued cash vouchers. Abella claimed that she did not
personally meet the clients nor did she directly receive money from them, as the clients coursed their payments
through Agpalza, an RBC agent. Agpalza would then turn over the payments to Abella, for which the latter issued
cash vouchers; and Abella would subsequently hand over the payments to RBC owner, Elizabeth Reyes (Reyes).
Abella disputed private complainants assertion and insisted that she did not promise private complainants
employment abroad. During her re-direct examination, Abella refuted her purported arrest and confrontation with
private complainants. Abella maintained that she voluntarily went with Agpalza to the police headquarters and that
she and Agpalza were detained at the second floor while private complainants were kept at the ground floor of the
police headquarters.
On March 26, 2009, the RTC rendered a Decision with the following verdict:
WHEREFORE, the Court finds the accused FE ABELLA y BUHAIN guilty beyond reasonable doubt of the crime of
Illegal Recruitment in large scale and imposes upon her the penalty of life imprisonment and a fine of
Php100,000.00.
FE ABELLA y BUHAIN is also ordered to return to, or refund the sums of money she had received from the following
private complainants: a) Imelda Miguel the sum of Php30,000.00; b) Fernando Callang the amount of
Php40,000.00; and c) Grace Marcelino the amount of Php50,000.00.
With costs against the accused.
11
Aggrieved, Abella appealed before the Court of Appeals.

The Court of Appeals, in a Decision dated September 30, 2010, affirmed the RTC judgment of conviction but with
the modification increasing the amount of fine imposed against Abella. The dispositive portion of the said Decision
reads:
WHEREFORE, premises considered, the appeal is DENIED. The Decision dated 26 March 2009 of the Regional
Trial Court of Manila, Branch 52, in Criminal Case No. 04-225062 finding accused-appellant Fe Abella y Buhain
guilty beyond reasonable doubt of illegal recruitment in large scale, sentencing her to suffer the penalty of life
imprisonment and ordering her to pay a fine and to return to private complainants Imelda Miguel, Fernando Callang
and Grace Marcelino the amounts of Php30,000.00, Php40,000.00 and Php50,000.00, respectively, is
herebyAFFIRMED with MODIFICATION in that the amount of fine is increased from Php100,000.00 to
Php500,000.00. Costs against accused-appellant.
12
Hence, the present appeal.

In her Supplemental Brief, Abella contends that the prosecution failed to prove her guilt beyond reasonable doubt as
the first element of illegal recruitment in large scale, i.e., the accused undertook a recruitment activity under Article
13(b) of the Labor Code or any prohibited practice under Article 34 of the same Code, is wanting. Abella points out
that: (a) it was not Abella who enticed private complainants to apply for work overseas given that by private
complainants own testimonies, they learned about the job opportunities abroad not from Abella, but from Agpalza,
Mateo, and Danao, who were so persuasive that private complainants travelled from their respective provinces to
Manila just to meet Abella; (b) if it were true that Abella received money from private complainants, she would have
already fled after getting private complainants money so as to evade arrest; and (c) the prosecution presented a
mere photocopy of the handwritten agreement supposedly executed by Abella in Miguels favor, and considering
that the contents of such agreement are in issue in this case, the RTC wrongfully accorded much weight to such
evidence.
We find no merit in the instant appeal.
To constitute illegal recruitment in large scale, three elements must concur: (a) the offender has no valid license or
authority required by law to enable him to lawfully engage in recruitment placement of workers: (b) the offender
undertakes any of the activities within the meaning of "recruitment and placement" under Article 13(b) of the Labor
Code, or any of the prohibited practices enumerated under Article 34 of the same Code (now Section 6 of Republic
Act No. 8042, otherwise known as the Migrant Workers and Overseas Filipinos Act of 1995); and (c) the offender
committed the same against three or more persons, individually or as a group.
13
Article 13(b) of the Labor Code defines "recruitment and placement" as "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." It also provides 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."
Article 38 of the same Code particularly defines "illegal recruitment" as follows:
ART. 38. Illegal Recruitment. (a) Any recruitment activities, including the prohibited practices enumerated under
Article 34 of this Code, to be undertaken by non-licensees or non-holders of authority, shall be deemed illegal and
punishable under Article 39 of this Code. The Department of Labor and Employment or any law enforcement officer
may initiate complaints under this Article.
(b) Illegal recruitment when committed by a syndicate or in large scale shall be considered an offense involving
economic sabotage and shall be penalized in accordance with Article 39 hereof.
Illegal recruitment is deemed committed by a syndicate if carried out by a group of three (3) or more persons
conspiring and/or confederating with one another in carrying out any unlawful or illegal transaction, enterprise or
scheme defined under the first paragraph hereof. Illegal recruitment is deemed committed in large scale if
committed against three (3) or more persons individually or as a group.
Republic Act No. 8042 broadened the concept of illegal recruitment under the Labor Code and provided stiffer
penalties, especially if it constitutes economic sabotage, either illegal recruitment in large scale or illegal recruitment
committed by a syndicate. Under Section 6 of Republic Act No. 8042, the following acts constitute "illegal
recruitment":
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 nonlicensee 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 workers fault. Illegal recruitment when committed by a syndicate or in large scale shall
be considered an offense involving economic sabotage.
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. (Emphases ours.)
The elements of illegal recruitment in large scale are all obtaining in this case and that the prosecution had
sufficiently proved that Abella is guilty of said offense.
First, it is undisputed that neither Abella nor RBC was licensed as a recruitment agency. The Certification14 dated
May 17, 2005 signed by OIC Paragua of the POEA Licensing Division states that "per available records of this
Office, Fe Abella y Buhain, in her personal capacity, and ROFEMA BUSINESS CONSULTANCY with address at
1807 Nakpil St., Brgy. 697, Malate, Manila, are not licensed by this Administration to recruit workers for overseas
employment. Any recruitment activity undertaken by the above-named person/entity is deemed illegal." Versoza, the
POEA Licensing Division employee who actually perused the database and other records of their office, prepared
the Certification for OIC Paraguas signature, and personally witnessed OIC Paragua signing the said Certification,
appeared as witness before the RTC to authenticate the Certification as one of the documentary evidence for the
prosecution. A POEA certification is a public document issued by a public officer in the performance of an official
duty; hence, it is prima facie evidence of the facts therein stated pursuant to Section 23, Rule 132 of the Rules of
Court. Public documents are entitled to a presumption of regularity, consequently, the burden of proof rests upon
the person who alleges the contrary. Abella does not negate the contents of the Certification but merely argues that
it has no bearing on whether or not she represented herself to the private complainants as someone authorized to
recruit for overseas employment.
15
Second, both the RTC and the Court of Appeals found that Abella had engaged in recruitment activities. The trial
and appellate courts accorded weight and credence to the consistent testimonies of private complainants Miguel,
Marcelino, and Callang that at separate instances, Agpalza, Mateo, and/or Danao brought private complainants to
the RBC office and introduced them to Abella, and it was Abella herself who offered and promised private
complainants jobs in Istanbul, Turkey, in consideration of placement fees. Miguels testimony is further supported by
a handwritten agreement signed by Abella, stating in detail the terms of Miguels alleged overseas employment,
and we quote:
16
1. Salary is $400 excluding overtime. There is a probationary period of 3 months.
2. Free board and lodging, one yr. contract renewable, 8 working hrs.
3. Total placement is P100TH, P50TH cash out and P50TH salary deduction. Training fee of P4,500 &
PDOS is included in the placement fee.
4. Downpayment of P25,000 to be used in the stamping of visa in the passport. After 1 week, applicant will
receive a xeroxed copy of his/her passport with stamped visa.
5. After downpayment, applicant will start training for 5 days, 8:00 AM-5:00 PM.
6. Remaining balance of P25TH will be given upon signing of the contract.
7. Downpayment is refundable in case of failure to process papers within the time frame agreed upon which
is within 2 months time. In case of refund certain charges will be deducted so the applicant cannot get the
full amount of downpayment.
8. Every payday, the applicant should deposit certain amount which they can afford to the ATM account of
the company.
9. Before departure, an Attorneys Affidavit will be prepared signed by Ms. Fe Abella, the applicant, one
member of the applicant[]s family particularly the nearest kin and the Agent handling the applicant. In case
the applicant does not comply with the payment of the remaining placement (P50TH), the member of the
family will be answerable for his/her obligation.
10. Ms. Fe Abella will be the one answerable for expired medical certificate.
11. In case problems arise in Turkey, applicant should approach the Philippine Embassy.
Abella is challenging the probative value of the above handwritten agreement on the ground that it is a mere
photocopy. Abella reasons that since the contents of said agreement are in issue, the best evidence rule applies.
The original of the agreement is the best evidence of Abella making representations that she had the power to send
private complainants abroad to work.
The non-presentation of the original copy of the handwritten agreement is not fatal to the prosecutions case. Miguel
personally testified before the RTC as to the circumstances of her recruitment by Abella. Abella made verbal, and
not only written, promises to Miguel of employment abroad. The handwritten agreement merely substantiates
Miguels testimony at best. In People v. Pabalan, we affirmed the sufficiency of testimonial evidence to prove
receipt by therein accused-appellant of placement fees, even in the absence of documentary evidence such as
receipts issued by accused-appellant, thus:
17
[T]he absence of receipts for some of the amounts delivered to the accused did not mean that the appellant did not
accept or receive such payments. Neither in the Statute of Frauds nor in the rules of evidence is the presentation of
receipts required in order to prove the existence of a recruitment agreement and the procurement of fees in illegal
recruitment cases. Such proof may come from the testimonies of witnesses.
18
Abella denies representing to private complainants that she was capable of deploying workers to Istanbul, Turkey.
Abella avows that she was a mere cashier at RBC who issued vouchers for payments made by clients and that she
subsequently turned over such payments to Reyes, the true owner of RBC.
We are not swayed by Abellas bare allegations, which conspicuously lacked any corroborative evidence. If Abella
was really a mere employee at RBC, then she could have presented basic evidence of her employment, such as
appointment papers, an identification card, or payslips. Also, the vouchers for the placement fees paid by private
complainants were issued and signed by Abella herself, without any indication that she issued and signed the same
on behalf of Reyes, the purported true owner of RBC. There is likewise absence of any proof of Abellas turnover to
or Reyess receipt of the amounts received from private complainants.
1wphi1
In contrast, the private complainants Miguel, Marcelino, and Callang were positive and categorical in their
testimonies that Abella promised them employment abroad in exchange for their payment of placement fees. Abella
herself provided Miguel with a Certification proving Abellas registration of the business name RBC; hence, negating
Abellas claim that RBC is actually owned by another person, Reyes. The private complainants testimonies were
consistent and corroborative of one another on material points, such as the placement fees asked of them, the
nature of work available, and their employment destination, which is, Istanbul, Turkey.
Well-settled is the rule that the trial court, having the opportunity to observe the witnesses and their demeanor
during the trial, can best assess the credibility of the witnesses and their testimonies. Abellas mere denial cannot
prevail over the positive and categorical testimonies of the private complainants. The findings of the trial court are
accorded great respect unless the trial court has overlooked or misconstrued some substantial facts, which, if
considered, might affect the result of the case. Furthermore, factual findings of the trial court, when affirmed by the
Court of Appeals, are deemed binding and conclusive.
19
Lastly, it was established that there were at least three victims in this case, namely, Miguel, Marcelino, and Callang,
who all testified before the RTC in support of their respective complaints.
Based on the foregoing, there is no doubt, as the RTC found and the Court of Appeals affirmed, that Abella is guilty
of illegal recruitment in large scale, which constitutes economic sabotage under the last paragraph of Section 6 of
Republic Act No. 8042.
Section 7(b) of Republic Act No. 8042 provides that "[t]he penalty of life imprisonment and a fine of not less than
Five hundred thousand pesos (P500,000.00) nor more than One million pesos (Pl,000,000.00) shall be imposed if
illegal recruitment constitutes economic sabotage as defined herein." Hence, we sustain the penalty of life
imprisonment and a fine of P500,000.00 imposed on Abella by the Court of Appeals.
WHEREFORE, we AFFIRM in toto the Decision dated September 30, 2010 of the Court of Appeals in CA-G.R.
CR.-H.C. No. 03974.
SO ORDERED.
G.R. No. 190970
November 24, 2014
VILMA M. SULIMAN, Petitioner,

vs.
PEOPLE OF THE PHILIPPINES, Respondent.
DECISION
PERALTA, J.:
Assailed in the present petition for review on certiorari is the Resolution of the Court of Appeals (CA) dated July 21,
2009, in CA-G.R. CR No. 30693 which denied herein petitioner's Motion to Admit Attached Motion for
Reconsideration, as well as the appellate court's Resolution dated January 8, 2010, which likewise denied
petitioner's Motion for Reconsideration of the CA Resolution dated July 21, 2009.
1
The factual and procedural antecedents of the case are as follows:

In six (6) Informations, all dated June 6, 2003,herein petitioner and one Luz P. Garcia were charged before the
Regional Trial Court (RTC) of Manila with two (2) counts of illegal recruitment under Section 6, paragraphs (a), (l)
and (m) of Republic Act No. 8042, otherwise known as the Migrant Workers and Overseas Filipinos Act of 1995, as
well as four (4) counts of estafaunder Article 315, paragraph 2(a) of the Revised Penal Code.
3
Only petitioner was brought to trial as her co-accused, Garcia, eluded arrest and remained at-large despite the
issuance of a warrant for her arrest.
The six cases were consolidated and, after trial, the RTC of Manila, Branch 21, rendered judgment finding petitioner
guilty beyond reasonable doubt of two (2) counts of illegal recruitment and three (3) counts of estafa. The dispositive
portion of the RTC Decision, dated June 7, 2006, reads as follows:
4
WHEREFORE, premises considered, the Court finds as follows:

1) In Crim. Case Nos. 03-216188 and 03-216189, accused VILMA SULIMAN GUILTY beyond reasonable
doubtas principal of the crimes charged and is hereby sentenced to suffer the indeterminate penalty of SIX
(6) YEARS each and to pay fine of P200,000.00 for each count.
2) In Crim. Case No. 03-216190, accused VILMA SULIMAN GUILTY beyond reasonable doubt as principal
of the crime charged and is hereby sentenced to suffer the penalty of SIX (6) MONTHS and ONE (1) DAY to
TWO (2) YEARS and ONE (1) DAY of prision correctional (sic) and to indemnify Anthony Mancera y Rey the
amount of P120,000.00 without subsidiary imprisonment in case of insolvency and to pay the costs.
3) In Crim. Case No. 03-216191, accused VILMA SULIMAN GUILTY beyond reasonable doubt as principal
of the crime of Estafa and is hereby sentenced to suffer the penalty of FOUR (4) YEARS and TWO (2)
MONTHS of prision correctional (sic) and to indemnify private complainant Perlita A. Prudencio the amount
ofP132,460.00 without subsidiary imprisonment in case of insolvency and to pay the costs.
4) In Crim. Case No. 03-216192, for failure of the prosecution to prove the guilt beyond reasonable doubt,
accused VILMA SULIMAN is hereby ACQUITTED of the crime charged.
5) In Crim. Case No. 03-216193, accused VILMA SULIMAN is GUILTY beyond reasonable doubt as
principal of the crime charged and is hereby sentenced to suffer the indeterminate penalty of SIX (6)
MONTHS and ONE (1) DAY of prision correctional (sic) and to indemnify Jimmy Tumabcao the amount
of P21,400.00 without subsidiary imprisonment in cases of insolvency and to pay the cost.
Accordingly, the bond posted for her provisional liberty is hereby CANCELLED.
Considering that the accused Vilma Suliman was detained from January 6, 2003 to July 23, 2004 prior to her
posting bond for her provisional liberty, her period of detention shall be credited in the service of her sentence.
Considering that Luz Garcia has not been apprehended nor voluntarily surrendered to date, let warrantbe issued for
her arrest and let the case against her be ARCHIVED to be reinstated upon her apprehension.
SO ORDERED.
Petitioner filed a Motion for Reconsideration, but the RTC denied it in its Order dated January 23, 2007 for lack of
merit.
6
Petitioner then filed an appeal with the CA.

On May 21, 2009, the CA promulgated its Decision, the dispositive portion of which reads, thus: WHEREFORE, in
view of the foregoing premises, the appeal filed in this case is hereby DENIED and consequently, DISMISSED. The
assailed Decision dated June 7, 2006 of the Regional Trial Court, Branch 21, in the City of Manila in Criminal Cases
Nos. 03-216188, 03-216189, 03-216190, 03-216191 and 03-216193 are hereby AFFIRMED with the following
modifications:
1. In Criminal Case Nos. 03-216188 and 03-216189 for illegal recruitment, the Court sentences accusedappellant VILMA SULIMAN to suffer the indeterminate penalty of six (6) years and one (1) day, as minimum,
to twelve (12) years, as maximum, and to pay a fine of Two Hundred Thousand Pesos (P200,000.00) for
each count.
2. In Criminal Case No. 03-216190 for estafa involving private complainant Anthony Mancera, the Court
sentences accused-appellant Vilma Suliman to suffer a minimum period of six (6) months and one (1) day of
prision correccional to a maximum term of fifteen (15) years, eight (8) months and twenty-one (21) days of
reclusion temporal.
3. In Criminal Case No. 03-216191 for estafa involving private complainant Perlita A. Prudencio, the Court
sentences accused-appellant Vilma Suliman to suffer the minimum period of four (4) years and two (2)
months of prision correccional to maximum term of seventeen (17) years, eight (8) months and twenty-one
(21) days of reclusion temporal.
4. In Crim. Case No. 03-216193 for estafa involving private complainant Jimmy Tumabcao, the Court
sentences accused-appellant Vilma Suliman to suffer the minimum term of six (6) months and one (1) day of
prision correccional to maximum term of six years, eight (8) months and twenty-one (21) days of prision
mayor.
SO ORDERED.
Petitioner's counsel received a copy of the above CA Decision on May 26, 2009. However, neither petitioner nor her
counsel filed a motion for reconsideration within the 15-day reglementary period for filing the said motion. Hence, on
June 11, 2009, the subject CA Decision became final.
9
On July 3, 2009, petitioner, through her new collaborating counsel, filed a Motion to Admit Attached Motion for
Reconsideration praying that the same be admitted in the higher interest of "substantial justice and due process."
Petitioner contended that her former counsel committed gross and inexcusable neglect of his duty as counsel in
failing to immediately inform petitioner about his receipt of the subject CA Decision, thereby depriving petitioner of
her right to file a motion for reconsideration which, in turn, is a violation of her right to due process.
10
On July 21, 2009, the CA issueda Resolution denying petitioner's Motion to Admit Attached Motion for
Reconsideration.
Petitioner filed a Motion for Reconsideration, but the CA denied it in its Resolution dated January 8, 2010.
11
Hence, the instant petition based on the following grounds:

THE HONORABLE COURT OF APPEALS ERRED IN NOT ADMITTING THE MOTION FOR RECONSIDERATION
OF THE PETITIONER
THE HONORABLE COURT OF APPEALS ERRED IN NOT HOLDING [THAT] PETITIONER SHOULD NOTBE
BOUND BY THE GROSS NEGLIGENCE OF ATTY. MAYO IN NOT INFORMING HER ABOUT HIS RECEIPT OF
THE DECISION OF THE COURT OF APPEALS ADVERSE TO HER ON MAY 26, 2009 OR IN NOT FILING A
MOTION FOR RECONSIDERATION TO PROTECT THE RIGHTS AND INTEREST OF THE PETITIONER.
12

The Court is not persuaded by petitioner's contention that she should not be bound by her counsel's gross neglect of
duty in not informing her of the adverse decision of the CA. The Court agrees with the observation of the CA that
petitioner is not entirely blameless as she was not vigilant in monitoring the progress of her case. Evidence of her
negligence is the fact that she did not make any effort to personally follow up her appeal with her counsel. Instead,
she merely relied on a certain Conrad Lucero, the person who referred her to her counsel, regarding updates ofher
appeal with the CA. In this respect, the Court's ruling in Bejarasco, Jr. v. People is instructive, to wit:
13
The general rule is that a client is bound by the counsels acts, including even mistakes in the realm of procedural
technique. The rationale for the rule isthat a counsel, once retained, holds the implied authority to do all acts
necessary or, atleast, incidental to the prosecution and management of the suit in behalf of his client, such that any
act or omission by counsel within the scope of the authority is regarded, in the eyes of the law, as the act or
omission of the client himself. A recognized exception to the rule is when the reckless or gross negligence of the
counsel deprives the client of due process of law. For the exception to apply, however, the gross negligence should
not be accompanied by the clients own negligence or malice, considering that the client has the duty to be vigilant
in respect of his interests by keeping himself up-to-date on the status of the case. Failing in thisduty, the client
should suffer whatever adverse judgment is rendered against him.
Truly, a litigant bears the responsibility to monitor the status of his case, for no prudent party leaves the fate of his
case entirely in the hands of his lawyer. It is the clients duty to be in contact with his lawyer from time to time in
order to be informed of the progress and developments of his case; hence, to merely rely on the bare reassurances
of his lawyer that everything is being taken care of is not enough.
14
It may not be amiss to add that this Court notes the propensity of petitioner and her counsel to disregard the Rules
and directives of the Court. In a Resolution issued by this Court on March 14, 2011, petitioner's counsel was
admonished for his failure to file petitioner's Reply to Comment which was required in an earlier Resolution issued
by this Court.
15
Moreover, it is a settled rule that the right to appeal is neither a natural right nor a part of due process; it is merely a
statutory privilege, and may be exercised only in the manner and in accordance with the provision of law. An
appeal being a purely statutory right, an appealing party must strictly comply with the requisites laid down in the
Rules of Court. Deviations from the Rules cannot be tolerated. The rationale for this strict attitude is not difficult to
appreciate as the Rules are designed to facilitate the orderly disposition of appealed cases. In an age where courts
are be devilled by clogged dockets, the Rules need to befollowed by appellants with greater fidelity. Their
observance cannot be leftto the whims and caprices of appellants. In the instant case, petitioner remained obstinate
in her non observance of the said Rules. Such obstinacy is incongruous with her late plea for liberality in construing
the Rules. On the above basis alone, the Court finds that the instant petition is dismissible.
16
17
18
19
In any case, even if the Court bends its Rules to allow the present petition, as it appears that petitioner assails not
only the denial by the CA of her motion to admit her belated Motion for Reconsideration but likewise seeks the
reversal of her conviction for illegal recruitment and estafa, the Court still finds no cogent reason to depart from the
assailed ruling of the CA. Indeed, after a careful and thorough review of the evidence on record, the Court finds that
the lower courts did not commit any error in convicting petitioner of the crimes of illegal recruitment and estafa.
At this point, it bears reiterating that in a petition for review on certiorari under Rule 45 of the Rules of Court, the
factual findings of the RTC, especially when affirmed by the CA, are generally held binding and conclusive on the
Court. We emphasize that while jurisprudence has provided exceptions to this rule, the petitioner carries the
burden of proving that one or more exceptional circumstances are present in the case. The petitioner must
additionally show that the cited exceptional circumstances will have a bearing on the results of the case. In the
instant case, the Court finds that none of the exceptions are present . Thus, there is no cogent reason to depart from
the findings of both the RTC and the CA that petitioner is guilty beyond reasonable doubt of the crimes charged.
20
21
22
23
The crime of illegal recruitment is defined under Section 6 of RA 8042, otherwise known as the Migrant Workers and
Overseas Filipinos Act of 1995, which provides as follows:
Sec. 6. DEFINITIONS. - For purposes of this Act, illegal recruitment shall mean any act of canvassing, enlisting,
contracting, transporting, utilizing, hiring, procuring workers and includes referring, contact 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 persons, whether a non-licensee, non-holder, licensee or
holder of authority.
employment;
employment;
(e) To influence or attempt to influence any persons or entity not to employ any worker who has not applied
(f) To engage in the recruitment of placement of workers in jobs harmful to public health or morality or to
(h) To fail to submit reports on the status of employment, placement vacancies, remittances of foreign
exchange earnings, separations from jobs, departures and such other matters or information as may be
Employment;
of any corporation engaged in travel agency or to be engaged directly orindirectly in the management of a
travel agency;
regulations;
(l) Failure to actually deploy without valid reasons as determined by the Department of Labor and
Employment; and
(m) Failure to reimburse expenses incurred by the workers 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 as
offense involving economic sabotage.
Illegal recruitment is deemed committed by a syndicate 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.
1wphi1
24
In the present case, both the RTC and the CA found that the prosecution has established that petitioner and her coaccused committed the acts enumerated under the provisions of Section 6 (a), (l) and (m) of RA 8042 when: (1) they
separately charged the private complainants the amounts of P132,460.00, P120,000.00 and P21,400.00 as
placement fees; (2) they failed to actually deploy the private complainants without valid reasons, and; (3) they failed
to reimburse the said complainants after such failure to deploy.
As to the charge of estafa, the act complained of in the instant case is penalized under Article 315, paragraph 2(a)
of the RPC, wherein estafa is committed by any person who shall defraud another by false pretenses or fraudulent
acts executed prior to or simultaneously with the commission of the fraud. It is committed by using fictitious name, or
by pretending to possess power, influence, qualifications, property, credit, agency, business or imaginary
transactions, or by means of other similar deceits. The elements of estafaby means of deceit are the following, viz.:
(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.
25
In the instant case, all the foregoing elements are present. It was proven beyond reasonable doubt, as found by the
RTC and affirmed by the CA, that petitioner and her co-accused misrepresented and falsely pretended that they had
the capacity to deploy the private complainants for employment either in South Korea, Saudi Arabia and Canada.
The misrepresentation was made prior toprivate complainants' payment of placement fees. It was the
misrepresentation and false pretenses made by petitioner and her co-accused that inducedthe private complainants
to part with their money. As a result of such false pretenses and misrepresentations, the private complainants
suffered damages as the promised employment abroad never materialized and the various amounts of money they
paid were never recovered. Petitioner argues that she could not be held liable because she was not privy nor was
she aware of the recruitment activities done by her coaccused. Petitioner avers that when her co-accused received
several amounts of money from the private complainants, she acted in her personal capacity and for her own benefit
without the knowledge and consent of petitioner. The Court is not persuaded. As owner and general manager,
petitioner was at the forefront of the recruitment activities of Suliman International. Undoubtedly, she has control,
manage mentor direction of the business of the said company. Petitioner's denial is an intrinsically weak defense,
especially in the face of positive assertions made by the private complainants who had no ill motive to falsely testify
against her. Indeed, of marked relevance is the absence of any showing that the private complainants had any ill
motive against petitioner other than to bring her to the bar of justice to answer for the crime of illegal recruitment.
Besides, for strangers to conspire and accuse another stranger of a most serious crime just to mollify their hurt
feelings would certainly be against human nature and experience. Where there is nothing to show that the
witnesses for the prosecution were actuated by improper motive, their positive and categorical declarations on the
witness stand under the solemnity of an oath deserve full faith and credence. In any case, petitioner cannot deny
participation in the recruitment of the private complainants because the prosecution has established that petitioner
was the one who offered the private complainants an alleged alternative employment in Ireland when their original
deployment did not materialize. WHEREFORE, the instant petition is DENIED. The Resolutions of the Court of
Appeals, dated July 21, 2009 and January 8, 2010 in CA-G.R. CR No. 30693, are AFFIRMED.
26
27
SO ORDERED.
G.R. No. 207328
April 20, 2015
WILHELMSEN-SMITH BELL MANNING/WILHELMSEN SHIP MANAGEMENT, LTD./ FAUSTO R. PREYSLER,

JR., Petitioners,
vs.
ALLAN SUAREZ, Respondent.
DECISION
BRION, J.:
We resolve the present petition for review on certiorari, assailing the March 15, 2013 decision and May 27, 2013
resolution of the Court of Appeals in CA-G.R. SP No. 127295.
1
The Antecedents
The case arose from the complaint for permanent total disability benefits, damages and attorney's fees, filed by
respondent Allan Suarez against petitioners Wilhelmsen-Smith Bell Manning, Inc., (agency), its responsible officer,
Fausto R. Preysler, Jr., and its principal, Wilhelmsen Ship Management, Ltd.
Suarez alleged that he has been continuously hired by the petitioners for five years as ordinary seaman and has
always been assigned to a car ship. His last contract, approved by the Philippine Overseas Employment
4
Administration (POEA) on May 20, 2010, was for nine months. His employment was also covered by a Model
Collective Bargaining Agreement (CBA) of the Associated Marine Officers and Seamens Union of the Philippines
(AMOSUP). After his pre-employment medical examination, he boarded the vessel Toreadoron May 26, 2010.
5
Sometime in December 2010, while securing chain lashing heavy equipment on board the vessel, Suarez suffered
severe back pain which radiated to his right abdomen. He was brought to a medical clinic in Rotterdam, Germany,
where he was diagnosed with Right Pelvoureteric Junction Obstruction. His attending physician declared him unfit to
work.
Suarez was medically repatriated and disembarked from the vessel on December 23, 2010. He immediately
reported to the agency and was referred to its accredited physician at the Metropolitan Medical Center (MMC), Dr.
Karen Frances Hao-Quan. Dr. Hao-Quan initially diagnosed him with "ureteropelvic junction obstruction" (UJO). On
December 30, 2010, he underwent a CT scan of the urography and was continuously treated as an out-patient.
Allegedly, despite his medications, his condition persisted. He was again examined by Dr. Hao-Quan and was found
to be suffering from "hydroneprosis secondary to UJO, right." On February 7, 2011, he underwent "nephrectomy,
right and cystocopy." On February 16, 2011, he again consulted Dr. Hao-Quan who diagnosed him with
"hydroneprhrosis secondary to UJO, right; s/p nephrectomy, right and cystoscopy."
Meanwhile, Suarez consulted a doctor of his choice, Dr. Manuel C. Jacinto, Jr., who found him with "hydronephrosis
secondary to UJO, right; gastric ulcer/erosion; h.pylori infections chronic pyelonephritis right kidney." Dr. Jacinto
declared Suarez no longer fit to work as a seafarer, prompting him to file the complaint. He prayed for permanent
total disability compensation of US$89,100.00 under the AMOSUP CBA.
6
To substantiate his claim, Suarez alleged that he had become unfit to work since he was repatriated on December
23, 2010, and because of his condition, no employer in his right mind would hire him. He further alleged that under
the permanent medical unfitness clause of the CBA, he is entitled to permanent disability benefits, regardless of his
disability grade.
The petitioners, for their part, confirmed that upon his disembarkation, Suarez was subjected to medical
examinations, treatments and surgical procedures by the company-designated doctors. They stressed that the
medical report of his January 13, 2011 check-up indicated (based on the
DTPA scan) that his right kidney was almost non-functional and his left kidney had normal perfusion. He was
diagnosed with "hydronephrosis secondary to UJO, right."
7
In her January 31, 2011 medical report, MMC Asst. Medical Coordinator, Dr. Mylene Cruz-Balbon, declared that
Suarezs UJO was not work-related. Thereafter, or on February 7, 2011, after undergoing specialized medical tests,
Suarez was subjected to prescribed major surgical procedures cystoretrograde pyelography and nephrectomy,
right kidney. On March 31, 2011, Dr. Cruz Balbon reiterated that Suarezs condition was not work-related. She also
reported that the prognosis of his condition was good, barring unforeseen circumstances; and that if he is entitled to
disability compensation, his disability grading secondary to loss of 1 kidney is Grade 7. Finally or on May 10, 2011,
the company urologist, Dr. Ed Gatchalian, declared Suarez fit to work.
8
10
The petitioners also pointed out that under the POEA-SEC, Suarezs illness is not an occupational disease. They
maintained that medical studies show that UJO is mainly a genetic abnormality. Still, they shouldered the cost of his
medical treatment until he was declared fit to work by the company-designated physician. They thus argued that
Suarezs claim for damages and attorneys fees had no basis as their denial of his demand for disability
compensation was not in bad faith.
11
The Rulings on Compulsory Arbitration

On October 28, 2011, Labor Arbiter (LA) Fedriel S. Panganiban rendered a decision dismissing the case for lack of
merit. LA Panganiban held that Suarez has not offered any evidence to refute the argument that his illness is not
compensable for not being work-related and because the company-designated physician had declared him fit to
work. The evidence, LA Panganiban emphasized, shows that the respondents have fully complied with their
contractual obligations, thus negating any finding of liability for complainants claims.
12
On appeal by Suarez, the National Labor Relations Commission (NLRC) reversed LA Panganibans ruling in its
decision of March 27, 2012. The labor tribunal found Suarez to have suffered from permanent total disability as he
was unable to perform his job for more than 120 days. It opined that his illness need not beshown to be work-related
provided it occurred during the term of the contract. It ordered the petitioners to pay Suarez, jointly and severally,
permanent total disability benefits of US$60,000.00 under the POEA-SEC, plus 10%attorneys fees. It refused to
honor the AMOSUP CBA "as the parties thereto were not specifically identified, particularly as regards respondents
herein."
13
14
The petitioners moved for reconsideration, but the NLRC denied the motion. They then appealed to the CA through
a petition for certiorari, contending that the NLRC committed grave abuse of discretion in reversing LA Panganibans
dismissal of the complaint.
The petitioners argued before the CA that Suarezs illness was not work-related as there was no evidence showing
that the working conditions on board the vessel caused or aggravated his medical condition, but even assuming that
his illness was work-related, his claim should nonetheless fail in view of the fit-to-work declaration by the companydesignated physician.
The CA Decision
The CA denied the petition. It found no grave abuse of discretion in the assailed NLRC judgment as it found the
judgment supported by substantial evidence. It concurred with the NLRC conclusion that Suarez suffered from
permanent total disability since he was unable to return to his job as a seafarer for more than 120 days. It stressed
that from the time Suarez was medically repatriated on December 23, 2010, he was unable to work for 138 days
since he was certified fit to work by the company designated physician only on May 10, 2011.
The CA refused to give credit to the fit-to-work assessment of the company-designated physician. It considered the
assessment not final, binding or conclusive on the seafarer, the labor tribunals, or the courts. Citing jurisprudence, it
stressed that the seafarer may request a second opinion regarding his ailment or injury and the medical report
issued by the physician of his choice shall be evaluated on its inherent merit by the labor tribunals and the courts.
15
Like the NLRC, the CA noted that the declaration by Dr. Jacinto, Suarezs chosen physician, that he was no longer
fit to work as a seaman jibed with the medical findings of one of the company doctors, Dr. Cruz Balbon. It concluded
that the two physicians shared the view that Suarezs work-related illness was subsisting and that he would feel the
effect of the loss of his kidney for the rest of his life.
16
The appellate court rejected the petitioners submission that there was no evidence that the working conditions on
board the Toreador caused or aggravated Suarezs illness. It emphasized that it is enough that there is a reasonable
linkage between the disease suffered by the employee and his work to make a rational mind conclude that Suarezs
work may have contributed to the establishment or, at the very least, aggravation of any preexisting condition he
might have had.
17
The CA pointed out that in the present case, Suarez was deployed to the petitioners car ship and "was exposed to
heavy equipment" requiring him to exert force that caused his medical condition. It also found credible Suarezs
claim that the food served onboard the vessel was extremely unhealthy as it was frozen, fatty and salty. The CA thus
believed that Suarezs working environment, as well as his diet onboard the vessel, may have aggravated or
contributed to the development of his Hydronephrosis secondary to UJO.
The petitioners moved for, but failed to secure, a reconsideration from the CA.
The Petition
The petitioners now appeal to the Court to set aside the CA rulings on grounds that the appellate court gravely erred
in affirming the award to Suarez of (1) US$60,000.00 in disability benefits, despite the declaration of the companydesignated physician that he was fit to work and that his illness was not work-related; and (2) attorneys fees,
despite the fact that their denial of his claim for disability benefits was based on valid grounds.
The petitioners bewail the rejection by the CA of the fit-to-work assessment of the company-designated physician,
considering as they point out, that a company-designated physicians assessment has been upheld in recent
decisions of this Court, absent any contrary finding of an independent third physician jointly appointed by the
parties. Moreover, they stress that in another recent ruling, the Court clothed the company doctors assessment
with the presumption of regularity and legality and, therefore should be given respect. In the present case, they add,
Suarez failed to rebut such presumption by moving for the appointment of a third doctor or by showing that the
company doctors findings are tainted with bias, malice or bad faith.
18
19
The petitioners insist that Suarezs illness is mainly a genetic abnormality as medical studies show and is therefore
not work-related. Further, they contend that the CA erred in upholding the NLRC finding that Suarez is permanently
disabled because he was unable to work for more than 120 days. They maintain that the 120-day rule had already
been overturned by recent Court rulings and does not apply to Suarezs claim.
20
The company-designated physician, the petitioners argue, assessed Suarezs illness to be non-work-related on
January 27, 2011. This assessment notwithstanding, they continued his treatment until he was declared fit to work
on May 10, 2011. Considering that Suarezs illness was not work-related and that the company-designated
physician declared him fit to work within the period set by the rules, the petitioners submit that Suarez is not entitled
to disability compensation and to attorneys fees.
Suarezs Comment
In his comment filed on November 18, 2013, Suarez prays for a dismissal of the petition with the submission that
the NLRC decision that was affirmed by the CA is supported by substantial evidence, relevant jurisprudence and the
provisions of the POEA-SEC. He maintains that the CA acted judiciously in upholding the findings of the NLRC that
because of his disability, he had become totally unfit to work as a seafarer in any capacity as a result of the illness
he contracted on board the petitioners vessel. He insists that he is entitled to full disability compensation. The
petitioners, he tells the Court, "had failed to come up with new issues, new arguments, new evidence or new
matter" that will justify a review of the case.
21
22
The Courts Ruling

We find merit in the petition. The facts, the law and relevant jurisprudence militate against the award of permanent
total disability benefits to Suarez.
First. It appears that Suarezs illness, hydronephrosis secondary to UJO, right (a kidney ailment) is not work-related
and therefore not compensable. Under Section 20 (B) 3 of the POEA-SEC, the employer is liable only for
compensation/benefits when the seafarer suffers work-related injury or illness during the term of the contract. Even
the disputed AMOSUP CBA (invoked by Suarez but rejected by the NLRC) states that a seafarer who suffers
permanent disability as a result of work related illness or from an injury as a result of an accident, shall in addition to
sick pay, be entitled to compensation according to the provisions of the CBA.
23
24
Also, UJO is not an occupational disease as it does not appear in the list of occupational diseases under Section
32-A of the POEA-SEC, although under its Section 20(4), it is disputably presumed to be work-related. In this case,
the company-designated physician certified that the subject illness is not work-related, an assessment supported
by medical studies indicating that UJO or uteropelvic junction obstruction is a congenital abnormality that remains
an enigma in terms of both diagnosis and therapy. The abnormality may be observed in both adults and children.
Thus, LA Panganiban aptly concluded that the petitioners were able to overcome the presumption.
25
26
Second. The foregoing notwithstanding and, even on the assumption that Suarezs illness is work-related, his claim
for permanent total disability compensation cannot prosper. The company-designated physician declared Suarez fit
to work. The declaration was made by Dr. Ed R. Gatchalian, a urological surgeon, in his letter of May 10, 2011 to
Dr. Robert Lim, MMC Medical Coordinator. According to Dr. Gatchalian: "Mr. Allan Suarez is now doing well. He has
fully recovered from his surgery. His urinalysis is now normal. He is now cleared to go back to work."
27
Under Section 20 (B) 3, par. 1 of the POEA-SEC, it is the company designated physician who determines the
fitness to work or the degree of permanent disability of a seafarer who disembarks from the vessel for medical
treatment. The AMOSUPCBA likewise provides that "the degree of disability which the employer, subject to this
28
Agreement, is liable to pay shall be determined by a doctor appointed by the Employer." The POEASEC,
supplemented by the CBA, if one exists is the law between the Parties and must be given respect. In this light, the
labor arbiter committed no error when he upheld the fit-to-work assessment of the company-designated physician
as it was in accordance with the law that governs Suarezs employment. The LAs reliance on the company doctors
assessment over that of Dr. Jacinto, Suarezs chosen physician, was justified not only by the governing law between
the parties, but also by the time and resources spent and the effort exerted by the petitioners physicians in the
examination, treatment and management (including surgical procedures) of Suarezs medical condition until he was
declared fit to work by the company urologist on May 10, 2011.
29
30
31
On the other hand, LA Panganiban noted that the medical certificate issued by Dr. Jacinto to Suarez on June 6,
2011 "shows that it was made without proof of any extensive examination having been conducted" and it was
"evident that it was the first and only consultation made by the complainant" with Dr. Jacinto. And if we may add,
Dr. Jacinto made substantially the same finding as those of the company doctors that Suarez suffered from UJO. In
this light, we just cannot accept Suarezs one-time consultation with Dr. Jacinto as a credible basis for his unfit-towork certification.
32
33
Third. The NLRC and CAs reliance on the 120-day rule for the award of permanent total disability compensation to
Suarez is misplaced.
In Splash Philippines, Inc., et al., v. Ronulfo G. Ruizo, the Court reiterated that the 120-day rule for the declaration
of a permanent total disability laid down in earlier maritime compensation cases, the most prominent of which was
Crystal Shipping, Inc., v. Natividad, had already been clarified or modified.
34
35
Citing Vergara v. Hammonia Maritime Services, Inc, the Court stressed that the degree of a seafarers disability
cannot be determined on the basis solely of the 120-day rule or intotal disregard of the seafarers employment
contract executed in accordance with the POEA-SEC the parties CBA, if there is one, and Philippine law and
rules in case of any unresolved dispute, claim or grievance arising out of or in connection with the POEA-SEC.
Stated otherwise, the Court emphasized that the application of the 120-day rule must depend on the circumstances
of the case, considering especially the parties compliance with their contractual duties and obligations.
36
In this case, Suarez was declared fit to work by Dr. Gatchalian 138 days after his repatriation, which was well within
the extended 240-day period set by Rule X, Section 2, Book IV of the Implementing Rules of the Labor Code (the
Rules on Employees Compensation), for the physician to make an assessment of the seafarers disability or to
declare him fit to work as explained in Vergara. The fit-to-work certification issued by Dr. Gatchalian clearly negated
a permanent total disability assessment. Yet, the NLRC and the CA rejected Dr. Gatchalians assessment and
invoked the 120-day rule, declaring that Suarez was permanently disabled because he had been unable to resume
his work as a seaman since he disembarked on December 23, 2010. Necessarily, they also upheld the unfit-to-work
certification of Dr. Jacinto, Suarezs physician of choice.
37
The NLRC and CA rulings were rendered with grave abuse of discretion as they were in total disregard of the
POEA-SEC and applicable Philippine law, particularly the following provisions: Section 20 (B) 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 companydesignated physician but in no case shall this period exceed one hundred twenty (120) days.
xxxx
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 the parties.
Section 20 (B) 6
In case of permanent total or partial disability of the seafarer caused by either injury or illness the seafarer shall be
compensated in accordance with the schedule of benefits in Section 32 of this Contract. Computation of benefits
arising from an illness or disease shall be governed by the rates and the rules of compensation applicable at the
time the illness or disease was contracted.
38
On the other hand, Rule X, Section 2 of the ECC Rules provides:

Sec. 2. Period of entitlement. (a) The income benefit shall be paid beginning on the first day of such disability. If
caused by an injury or sickness, it shall not be paid longer than 120 days except where such injury or sickness still
requires medical attendance beyond 120 days but not to exceed 240 days from onset of disability in which case
benefit for temporary total disability shall be paid. However, the System may declare the total and permanent status
at any time after 120 days of continuous temporary total disability as may be warranted by the degree of actual loss
or impairment of physical or mental functions as determined by the system.
1wphi1
39
The Court said in Vergara that "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 permanent partial or
total disability already exists. The seaman may of course also be declared fit to work at any time such declaration is
justified by his medical condition." Needless to say, and as earlier mentioned, Dr. Gatchalian declared Suarez fit to
work 138 days after his repatriation on December 23, 2010.
40
While Suarez was free to consult a physician of his choice regarding his medical condition and/or disability as
implied by the last paragraph of Section 20 (B) 3 of the POEA-SEC, the contrary opinion of his chosen physician
should have been referred to a third doctor, jointly with the petitioners, for a binding and final opinion. He should
have initiated the referral considering that the petitioners were not aware that he consulted Dr. Jacinto. Instead, he
filed the complaint upon issuance of the unfit-to-work certification of Dr. Jacinto.
The filing of the complaint was premature and constituted a breach of Suarez's contractual obligation with the
petitioners. And because there was no third and binding opinion, Dr. Gatchalian's fit-to-work assessment should
prevail. The complaint should have been dismissed.
41
42
Finally, one other consideration why the 120-day rule cannot be accepted as a cure-all formula for the award of a
permanent total disability compensation is the provision of a disability compensation system under the POEA-SEC
under its Section 32 which laid down a Schedule of Disability Impediment for Injuries Suffered and Diseases
including Occupational Diseases or Illness Contracted, in conjunction with Section 20 (B) 6 above which, in turn,
provides that in case of a permanent total or partial disability, the seafarer he shall be compensated in accordance
with Section 32.
In a clarificatory resolution dated February 12, 2007 in relation to Crystal Shipping, the Court declared that the
POEA-SEC does not measure disability in terms of number of days but by gradings only. Significantly, permanent
total disability is classified under Grade 1 under Section 32. As we stressed in Splash Philippines, it is about time
that the schedule of disability compensation under Section 32 is seriously observed, as we must in this case. There
being no impediment grading declared by Dr. Jacinto, Suarez's claim for total disability benefits must necessarily
fail.
43
To reiterate, we find merit in the petition.

WHEREFORE, premises considered, the petition for review on certiorari is GRANTED. The assailed decision and
resolution of the Court of Appeals are SET ASIDE. The decision dated October 28, 2011 of the Labor Arbiter is
hereby ordered REINSTATED. No costs.
SO ORDERED.
G.R. No. 193101
April 20, 2015
NICANOR CERIOLA, Petitioner,

vs.
NAESS SHIPPING PHILIPPINES, INC., MIGUEL OCA AND/OR KUWAIT OIL TANKER, Respondents.
DECISION
PEREZ, J.:
Before us is a Petition for Review on Certiorari assailing the Decision of the Court of Appeals in CA-G.R. SP. No.
107477 which reversed and set aside the Decision of the National Labor Relations Commission (NLRC) granting
the appeal of petitioner Nicanor Ceriola sustaining his claims for disability benefit under the Philippine Overseas
Employment Administration-Standard Employment Contract (POEA-SEC). The NLRC, in turn, reversed and set
aside the Decision of the Labor Arbiter dismissing the complaint of petitioner.
1
From the year 1981, petitioner has been employed as a seafarer on board various vessels of respondent NAESS
Shipping Philippines, Inc. (NAESS Shipping) covered by different overseas employment contracts.
The controversy between the parties involving the claimed illness of petitioner, and his possible entitlement to
disability benefit, is reckoned from the start of the employment contract of 6 June 1999, where petitioner was
deployed on board the vessel "GAS AL AHMADI."
After completing that contract, and for re-deployment purposes, petitioner reported to respondent for extensive
medical examination, where he was then diagnosed to be suffering from early stage of "Lumbar Spondylosis."
Despite the diagnosis, petitioner was declared "fit to work" and was deployed for two successive overseas
employment contracts on board the vessel "GAS AL BURGAN": (1) from 8 July 2000 to 12 April 2001; and (2) from 7
July 2001 until 12 April 2002. In between these employment contracts, specifically between the contract of 8 July
2000-12 April 2001 and that of 7 July 2001-12 April 2002, as per standard procedure, petitioner underwent medical
examination because he was experiencing severe back pains. The results of the medical examination indicated that
the dislocation of petitioners lumbar vertebrae had aggravated. However, considering that his prior medical
clearance in the year 2000 of "fit to work" was effective for two (2) years, petitioner was re-deployed on board "GAS
AL BURGAN" 7 from July 2001 to 12 April 2002.
4
Reckoned from this period, the finding of fact of the labor tribunals and the appellate court conflict on the results of
petitioners medical examinations. Three different certifications come up, respectively supporting the assertions of
either the petitioner or respondents:
1. Results of petitioners medical consultation from 11 June 2002 to 1 April 2003 which declared petitioner
"unfit to work" due to a work related injury or ailment, offered in evidence by petitioner and cited by the
NLRC in reversing the ruling of the Labor Arbiter.
2. Results of petitioners medical examination after expiration of his last contract on 12 April 2002 which
declared him "fit to work," and submitted by respondents NAESS Shipping Philippines, Inc., Miguel Oca
and/or Kuwait Oil Tanker.
3. Debriefing Questionnaire duly accomplished by petitioner on 16 April 2002, petitioner specifically stating
that "all ok during his contract inc. his health (sic)."
In fact, the Court of Appeals in its Decision and Resolution made differing factual findings thereon, thus:
Before [petitioner] went on board, he was declared fit for work. Never during his work on board, did [petitioner]
complain of any medical condition. When he disembarked on finished contract on 12 April 2002, [petitioner] did not
complain of any illness nor did he report for medical consultation for any medical condition. He therefore did not
qualify for the disability benefits forming part of his employment contract. He did not suffer any medical condition
during the term of his contract nor was proof presented that whatever medical condition he complained of was
caused by work-related illness or injury as he made no report of any medical condition when he disembarked. In fact
he was declared fit for work in the 23 July 2002 Certification issued by Dr. Calanoc of Seamens Hospital.
5
The instant case arose from the complaint of [petitioner] for disability benefits granted under the Philippine Overseas
Employment Administration Standard Employment Contract (POEA-SEC) for seamen. Records show that
[petitioner] was last deployed for the period from 07 July 2001 until 12 April 2002 when [petitioner] disembarked
after completion of contract. [Petitioner] underwent another medical examination on July 2002, for possible redeployment but was declared "unfit to work." (Emphasis supplied)
6
It appears from the record that petitioner never underwent post- employment medical examination as required under
Section 20 (B) of the POEA SEC. Thus, as previously adverted to:
1. The Labor Arbiter dismissed the complaint of petitioner:

It is not disputed that [petitioner] completed his last contract with the respondents and was discharged from the
vessel on April 13, 2002. There is no showing that prior thereto, the [petitioner] has sustained an injury or suffered
an illness during the term of his contract which can be the basis for a claim for disability benefits under the contract.
On the contrary, the Debriefing Questionnaire duly accomplished by [petitioner] on April 16, 2002 contains his
handwritten acknowledgement that was "all ok during his contract incl. his health." Moreover, in June-July 2002, the
[petitioner] underwent a series of examinations preparatory to deployment wherein he was declared fit to work.
It must be stressed that under Section 20.B of the POEA Standard Contract, the employer is liable for payment of
disability benefits for work-related sickness/injury sustained during the term of the contract only after the
degree/extent of injury has been assessed, and the corresponding impediment grade is declared by the companydesignated physician.
In this case, a disability assessment was not undertaken as the complainant was declared fit to work by the
respondents designated physician to whom the [petitioner] was referred, and that the declaration of fitness was
issued after [petitioner] has undergone a physical therapy program.
xxxx
[Petitioner] in this case was declared fit to work on July 23, 2002, after being evaluated and treated by the companydesignated physician.
In the absence of proof that the certification of fitness was irregularly issued, or does not reflect the actual medical
condition of the affected seafarer, said certification must be upheld and given probative weight to support the denial
of the claim.
Accordingly, the declaration of fitness issued by the company designated physician negates [petitioners] claim for
disability benefits.
And, while [petitioner] may have presented a medical certificate to support his claim for disability benefits, a perusal
thereof fails to disclose the declaration of disability that would render operative the provisions of the POEA Standard
Employment Contract.
xxxx
WHEREFORE, premises considered, judgment is hereby rendered dismissing the complaint for lack of merit.
2. However, on appeal, the NLRC reversed the Labor Arbiter and granted petitioners claim for disability benefits:
While it is true that the certification mentioned by the Labor Arbiter appear on record, the latter seemed not to have
noticed the more recent certification which was issued by the respondents hospital in April 2003. To reiterate, the
certificate states that [petitioner] is "unfit to work" and his illness appears to be work-oriented. x x x
In support of his claims, we are persuaded by [petitioners] allegations and arguments that:
1. His injury or ailment was due to his work of lifting heavy objects at the vessel;
2. The fact that such was work-related was attested to by the designated hospital of the respondent;
3. [Petitioners] employment history shows that he spent his entire seafaring career since 1981 with herein
respondents;
4. After every conclusion of his contract, he would merely take a vacation of approximately two (2) months
only;
5. Beginning with his contract with the duration of 8 July 2000 to April 2001, he was already diagnosed to
have a work-related injury or illness of "lumbar spondylosis" or dislocation of lumbar vertebrae;
6. Since his injury then was not yet severe, he was still allowed to be deployed. However, during the period
he was on board, he sustained or aggravated his present illness; and
7. At present, he could no longer perform heavy works.
The foregoing allegations and argument substantiate the following requirements provided under the POEA Standard
Employment Contract for an injury or illness to be compensable:
1. The seafarers work must involve the risks described herein; 2. The disease was contracted as a result of
the seafarers exposure to the described risks;
3. The disease was contracted within a period of exposure and under such other factors necessary to
contract it;
4. There was no notorious negligence on the part of the seafarer.
xxxx
WHEREFORE, premises considered, [petitioners] appeal is hereby GRANTED. Accordingly, the assailed Decision
is hereby REVERSED and SET ASIDE.
Respondents are hereby held jointly and solidarily liable to pay [petitioner] his disability benefit in such amount as
may correspond to the impediment grade to be provided by the Employees Compensation Commission.
[Petitioner] is hereby directed to strictly comply with the order requiring him to present himself to the Employees
Compensation Commision (ECC) and secure the impediment grade corresponding to his disability.
Other claims are dismissed for lack of basis.
3. On petition for certiorariby respondents alleging grave abuse of discretion by the NLRC in granting petitioners
claim for disability benefits, the appellate court reinstated the ruling of the Labor Arbiter denying petitioners claim:
In the instant case, [petitioner] had finished his contract when he disembarked on 12 April 2002. Thus, [petitioner]
can no longer claim any benefits under his employment contract.
xxxx
cause by work-related illness or injury as he made no report of any medical condition when he disembarked. In fact
xxxx
That the person qualified to determine the disability benefits of a seafarer is the company designated physician, was
again emphasized by the Supreme Court in Vergara v. Hammonia Maritimex x x.
xxxx
WHEREFORE, premises considered, the instant petition is hereby GRANTED. The decision of the NLRC is hereby
REVERSED and SET ASIDE and the decision of the Labor Arbiter is REINSTATED. And the complaint is hereby
DISMISSED for lack of merit.
9
4. On motion for reconsideration, the appellate court stood pat on its ruling and denied petitioners claim for disability
benefit:
The instant case arose from the complaint of [petitioner] for disability benefits granted under the Philippine Overseas
Employment Administration Standard Employment Contract (POEA-SEC) for seamen. Records show that
[petitioner] was last deployed for the period from 07 July 2001 until 12 April 2002 when [petitioner] disembarked
after completion of contract. [Petitioner] underwent another medical examination on July 2002, for possible redeployment but was declared "unfit to work."
From the above facts it is clear that [petitioner] was no longer under any POEA-SEC, a requirement for one to enjoy
the disability benefits provided therein.
Seafarers are contractual employees. Their employment is governed by the contracts they sign every time they are
re[-]hired and their employment is terminated when the contract expires. Their employment is contractually fixed for
a certain period of time. They fall under the exception of Article 280 whose employment has been fixed for a specific
project or undertaking the completion or termination of which has been determined at the time of engagement of the
employee or where the work or services to be performed is seasonal in nature and the employment is for the
duration of the season.
When [petitioner] disembarked, it was because of the completion of his contract or his contract had ended. And he
had no complaints whatsoever.
When [petitioner] was found to be unfit to work, he was no longer a subject of any POEA Standard Employment
Contract (POEA-SEC) for which disability benefits is a part of and of which [petitioner] is claiming to be entitled to.
For being not covered by a POEA-SEC, [petitioner] cannot make any claim based on the POEA-SEC.
Accordingly, the Motion for Reconsideration is hereby DENIED for lack of merit.
10
Hence, this appeal by certiorari of petitioner positing reversible error in the appellate courts ruling:
I. WHETHER OR NOT THERE IS REVERSIBLE ERROR IN THE COURT OF APPEALS DECISION
GRANTING THE PETITION FOR CERTIORARI OF THE RESPONDENTS
II. WHETHER OR NOT THERE IS REVERSIBLE ERROR IN THE COURT OF APPEALS DECISION
REVERSING AND SETTING ASIDE THE DECISION OF THE NATIONAL LABOR RELATIONS
COMMISSION THAT THE AILMENT OF THE PETITIONER IS WORK-RELATED AND THEREFORE
COMPENSABLE
III. WHETHER OR NOT THERE IS REVERSIBLE ERROR IN THE COURT OF APPEALS DECISION
WHICH DISREGARD THE LATEST MEDICAL CERTIFICATION OF THE RESPONDENTS DESIGNATED
PHYSICIAN THAT THE AILMENT OF THE PETITIONER IS WORK-RELATED
IV. WHETHER OR NOT THERE IS REVERSIBLE ERROR IN THE COURT OF APPEALS DECISION THAT
RESPONDENT IS NOT ENTITLED TO DISABILITY BENEFITS BECAUSE HE HAS ALREADY FINISHED
HIS CONTRACT OF EMPLOYMENT
11
We impale the foregoing into the sole issue of whether petitioner is entitled to disability benefits. We answer in the
negative and deny the petition.
Petitioner claims disability benefits for a work-related injury or illness during the term of his contract. Petitioner
asseverates that his illness of "Lumbar Spondylosis" is work-related given that he experienced such while on board
respondents vessel in 1999, albeit he was given a "fit to work" certification effective for two (2) years from year
2000. He then points out that during his last employment contract from July 2001 to April 2002, his illness worsened
and became aggravated resulting in a diagnosis of "herniated disc L3-L4 and L4-L5." We note, however, that
petitioner only vaguely refers to the specifics of what transpired after he signed-off from respondents vessel in April
2002, although it is this last employment contract on which petitioner bases his claim for disability benefits:
12. After the completion of his contract of employment for the period covering 7 July 2001 to April 2002, [petitioner]
underwent another medical examination with the hope that he can be re[-]deployed again come July 2002 until April
2003. However, he was declared "unfit to work" by the Seamens Hospital when the result of the medical
examinations was released. His ailment of "Lumbar Spondylosis" further aggravated and he was diagnosed to have
herniated disc L3-L4 and L4-L5. Copy of the result or interpretation of the CT scan of [petitioner] is hereto attached
and marked as Annex "B". The Medical Certification issued by the Seamens Hospital dated 1 April 2003 declaring
[petitioner] had undergone consultation for Pre-Post Employment Medical Examination from June 11, 2002 to April
1, 2003 and was declared "UNFIT" due to a work related injury or ailment is hereto attached and marked as ANNEX
"C."
12
Before we proceed, we clarify that for petitioners last employment contract for the period 7 July 2001 to April 2002,
the 2000 POEA-SEC was already in effect. However, the implementation of the provisions of the foregoing 2000
POEA-SEC was temporarily suspended by the Court on 11 September 2000, specifically Section 20,paragraphs (A),
(B), and (D) thereof, and was lifted only on 5 June 2002, through POEA Memorandum Circular No. 2, series of
2002. We thus determine herein petitioners entitlement to disability benefits under the provisions of the 1996
POEA-SEC since it was, effectively, the governing circular at the time petitioners employment contract was
executed.
13
Section 20 (B) of the 1996 POEA-SEC provides the entitlement of a seafarer who suffers injury or illness during the
effectivity of his contract:
B. COMPENSATION AND BENEFITS FOR INJURY OR ILLNESS
The liabilities of the employer when the seafarer suffers injury or illness during the term of his contract are as
follows:
1. x x x
2. x x x
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 companydesignated 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.
Section 20 (B) of the 2000 POEA-SEC does not depart therefrom, except to specifically indicate that the
compensable injury or illness, likewise during the term of the employment contract, must be work-related:
B. COMPENSATION AND BENEFITS FOR INJURY OR ILLNESS
The liabilities of the employer when the seafarer suffers work-related injury or illness during the term of his contract
are as follows:
1. x x x
2. x x x
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 companydesignated 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. Clearly,
however, in claiming disability benefits, both the 1996 and 2000 POEA-SEC requires the injury or illness of the
seafarer to be work-related.
Because of the conflicting factual findings of the labor tribunals and the appellate court on petitioners actual medical
condition after his last employment contract, we reiterate the parameter of work-related illness in resolving
petitioners claim for disability benefits. Under Section 20 (B) (3) of the 1996 POEA-SEC, for the employer to be
liable: (1) the injury or illness must occur during the term of contract, disputably presumed to be work-related; (2) the
injury or illness is work-related; and (3) the work-related injury or illness is determined in a mandatory post
employment medical examination by a company designated physician within three (3) working days of the
seafarers return.
14
Claiming entitlement to benefits under the law, petitioner must establish his right thereto by substantial evidence.
15
While petitioner has asserted that his disability is work-related and occurred during the term of his contract, what
jumps out of the different factual findings of all three labor tribunals, the Labor Arbiter, the NLRC and the Court of
Appeals, is that petitioner did not undergo a post employment medical examination as required in Section 20 of both
the 1996 and 2000 POEA-SEC. In fact, petitioner refers to the medical examination he underwent as a "Pre-Post
Employment Medical Examination" from 11 June 2002 to 1 April 2003, which yielded a medical certification that
petitioner is "UNFIT" to work due to a work-related injury or illness.
A mere asseveration that the medical examination is both "pre and post employment" does not comply with the
mandatory language of the POEA-SEC. That the three-day post employment medical examination is mandatory
brooks no argument:
The rationale for the rule [on mandatory post-employment medical examination within three days from repatriation
by a company-designated physician] is that reporting the illness or injury within three days from repatriation fairly
makes it easier for a physician to determine the cause of the illness or injury. Ascertaining the real cause of the
illness or injury beyond the period may prove difficult. To ignore the rule might set a precedent with negative
repercussions, like opening floodgates to a limitless number of seafarers claiming disability benefits, or causing
unfairness to the employer who would have difficulty determining the cause of a claimants illness because of the
passage of time. The employer would then have no protection against unrelated disability claims.
In fine, we hold that Victors non-compliance with the three-day rule on post-employment medical examination is
fatal to his cause. As a consequence, his right to claim for compensation and disability benefits is forfeited. On this
score alone, his Complaint could have been dismissed outright. (Emphasis supplied)
16
Notably, the post-employment medical examination has two (2) requisites: (1) it is done by a company-designated
physician, (2) within three (3) working days upon the seafarers return. The only exception thereto is physical
incapacity of the seafarer to undergo said post-employment medical examination, in which case, a written notice to
the agency within the same period is deemed as compliance. The law specifically declares that failure to comply
with the mandatory reporting requirement shall result in the seafarers forfeiture of his right to claim benefits
thereunder. Clearly, the three-day period from return of the seafarer or sign-off from the vessel, whether to undergo
a post-employment medical examination or report the seafarers physical incapacity, should always be complied
with to determine whether the injury or illness is work-related.
In Wallem Maritime Services, Inc. v. NLRC and Inductivo, we upheld the exception to the mandatory requirement of
the post-employment medical examination:
17
Admittedly, Faustino Inductivo did not subject himself to post employment medical examination within three (3) days
from his return to the Philippines, as required by the above provision of the POEA Standard Employment Contract.
But such requirement is not absolute and admits of an exception, i.e., when the seaman is physically incapacitated
from complying with the requirement. Indeed, for a man who was terminally ill and in need of urgent medical
attention one could not reasonably expect that he would immediately resort to and avail of the required medical
examination, assuming that he was still capable of submitting himself to such examination at that time. It is quite
understandable that his immediate desire was to be with his family in Nueva Ecija whom he knew would take care of
him. Surely, under the circumstances, we cannot deny him, or his surviving heirs after his death, the right to claim
benefits under the law. (Emphasis supplied)
In Interorient Maritime Enterprises, Inc. v. Remo, we carved another exception, not found in the law, i.e. when the
employer refuses to refer the seafarer to a company-designated physician: What if the seafarer reported to his
employer but despite his request for a post-employment medical examination, the employer, who is mandated to
provide this service under POEA Memorandum Circular No. 055-96, did not do so? Would the absence of a postemployment medical examination be taken against the seafarer?
18
Both parties in this case admitted that Lutero was confined in a hospital in Dubai for almost one week due to a trial
fibrillation and congestive heart failure. Undeniably, Lutero suffered a heart ailment while under the employ of
petitioners. This fact is duly established. Respondent has also consistently asserted that 2-3 days immediately after
his repatriation on April 19, 1999, Lutero reported to the office of Interorient, requesting the required postemployment medical examination. However, it appears that, instead of heeding Lutero's request, Interorient
conveniently prioritized the execution of the Acknowledgment and Undertaking which were purportedly notarized on
April 20, 1999, thus leaving Lutero in the cold. In their pleadings, petitioners never traversed this assertion and did
not meet this issue head on. This self-serving act of petitioners should not be condoned at the expense of our
seafarers. Therefore, the absence of a post-employment medical examination cannot be used to defeat
respondents claim since the failure to subject the seafarer to this requirement was not due to the seafarers fault but
to the inadvertence or deliberate refusal of petitioners. (Emphasis supplied)
In stark contrast, however, petitioner, in this case, despite his asseveration that his "Lumbar Spondylosis" worsened
during his last employment contract, did not submit himself to a post-employment medical examination. Moreover,
petitioners medical certification, albeit emphasized by the NLRC to have been issued by respondents hospital, was
issued only in April 2003, long after the last employment contract of petitioner had expiredin April 2002.
Significantly, petitioner does not proffer a reason for his failure to undergo a post-employment medical examination
within three (3) working days from his return given that he claims he suffered the illness during the term of his
employment contract, from July 2001 to April 2002. At the least, petitioner should have reported that he was
suffering from symptoms of his illness while on board respondents vessel during the term of his last employment
contract.
Contrary to his present claims, on the date nearest the expiration of his employment contract, specifically, 16 April
2002, petitioner accomplished a Debriefing Questionnaire acknowledging that "all [was] ok during his contract[,]
including his health." He deliberately glosses over the mandatory nature of the post-employment medical
examination, which he did not undergo, by his general averment that after expiration of his last employment contract
in April 2002, he underwent medical examination from June 2002 to April 2003, and was no longer re-deployed
since he was found "UNFIT" due to a work-related illness.
19
To our mind, such a claim is neither here nor there, and is clearly far from the requirement that a claimant must
establish his entitlement to disability benefits under the law by substantial evidence. We cannot overemphasize that
"self-serving and unsubstantiated declarations are insufficient to establish a case x x x where the quantum of
evidence required to establish as fact is substantial evidence."
20
21
Petitioner himself, in paragraph 56 of his petition, highlights the apparent conflict in his medical certifications, which,
in any event, was done beyond the three-day period of the seafarers return or sign-off from the vessel to undergo
the mandatory post-employment medical examination:
56. Indeed, the medical certification issued by Dr. Calanoc dated July 23, 2002declared [petitioner] fit to work. Said
certification also stated that he underwent physical therapy for ten (10) sessions. But the said certification was later
on supplanted by another certification by Dr. Calanoc which stated that [petitioner] has undergone Consultation/PrePost employment Medical Examination from June 11, 2002 but is found to be UNFIT for work with the DIAGNOSIS
IMPRESSION: Herniated Disc L3-L4-L4-L5, which is WORK RELATED. (Emphasis supplied)
22
We, thus, cite with favor the Court of Appeals disquisition, defining the nature of employment of Filipino seafarers
and the applicable law therefor:
Seafarers are considered contractual employees. Their employment is governed by the contracts they sign every
time they are re[-]hired and their employment is terminated when the contract expires. Their employment is
contractually fixed for a certain period of time. They fall under the exception of Article 280 whose employment has
been fixed for a specific project or undertaking the completion or termination of which has been determined at the
time of engagement of the employee or where the work or services to be performed is seasonal in nature and the
employment is for the duration of the season.
As a Filipino seaman, [petitioner] is governed by the Rules and Regulations of the POEA. The Standard
employment Contract governing the employment of All Filipino Seamen on Board Ocean-Going Vessels of the
POEA, particularly in Part I, Sec. C specifically provides that the contract of seamen shall be for a fixed period.
Moreover, it is an accepted maritime industry practice that employment of seafarers are for a fixed period only.
Constrained by the nature of their employment which is quite peculiar and unique in itself, it is for the mutual interest
of both the seafarer and the employer why the employment status must be contractual only or for a certain period of
time.
In the instant case, [petitioner] had finished his contract when he disembarked on 12 April 2002. Thus, [petitioner]
can no longer claim any benefits under his employment contract.
1awp++i1
xxxx
cause by work-related illness or injury as he made no report of any medical condition when he disembarked. In fact
23
In all, petitioner utterly failed to establish by substantial evidence, his entitlement to disability benefits for a workrelated illness under the POEA-SEC, having failed to undergo a post-employment medical examination by a
company designated physician within three (3) working days from his return without valid or justifiable reason.
WHEREFORE, premises considered, the petition is DENIED. The Decision of the Court of Appeals in CA-G.R. SP
No. 107477 is AFFIRMED.
SO ORDERED.
G.R. No. 196357
April 20, 2015
THE HEIRS OF THE LATE DELFIN DELA CRUZ, represented by his SPOUSE, CARMELITA DELA
CRUZ,Petitioners,
vs.
PHILIPPINE TRANSMARINE CARRIERS, INC., represented by MR. CARLOS C. SALINAS and/or TECTO
BELGIUM N.V., Respondents.
DECISION
DEL CASTILLO, J.:

This Petition for Review on Certiorari assails the June 18, 2010 Decision of the Court of Appeals (CA) in CA-G.R.
SP No. 105930 dismissing the petition for certiorari filed therewith and affirming the January 23, 2007 Decision of
the National Labor Relations Commission (NLRC) in OFW (M) 03-12-3155-00 (CA No. 046453-05). Said NLRC
Decision reversed and set aside the Labor Arbiter's May 30, 2005 Decision which, in tum, granted the late Delfin
Dela Cruz's (Delfin) claims for sickness allowance and disability benefits filed against respondents Philippine
Transmarine Carriers, Inc. and/or Tecto Belgium N.V. (respondents). Also assailed in this petition is the CA's March
29, 2011 Resolution denying the Motion for Reconsideration filed by the heirs of Delfin (petitioners).
1
Factual Antecedents
The facts, as summarized by the CA in its assailed Decision, are as follows:
The late Delfin Dela Cruz was contracted for the position of [Oiler] by x x x Philippine Transmarine Carriers[,] Inc., a
local manning agent for and in behalf of the latters principal, Tecto Belgium N.V.[,] under the following terms and
conditions as provided for in the Contract of Employment:
Duration of contract - 9 months
Position - OILER
Basic Monthly
Salary - $535.00 per month
Hours of Work - 44 hours per week
Overtime - $298/month fixed overtime US$3.50/hour after 85 hours
Vacation Leave w/ - 8 days/month with Seniority Bonus
Pay - US$7.50/month
Point of Hire - Manila, Philippines
As required by law and by the employment contract, [Delfin] underwent a Pre-Employment Medical Examination
(PEME) and was declared Fit for Sea Service. [His] work includes observing routine watch, taking records of
pressure of temperature of all working apparatus, obeying all orders and commands of the engineers, and
maintaining cleanliness of machinery and engine room.
[Delfin] left the Philippines on 16 August 2000 and immediately embarked the vessel "Lady Hilde" on 17 August
2000. While on board, he felt gradual chest pains and pain [in] his upper abdominal region. On 26 [June] 2001,
while performing his regular duties, he was hit by a metal board on his back. He, thereafter, requested medical
attention and was given medications and advised to be given light duties for the rest of the week. Upon the vessels
arrival at a convenient port on 16 August 2001, his contract expired and [he] was signed off from the vessel. He xxx
reported to xxx[respondents] as required. He also sought medical assistance but was not [extended] such.
On 13 November 2003, [Delfin] went to De Los Santos Medical Center for proper medical attention[.] [There,] he
underwent X-Ray and MRI of the [Thoracic] Spine. Afterwards, he was not employed by xxx [respondents] because
he was already incapacitated to engage in his customary work. He filed his claim for sickness allowance from the
same manning agency but the same was not [granted].
His [condition] deteriorated[.] [Thereafter, he was] admitted at St. Lukes Medical Center, where he was diagnosed to
be suffering from [malignant] peripheral nerve sheath tumor [MPNST]. He shouldered his medical expenses x x x.
On 4 December 2003, he filed a complaint before the NLRC to claim payment for sickness allowance and disability
compensation. x x x
[Respondents] filed [a] Motion to Dismiss on the ground of prescription, the claim having [been] filed beyond one
year from the date of the termination of the contract. [Delfin] countered x x x that the applicable prescription period is
3 years, according to the POEA Standard Employment Contract. The parties, thereafter, submitted their position
papers. [Delfin] claimed [for] medical reimbursement and sickness allowance, permanent disability compensation,
and damages and attorneys fees.
[Delfin], on one hand, asseverated in his complaint that he is entitled to sickness allowance because of the incident
when he was hit by a metal board on his back, which required medical attention. Furthermore, [Delfin] averred that
he is entitled [to] sickness allowance because his inability to work and perform his usual occupation after he
acquired the sickness while on board, lasted for more than 120 days. This is also the basis of his claim for
permanent disability compensation. [Delfin] also claimed that attorneys fees should be paid for the expenses he
incurred due to the filing of the suit and that moral damages may be paid as well for injuries such as mental anguish,
besmirched reputation, wounded feelings, and social humiliation. [Respondents], on the other hand, averred that the
medical condition of [Delfin] was not acquired or suffered during the term of his employment, that said medical
condition is not work-related, and[,] therefore, the said illness is not compensable under the POEA Standard
Employment Contract. Furthermore, [respondents] asseverated that more than two years had elapsed from the time
of the termination of [Delfins] employment in August 2001 up to the time the claim was filed in November 2003,and
thus the illness was not acquired during the period of employment. [Respondents] also argued that the
company[-]designated physician neither issued any certification as regards the medical condition of [Delfin] nor
conducted a post[-]employment medical examination, after he was discharged from the vessel in August 2001.
On 6 May 2005, [Delfin] passed away. x x x
Ruling of the Labor Arbiter (LA)

Ultimately, the LA rendered a Decision dated May 30, 2005in favor of Delfin. The LA opined that Delfin contracted
his illness during the period of his employment with respondents and that such illness is a compensable
occupational disease. Hence, Delfin is entitled to his claims. The dispositive portion of the Decision reads:
8
WHEREFORE, judgment is hereby rendered ordering respondents, jointly and severally, to pay complainant
DELFIN C. DELA CRUZ, SIXTY THOUSAND US DOLLARS (US$60,000.00) representing total permanent disability
compensation, sickness allowance of US$2,140.00 or its equivalent in local currency at the time of actual payment
plus ten percent (10%) of the total monetary award by way of attorneys fees.
All other claims are dismissed for lack of merit.
SO ORDERED.
Ruling of the National Labor Relations Commission

On appeal, the NLRC, in a Decision handed down on January 23, 2007, reversed the Decision of the LA. It found
Delfins claims to be barred by prescription for having been filed beyond the reglementary period of one year from
the termination of the employment contract. The NLRC also found no evidence that would establish a causal
connection between Delfins ailment and his working conditions.
10
Petitioners moved for reconsideration but the same was denied in the NLRCs March 30, 2007 Resolution.
Ruling of the Court of Appeals
Aggrieved yet undeterred, petitioners filed a Petition for Certiorari with the CA.
12
11
In its June 18, 2010 Decision, the CA held that Delfins Complaint was filed well within the reglementary period of
three years from the date the cause of action arose, as provided for in Section 30 of the Philippine Overseas
Employment Administration Standard Terms and Conditions Governing the Employment of Filipino Seafarers OnBoard Ocean-Going Vessels (POEA SEC). Nonetheless, the CA sustained the NLRCs pronouncement that
petitioners are not entitled to disability compensation as they failed to establish that Delfins illness was work-related.
According to the CA, Delfins illness, which is known as Malignant Peripheral Nerve Sheath Tumor (MPNST), is a
type of soft tissue sarcoma that develops in cells that forma protective sheath (covering) around peripheral nerves.
Peripheral nerves are those that radiate from the brain and spinal cord and stimulate the muscles. However, aside
from the June 26, 2001 incident where Delfin was hit by a metal board on his back, there was no other reported
incident that would reasonably connect Delfins ailment to his working condition. Petitioners could only offer their
allegations that Delfin experienced chest pains without, however, presenting proofs in support thereof. The CA also
found notable that it was only on November 13, 2003 or two years after the termination of his contract and
repatriation when Delfin went to Delos Santos Medical Center for medical check-up and underwent chest x-ray and
MRI of the thoracic spine.
13
The findings of said hospital conformed to the diagnosis of St. Lukes Medical Center that Delfin has MPNST.
With regard to petitioners claim for sickness allowance, the CA denied the same considering that Delfins contract
with respondents had long expired. It likewise denied petitioners claim for attorneys fees, moral damages and
exemplary damages as there is no proof that respondents committed bad faith in denying Delfins claims.
The CAs assailed Decision bears the following dispositive portion:
WHEREFORE, the petition is DISMISSED. The Decision dated 23 January 2007 by the NLRC is AFFIRMED.
SO ORDERED.
14
Petitioners filed a Motion for Reconsideration. This was denied by the CA in its March 29, 2011 Resolution.
15
16
Thus, the present Petition for Review on Certiorari.

Issues
I. Whether xxx [petitioners are] entitled to permanent disability benefits and sickness allowance; II. Whether xxx
[petitioners are] entitled to attorneys fees and damages.
17
Our Ruling
A Petition filed under Rule 45 shall raise only questions of law. But when the findings of the labor tribunals and the
CA are in conflict with each other, the Court may make its own
examination of the evidence on record.
The issues petitioners brought before this Court pertain to questions of fact since they basically seek to determine if
the illness responsible for Delfins disability was acquired by him during the course of his employment as to entitle
petitioners to permanent disability benefits, sickness allowance, attorneys fees and damages.
As a general rule, this Court does not review questions of facts in a petition filed under Rule 45 of the Rules of Court
as only questions of law can be raised in such petition. However, this rule is not absolute and without exceptions. In
case the factual findings of the tribunals or courts below are in conflict with each other, this Court may make its own
examination and evaluation of the evidence on record. Here, the LA found that petitioners ought to be awarded
permanent disability benefits, sickness allowance, attorneys fees and damages; the NLRC and the CA, on the other
hand, ruled otherwise. Hence, the Court is constrained to examine the evidence on record.
18
19
The 1996 POEA SEC concerning permanent disability claims and sickness allowance applies to this case.
The Standard Terms and Conditions Governing the Employment of Filipino Seafarers On-Board Ocean-Going
Vessels as contained in Department Order No. 04 and Memorandum Circular No. 09, both Series of 2000, initially
took effect on June 25, 2000. This, at first blush, must be strictly and faithfully observed in this case. However, the
POEA had likewise issued Memorandum Circular No. 11, series of 2000 (Memorandum Circular 11-00), concerning,
among others, compensation and benefits for injury and illness, viz:
20
In view of the Temporary Restraining Order [TRO] issued by the Supreme Court in a Resolution dated 11 September
2000 on the implementation of certain amendments of the Revised Terms and Conditions Governing the
Employment of Filipino Seafarers on board Ocean-Going Vessels as contained in DOLE Department Order No. 04
and POEA Memorandum Circular No. 09, both Series of 2000, please be advised of the following:
1. Section 20, Paragraphs (A), (B) and (D) of the former Standard Terms and Conditions Governing the Employment
of Filipino Seafarers on board Ocean-Going Vessels, as provided in DOLE Department Order No. 33, and POEA
Memorandum Circular No. 55, both Series of 1996 shall apply in lieu of Section 20 (A), (B)and (D) of the Revised
Version;(Emphasis supplied)
It must be noted that: 1)the above TRO was lifted only on June 5, 2002; 2) Delfins contract with respondents was
entered into on August 8, 2000; 3) he embarked on Lady Hilde on August 17, 2000; and 4) was repatriated on
August 16, 2001. Thus, as the TRO was in effect at the time of Delfins employment with respondents, it follows that
it is the 1996 POEA SEC provisions concerning permanent disability claims and sickness allowance which should
apply, and not those of the 2000 POEA SEC.
21
Petitioners are not entitled to permanent disability benefits and sickness allowance.
Section 20 (B) of the 1996 POEA SEC reads as follows:
SECTION 20. COMPENSATION AND BENEFITS
x x x x B. COMPENSATION AND BENEFITSFOR INJURY OR ILLNESS:
The liabilities of the employer when the seafarer suffers injury or illness during the term of his contract are as
follows:
1. The employer shall continue to pay the seafarer his wages during the time he is on board the vessel;
2. If the injury or illness requires medical and/or dental treatment in a foreign port, the employer shall be
liable for the full cost of such medical, serious dental, surgical and hospital treatment as well as board and
lodging until the seafarer is declared fit to work or to be repatriated.
However, if after repatriation, the seafarer still requires medical attention arising from said injury or illness,
he shall be so provided at cost to the employer until such time he is declared fit or the degree of his disability
has been established by the company-designated physician.
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.
4. Upon sign-off of the seafarer from the vessel for medical treatment, the employer shall bear the full cost of
repatriation in the event that the seafarer is declared (1) fit for repatriation; or (2) fit to work but the employer
is unable to find employment for the seafarer on board his former vessel or another vessel of the employer
despite earnest efforts.
5. In case of permanent total or partial disability of the seafarer during the term of employment caused by
either injury or illness, the seafarer shall be compensated in accordance with the schedule of benefits
enumerated in Section 30 of his Contract. Computation of his benefits arising from an illness or disease shall
be governed by the rates and the rules of compensation applicable at the time the illness or disease was
contracted. (Emphasis supplied)
The above provision demonstrates that the 1996 POEA SEC covers all injuries or illnesses occurring in the lifetime
of the employment contract. The seafarer only has to prove that his injury or illness was acquired during the term of
employment to support his claim for disability benefits and sickness allowance. Verily, his injury or illness need not
be shown to be work-related to be compensable under said employment contract.
22
23
24
However, the Court also reiterates the rule that "whoever claims entitlement to the benefits provided bylaw should
establish his right to the benefits by substantial evidence" or "such relevant evidence as a reasonable mind might
accept as adequate to support a conclusion, even if other equally reasonable minds might conceivably opine
otherwise." Absent a showing thereof, any decision set forth will only be based on unsubstantiated allegations.
Accordingly, the Court cannot grant a claim for disability benefits without adequate substantiation for to do so will
offend due process. The foregoing jurisprudential principle effectively shows that the burden of proving entitlement
to disability benefits lies on petitioners. Thus, they must establish that Delfin suffered or contracted his injury or
illness which resulted in his disability during the term of the employment contract. An examination of the records,
however, shows that petitioners failed to discharge such burden.
25
26
27
28
The 1996 POEA SEC clearly provides that a seafarer must submit himself to a post-employment medical
examination within three days from his arrival in the Philippines (mandatory reporting requirement) so that his claim
for disability and sickness allowance can prosper. The only exception to this rule is when the seafarer is physically
in capacitated to do so, but there must be a written notice to the agency within the same period of three days for the
seaman to be considered to have complied with the requirement. Otherwise, he forfeits his right to claim his
disability benefits and sickness allowance. In Manota v. Avantgarde Shipping Corporation, the Court explained the
rationale behind the three-day period requirement, thus:
29
30
31
32
The 3-day mandatory reporting requirement must be strictly observed since within 3 days from repatriation, it would
be fairly manageable for the physician to identify whether the disease x xx was contracted during the term of his
employment or that his working conditions increased the risk of contracting the ailment.
xxxx
x x x Moreover, the post-employment medical examination within 3 days from x xx arrival is required in order to
ascertain [the seafarers] physical condition, since to ignore the rule would set a precedent with negative
repercussions because it would open the floodgates to a limitless number of seafarers claiming disability benefits. It
would certainly be unfair to the employer who would have difficulty determining the cause of a claimants illness
considering the passage of time. In such a case, the employers would have no protection against unrelated
disability claims. Here, petitioners claim that Delfin went to respondents to comply with the mandatory reporting
requirement and to seek medical assistance but his request for medical evaluation was unheeded. Petitioners,
however, failed to support this. In Career Philippines Shipmanagement, Inc. v. Serna, the Court upheld the
seafarers claim that he complied with the mandatory reporting requirement and sought medical assistance from his
agency, thus:
33
34
We see no reason to disturb the lower tribunals finding. While Sernas verified claim with respect to his July 14,
1999 visit to the petitioners office may be seen by some as a bare allegation, we note that the petitioners
corresponding denial is itself also a bare allegation that, worse, is unsupported by other evidence on record. In
contrast, the events that transpired after the July 14, 1999 visit, as extensively discussed by the CA above,
effectively served to corroborate Sernas claim on the visits purpose, i.e., to seek medical assistance. Under these
circumstances, we find no grave abuse of discretion on the part of the NLRC when it affirmed the labor arbiter ruling
and gave credence to Serna on this point. Under the evidentiary rules, a positive assertion is generally entitled to
more weight than a plain denial. (Emphasis supplied) There, Serna (the seafarer) claimed that he reported to his
employers office on July 14, 1999, or two days after his repatriation, to submit himself to the mandatory reporting
requirement. The Court found his allegation credible in light of the fact that despite the nonchalant instruction given
to him by his agency to wait for a referral to the company-designated physicians, Serna took it upon himself to seek
medical assistance and submit to a check-up with his personal physician to find out what was wrong with him.
Indeed, about two weeks from the time he reported for the mandatory reporting requirement and was told to wait for
a referral, Sernas check-up with his private physician revealed that he was suffering from toxic goiter. Several days
later, he submitted to a medical examination conducted by the company-designated physician who diagnosed him
with a trial fibrillation and declared him unfit to work. Still, Serna did not stop there. He continued with his medical
treatment with his personal physician and even asked for a second opinion from another doctor who concurred with
the toxic goiter diagnosis of his first personal physician. Further, he was examined by a third doctor who found that
he had a history of goiter with throtoxicos since 1999. He was also diagnosed with thyrotoxic heart disease, chronic
atrial fibrillation and hypertensive cardiovascular disease. Ultimately, Serna was given a disability rating of Grade 3
classified as permanent medical unfitness which entitled him to 100% compensation as provided for under the
collective bargaining agreement. Verily, the above steps taken by Serna helped establish his claim that he complied
with the mandatory reporting requirement and that he sought medical assistance from his employer, and further, that
he did so within the period required by law. His having been vigilant in asserting his rights to medical assistance
tended to show the same.
Unfortunately in this case, petitioners failed to show the steps supposedly undertaken by Delfin to comply with the
mandatory reporting requirement. To the Courts mind, this lapse on petitioners part only demonstrates that Delfin
did not comply with what was incumbent upon him. The reasonable conclusion, therefore, is that at the time of his
repatriation, Delfin was not suffering from any physical disability requiring immediate medical attendance.
Otherwise, and even if his request for medical assistance went unheeded, he would have submitted himself for
check-up with his personal physician. After all, the injury complained of by Delfin was a serious one and it would
seem illogical for him to just suffer in silence and bear the pain for a considerable length of time. Moreover, while the
rule on mandatory reporting requirement is not absolute as a seafarer may show that he was physically incapable to
comply with the same by submitting a written notice to the agency within the same three-day period, nowhere in the
records does it show that Delfin submitted any such notice. Clearly, petitioners failed to show that Delfin complied
with the mandatory reporting requirement. Thus, he is deemed to have forfeited his right to claim disability benefits
and sickness allowance.
Even assuming that there was compliance with the mandatory reporting requirement, other factors that strongly
militate against the granting of petitioners claims exist in this case.
First, while petitioners did present a medical certificate dated June 26, 2001 which was issued while Delfin was still
employed with respondents, nothing therein shows that the incident subject thereof has something to do or is
related to MPNST the injury or illness which caused Delfins disability. Specifically, said certificate pertains to a
blow on Delfins back caused by a metal board and for which he complained of "persistent pain in the chest and
upper abdominal region." For this, Delfin was advised to undertake only "light duties for [the] rest of [the] week" and
that "if not settled[,] will need reassess[ment]." On the other hand, the injury that showed up in his chest x-ray and
MRI for which he claimed compensation pertains to a different portion of his body, i.e., a fracture in one of his
ribs. Besides, if indeed there is truth to petitioners assertion that Delfin continued to experience pain after he was
hit by a metal board on his back, then why did he not request for reassessment as advised or submit himself to the
mandatory reporting requirement after he was repatriated? What is glaring instead is that against all these,
petitioners only offered their bare allegation that Delfins medical condition did not improve thereafter. Second, while
Delfin averred that he experienced on-and-off pain even prior to the June 26, 2001 incident, there exists no record
thereof. On the contrary, Delfin himself claimed that despite the pain, he "remained calm and unbothered by the
same."
35
36
Third, it is also interesting to note that although petitioners did submit Delfins chest x-ray and MRI results revealing
a fracture in one of his ribs, it must be emphasized that these findings were issued more than two years after his
repatriation. Worse still, the Clinical Abstract submitted by petitioner was undated such that it cannot be determined
when the said document was released. Be that as it may, it can be safely concluded that the said clinical abstract
was issued in or after 2004 since it contained a detailed history of Delfins illness starting from his having been
diagnosed with MPNST in 2003, and an enumeration of his documented episodes of pathologic fractures occurring
in May 2002, December 2003 and April 2004. These only highlight the fact that a considerable period of time had
passed from Delfins repatriation in August 2001 up to the time that he started to suffer pathologic fractures in May
37
38
2002. Thus, it cannot be said that Delfins rib fracture subject of the above-mentioned chest x-ray and MRI was
caused by the blow on his back of the metal sheet that fell on him as petitioners would want to impress upon this
Court. On the other hand, what is more likely under the circumstances is that the fracture came about after his
repatriation. For one, the report contained in Delfins clinical abstract is telling, viz:
Patient is a diagnosed case of Malignant Peripheral Nerve Sheath Tumor. (2003 SLMC)[.] He also had several
episodes of pathologic fractures: x xx
Sixteen hours prior to admission, while in bed, trying to change position, patient suddenly heard a cracking [sound],
which was followed by shooting pain on the left thigh, intermittent, localized, aggravated by movement, with no
alleviating factors. x x x (Emphases supplied)
39
Notably, MPNST, of which Delfin was diagnosed with more than two years after his repatriation, causes pathologic
fractures. And since Delfin is prone to pathologic fractures because of MPNST, it is quite possible that any wrong
movement of his body may cause fracture similar to what happened to him as narrated in the clinical report. As to
the cause of MPNST, again, it bears stating at this point that petitioners failed to show that the same has any
connection with the accident figured in by Delfin while he was on board the vessel.
40
Fourth, the Court notes that Delfins Position Paper filed with the Labor Arbiter contained vague and ambiguous
allegations of two purported compensable illnesses, viz:
The record of the case will reveal that complainant is suffering from two (2) compensable sicknesses, one (1)
affecting his abdomen and two (2) affecting his back down to his legs. However, in the Rejoinder later filed by him
with the same tribunal, he drastically changed such theory by claiming that he instead suffers from MPNST. "It has
been held that a party will not be allowed to make a mockery of justice by taking inconsistent positions which, if
allowed, would result in brazen deception."
41
42
43
Lastly, this Court deems it proper to reiterate its ruling in Quizora v. Denholm Crew Management (Philippines),
Inc. on the relevance of the seafarers passing his PEME vis--vis the probability of his having acquired his injury or
illness during the period of employment, thus:
44
The fact that respondent passed the companys PEME is of no moment. We have ruled that in the past the PEME is
not exploratory in nature. It was not intended to be a totally in-depth and thorough examination of an applicants
medical condition. The PEME merely determines whether one is "fit to work" at sea or "fit for sea service," it does
not state the real state of health of an applicant. In short, the "fit to work" declaration in the respondents PEME
cannot be a conclusive proof to show that he was free from any ailment prior to his deployment. Thus we held in
NYK-FIL Ship Management, Inc. v. NLRC:
While a PEME may reveal enough for the petitioner (vessel) to decide whether a seafarer is fit for overseas
employment, it may not be relied upon to inform petitioners of a seafarers true state of health. The PEME could not
have divulged respondents illness considering that the examinations were not exploratory. (Emphases supplied)
Hence, the fact that Delfin passed his PEME is of no moment in this case.
Based on the foregoing, the Court holds that the NLRC and the CA correctly disallowed petitioners' claim for
permanent disability benefits and sickness allowance.
Petitioner is neither entitled to attorneys fees and damages.
The claim for attorney's fees cannot, likewise, be allowed. The Court has consistently held that attorney's fees
cannot be recovered as part of damages based on the policy that no premium should be placed on the right to
litigate. Suffice it to say that the authority of the court to award attorney's fees under Article 2208 of the Civil Code
requires factual, legal, and equitable grounds. They cannot be awarded absent. a showing of bad faith in a party's
tenacity in pursuing his case even if his belief in his stance is specious. Verily, being compelled to litigate with third
persons or to incur expenses to protect one's rights is not a sufficient reason for granting attorney's fees. As can be
seen from our discussions above, petitioners were not able to prove that respondents acted in bad faith in refusing
to acknowledge their claims. This Court, thus, deems it inappropriate to award attorney's fees.
1wphi1
45
As a final note, it must be mentioned that the Court respects and upholds the principle of liberality in construing the
POEA-SEC in favor of the seafarer. Nonetheless, it cannot grant claims for compensation based on mere
conjectures. Indeed, liberal construction neither warrants the blithe disregard of the evidence on record nor the
misapplication of our laws. WHEREFORE, the Petition is hereby DENIED. The June 18, 2010 Decision and March
29, 2011 Resolution of the Court of Appeals in CA-G.R. SP No. 105930 are AFFIRMED.
46
SO ORDERED.
G.R. No. 203804
April 15, 2015
DARIO A. CARCEDO (substituted by his wife PRISCILLA DELA CRUZ-CARCEDO), Petitioner,

vs.
MAINE MARINE PHILIPPINES, INC. and/or MISUGA KAJUN CO., LTD., and/or MA. CORAZON GEUSESONGCUYA, Respondents.
DECISION
CARPIO, J.:
The Case
Before the Court is a petition for review assailing the Decision dated 29 June 2012 and Resolution dated 5 October
2012 of the Court of Appeals in CA-G.R. SP No. 120706, nullifying the Decision dated 8 March 2011 of the National
Labor Relations Commission (NLRC) in NLRC LAC Case No. 01-000007-11 (OFW), and reinstating the
Decision dated 30 November 2010 of the Labor Arbiter in NLRC NCR-OFW [M]-00-09-13527-09.
1
The Facts
On 6 August 2008, Dario A. Carcedo (Carcedo) was hired by respondent Maine Marine Philippines, Inc. for its
foreign principal Misuga Kajun Co., Ltd. (collectively, respondents). He was engaged as Chief Officer on board M/V
Speedwell under contract for nine months, with a basic monthly salary of US$1,350.00.
6
Carcedo underwent the Pre-Employment Medical Examination on 8 August 2008, where he was declared fit for
work. He boarded the vessel on 10 August 2008.
In November 2008, Carcedos foot was wounded because of his safety shoes. Upon examination, the ship doctor
gave him antibiotics and allowed him to resume work. His foots condition worsened when he slid down the deck
and bumped his right foot. In January 2009, he felt pain in the back of his swollen leg and developed fever and
headache.
7
On 19 January 2009, he was treated at the Yoshino Hospital in Japan. The doctor diagnosed Carcedo with an open
fracture of the right major toe bone with a suspicion of sepsis.
8
Carcedo was repatriated on 20 January 2009. He was immediately referred to the company-designated physician,
Dr. Nicomedez Cruz of the Manila Doctors Hospital, for medical treatment. In Dr. Cruzs report dated 26 January
2009, he stated:
9
The patient underwent debridement of the wound of the right big toe today at Manila Doctors Hospital. Operative
findings showed infected open wound in the medial aspect of the right big toe. There is foul smelling purulent
discharge. Vascularity of the toe is compromised with beginning gangrene formation. He tolerated the procedure
well. Fasting blood sugar is elevated at 14 (normal value = 4.2-6.1). He was referred to our endocrinologist for comanagement.
Diagnosis:
Infected wound with gangrene, right big toe
S/P Debridement
Diabetes mellitus
10
Carcedo also underwent disarticulation of the right big toe on 26 January 2009. He was discharged from the
hospital on 12 February 2009.
11
12
On 24 March 2009, Dr. Cruz recommended "an impediment disability grading of 8% Loss of first toe (big toe) and
some of its metatarsal bone."
13
Due to infection of the amputated stump, Carcedo was again admitted to the hospital on 20 April 2009 for
intravenous antibiotics. While confined in the hospital, Carcedo underwent sequestrectomy of the right first
metatarsal bone. He also underwent curettage and serial debridements of the wound. On 27 May 2009, Carcedos
right first metatarsal bone was removed. He was discharged on 6 June 2009, with the following report from Dr.
Cruz:
14
15
16
17
The patient was discharged today from the hospital. The wound of the right foot is still open with good granulation
tissues. There is a minimal suppuration and serous discharge. He is advised to continue daily wound care.
18
On his follow-up consultation on 15 June 2009, Dr. Cruz noted that:

There is x x x good granulation tissue on the stump of amputated right big toe. The wound is open but with slight
yellowish discharge. Cleaning and dressing were done. He was advised to continue his medications.
19
On 21 October 2009, Carcedo filed a complaint for total and permanent disability benefits in the amount of
US$148,500.00, sickness allowance and other consequential damages. Meanwhile, Carcedo consulted orthopedic
surgeon, Dr. Alan Leonardo R. Raymundo, who amputated Carcedos second toe on 30 November 2009. Dr.
Raymundos Medical Report dated 16 March 2010 reads:
20
21
The patient saw me last October 29 and was advised that his condition was still in the healing process. However, in
November 30 of the same year, the patient again developed chills and was admitted at the UP-PGH where he
underwent an amputation of the 2nd ray of the left foot and was diagnosed with chronic osteomyelitis with a nonhealing wound in the said area. On follow-up today, the wound has already completely healed and closed well with
no draining sinus noted. He now has absence of the first and second toe which is prompting him to walk on the
lateral aspect of his left foot with a cane. He still has some pain on weight bearing but the wound is already
completely healed.
RECOMMENDATION:
I told him that with his present condition right now, he is not fit to return to his previous work duties as a chief mate
on board.
22
The Court of Appeals summarized the positions of the parties, thus:

In his position paper, Carcedo averred: (1) his injury was work related because he sustained the wound from his
safety shoes at work, hence, his injury was compensable under Section 20(B) of the POEA Standard Employment
Contract; (2) his disability was total and permanent; the injury on his leg was so severe that despite medication,
there was no certainty that his former physical condition would get restored and he could resume his customary
work; he walked with difficulty and not without a cane; his Orthopedic Surgeon, Dr. Alan Leonardo R. Raymundo
recommended, viz: "x x x with his present condition right now, he is not fit to return to his previous work duties as a
chief mate on board"; (3) he suffered severe depression and anxiety, for which, he was entitled to moral and
exemplary damages, and attorneys fees; his employers refusal to pay his disability benefits showed evident bad
faith; and, he was denied a better medical treatment because he had to make do with what his depleted resources
could afford.
Maine posited: there were valid reasons to deny Carcedos claims, viz: (1) they were bound by the provisions on
disability compensation under the POEA Standard Employment Contract and CBA; the disability compensation
schedule under the IBF-JSU/AMOSUP IMMAJ CBA Schedule of Disability and Impediment (Annex 3 of the CBA),
provided:
Degree of
Disability
Rate of
Compensation
Senior Officers
US$
100
148,500
75
111,375
60
89,100
50
74,250
40
59,400
30
44,550
20
29,700
10
14,850
the CBA further stated:

28.4 The Company shall provide disability compensation to the seafarer in accordance with APPENDIX 3, with any
differences, including less than ten percent (10%) disability, to be pro rata; since Carcedos injury fell under Loss of
1st toe (big toe) and some of its metatarsal bone,[] his rate of compensation was equivalent to 8% computed, as
follows:
US$148,500 x 0.08 = US$11,880.00
(2) the disability assessment of the company-designated physician who attended to the seafarer throughout his
illness and who had authority to assess his medical condition, should be given utmost credence, instead of a doctor
who had only examined the seafarer later; (3) it had not acted in bad faith and had dealt fairly with Carcedo; it
complied with its duties under the POEA contract; it paid for all of Carcedos medical bills and even offered to pay
disability benefit of US$11,880.00; and Carcedo was, thus, not entitled to attorneys fees and exemplary damages.
23
In Respondents Reply to Complainants Position Paper, they submitted the opinions of more doctors to refute
Carcedos claim that he was unfit for sea duty.
24
The Ruling of the Labor Arbiter

On 30 November 2010, Labor Arbiter Patricio Libo-on denied Carcedos claim for full disability and awarded him
only partial disability in the amount of US$11,800.00 in accordance with the contract between the parties. The
dispositive portion of the decision reads:
WHEREFORE, premises considered, the complaint for the payment of full disability is dismissed and respondent is
ordered to pay the complainant partial disability in the amount of US$11,800.00.
SO ORDERED.
25
The Labor Arbiter held that the contract between the parties is the law between them. Hence, the partial and
permanent disability assessment made by the company-designated physician in accordance with the CBA prevails
over the inability of Carcedo to return to his usual work.
The Ruling of the NLRC
On appeal, the NLRC reversed the Labor Arbiters decision and awarded Carcedo full disability benefits and
attorneys fees. The dispositive portion of the NLRC Decision dated 8 March 2011 reads:
WHEREFORE, premises considered, the instant appeal is hereby GRANTED. The decision appealed from is
REVERSED and SET ASIDE, and a new one issued ordering MAINE MARINE PHILIPPINES, INC., to pay DARIO
A. CARCEDO, or his surviving spouse, PRISCILLA V. DELA CRUZ-CARCEDO, the amount of ONE HUNDRED
FORTY EIGHT THOUSAND FIVE HUNDRED US DOLLARS ($148,500.00), plus attorneys fees not exceeding
US$14,850.00.
SO ORDERED.
26
The NLRC gave credence to the findings of Dr. Raymundo, and held that Carcedos death was confirmation of his
unfitness to do work as a seaman. The NLRC applied the definition of permanent disability enunciated by the Court
in the case of Crystal Shipping Inc. v. Natividad, which was "the inability of a worker to perform his job for more
than 120 days, regardless of whether or not he loses the use of any part of his body."
27
28
29
In its Resolution dated 27 May 2011, the NLRC denied respondents motion for reconsideration for lack of merit.
Hence, herein respondents filed a Petition for Certiorari before the Court of Appeals.
30
31
The Ruling of the Court of Appeals

The Court of Appeals upheld the 8% disability grading made by the company-designated physician in accordance
with the CBA. However, the Court of Appeals also declared Carcedo to be suffering from total and permanent
disability because (1) he was unable to perform his job for more than 120 days; and (2) the declarations by the
company-designated physician that Carcedo was fit for sea duty were made more than 400 days from repatriation.
The dispositive portion of the Court of Appeals Decision dated 29 June 2012 reads:
ACCORDINGLY, the Decision dated March 8, 2011 is NULLIFIED and the Labor Arbiters Decision dated November
30, 2010, REINSTATED.
SO ORDERED.
32
Hence, this petition.

The Issues
Carcedo assigned the following errors:
I
THE COURT OF APPEALS COMMITTED SERIOUS ERROR OF LAW IN NOT AWARDING TOTAL AND
PERMANENT DISABILITY BENEFITS TO THE PETITIONER IN ACCORDANCE WITH THE COLLECTIVE
BARGAINING AGREEMENT.
II
THE HONORABLE COURT OF APPEALS COMMITTED SERIOUS ERROR OF LAW IN DISMISSING
PETITIONERS CLAIMS FOR DAMAGES AND ATTORNEYS FEES.
33
The Courts Ruling

We grant the petition in part.
Entitlement to Disability Benefits
A contract is the law between the parties, which in this case are the CBA and the POEA-SEC. The CBA contains the
following pertinent medical and disability provisions:
Article 25: Medical
xxxx
25.3 A seafarer repatriated to their port of engagement, unfit as a result of sickness or injury, shall be entitled to
medical attention (including hospitalization) at the Companys expense:
xxxx
(b) in the case of injury, for so long as medical attention is required or until a medical determination in accordance
with clause 28.2 concerning permanent disability.
xxxx
Article 28: Disability
28.1. A seafarer who suffers permanent disability as a result of an accident whilst in the employment of the
Company regardless of fault, including accidents occurring while traveling to or from the ship, and whose
ability to do work as a seafarer is reduced as a result thereof, but excluding permanent disability due to
willful acts, shall in addition to sick pay, be entitled to compensation according to the provisions of this
Agreement.
28.2. The disability suffered by the seafarer shall be determined by a doctor appointed by the Company. If a
doctor appointed by or on behalf of the seafarer disagrees with the assessment, a third doctor may be
nominated jointly between the Company and the Union and the decision of this doctor shall be final and
binding on both parties.
28.3 The Company shall provide disability compensation to the seafarer in accordance with APPENDIX 3,
with any differences, including less than ten percent (10%) disability, to be pro rata. 28.4. A seafarer whose
disability, in accordance with 28.2 above is assessed at fifty percent (50%) or more under the attached
APPENDIX 3 shall, for the purpose of this paragraph, be regarded as permanently unfit for further sea
service in any capacity and be entitled to one hundred percent (100%) compensation. Furthermore, any
seafarer assessed at less than fifty percent (50%) disability but certified as permanently unfit for further sea
service in any capacity by the Company-nominated doctor, shall also be entitled to one hundred percent
(100%) compensation. Any disagreement as to the assessment or entitlement shall be resolved in
accordance with clause 28.2 above.
34
Based on the above-quoted provisions of the CBA, there are three instances when a seafarer may be entitled to
100% disability compensation. These are: (1) when the seafarer is declared to have suffered 100% disability; (2)
when the seafarer is assessed with disability of at least 50%; and (3) when the seafarer, while assessed at below
50% disability, is certified as permanently unfit for sea service.
According to the CBA, both the disability assessment and the certification as permanently unfit for sea service are to
be given by the company-designated physician. These can be overruled by a third doctor jointly appointed by the
company and the union, in the event that the seafarers personal physician disagrees with the evaluations of the
company designated physician. Section 20(B)(3) of the POEA-SEC provides a similar mechanism for determining
the disability assessment.
35
However, it is not only the contract between the parties that governs the determination of the disability
compensation due the seafarer. The Court has ruled that the provisions on disability of the Labor Code and the
Amended Rules on Employee Compensation (AREC) implementing Title II, Book IV of the Labor Code are
applicable to the case of seafarers. In Remigio v. NLRC, the Court held:
36
The standard employment contract for seafarers was formulated by the POEA pursuant to its mandate under E.O.
No. 247 to "secure the best terms and conditions of employment of Filipino contract workers and ensure compliance
therewith" and to "promote and protect the well-being of Filipino workers overseas." Section 29 of the 1996 POEA
SEC itself provides that "[a]ll rights and obligations of the parties to [the] Contract, including the annexes thereof,
shall be governed by the laws of the Republic of the Philippines, international conventions, treaties and covenants
where the Philippines is a signatory." Even without this provision, a contract of labor is so impressed with public
interest that the New Civil Code expressly subjects it to "the special laws on labor unions, collective bargaining,
strikes and lockouts, closed shop, wages, working conditions, hours of labor and similar subjects."
Thus, the Court has applied the Labor Code concept of permanent total disability to the case of seafarers. In
Philippine Transmarine Carriers v. NLRC, seaman Carlos Nietes was found to be suffering from congestive heart
failure and cardiomyopathy and was declared as unfit to work by the company-accredited physician. The Court
affirmed the award of disability benefits to the seaman, citing ECC v. Sanico, GSIS v. CA, and Bejerano v. ECC that
"disability should not be understood more on its medical significance but on the loss of earning capacity. Permanent
total disability means disablement of an employee to earn wages in the same kind of work, or work of similar nature
that [he] was trained for or accustomed to perform, or any kind of work which a person of [his] mentality and
attainment could do. It does not mean absolute helplessness." It likewise cited Bejerano v. ECC, that in a disability
compensation, it is not the injury which is compensated, but rather it is the incapacity to work resulting in the
impairment of ones earning capacity.
37
The pertinent Labor Code provision is found in Article 192(c)(1), Chapter VI, Title II, Book IV:
Art. 192. Permanent and total disability.
xxxx
(c) The following disabilities shall be deemed total and permanent:
(1) Temporary total disability lasting continuously for more than one hundred twenty days, except as otherwise
provided for in the Rules[.] (Emphasis supplied)
The corresponding provision in the AREC is Section 2(b) of Rule VII which reads:
SECTION 2. Disability. x x x
(b) A disability is total and permanent if as a result of the injury or sickness the employee is unable to perform any
gainful occupation for a continuous period exceeding 120 days, except as otherwise provided for in Rule X of these
Rules. (Emphasis supplied)
The above rule pertains to Section 2, Rule X of the AREC:
SECTION 2. Period of entitlement. (a) The income benefit shall be paid beginning on the first day of such disability.
If caused by an injury or sickness it shall not be paid longer than 120 consecutive days except where such injury or
sickness still requires medical attendance beyond 120 days but not to exceed 240 days from onset of disability in
which case benefit for temporary total disability shall be paid. However, the System may declare the total and
permanent status at any time after 120 days of continuous temporary total disability as may be warranted by the
degree of actual loss or impairment of physical or mental functions as determined by the System. (Emphasis
supplied)
These provisions, in conjunction with Section 20(B)(3) of the POEASEC, were interpreted in the case of Vergara v.
Hammonia Maritime Services, Inc. thus:
38
As these provisions operate, 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 Standard
Employment Contract 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 permanent partial or total disability already exists. The seaman may of course also be declared fit to
work at any time such declaration is justified by his medical condition. (Emphasis supplied)
39
Hence, a partial and permanent disability could, by legal contemplation, become total and permanent. The Court in
Kestrel Shipping Co., Inc. v. Munar held that the declaration by the company-designated physician is an obligation,
the abdication of which transforms the temporary total disability to permanent total disability, regardless of the
disability grade, viz:
1wphi1
40
Indeed, under Section 32 of the POEA-SEC, only those injuries or disabilities that are classified as Grade 1 may be
considered as total and permanent. However, if those injuries or disabilities with a disability grading from 2 to 14,
hence, partial and permanent, would incapacitate a seafarer from performing his usual sea duties for a period of
more than 120 or 240 days, depending on the need for further medical treatment, then he is, under legal
contemplation, totally and permanently disabled. In other words, an impediment should be characterized as partial
and permanent not only under the Schedule of Disabilities found in Section 32 of the POEA-SEC but should be so
under the relevant provisions of the Labor Code and the Amended Rules on Employee Compensation (AREC)
implementing Title II, Book IV of the Labor Code. That while the seafarer is partially injured or disabled, he is not
precluded from earning doing the same work he had before his injury or disability or that he is accustomed or
trained to do. Otherwise, if his illness or injury prevents him from engaging in gainful employment for more than 120
or 240 days, as the case may be, he shall be deemed totally and permanently disabled.
Moreover, the company-designated physician is expected to arrive at a definite assessment of the seafarers fitness
to work or permanent disability within the period of 120 or 240 days. That should he fail to do so and the seafarers
medical condition remains unresolved, the seafarer shall be deemed totally and permanently disabled. (Emphasis
supplied)
41
Assessment of Disability Grading

We cannot agree with the Court of Appeals and the Labor Arbiter that the 24 March 2009 disability assessment
made by Dr. Cruz was definitive. To our mind, the said disability assessment was an interim one because Carcedo
continued to require medical treatments even after 24 March 2009. He was confined in the hospital from 20 April
2009 to 6 June 2009, where he underwent serial debridements, curettage, sequestrectomy and even amputation of
the right first metatarsal bone. He was certainly still under total disability, albeit temporary at that time.
His discharge from the hospital was 137 days from repatriation. Following the Courts rulings in Vergaraand Kestrel,
since Carcedo required further medical treatments beyond the 120 day period, his total and temporary disability was
extended. The company-designated physician then had until 240 days from repatriation to give the final
assessment.
During the follow-up consultation on 15 June 2009, Dr. Cruz noted that Carcedos wound was still open and that he
was to continue his medications. Carcedos injury required tending. This was 146 days from repatriation, and Dr.
Cruz still had nearly 100 days within which to give
42
Carcedos final disability assessment, yet he gave none.

Indeed, the schedule of disabilities in the CBA, if there is one, or the POEA-SEC, should be the primary basis for the
determination of a seafarers degree of disability. However, the POEA-SEC and the CBA cannot be read in isolation
from the Labor Code and the AREC. Otherwise, the disability rating of the seafarer will be completely at the mercy of
the company designated physician, without redress, should the latter fail or refuse to give one.
Here, the company-designated physician failed to give a definitive impediment rating of Carcedos disability beyond
the extended temporary disability period, after the 120-day period but less than 240 days. By operation of law,
therefore, Carcedos total and temporary disability lapsed into a total and permanent disability.
43
Even assuming that Dr. Cruzs 24 March 2009 disability rating were definitive, Carcedo would still have a cause of
action for total and permanent disability compensation. Dr. Cruzs declaration of 8% impediment rating was made 63
days from repatriation, within the 120-day period. However, beyond this period, Carcedo was still incapacitated to
perform his usual sea duties as he was still undergoing medical treatments and was confined in the hospital. In C.F.
Sharp Crew Management, Inc. v. Taok, the Court held:
44
Based on this Courts pronouncements in Vergara, it is easily discernible that the 120-day or 240-day period and the
obligations the law imposed on the employer are determinative of when a seafarers cause of action for total and
permanent disability may be considered to have arisen. Thus, a seafarer may pursue an action for total and
permanent disability benefits if: (a) the company-designated physician failed to issue a declaration as to his fitness
to engage in sea duty or disability even after the lapse of the 120-day period and there is no indication that further
medical treatment would address his temporary total disability, hence, justify an extension of the period to 240 days;
(b) 240 days had lapsed without any certification being issued by the company-designated physician; (c) the
company-designated physician declared that he is fit for sea duty within the 120-day or 240-day period, as the case
may be, but his physician of choice and the doctor chosen under Section 20-B(3) of the POEA-SEC are of a
contrary opinion; (d) the company-designated physician acknowledged that he is partially permanently disabled but
other doctors who he consulted, on his own and jointly with his employer, believed that his disability is not only
permanent but total as well; (e) the company-designated physician recognized that he is totally and permanently
disabled but there is a dispute on the disability grading; (f) the company-designated physician determined that his
medical condition is not compensable or work-related under the POEA-SEC but his doctor-of-choice and the third
doctor selected under Section 20-B(3) of the POEA-SEC found otherwise and declared him unfit to work; (g) the
company-designated physician declared him totally and permanently disabled but the employer refuses to pay him
the corresponding benefits; and(h) the company-designated physician declared him partially and permanently
disabled within the 120-day or 240-day period but he remains incapacitated to perform his usual sea duties after the
lapse of the said periods. (Emphasis supplied)
45
Certification of Fitness for Sea Service

Neither was there a certification from the company-designated physician as to Carcedos fitness for sea service.
Dr. Cruzs 24 March 2009 report on the disability grading of Carcedo did not include a certification that he was
already fit for sea duty. And even if it had, it would be belied by his subsequent reports on, and the fact of, the
continuation of medical treatments and hospitalization of Carcedo after the issuance of the 24 March 2009 report.
However, in Respondents Reply to Complainants Position Paper, they wrote:
xxxx
b. Medical Director and PEME doctor Dr. Fe Bacungan clearly opined that complainants amputated right big
toe will not in any way interfere with his current position as Chief Officer on board.
c. Another PEME doctor Dr. Pascualito Gutay likewise opined that complainants current condition will not
render him unfit for further sea duties as Chief Officer onboard.
xxxx
46
The Court of Appeals considered the opinions of Dr. Bacungan and Dr. Gutay as fit for sea duty declarations of
respondents designated physicians. We disagree. These opinions are not the certifications of fitness for sea duty
contemplated by the CBA and the POEA-SEC. First, Dr. Bacungan and Dr. Gutay were not the company-designated
physicians assigned to the care of Carcedo. Second, they were given in response to a hypothetical inquiry by
respondents counsel. Third, neither doctor examined Carcedo in coming up with their opinions.
47
As discussed above, the determination of the fitness of a seafarer for sea duty is the province of the companydesignated physician, subject to the periods prescribed by law. Hence, we also disagree with the NLRCs giving
credence to the declaration of Dr. Raymundo that Carcedo was unfit to work as a seaman.
Carcedo consulted Dr. Raymundo more than nine months since repatriation, and four months since he last
consulted the company-designated physician. During the latter period, Carcedo could have developed any number
of conditions that may or may not be related to the injury suffered while on board the ship. Notably, Dr. Raymundos
medical report does not specify what "condition" of Carcedo was "still in the healing process."
48
In addition, Dr. Raymundo was only consulted after Carcedo was treated by the company-designated physician. Dr.
Raymundo did not have a chance to observe Carcedo from the time of his repatriation, and was not able to monitor
his condition throughout the treatments.
Besides, Dr. Raymundos disability assessment includes a second ray amputation which he performed on Carcedo.
This, and the amputation of the first toe and its metatarsal bone performed by the company-designated physician,
formed the basis of Dr. Raymundos unfit for sea duty declaration. In contrast, the injury diagnosed by the doctor at
the Yoshino Hospital in Japan and the initial findings of Dr. Cruz immediately upon repatriation only pertain to the
first toe. Apart from the vague mention of a condition that was still in the healing process, there was no indication
that the second ray amputation was a consequence of the injury sustained while on board.
Nevertheless, Carcedos disability is deemed total and permanent due to the lack of a final disability assessment
and of a certification of fitness for sea service from Dr. Cruz.
Disability Compensation Due
Based on the foregoing discussion, we hold that Carcedo is entitled to full disability compensation. As a senior
officer at the time he was injured, at 100% degree of disability, Carcedo is entitled to US$148,500.00.
49
Moral and Exemplary Damages

and Attorneys Fees
The Labor Arbiter found no basis to award damages and attorneys fees. The NLRC likewise did not award
damages but awarded attorneys fees. The Court of Appeals did not award moral and exemplary damages but
deleted the award of attorneys fees.
We find no ground to disturb the following findings of the Court of Appeals:
As for attorneys fees, the same may be awarded if petitioner acted in gross and evident bad faith in refusing to
satisfy plaintiffs plainly valid, just and demandable claim.
Here [respondents] did not act in bad faith because they in fact paid all expenses relative to Carcedos treatment
and hospitalization. They even offered to pay disability benefits, albeit, Carcedo refused it because he wanted
Grade 1, no less. Too, the assailed decision did not explain the basis for the award of attorneys fees.
50
Indeed, the NLRC only included the award of attorneys fees in the dispositive portion of the Decision dated 8 March
2011 without a discussion as to the basis therefor.
A Final Note
In Philippine Hammonia Ship Agency v. Dumadag, the Court lamented:
51
The third-doctor-referral provision of the POEA-SEC, it appears to us, has been honored more in the breach than in
the compliance. This is unfortunate considering that the provision is intended to settle disability claims voluntarily at
the parties level where the claims can be resolved more speedily than if they were brought to court.
52
In this case, the third-doctor-referral provision did not find application because of the lack of a definitive disability
assessment by the company-designated physician. However, the respondents believed, nay, insisted, that the 24
March 2009 disability rating of 8% was the final assessment of their designated physician. When Carcedo submitted
the contrary findings of his personal physician, respondents presented the opinions of five more doctors, in rebuttal,
just to say that Carcedo could have been declared fit for sea duty if he were to re-apply for the same position of
chief mate.
At that point in time, the parties were yet before the Labor Arbiter, who could have facilitated the election of the third
doctor. We would like to remind ship owners, manning companies and seafarers of their respective obligations as
regards the third doctor provision. In INC Shipmanagement, Incorporated v. Rosales, we held:
To definitively clarify how a conflict situation should be handled, upon notification that the seafarer disagrees with
the company doctors assessment based on the duly and fully disclosed contrary assessment from the seafarers
own doctor, the seafarer shall then signify his intention to resolve the conflict by the referral of the conflicting
assessments to a third doctor whose ruling, under the POEA-SEC, shall be final and binding on the parties. Upon
notification, the company carries the burden of initiating the process for the referral to a third doctor commonly
agreed between the parties. In Bahia, we said:
In the absence of any request from him (as shown by the records of the case), the employer-company cannot be
expected to respond. As the party seeking to impugn the certification that the law itself recognizes as prevailing,
Constantino bears the burden of positive action to prove that his doctors findings are correct, as well as the burden
to notify the company that a contrary finding had been made by his own physician. Upon such notification, the
company must itself respond by setting into motion the process of choosing a third doctor who, as the POEA-SEC
provides, can rule with finality on the disputed medical situation.
53
WHEREFORE, the petition is GRANTED in part. We REVERSE the Court of Appeals Decision dated 29 June 2012
and Resolution dated 5 October 2012 in CA-G.R. SP No. 120706. We REINSTATE with MODIFICATION the
Decision dated 8 March 2011 of the National Labor
Relations Commission in NLRC LAC Case No. 01-000007-11 (OFW).
We order Maine Marine Philippines, Inc. to pay Dario A. Carcedo, or his surviving spouse, Priscilla Dela CruzCarcedo, the amount of US$148,500.00 only, without attorney's fees. The award shall be paid in Philippine pesos,
computed at the exchange rate prevailing at the time of payment.
SO ORDERED.
G.R. No. 208686
July 1, 2015
PEOPLE OF THE PHILIPPINES, Appellee,

vs.
ALELIE TOLENTINO a.k.a. "Alelie Tolentino y Hernandez," Appellant.
DECISION
CARPIO, J.:
This is an appeal from the 29 November 2012 Decision of the Court of Appeals in CA-G.R. CR-HC No. 04558,
affirming the trial court's decision, finding appellant Alelie Tolentino (appellant) guilty beyond reasonable doubt of
illegal recruitment and estafa.
1
The Facts
Appellant was charged with illegal recruitment and five (5) counts of estafa under Article 315, paragraph 2(a) of the
Revised Penal Code. The Informations against appellant read:
CRIM. CASE NO. 02-755
The undersigned Assistant City Prosecutor accuses ALELIE TOLENTINO of the crime of Illegal Recruitment
committed as follows:
That on or about [or sometime in] the last week of August, 2001 and 1st week of November, 2001 and thereafter, in
the City of Muntinlupa, Philippines and within the jurisdiction of this Honorable Court, the above-named accused
jointly with NARCISA SANTOS did then and there willfully, unlawfully and feloniously advertise for employment,
enlist, contract and promise employment to the following persons: LEDERLE PANESA, ORLANDO LAYOSO,
JIMMY LEJOS, MARCELINO LEJOS and DONNA MAGBOO for a fee without first securing license and/or permit
from the government agency concerned.
Contrary to law.

The undersigned Assistant City Prosecutor accuses ALELIE TOLENTINO of the crime of Estafa under Art. 315 Par.
2(a) of the Revised Penal Code, as amended, committed as follows:
That on or about or sometime in the first week of August 2001 and thereafter, in the City of Muntinlupa, Philippines
and within the jurisdiction of this Honorable Court, the above-named accused, by means of deceit, fraudulent acts
and false pretenses executed prior to or simultaneously with the commission of the fraud, did [then] and there
willfully, unlawfully and feloniously defraud one LEDERLE PANESA, in the following manner: accused represented
to the said complainant that she could secure work for the said complainant at Korea and she is capable of
processing the travel visa and other documents for her travel and employment at Korea and demanded from the
said complainant to pay the amount of P75,000.00 as placement fee; accused well knew that such representations
were false and made only to induce complainant to part with her money as in fact complainant gave and delivered
the amount of P15,000.00 as partial payment to the accused; and accused once in possession of the said amount,
did then and there willfully, unlawfully and feloniously misappropriate, misapply and convert the same to her own
personal use and benefit to the damage and prejudice of the said complainant in the amount of P15,000.00.
Contrary to law.

That on or about or sometime in the first week of November, 2001 and thereafter, in the City of Muntinlupa,
Philippines and within the jurisdiction of this Honorable Court, the above-named accused conspiring and
confederating with NARCISA SANTOS, and both of them mutually helping and aiding one another, by means of
deceit, fraudulent acts and false pretenses executed prior to or simultaneously with the commission of the fraud, did
[then] and there willfully, unlawfully and feloniously defraud one ORLANDO LAYOSO, in the following manner:
accused represented to the said complainant that she could secure work for the said complainant at Korea and she
is capable of processing the travel visa and other documents for [his] travel and employment at Korea and
demanded from the said complainant to pay the amount of P80,000.00 as placement fee; accused well knew that
such representations were false and made only to induce complainant to part with [his] money as in fact
complainant gave and delivered the amount of P35,000.00 as partial payment to the accused; and accused once in
possession of the said amount, did then and there willfully, unlawfully and feloniously misappropriate, misapply and
convert the same to her own personal use and benefit to the damage and prejudice of the said complainant in the
amount of P35,000.00.
Contrary to law.

[then] and there willfully, unlawfully and feloniously defraud one DONNA MAGBOO, in the following manner:
is capable of processing the travel visa and other documents for her travel and employment at Korea and
such representations were false and made only to induce complainant to part with her money as in fact complainant
gave and delivered the amount of P35,000.00 as partial payment to the accused; and accused once in possession
of the said amount, did then and there willfully, unlawfully and feloniously misappropriate, misapply and convert the
same to her own personal use and benefit to the damage and prejudice of the said complainant in the amount
ofP35,000.00.
Contrary to law.

2(a) of the Revised Penal Code, as amended, committed as follows: That on or about or sometime in the first week
of November, 2001 and thereafter, in the City of Muntinlupa, Philippines and within the jurisdiction of this Honorable
Court, the above-named accused conspiring and confederating with NARCISA SANTOS, and both of them mutually
helping and aiding one another, by means of deceit, fraudulent acts and false pretenses executed prior to or
simultaneously with the commission of the fraud, did [then] and there willfully, unlawfully and feloniously defraud one
JIMMY LEJOS, in the following manner: accused represented to the said complainant that she could secure work
for the said complainant at Korea and she is capable of processing the travel visa and other documents for [his]
travel and employment at Korea and demanded from the said complainant to pay the amount of P80,000.00 as
placement fee; accused well knew that such representations were false and made only to induce complainant to
part with [his] money as in fact complainant gave and delivered the amount of P35,000.00 as partial payment to the
accused; and accused once in possession of the said amount, did then and there willfully, unlawfully and feloniously
misappropriate, misapply and convert the same to her own personal use and benefit to the damage and prejudice of
the said complainant in the amount of P35,000.00.
Contrary to law.

[then] and there willfully, unlawfully and feloniously defraud one MARCELINO LEJOS, in the following manner:
is capable of processing the travel visa and other documents for [his] travel and employment at Korea and
such representations were false and made only to induce complainant to part with [his] money as in fact
complainant gave and delivered the amount of P20,000.00 as partial payment to the accused; and accused once in
possession of the said amount, did then and there willfully, unlawfully and feloniously misappropriate, misapply and
convert the same to her own personal use and benefit to the damage and prejudice of the said complainant in the
amount of P20,000.00.
Contrary to law.
Private complainants Orlando Layoso, Donna Magboo, Jimmy Lejos, and Marcelino Lejos alleged that sometime in
the first week of November 2001, they had a meeting with appellant Alelie Tolentino (appellant) in her office at the
3rd floor, Arevalo Building, Alabang, Muntinlupa City. Appellant told them the procedure for overseas employment
and offered them assistance to find work abroad for a fee of P80,000. Appellant showed them pictures of those she
allegedly helped find work abroad and told them that they would be earning $630 monthly as factory workers in
Korea. When asked about her license to recruit overseas workers, appellant told private complainants that she
would show it to them at some other time. On 14 November 2001, private complainants again met with appellant at
8
her office and each of them gave appellant P20,000 as partial payment of the agreed fee, which included expenses
for medical examination and processing of their documents for work in Korea. Appellant promised to secure their
visas and employment contracts within three months.
On 30 January 2002, private complainants met with appellant, who was accompanied by a certain Narcisa Santos,
at Wendys in Arquiza Street, Manila for signing of contract. However, the names written on the employment
contracts were not private complainants names. Appellant explained that the contracts were supposedly for other
applicants who sought her services but later backed out. Appellant assured them that original contracts bearing their
names would subsequently be provided. Private complainants signed the contracts and paid P15,000 each as their
second partial payment.
On 7 February 2002, private complainants received information that the Criminal Investigation and Detection Group
arrested appellant for illegal recruitment. When private complainants confronted appellant at the Manila City Hall
where she was held, they demanded the return of their payments amounting to P35,000 each, except for Marcelino
Lejos whose total payment only amounted to P20,000. Appellant denied the charges against her and promised them
that they would get their money back. Subsequently, private complainants were able to secure a certification from
the Philippine Overseas Employment Administration (POEA) that appellant was not licensed to recruit workers for
overseas employment.
Another complainant, Lederle Panesa, alleged that in August 2001, she met with appellant, who offered her work in
Korea for a placement fee of P75,000. On 7 September 2001, Panesa gave appellant P15,000 as initial payment.
Appellant assured Panesa that she would be leaving for Korea on the second week of November 2001 and that the
balance of the placement fee could be paid upon her receipt of the visa. However, after said meeting, Panesa no
longer heard from appellant, which prompted Panesa to visit appellants office. Appellant informed Panesa that there
were no job openings in Korea at that time. Appellant offered Panesa employment in other countries such as
Malaysia and Palau, but Panesa refused the offer and demanded the return of her money. Nevertheless, appellant
was able to persuade Panesa to wait until December 2001. Appellant never contacted Panesa thereafter. On 7
February 2002,Panesa was informed that appellant was apprehended for illegal recruitment. Panesa proceeded to
the Office of the City Prosecutor in Manila, but failed to confront appellant. It was only then that Panesa learned
about appellant not being authorized by the POEA to recruit workers for overseas employment.
For the defense, appellant was presented as the lone witness. Appellant denied the charges against her. She
testified that she was introduced to private complainants by a certain Cezar Manonson and that the owner of the
office she is renting is her relative. Private complainants allegedly sought her help regarding possible work in Korea
and that she merely explained the procedure for overseas employment to them. She was hesitant to help them
because she does not recruit workers as she herself was also applying for work as factory worker through Narcisa
Santos. She admitted having received money from private complainants and issuing receipts for the payments,
upon instructions from Narcisa Santos. She confirmed her signature on the petty cash vouchers she issued to
private complainants, evidencing their payments. She testified that she gave the payments to Narcisa Santos.
However, she admitted that she does not have proof that she indeed turned over the money to Narcisa Santos.
On 9 June 2010, the trial court rendered a decision, the dispositive portion of which reads: WHEREFORE, the Court
finds accused Alelie (also known as Alelie Tolentino) guilty beyond reasonable doubt of the offense of large scale
illegal recruitment, which constitutes economic sabotage in Criminal Case Case No. 02-755 and sentences her to
life imprisonment and to pay a fine of P500,000.00; and five counts of estafa under Article 315 2(a) of the Revised
Penal Code, as amended, in the following criminal cases and sentences her, as follows:
In Criminal Case No. 02-756, an indeterminate penalty of six months of arresto mayor in its maximum to four years
two months and one day of prision correccional in its maximum as the maximum period, and to pay the private
complainant the amount of P5,000.00 as and for moral damages. Accused is further ordered to return the amount
ofP15,000.00 she illegally collected from the private complainant.
In Criminal Case Nos. 02-757, 02-758 and 02-759, an indeterminate penalty [of] six months of arresto mayor in its
maximum to twelve years of prision mayor in its maximum, and to pay the private complainants individually each in
the amount of P15,000.00 as and for moral damages. Accused is further ordered to return the amount ofP35,000.00
she illegally collected each from the private complainants.
In Criminal Case No. 02-760, an indeterminate penalty of six months of arresto mayor in its maximum as the
minimum period to six years and one day of prision mayor in its minimum as the maximum period, and to pay the
private complainant the amount of P8,000.00 as and for moral damages. Accused is further ordered to return the
amount of P20,000.00 she illegally collected from the private complainant.
Her full period of preventive imprisonment shall be credited in her favor in accordance with Article 29 of the Revised
Penal Code.
SO ORDERED.
The Ruling of the Court of Appeals

On appeal, the Court of Appeals affirmed the trial courts decision. The Court of Appeals held that the prosecution
adequately proved that appellant engaged in illegal recruitment in large scale. The Court of Appeals noted that
appellant admitted that she had no authority or valid license to engage in recruitment and placement of workers. The
testimonies and the documentary evidence submitted by the prosecution showed that appellant led complainants to
believe that she had the power or ability to send private complainants to Korea to work as factory workers and that
the latter were convinced to give their payment to appellant in order to be employed. Appellant even issued petty
cash vouchers acknowledging receipt of private complainants payment and she made them sign Trainee
Agreements, which were purportedly their contract with their Korean employer. Based on the facts and evidence
presented, the Court of Appeals concluded that appellant clearly engaged in illegal recruitment activities. Appellants
claim that it was Narcisa Santos who recruited the private complainants and who profited from the illegal transaction
was disregarded by the Court of Appeals for lack of evidence. The Court of Appeals noted that it was appellant who
dealt directly with private complainants.
On the charge of estafa, the Court of Appeals likewise upheld appellants conviction for said crime. The evidence
presented to prove appellants liability for illegal recruitment also established her liability for estafa. The Court of
Appeals ruled that a person may be charged and convicted separately of illegal recruitment under Republic Act No.
8042 (RA 8042) in relation to the Labor Code, and estafa under Article 315, paragraph 2(a) of the Revised Penal
Code.
Hence, this appeal.
The Court's Ruling
We find the appeal without merit. The Court of Appeals was correct in affirming the ruling of the trial court that the
appellants guilt of the crimes she was accused of was clearly established by the witnesses and the evidence of the
prosecution.
Illegal Recruitment in Large Scale
Article 13(b) of the Labor Code defines recruitment and placement as "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."
Illegal recruitment, on the other hand is defined under Article 38 of the Labor Code as follows: ART. 38. Illegal
Recruitment
(a) Any recruitment activities, including the prohibited practices enumerated under Article 34of this Code, to
be undertaken by non-licensees or non-holders of authority shall be deemed illegal and punishable under
Article 39 of this Code. The Department of Labor and Employment or any law enforcement officer may
initiate complaints under this Article.
(b) Illegal recruitment when committed by a syndicate or in large scale shall be considered an offense
involving economic sabotage and shall be penalized in accordance with Article 39 hereof. Illegal recruitment
is deemed committed by a syndicate if carried out by a group of three (3) or more persons conspiring and/or
confederating with one another in carrying out any unlawful or illegal transaction, enterprise or scheme
defined under the first paragraph hereof. Illegal recruitment is deemed committed in large scale if committed
against three (3) or more persons individually or as a group.
(c) The Secretary 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 job-seekers. The Secretary 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, establishments and entities found to be engaged in the recruitment of workers for
overseas employment, without having been licensed or authorized to do so. (Emphases supplied)
Illegal recruitment, as defined under Article 38 of the Labor Code, encompasses recruitment activities for both local
and overseas employment. However, illegal recruitment under this article is limited to recruitment activities
undertaken by non-licensees or non-holders of authority. Thus, under the Labor Code, to constitute illegal
recruitment in large scale, three elements must concur:
10
1. The accused undertook any recruitment activity defined under Art. 13 (b) or any prohibited practice
enumerated under Art. 34 of the Labor Code.
2. He did not have the license or the authority to lawfully engage in the recruitment and placement of
workers.
3. He committed the same against three or more persons, individually or as a group.
11
RA 8042, otherwise known as the "Migrant Workers and Overseas Filipinos Act of 1995," established a higher
standard of protection and promotion of the welfare of the migrant workers, their families and overseas Filipinos in
distress. RA 8042 also broadened the concept of illegal recruitment for overseas employment and increased the
penalties, especially for Illegal Recruitment in Large Scale and Illegal Recruitment Committed by a Syndicate, which
are considered offenses involving economic sabotage. Part II of RA 8042 defines and penalizes illegal recruitment
for employment abroad, whether undertaken by a non-licensee or non-holder of authority or by a licensee or holder
of authority.
12
13
Section 6 of RA 8042 provides for the definition of illegal recruitment, while Section 7 enumerates the penalties
therefor, thus:
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 for 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:
employment;
employment;
(e) To influence or attempt to influence any person or entity not to employ any worker who has not applied
(f) To engage in the recruitment or placement of workers in jobs harmful to public health or morality or to the
(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
Employment;
of any corporation engaged in travel agency or to be engaged directly or indirectly in the management of a
travel agency;
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 workers fault. Illegal recruitment when committed by a syndicate or in large scale shall be considered an
offense involving economic sabotage.
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 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 (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. (Emphases supplied)
Unlike illegal recruitment as defined under the Labor Code which is limited to recruitment activities undertaken by
non-licensees or non-holders of authority, under Article 6 of RA 8042, illegal recruitment (for overseas employment)
may be committed not only by non-licensees or non-holders of authority but also by licensees or holders of authority.
Article 6 enumerates thirteen acts or practices [(a) to (m)] which constitute illegal recruitment, whether committed by
any person, whether a non-licensee, non-holder, licensee or holder of authority. Except for the last two acts [(l) and
(m)] on the list under Article 6 of RA8042, the first eleven acts or practices are also listed in Article 34 of the Labor
Code under the heading "Prohibited practices." Thus, under Article 34 of the Labor Code, it is unlawful for any
individual, entity, licensee or holder of authority to engage in any of the enumerated prohibited practices, but such
acts or practices do not constitute illegal recruitment when undertaken by a licensee or holder of authority. However,
under Article 38(A) of the Labor Code, when a non-licensee or non-holder of authority undertakes such "prohibited
practices," he or she is liable for illegal recruitment. RA 8042 broadened the definition of illegal recruitment for
overseas employment by including thirteen acts or practices which now constitute as illegal recruitment, whether
committed by a non-licensee, non-holder, licensee or holder of authority.
14
Under RA 8042, a non-licensee or non-holder of authority commits illegal recruitment for overseas employment in
two ways: (1) by 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; and
(2) by undertaking any of the acts enumerated under Section 6 of RA 8042. On the other hand, a licensee or holder
of authority is also liable for illegal recruitment for overseas employment when he or she undertakes any of the
thirteen acts or practices [(a) to (m)] listed under Section 6 of RA 8042. To constitute illegal recruitment in large
scale, the offense of illegal recruitment must be committed against three or more persons, individually or as a group.
In this case, the prosecution sufficiently proved that appellant engaged in large-scale illegal recruitment.
First, appellant is a non-licensee or non-holder of authority. Part of the evidence submitted by the prosecution is a
POEA Certification dated 10 March 2003, stating that appellant is not licensed by the POEA to recruit workers for
overseas employment. Appellant admitted that she has no valid license or authority required by law to lawfully
engage in recruitment and placement of workers.
15
Second, despite the absence of a license or authority to undertake recruitment activities, appellant gave the
impression that she has the power or ability to secure work for private complainants in Korea. Private complainants
Orlando Layoso, Donna Magboo, and Jimmy Lejos all testified that appellant promised them work as factory
workers in Korea and induced them to pay placement fees, which included the expenses for medical examination
and the processing of their documents for work in Korea. Appellant even showed pictures of previous applicants,
whom she allegedly helped find work abroad. Appellant also explained to them the procedure for overseas
employment and promised them that she would secure their visas and employment contracts within three months.
The testimonies of Orlando Layoso, Donna Magboo, and Jimmy Lejos were corroborated by private respondents
Marcelino Lejos and Lederle Panesa, whose Affidavits of Complaint were adopted as their direct testimonies.
This Court has held in several cases that an accused who represents to others that he could send workers abroad
for employment, even without the authority or license to do so, commits illegal recruitment.
16
Third, there are at least three victims in this case which makes appellant liable for large-scale illegal recruitment.
Appellant denies that she gave private complainants the distinct impression that she had the power or ability to send
them abroad for work. She insists that she herself had been applying then as a factory worker in Korea through
Narcisa Santos, who had previously deployed her as domestic helper in Hongkong. Although appellant admits
having received payments from private complainants and issuing receipts, she submits that she did so only upon
the instructions of Narcisa Santos, to whom she turned over the money collected from private complainants.
The Court is not swayed by appellants contentions. As found by the trial court and the appellate court, it was clearly
established that appellant dealt directly with the private complainants: she explained to them the procedure for
overseas employment; she charged them placement fees to cover their medical examination and the processing of
their travel documents; she issued petty cash vouchers with her signature, acknowledging receipts of their
payments; she promised the eventual release of their visas and employment contracts; and she made them sign
Trainee Agreements, purportedly their contract with their Korean employer. Clearly, appellant, despite being a nonlicensee or non-holder of authority, engaged in recruitment activities, making her liable for illegal recruitment.
Well-settled is the rule that the trial court, having the opportunity to observe the witnesses and their demeanor
during the trial, can best assess the credibility of the witnesses and their testimonies. Appellants mere denial
cannot prevail over the positive and categorical testimonies of the complainants. The trial courts findings are
17
18
accorded great respect unless the trial court has overlooked or misconstrued some substantial facts, which if
considered might affect the result of the case. Furthermore, factual findings of the trial court, when affirmed by the
Court of Appeals, are deemed binding and conclusive.
19
20
Thus, we affirm the finding of both the trial court and the appellate court that appellant is guilty beyond reasonable
doubt of illegal recruitment in large scale. However, we modify the penalty imposed.
The penalty imposed by the trial court in this case for large-scale illegal recruitment, which constitutes economic
sabotage, is life imprisonment and a fine of P500,000. Section 7 of RA 8042 provides that the penalty of life
imprisonment and a fine of not less than P500,000 nor more than P1,000,000 shall be imposed if illegal recruitment
constitutes economic sabotage. Said article further provides that the maximum penalty shall be imposed if
committed by a non-licensee or non-holder of authority. Thus, the proper penalty in this case is life imprisonment
and a fine of P1,000,000.
Estafa
We likewise affirm appellants conviction for five counts of estafa under Article 315(2)(a) of the Revised Penal Code.
It is settled that a person, for the same acts, may be convicted separately for illegal recruitment under RA 8042 (or
the Labor Code), and estafa under Article 315(2)(a) of the Revised Penal Code.
21
22
The elements of estafa are: (1) the accused defrauded another by abuse of confidence or by means of deceit; and
(2) the offended party or a third party suffered damage or prejudice capable of pecuniary estimation. In this case,
the prosecution proved beyond reasonable doubt that appellant deceived private complainants into believing that
she had the authority and capability to send them to Korea for employment, despite her not being licensed by the
POEA to recruit workers for overseas employment. She even showed them pictures of past applicants whom she
allegedly sent abroad for work. She also assured them that she would be able to secure their visas and employment
contracts once they pay the placement fee. Because of the assurances given by appellant, private complainants
paid appellant a portion of the agreed placement fee, for which appellant issued petty cash vouchers with her
signature, evidencing her receipt of the payments. Clearly, these acts of appellant constitute estafa punishable
under Article 315 (2)(a) of the Revised Penal Code.
23
24
The penalty for estafa depends on the amount defrauded. Article 315 of the Revised Penal Code provides:
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;
xxxx
Thus, when the amount of fraud is over P12,000 but not exceeding P22,000, the penalty imposed is prision
correccional in its maximum period to prision mayor in its minimum period, i.e., from 4 years, 2 months and 1 day to
8 years. Under the Indeterminate Sentence Law, the minimum term shall be within the range of the penalty next
lower to that prescribed by the Revised Penal Code, which is prision correccional in its minimum to medium period.
The time included in this penalty is from 6 months and 1 day to 4 years and 2 months.
When the amount of fraud exceeds P22,000, the penalty shall be imposed in its maximum period, and adding one
year for every P10,000 in excess of P22,000. But, the total penalty imposed should not exceed 20 years. The
maximum term under the Indeterminate Sentence Law is that which, in view of the attending circumstances, could
be properly imposed under the Revised Penal Code. The range of penalty under Article 315 is composed of only two
periods. To compute the maximum period of the indeterminate sentence, the total number of years included in the
two periods should be divided into three equal portions, with each portion forming a period. Following this
computation, the minimum, medium, and maximum periods of the prescribed penalty are:
1. Minimum Period 4 years, 2 months and 1 day to 5 years, 5 months and 10 days;
2. Medium Period 5 years, 5 months and 11 days to 6 years, 8 months and 20 days;
3. Maximum Period 6 years, 8 months and 21 days to 8 years.
Any incremental penalty, i.e. one year for every P10,000 in excess of P22,000, shall be added to anywhere from6
years, 8 months and 21 days to 8 years, at the courts discretion, provided the total penalty does not exceed 20
years.
25
We find that the penalty imposed by the trial court, and affirmed by the appellate court, is not in accord with the
penalty prescribed. The trial court erroneously imposed the minimum period of "six months of arresto mayor in its
maximum." Hence, we modify the penalty imposed on the five counts of estafa and we delete the moral damages
awarded for having no basis in law. Considering the number of victims defrauded, we find that a minimum period of
2 years of prision correccional is appropriate.
1wphi1
In Criminal Case No. 02-756, where the amount defrauded is P15,000, and in the absence of any mitigating or
aggravating circumstance, the maximum term shall be taken from the medium period of the penalty prescribed (i.e.
5 years, 5 months and 11 days to 6 years, 8 months and 20 days). Appellant should be sentenced to 2 years of
prision correccional as minimum to 6 years and 1 day of prision mayor as maximum.
In Criminal Case Nos. 02-757, 02-758, and 02-759, where the amount defrauded is P35,000 each, the maximum
period (anywhere from 6 years, 8 months and 21 days to 8 years) shall be imposed, plus the incremental penalty of
one year (additional 1 year imprisonment for the P10,000 in excess of P22,000). We fix the maximum term at 7
years of prision mayor. Adding the incremental penalty of 1 year to the maximum term, appellant should be
sentenced in each of these cases to 2 years of prision correccional as minimum to 8 years of prision mayor as
maximum.
In Criminal Case No. 02-760, where the amount defrauded is P20,000, appellant should be sentenced to 2 years of
prision correccional as minimum to 6 years and 1 day of prision mayor as maximum.
Furthermore, appellant should indemnify private complainants for the amounts paid to her, with legal interest at the
rate of 6% per annum, from the time of demand, which shall be deemed as the same day the Informations were filed
against appellant, until the amounts are fully paid. WHEREFORE, we AFFIRM WITH MODIFICATIONS the
Decision dated 29 November 2012 of the Court of Appeals in CA-G.R. CRHC No. 04558 to read as follows:
26
1. In Criminal Case No. 02-755, appellant Alelie Tolentino is found GUILTY beyond reasonable doubt of
illegal recruitment in large scale, constituting economic sabotage, as defined and penalized in Section 6 and
Section 7(b) of RA 8042. She is sentenced to suffer the penalty of life imprisonment and is ordered to pay a
fine of One Million Pesos (P1,000,000).
estafa, as defined and penalized in Article 315(2)(a) of the Revised Penal Code. She is sentenced to suffer
the indeterminate penalty of 2 years of prision correccional as minimum to 6 years and 1 day of prision
mayor as maximum. She is ordered to indemnify private complainant Lederle Panesa in the amount of
Fifteen Thousand Pesos (P15,000) as actual damages, with legal interest of six percent (6%) per annum
from 28 June 2002, until the said amount is fully paid.
the indeterminate penalty of 2 years of prision correccional as minimum to 8 years of prision mayor as
maximum. She is ordered to indemnify private complainant Orlando Layoso in the amount of Thirty Five
Thousand Pesos (P35,000) as actual damages, with legal interest of six percent (6%) per annum from 28
June 2002, until the said amount is fully paid.
4. In Criminal Case No. 02-758,appellant Alelie Tolentino is found GUILTY beyond reasonable doubt of
maximum. She is ordered to indemnify private complainant Donna Magboo in the amount of Thirty Five
maximum. She is ordered to indemnify private complainant Jimmy Lejos in the amount of Thirty Five
the indeterminate penalty of 2 years of prision correccional as minimum to 6 years and 1 day of prision
mayor as maximum. She is ordered to indemnify private complainant Marcelino Lejos in the amount of
Twenty Thousand Pesos (P20,000) as actual damages, with legal interest of six percent (6%) per annum
from 28 June 2002, until the said amount is fully paid.
SO ORDERED.
G.R. Nos. 178034 & 178117 G R. Nos. 186984-85
October 17, 2013
ANDREW JAMES MCBURNIE, Petitioner,

vs.
EULALIO GANZON, EGI-MANAGERS, INC. and E. GANZON, INC., Respondents.
RESOLUTION
REYES, J.:
For resolution are the
(1) third motion for reconsideration1 filed by Eulalio Ganzon (Ganzon), EGI-Managers, Inc. (EGI) and E.
Ganzon, Inc. (respondents) on March 27, 2012, seeking a reconsideration of the Courts Decision 2 dated
September 18, 2009 that ordered the dismissal of their appeal to the National Labor Relations Commission
(NLRC) for failure to post additional appeal bond in the amount of P54,083,910.00; and
(2) motion for reconsideration3 filed by petitioner Andrew James McBurnie (McBurnie) on September 26,
2012, assailing the Court en bancs Resolution4 dated September 4, 2012 that (1) accepted the case from
the Courts Third Division and (2) enjoined the implementation of the Labor Arbiters (LA) decision finding
him to be illegally dismissed by the respondents.
Antecedent Facts
The Decision dated September 18, 2009 provides the following antecedent facts and proceedings
On October 4, 2002, McBurnie, an Australian national, instituted a complaint for illegal dismissal and other monetary
claims against the respondents. McBurnie claimed that on May 11, 1999, he signed a five-year employment
agreement5 with the company EGI as an Executive Vice-President who shall oversee the management of the
companys hotels and resorts within the Philippines. He performed work for the company until sometime in
November 1999, when he figured in an accident that compelled him to go back to Australia while recuperating from
his injuries. While in Australia, he was informed by respondent Ganzon that his services were no longer needed
because their intended project would no longer push through.
The respondents opposed the complaint, contending that their agreement with McBurnie was to jointly invest in and
establish a company for the management of hotels. They did not intend to create an employer-employee
relationship, and the execution of the employment contract that was being invoked by McBurnie was solely for the
purpose of allowing McBurnie to obtain an alien work permit in the Philippines. At the time McBurnie left for Australia
for his medical treatment, he had not yet obtained a work permit.
In a Decision6 dated September 30, 2004, the LA declared McBurnie as having been illegally dismissed from
employment, and thus entitled to receive from the respondents the following amounts: (a) US$985,162.00 as salary
and benefits for the unexpired term of their employment contract, (b) P2,000,000.00 as moral and exemplary
damages, and (c) attorneys fees equivalent to 10% of the total monetary award.
Feeling aggrieved, the respondents appealed the LAs Decision to the NLRC. 7 On November 5, 2004, they filed their
Memorandum of Appeal8 and Motion to Reduce Bond9, and posted an appeal bond in the amount of P100,000.00.
The respondents contended in their Motion to Reduce Bond, inter alia, that the monetary awards of the LA were null
and excessive, allegedly with the intention of rendering them incapable of posting the necessary appeal bond. They
claimed that an award of "more than P60 Million Pesos to a single foreigner who had no work permit and who left
the country for good one month after the purported commencement of his employment" was a patent
nullity.10Furthermore, they claimed that because of their business losses that may be attributed to an economic
crisis, they lacked the capacity to pay the bond of almost P60 Million, or even the millions of pesos in premium
required for such bond.
On March 31, 2005, the NLRC denied11 the motion to reduce bond, explaining that "in cases involving monetary
award, an employer seeking to appeal the [LAs] decision to the Commission is unconditionally required by Art. 223,
Labor Code to post bond in the amount equivalent to the monetary award x x x." 12 Thus, the NLRC required from the
respondents the posting of an additional bond in the amount of P54,083,910.00.
When their motion for reconsideration was denied,13 the respondents decided to elevate the matter to the Court of
Appeals (CA) via the Petition for Certiorari and Prohibition (With Extremely Urgent Prayer for the Issuance of a
Preliminary Injunction and/or Temporary Restraining Order)14 docketed as CA-G.R. SP No. 90845.
In the meantime, in view of the respondents failure to post the required additional bond, the NLRC dismissed their
appeal in a Resolution15 dated March 8, 2006. The respondents motion for reconsideration was denied on June 30,
2006.16 This prompted the respondents to file with the CA the Petition for Certiorari (With Urgent Prayers for the
Immediate Issuance of a Temporary Restraining Order and a Writ of Preliminary Injunction) 17 docketed as CA-G.R.
SP No. 95916, which was later consolidated with CA-G.R. SP No. 90845.
CA-G.R. SP Nos. 90845 and 95916
On February 16, 2007, the CA issued a Resolution18 granting the respondents application for a writ of preliminary
injunction. It directed the NLRC, McBurnie, and all persons acting for and under their authority to refrain from
causing the execution and enforcement of the LAs decision in favor of McBurnie, conditioned upon the respondents
posting of a bond in the amount of P10,000,000.00. McBurnie sought reconsideration of the issuance of the writ of
preliminary injunction, but this was denied by the CA in its Resolution19 dated May 29, 2007.
McBurnie then filed with the Court a Petition for Review on Certiorari 20 docketed as G.R. Nos. 178034 and 178117,
assailing the CA Resolutions that granted the respondents application for the injunctive writ. On July 4, 2007, the
Court denied the petition on the ground of McBurnies failure to comply with the 2004 Rules on Notarial Practice and
to sufficiently show that the CA committed any reversible error.21 A motion for reconsideration was denied with finality
in a Resolution22 dated October 8, 2007.
Unyielding, McBurnie filed a Motion for Leave (1) To File Supplemental Motion for Reconsideration and (2) To Admit
the Attached Supplemental Motion for Reconsideration,23 which was treated by the Court as a second motion for
reconsideration, a prohibited pleading under Section 2, Rule 56 of the Rules of Court. Thus, the motion for leave
was denied by the Court in a Resolution24 dated November 26, 2007. The Courts Resolution dated July 4, 2007
then became final and executory on November 13, 2007; accordingly, entry of judgment was made in G.R. Nos.
178034 and 178117.25
In the meantime, the CA ruled on the merits of CA-G.R. SP No. 90845 and CA-G.R. SP No. 95916 and rendered its
Decision26 dated October 27, 2008, allowing the respondents motion to reduce appeal bond and directing the NLRC
to give due course to their appeal. The dispositive portion of the CA Decision reads:
WHEREFORE, in view of the foregoing, the petition for certiorari and prohibition docketed as CA GR SP No. 90845
and the petition for certiorari docketed as CA GR SP No. 95916 are GRANTED. Petitioners Motion to Reduce
Appeal Bond is GRANTED. Petitioners are hereby DIRECTED to post appeal bond in the amount
ofP10,000,000.00. The NLRC is hereby DIRECTED to give due course to petitioners appeal in CA GR SP No.
95916 which is ordered remanded to the NLRC for further proceedings.
SO ORDERED.27
On the issue28 of the NLRCs denial of the respondents motion to reduce appeal bond, the CA ruled that the NLRC
committed grave abuse of discretion in immediately denying the motion without fixing an appeal bond in an amount
that was reasonable, as it denied the respondents of their right to appeal from the decision of the LA. 29 The CA
explained that "(w)hile Art. 223 of the Labor Code requiring bond equivalent to the monetary award is explicit,
Section 6, Rule VI of the NLRC Rules of Procedure, as amended, recognized as exception a motion to reduce bond
upon meritorious grounds and upon posting of a bond in a reasonable amount in relation to the monetary award." 30
On the issue31 of the NLRCs dismissal of the appeal on the ground of the respondents failure to post the additional
appeal bond, the CA also found grave abuse of discretion on the part of the NLRC, explaining that an appeal bond
in the amount of P54,083,910.00 was prohibitive and excessive. Moreover, the appellate court cited the pendency of
the petition for certiorari over the denial of the motion to reduce bond, which should have prevented the NLRC from
immediately dismissing the respondents appeal.32
Undeterred, McBurnie filed a motion for reconsideration. At the same time, the respondents moved that the appeal
be resolved on the merits by the CA. On March 3, 2009, the CA issued a Resolution 33 denying both motions.
McBurnie then filed with the Court the Petition for Review on Certiorari34 docketed as G.R. Nos. 186984-85.
In the meantime, the NLRC, acting on the CAs order of remand, accepted the appeal from the LAs decision, and in
its Decision35 dated November 17, 2009, reversed and set aside the Decision of the LA, and entered a new one
dismissing McBurnies complaint. It explained that based on records, McBurnie was never an employee of any of
the respondents, but a potential investor in a project that included said respondents, barring a claim of dismissal,
much less, an illegal dismissal. Granting that there was a contract of employment executed by the parties, McBurnie
failed to obtain a work permit which would have allowed him to work for any of the respondents. 36 In the absence of
such permit, the employment agreement was void and thus, could not be the source of any right or obligation.
Court Decision dated September 18, 2009
On September 18, 2009, the Third Division of this Court rendered its Decision37 which reversed the CA Decision
dated October 27, 2008 and Resolution dated March 3, 2009. The dispositive portion reads:
WHEREFORE, the petition is GRANTED. The Decision of the Court of Appeals in CA-G.R. SP Nos. 90845 and
95916 dated October 27, 2008 granting respondents Motion to Reduce Appeal Bond and ordering the National
Labor Relations Commission to give due course to respondents appeal, and its March 3, 2009 Resolution denying
petitioners motion for reconsideration, are REVERSED and SET ASIDE. The March 8, 2006 and June 30, 2006
Resolutions of the National Labor Relations Commission in NLRC NCR CA NO. 042913-05 dismissing respondents
appeal for failure to perfect an appeal and denying their motion for reconsideration, respectively, are REINSTATED
and AFFIRMED.
SO ORDERED.38
The Court explained that the respondents failure to post a bond equivalent in amount to the LAs monetary award
was fatal to the appeal.39 Although an appeal bond may be reduced upon motion by an employer, the following
conditions must first be satisfied: (1) the motion to reduce bond shall be based on meritorious grounds; and (2) a
reasonable amount in relation to the monetary award is posted by the appellant. Unless the NLRC grants the motion
to reduce the cash bond within the 10-day reglementary period to perfect an appeal from a judgment of the LA, the
employer is mandated to post the cash or surety bond securing the full amount within the said 10-day period. 40 The
respondents initial appeal bond of P100,000.00 was grossly inadequate compared to the LAs monetary award.
The respondents first motion for reconsideration41 was denied by the Court for lack of merit via a Resolution42dated
December 14, 2009.
Meanwhile, on the basis of the Courts Decision, McBurnie filed with the NLRC a motion for reconsideration with
motion to recall and expunge from the records the NLRC Decision dated November 17, 2009. 43 The motion was
granted by the NLRC in its Decision44 dated January 14, 2010.45
Undaunted by the denial of their first motion for reconsideration of the Decision dated September 18, 2009, the
respondents filed with the Court a Motion for Leave to Submit Attached Second Motion for Reconsideration 46 and
Second Motion for Reconsideration,47 which motion for leave was granted in a Resolution48 dated March 15, 2010.
McBurnie was allowed to submit his comment on the second motion, and the respondents, their reply to the
comment. On January 25, 2012, however, the Court issued a Resolution49 denying the second motion "for lack of
merit," "considering that a second motion for reconsideration is a prohibited pleading x x x." 50
The Courts Decision dated September 18, 2009 became final and executory on March 14, 2012. Thus, entry of
judgment51 was made in due course, as follows:
ENTRY OF JUDGMENT
This is to certify that on September 18, 2009 a decision rendered in the above-entitled cases was filed in this Office,
the dispositive part of which reads as follows:
xxxx
and that the same has, on March 14, 2012 become final and executory and is hereby recorded in the Book of
Entries of Judgments.52
The Entry of Judgment indicated that the same was made for the Courts Decision rendered in G.R. Nos. 18698485.
On March 27, 2012, the respondents filed a Motion for Leave to File Attached Third Motion for Reconsideration, with
an attached Motion for Reconsideration (on the Honorable Courts 25 January 2012 Resolution) with Motion to Refer
These Cases to the Honorable Court En Banc.53 The third motion for reconsideration is founded on the following
grounds:
I.
THE PREVIOUS 15 MARCH 2010 RESOLUTION OF THE HONORABLE COURT ACTUALLY GRANTED
RESPONDENTS "MOTION FOR LEAVE TO SUBMIT A SECOND MOTION FOR RECONSIDERATION."
HENCE, RESPONDENTS RESPECTFULLY CONTEND THAT THE SUBSEQUENT 25 JANUARY 2012
RESOLUTION CANNOT DENY THE " SECOND MOTION FOR RECONSIDERATION " ON THE GROUND THAT IT
IS A PROHIBITED PLEADING. MOREOVER, IT IS RESPECTFULLY CONTENDED THAT THERE ARE VERY
PECULIAR CIRCUMSTANCES AND NUMEROUS IMPORTANT ISSUES IN THESE CASES THAT CLEARLY
JUSTIFY GIVING DUE COURSE TO RESPONDENTS "SECOND MOTION FOR RECONSIDERATION," WHICH
ARE:
II.
THE 10 MILLION PESOS BOND WHICH WAS POSTED IN COMPLIANCE WITH THE OCTOBER 27, 2008
DECISION OF THE COURT OF APPEALS IS A SUBSTANTIAL AND SPECIAL MERITORIOUS CIRCUMSTANCE
TO MERIT RECONSIDERATION OF THIS APPEAL.
III.
THE HONORABLE COURT HAS HELD IN NUMEROUS LABOR CASES THAT WITH RESPECT TO ARTICLE 223
OF THE LABOR CODE, THE REQUIREMENTS OF THE LAW SHOULD BE GIVEN A LIBERAL
INTERPRETATION, ESPECIALLY IF THERE ARE SPECIAL MERITORIOUS CIRCUMSTANCES AND ISSUES.
IV. THE LAS JUDGMENT WAS PATENTLY VOID SINCE IT AWARDS MORE THAN P60 MILLION PESOS TO A
SINGLE FOREIGNER WHO HAD NO WORK PERMIT, AND NO WORKING VISA.
V.
PETITIONER MCBURNIE DID NOT IMPLEAD THE NATIONAL LABOR RELATIONS COMMISSION (NLRC) IN HIS
APPEAL HEREIN, MAKING THE APPEAL INEFFECTIVE AGAINST THE NLRC.
VI.
NLRC HAS DISMISSED THE COMPLAINT OF PETITIONER MCBURNIE IN ITS NOVEMBER 17, 2009 DECISION.
VII.
THE HONORABLE COURTS 18 SEPTEMBER 2009 DECISION WAS TAINTED WITH VERY SERIOUS
IRREGULARITIES.
VIII.
GR NOS. 178034 AND 178117 HAVE BEEN INADVERTENTLY INCLUDED IN THIS CASE.
IX.
THE HONORABLE COURT DID NOT DULY RULE UPON THE OTHER VERY MERITORIOUS ARGUMENTS OF
THE RESPONDENTS WHICH ARE AS FOLLOWS:
(A) PETITIONER NEVER ATTENDED ANY OF ALL 14 HEARINGS BEFORE THE [LA] (WHEN 2
MISSED HEARINGS MEAN DISMISSAL).
(B) PETITIONER REFERRED TO HIMSELF AS A "VICTIM" OF LEISURE EXPERTS, INC., BUT
NOT OF ANY OF THE RESPONDENTS.
(C) PETITIONERS POSITIVE LETTER TO RESPONDENT MR. EULALIO GANZON CLEARLY
SHOWS THAT HE WAS NOT ILLEGALLY DISMISSED NOR EVEN DISMISSED BY ANY OF THE
RESPONDENTS AND PETITIONER EVEN PROMISED TO PAY HIS DEBTS FOR ADVANCES
MADE BY RESPONDENTS.
(D) PETITIONER WAS NEVER EMPLOYED BY ANY OF THE RESPONDENTS. PETITIONER
PRESENTED WORK FOR CORONADO BEACH RESORT WHICH IS [NEITHER] OWNED NOR
CONNECTED WITH ANY OF THE RESPONDENTS.
(E) THE [LA] CONCLUDED THAT PETITIONER WAS DISMISSED EVEN IF THERE WAS
ABSOLUTELY NO EVIDENCE AT ALL PRESENTED THAT PETITIONER WAS DISMISSED BY
THE RESPONDENTS.
(F) PETITIONER LEFT THE PHILIPPINES FOR AUSTRALIA JUST 2 MONTHS AFTER THE START
OF THE ALLEGED EMPLOYMENT AGREEMENT, AND HAS STILL NOT RETURNED TO THE
PHILIPPINES AS CONFIRMED BY THE BUREAU OF IMMIGRATION.
(G) PETITIONER COULD NOT HAVE SIGNED AND PERSONALLY APPEARED BEFORE THE
NLRC ADMINISTERING OFFICER AS INDICATED IN THE COMPLAINT SHEET SINCE HE LEFT
THE COUNTRY 3 YEARS BEFORE THE COMPLAINT WAS FILED AND HE NEVER CAME
BACK.54
On September 4, 2012, the Court en banc55 issued a Resolution56 accepting the case from the Third Division. It also
issued a temporary restraining order (TRO) enjoining the implementation of the LAs Decision dated September 30,
2004. This prompted McBurnies filing of a Motion for Reconsideration,57 where he invoked the fact that the Courts
Decision dated September 18, 2009 had become final and executory, with an entry of judgment already made by the
Court.
Our Ruling
In light of pertinent law and jurisprudence, and upon taking a second hard look of the parties arguments and the
records of the case, the Court has ascertained that a reconsideration of this Courts Decision dated September 18,
2009 and Resolutions dated December 14, 2009 and January 25, 2012, along with the lifting of the entry of
judgment in G.R. No. 186984-85, is in order.
The Courts acceptance of the
third motion for reconsideration
At the outset, the Court emphasizes that second and subsequent motions for reconsideration are, as a general rule,
prohibited. Section 2, Rule 52 of the Rules of Court provides that "no second motion for reconsideration of a
judgment or final resolution by the same party shall be entertained." The rule rests on the basic tenet of immutability
of judgments. "At some point, a decision becomes final and executory and, consequently, all litigations must come
to an end."58
The general rule, however, against second and subsequent motions for reconsideration admits of settled
exceptions. For one, the present Internal Rules of the Supreme Court, particularly Section 3, Rule 15 thereof,
provides:
Sec. 3. Second motion for reconsideration. The Court shall not entertain a second motion for reconsideration,
and any exception to this rule can only be granted in the higher interest of justice by the Court en banc upon a vote
of at least two-thirds of its actual membership. There is reconsideration "in the higher interest of justice" when the
assailed decision is not only legally erroneous, but is likewise patently unjust and potentially capable of causing
unwarranted and irremediable injury or damage to the parties. A second motion for reconsideration can only be
entertained before the ruling sought to be reconsidered becomes final by operation of law or by the Courts
declaration.
x x x x (Emphasis ours)
In a line of cases, the Court has then entertained and granted second motions for reconsideration "in the higher
interest of substantial justice," as allowed under the Internal Rules when the assailed decision is "legally erroneous,"
"patently unjust" and "potentially capable of causing unwarranted and irremediable injury or damage to the parties."
In Tirazona v. Philippine EDS Techno-Service, Inc. (PET, Inc.), 59 we also explained that a second motion for
reconsideration may be allowed in instances of "extraordinarily persuasive reasons and only after an express leave
shall have been obtained."60 In Apo Fruits Corporation v. Land Bank of the Philippines,61 we allowed a second motion
for reconsideration as the issue involved therein was a matter of public interest, as it pertained to the proper
application of a basic constitutionally-guaranteed right in the governments implementation of its agrarian reform
program. In San Miguel Corporation v. NLRC,62 the Court set aside the decisions of the LA and the NLRC that
favored claimants-security guards upon the Courts review of San Miguel Corporations second motion for
reconsideration. In Vir-Jen Shipping and Marine Services, Inc. v. NLRC, et al., 63 the Court en banc reversed on a
third motion for reconsideration the ruling of the Courts Division on therein private respondents claim for wages and
monetary benefits.
It is also recognized that in some instances, the prudent action towards a just resolution of a case is for the Court to
suspend rules of procedure, for "the power of this Court to suspend its own rules or to except a particular case from
its operations whenever the purposes of justice require it, cannot be questioned." 64 In De Guzman v.
Sandiganbayan,65 the Court, thus, explained:
The rules of procedure should be viewed as mere tools designed to facilitate the attainment of justice. Their strict
and rigid application, which would result in technicalities that tend to frustrate rather than promote substantial
justice, must always be avoided. Even the Rules of Court envision this liberality. This power to suspend or even
disregard the rules can be so pervasive and encompassing so as to alter even that which this Court itself has
already declared to be final, as we are now compelled to do in this case. x x x.
xxxx
The Rules of Court was conceived and promulgated to set forth guidelines in the dispensation of justice but not to
bind and chain the hand that dispenses it, for otherwise, courts will be mere slaves to or robots of technical rules,
shorn of judicial discretion. That is precisely why courts in rendering real justice have always been, as they in fact
ought to be, conscientiously guided by the norm that when on the balance, technicalities take a backseat against
substantive rights, and not the other way around. Truly then, technicalities, in the appropriate language of Justice
Makalintal, "should give way to the realities of the situation." x x x.66 (Citations omitted)
Consistent with the foregoing precepts, the Court has then reconsidered even decisions that have attained finality,
finding it more appropriate to lift entries of judgments already made in these cases. In Navarro v. Executive
Secretary,67 we reiterated the pronouncement in De Guzman that the power to suspend or even disregard rules of
procedure can be so pervasive and compelling as to alter even that which this Court itself has already declared
final. The Court then recalled in Navarro an entry of judgment after it had determined the validity and
constitutionality of Republic Act No. 9355, explaining that:
Verily, the Court had, on several occasions, sanctioned the recall of entries of judgment in light of attendant
extraordinary circumstances. The power to suspend or even disregard rules of procedure can be so pervasive and
compelling as to alter even that which this Court itself had already declared final. In this case, the compelling
concern is not only to afford the movants-intervenors the right to be heard since they would be adversely affected by
the judgment in this case despite not being original parties thereto, but also to arrive at the correct interpretation of
the provisions of the [Local Government Code (LGC)] with respect to the creation of local government units. x x
x.68(Citations omitted)
In Munoz v. CA,69 the Court resolved to recall an entry of judgment to prevent a miscarriage of justice. This
justification was likewise applied in Tan Tiac Chiong v. Hon. Cosico, 70 wherein the Court held that:
The recall of entries of judgments, albeit rare, is not a novelty. In Muoz v. CA , where the case was elevated to this
Court and a first and second motion for reconsideration had been denied with finality , the Court, in the interest of
substantial justice, recalled the Entry of Judgment as well as the letter of transmittal of the records to the Court of
Appeals.71 (Citation omitted)
In Barnes v. Judge Padilla,72 we ruled:
A final and executory judgment can no longer be attacked by any of the parties or be modified, directly or indirectly,
even by the highest court of the land.
However, this Court has relaxed this rule in order to serve substantial justice considering (a) matters of life, liberty,
honor or property, (b) the existence of special or compelling circumstances, (c) the merits of the case, (d) a cause
not entirely attributable to the fault or negligence of the party favored by the suspension of the rules, (e) a lack of
any showing that the review sought is merely frivolous and dilatory, and (f) the other party will not be unjustly
prejudiced thereby.73 (Citations omitted)
As we shall explain, the instant case also qualifies as an exception to, first, the proscription against second and
subsequent motions for reconsideration, and second, the rule on immutability of judgments; a reconsideration of the
Decision dated September 18, 2009, along with the Resolutions dated December 14, 2009 and January 25, 2012, is
justified by the higher interest of substantial justice.
To begin with, the Court agrees with the respondents that the Courts prior resolve to grant , and not just merely
note, in a Resolution dated March 15, 2010 the respondents motion for leave to submit their second motion for
reconsideration already warranted a resolution and discussion of the motion for reconsideration on its merits.
Instead of doing this, however, the Court issued on January 25, 2012 a Resolution 74 denying the motion to
reconsider for lack of merit, merely citing that it was a "prohibited pleading under Section 2, Rule 52 in relation to
Section 4, Rule 56 of the 1997 Rules of Civil Procedure, as amended." 75 In League of Cities of the Philippines (LCP)
v. Commission on Elections,76 we reiterated a ruling that when a motion for leave to file and admit a second motion
for reconsideration is granted by the Court, the Court therefore allows the filing of the second motion for
reconsideration. In such a case, the second motion for reconsideration is no longer a prohibited pleading. Similarly
in this case, there was then no reason for the Court to still consider the respondents second motion for
reconsideration as a prohibited pleading, and deny it plainly on such ground. The Court intends to remedy such
error through this resolution.
More importantly, the Court finds it appropriate to accept the pending motion for reconsideration and resolve it on
the merits in order to rectify its prior disposition of the main issues in the petition. Upon review, the Court is
constrained to rule differently on the petitions. We have determined the grave error in affirming the NLRCs rulings,
promoting results that are patently unjust for the respondents, as we consider the facts of the case, pertinent law,
jurisprudence, and the degree of the injury and damage to the respondents that will inevitably result from the
implementation of the Courts Decision dated September 18, 2009.
The rule on appeal bonds
We emphasize that the crucial issue in this case concerns the sufficiency of the appeal bond that was posted by the
respondents. The present rule on the matter is Section 6, Rule VI of the 2011 NLRC Rules of Procedure, which was
substantially the same provision in effect at the time of the respondents appeal to the NLRC, and which reads:
RULE VI
APPEALS
Sec. 6. BOND. In case the decision of the Labor Arbiter or the Regional Director involves a monetary award, an
appeal by the employer may be perfected only upon the posting of a cash or surety bond. The appeal bond shall
either be in cash or surety in an amount equivalent to the monetary award, exclusive of damages and attorneys
fees.
xxxx
No motion to reduce bond shall be entertained except on meritorious grounds and upon the posting of a bond in a
reasonable amount in relation to the monetary award.
The filing of the motion to reduce bond without compliance with the requisites in the preceding paragraph shall not
stop the running of the period to perfect an appeal. (Emphasis supplied)
While the CA, in this case, allowed an appeal bond in the reduced amount of P10,000,000.00 and then ordered the
cases remand to the NLRC, this Courts Decision dated September 18, 2009 provides otherwise, as it reads in part:
The posting of a bond is indispensable to the perfection of an appeal in cases involving monetary awards from the
decision of the Labor Arbiter. The lawmakers clearly intended to make the bond a mandatory requisite for the
perfection of an appeal by the employer as inferred from the provision that an appeal by the employer may be
perfected "only upon the posting of a cash or surety bond." The word "only" makes it clear that the posting of a cash
or surety bond by the employer is the essential and exclusive means by which an employers appeal may be
perfected. x x x.
Moreover, the filing of the bond is not only mandatory but a jurisdictional requirement as well, that must be complied
with in order to confer jurisdiction upon the NLRC. Non-compliance therewith renders the decision of the Labor
Arbiter final and executory. This requirement is intended to assure the workers that if they prevail in the case, they
will receive the money judgment in their favor upon the dismissal of the employers appeal. It is intended to
discourage employers from using an appeal to delay or evade their obligation to satisfy their employees just and
lawful claims.
xxxx
Thus, it behooves the Court to give utmost regard to the legislative and administrative intent to strictly require the
employer to post a cash or surety bond securing the full amount of the monetary award within the 10[-]day
reglementary period. Nothing in the Labor Code or the NLRC Rules of Procedure authorizes the posting of a bond
that is less than the monetary award in the judgment, or would deem such insufficient posting as sufficient to perfect
the appeal.
While the bond may be reduced upon motion by the employer, this is subject to the conditions that (1) the motion to
reduce the bond shall be based on meritorious grounds; and (2) a reasonable amount in relation to the monetary
award is posted by the appellant, otherwise the filing of the motion to reduce bond shall not stop the running of the
period to perfect an appeal. The qualification effectively requires that unless the NLRC grants the reduction of the
cash bond within the 10-day reglementary period, the employer is still expected to post the cash or surety bond
securing the full amount within the said 10-day period. If the NLRC does eventually grant the motion for reduction
after the reglementary period has elapsed, the correct relief would be to reduce the cash or surety bond already
posted by the employer within the 10-day period.77 (Emphasis supplied; underscoring ours)
To begin with, the Court rectifies its prior pronouncement the unqualified statement that even an appellant who
seeks a reduction of an appeal bond before the NLRC is expected to post a cash or surety bond securing the full
amount of the judgment award within the 10-day reglementary period to perfect the appeal.
The suspension of the period to
perfect the appeal upon the filing of
a motion to reduce bond
To clarify, the prevailing jurisprudence on the matter provides that the filing of a motion to reduce bond, coupled with
compliance with the two conditions emphasized in Garcia v. KJ Commercial 78 for the grant of such motion, namely,
(1) a meritorious ground, and (2) posting of a bond in a reasonable amount, shall suffice to suspend the running of
the period to perfect an appeal from the labor arbiters decision to the NLRC. 79 To require the full amount of the bond
within the 10-day reglementary period would only render nugatory the legal provisions which allow an appellant to
seek a reduction of the bond. Thus, we explained in Garcia:
The filing of a motion to reduce bond and compliance with the two conditions stop the running of the period to
perfect an appeal. x x x
xxxx
The NLRC has full discretion to grant or deny the motion to reduce bond, and it may rule on the motion beyond the
10-day period within which to perfect an appeal. Obviously, at the time of the filing of the motion to reduce bond and
posting of a bond in a reasonable amount, there is no assurance whether the appellants motion is indeed based on
"meritorious ground" and whether the bond he or she posted is of a "reasonable amount." Thus, the appellant
always runs the risk of failing to perfect an appeal.
x x x In order to give full effect to the provisions on motion to reduce bond, the appellant must be allowed to wait for
the ruling of the NLRC on the motion even beyond the 10-day period to perfect an appeal. If the NLRC grants the
motion and rules that there is indeed meritorious ground and that the amount of the bond posted is reasonable, then
the appeal is perfected. If the NLRC denies the motion, the appellant may still file a motion for reconsideration as
provided under Section 15, Rule VII of the Rules. If the NLRC grants the motion for reconsideration and rules that
there is indeed meritorious ground and that the amount of the bond posted is reasonable, then the appeal is
perfected. If the NLRC denies the motion, then the decision of the labor arbiter becomes final and executory.
xxxx
In any case, the rule that the filing of a motion to reduce bond shall not stop the running of the period to perfect an
appeal is not absolute. The Court may relax the rule. In Intertranz Container Lines, Inc. v. Bautista, the Court held:
"Jurisprudence tells us that in labor cases, an appeal from a decision involving a monetary award may be perfected
only upon the posting of cash or surety bond. The Court, however, has relaxed this requirement under certain
exceptional circumstances in order to resolve controversies on their merits. These circumstances include: (1)
fundamental consideration of substantial justice; (2) prevention of miscarriage of justice or of unjust enrichment; and
(3) special circumstances of the case combined with its legal merits, and the amount and the issue
involved."80(Citations omitted and emphasis ours)
A serious error of the NLRC was its outright denial of the motion to reduce the bond, without even considering the
respondents arguments and totally unmindful of the rules and jurisprudence that allow the bonds reduction. Instead
of resolving the motion to reduce the bond on its merits, the NLRC insisted on an amount that was equivalent to the
monetary award, merely explaining:
We are constrained to deny respondents motion for reduction. As held by the Supreme Court in a recent case, in
cases involving monetary award, an employer seeking to appeal the Labor Arbiters decision to the Commission is
unconditionally required by Art. 223, Labor Code to post bond in the amount equivalent to the monetary award
(Calabash Garments vs. NLRC, G.R. No. 110827, August 8, 1996). x x x81 (Emphasis ours)
When the respondents sought to reconsider, the NLRC still refused to fully decide on the motion. It refused to at
least make a preliminary determination of the merits of the appeal, as it held:
We are constrained to dismiss respondents Motion for Reconsideration. Respondents contention that the appeal
bond is excessive and based on a decision which is a patent nullity involves the merits of the case. x x x 82
Prevailing rules and jurisprudence
allow the reduction of appeal bonds.
By such haste of the NLRC in peremptorily denying the respondents motion without considering the respondents
arguments, it effectively denied the respondents of their opportunity to seek a reduction of the bond even when the
same is allowed under the rules and settled jurisprudence. It was equivalent to the NLRCs refusal to exercise its
discretion, as it refused to determine and rule on a showing of meritorious grounds and the reasonableness of the
bond tendered under the circumstances.83 Time and again, the Court has cautioned the NLRC to give Article 223 of
the Labor Code, particularly the provisions requiring bonds in appeals involving monetary awards, a liberal
interpretation in line with the desired objective of resolving controversies on the merits. 84 The NLRCs failure to take
action on the motion to reduce the bond in the manner prescribed by law and jurisprudence then cannot be
countenanced. Although an appeal by parties from decisions that are adverse to their interests is neither a natural
right nor a part of due process, it is an essential part of our judicial system. Courts should proceed with caution so
as not to deprive a party of the right to appeal, but rather, ensure that every party has the amplest opportunity for the
proper and just disposition of their cause, free from the constraints of technicalities. 85 Considering the mandate of
labor tribunals, the principle equally applies to them.
Given the circumstances of the case, the Courts affirmance in the Decision dated September 18, 2009 of the
NLRCs strict application of the rule on appeal bonds then demands a re-examination. Again, the emerging trend in
our jurisprudence is to afford every party-litigant the amplest opportunity for the proper and just determination of his
cause, free from the constraints of technicalities.86 Section 2, Rule I of the NLRC Rules of Procedure also provides
the policy that "the Rules shall be liberally construed to carry out the objectives of the Constitution, the Labor Code
of the Philippines and other relevant legislations, and to assist the parties in obtaining just, expeditious and
inexpensive resolution and settlement of labor disputes." 87
In accordance with the foregoing, although the general rule provides that an appeal in labor cases from a decision
involving a monetary award may be perfected only upon the posting of a cash or surety bond, the Court has relaxed
this requirement under certain exceptional circumstances in order to resolve controversies on their merits. These
circumstances include: (1) the fundamental consideration of substantial justice; (2) the prevention of miscarriage of
justice or of unjust enrichment; and (3) special circumstances of the case combined with its legal merits, and the
amount and the issue involved.88 Guidelines that are applicable in the reduction of appeal bonds were also
explained in Nicol v. Footjoy Industrial Corporation.89 The bond requirement in appeals involving monetary awards
has been and may be relaxed in meritorious cases, including instances in which (1) there was substantial
compliance with the Rules, (2) surrounding facts and circumstances constitute meritorious grounds to reduce the
bond, (3) a liberal interpretation of the requirement of an appeal bond would serve the desired objective of resolving
controversies on the merits, or (4) the appellants, at the very least, exhibited their willingness and/or good faith by
posting a partial bond during the reglementary period. 90
In Blancaflor v. NLRC,91 the Court also emphasized that while Article 22392 of the Labor Code, as amended by
Republic Act No. 6715, which requires a cash or surety bond in an amount equivalent to the monetary award in the
judgment appealed from may be considered a jurisdictional requirement for the perfection of an appeal,
nevertheless, adhering to the principle that substantial justice is better served by allowing the appeal on the merits
to be threshed out by the NLRC, the foregoing requirement of the law should be given a liberal interpretation.
As the Court, nonetheless, remains firm on the importance of appeal bonds in appeals from monetary awards of
LAs, we stress that the NLRC, pursuant to Section 6, Rule VI of the NLRC Rules of Procedure, shall only accept
motions to reduce bond that are coupled with the posting of a bond in a reasonable amount. Time and again, we
have explained that the bond requirement imposed upon appellants in labor cases is intended to ensure the
satisfaction of awards that are made in favor of appellees, in the event that their claims are eventually sustained by
the courts.93 On the part of the appellants, its posting may also signify their good faith and willingness to recognize
the final outcome of their appeal.
At the time of a motion to reduce appeal bonds filing, the question of what constitutes "a reasonable amount of
bond" that must accompany the motion may be subject to differing interpretations of litigants. The judgment of the
NLRC which has the discretion under the law to determine such amount cannot as yet be invoked by litigants until
after their motions to reduce appeal bond are accepted.
Given these limitations, it is not uncommon for a party to unduly forfeit his opportunity to seek a reduction of the
required bond and thus, to appeal, when the NLRC eventually disagrees with the partys assessment. These have
also resulted in the filing of numerous petitions against the NLRC, citing an alleged grave abuse of discretion on the
part of the labor tribunal for its finding on the sufficiency or insufficiency of posted appeal bonds.
It is in this light that the Court finds it necessary to set a parameter for the litigants and the NLRCs guidance on the
amount of bond that shall hereafter be filed with a motion for a bonds reduction. To ensure that the provisions of
Section 6, Rule VI of the NLRC Rules of Procedure that give parties the chance to seek a reduction of the appeal
bond are effectively carried out, without however defeating the benefits of the bond requirement in favor of a winning
litigant, all motions to reduce bond that are to be filed with the NLRC shall be accompanied by the posting of a cash
or surety bond equivalent to 10% of the monetary award that is subject of the appeal, which shall provisionally be
deemed the reasonable amount of the bond in the meantime that an appellants motion is pending resolution by the
Commission. In conformity with the NLRC Rules, the monetary award, for the purpose of computing the necessary
appeal bond, shall exclude damages and attorneys fees.94 Only after the posting of a bond in the required
percentage shall an appellants period to perfect an appeal under the NLRC Rules be deemed suspended.
The foregoing shall not be misconstrued to unduly hinder the NLRCs exercise of its discretion, given that the
percentage of bond that is set by this guideline shall be merely provisional. The NLRC retains its authority and duty
to resolve the motion and determine the final amount of bond that shall be posted by the appellant, still in
accordance with the standards of "meritorious grounds" and "reasonable amount". Should the NLRC, after
considering the motions merit, determine that a greater amount or the full amount of the bond needs to be posted
by the appellant, then the party shall comply accordingly. The appellant shall be given a period of 10 days from
notice of the NLRC order within which to perfect the appeal by posting the required appeal bond.
Meritorious ground as a condition
for the reduction of the appeal bond
In all cases, the reduction of the appeal bond shall be justified by meritorious grounds and accompanied by the
posting of the required appeal bond in a reasonable amount.
The requirement on the existence of a "meritorious ground" delves on the worth of the parties arguments, taking
into account their respective rights and the circumstances that attend the case. The condition was emphasized in
University Plans Incorporated v. Solano,95 wherein the Court held that while the NLRCs Revised Rules of Procedure
"allows the [NLRC] to reduce the amount of the bond, the exercise of the authority is not a matter of right on the part
of the movant, but lies within the sound discretion of the NLRC upon a showing of meritorious grounds." 96 By
jurisprudence, the merit referred to may pertain to an appellants lack of financial capability to pay the full amount of
the bond,97 the merits of the main appeal such as when there is a valid claim that there was no illegal dismissal to
justify the award,98 the absence of an employer-employee relationship, 99 prescription of claims,100 and other similarly
valid issues that are raised in the appeal.101 For the purpose of determining a "meritorious ground", the NLRC is not
precluded from receiving evidence, or from making a preliminary determination of the merits of the appellants
contentions.102
In this case, the NLRC then should have considered the respondents arguments in the memorandum on appeal
that was filed with the motion to reduce the requisite appeal bond. Although a consideration of said arguments at
that point would have been merely preliminary and should not in any way bind the eventual outcome of the appeal, it
was apparent that the respondents defenses came with an indication of merit that deserved a full review of the
decision of the LA. The CA, by its Resolution dated February 16, 2007, even found justified the issuance of a
preliminary injunction to enjoin the immediate execution of the LAs decision, and this Court, a temporary restraining
order on September 4, 2012.
Significantly, following the CAs remand of the case to the NLRC, the latter even rendered a Decision that contained
findings that are inconsistent with McBurnies claims. The NLRC reversed and set aside the decision of the LA, and
entered a new one dismissing McBurnies complaint. It explained that McBurnie was not an employee of the
respondents; thus, they could not have dismissed him from employment. The purported employment contract of the
respondents with the petitioner was qualified by the conditions set forth in a letter dated May 11, 1999, which reads:
May 11, 1999
MR. ANDREW MCBURNIE
Re: Employment Contract
Dear Andrew,
It is understood that this Contract is made subject to the understanding that it is effective only when the project
financing for our Baguio Hotel project pushed through.
The agreement with EGI Managers, Inc. is made now to support your need to facilitate your work permit with the
Department of Labor in view of the expiration of your contract with Pan Pacific.
Regards,
Sgd. Eulalio Ganzon (p. 203, Records)103
For the NLRC, the employment agreement could not have given rise to an employer-employee relationship by
reason of legal impossibility. The two conditions that form part of their agreement, namely, the successful completion
of the project financing for the hotel project in Baguio City and McBurnies acquisition of an Alien Employment
Permit, remained unsatisfied.104 The NLRC concluded that McBurnie was instead a potential investor in a project that
included Ganzon, but the said project failed to pursue due to lack of funds. Any work performed by McBurnie in
relation to the project was merely preliminary to the business venture and part of his "due diligence" study before
pursuing the project, "done at his own instance, not in furtherance of the employment contract but for his own
investment purposes."105 Lastly, the alleged employment of the petitioner would have been void for being contrary to
law, since it is undisputed that McBurnie did not have any work permit. The NLRC declared:
Absent an employment permit, any employment relationship that McBurnie contemplated with the respondents was
void for being contrary to law. A void or inexistent contract, in turn, has no force and effect from the beginning as if it
had never been entered into. Thus, without an Alien Employment Permit, the "Employment Agreement" is void and
could not be the source of a right or obligation. In support thereof, the DOLE issued a certification that McBurnie has
neither applied nor been issued an Alien Employment Permit (p. 204, Records). 106
McBurnie moved to reconsider, citing the Courts Decision of September 18, 2009 that reversed and set aside the
CAs Decision authorizing the remand. Although the NLRC granted the motion on the said ground via a
Decision107that set aside the NLRCs Decision dated November 17, 2009, the findings of the NLRC in the November
17, 2009 decision merit consideration, especially since the findings made therein are supported by the case records.
In addition to the apparent merit of the respondents appeal, the Court finds the reduction of the appeal bond
justified by the substantial amount of the LAs monetary award. Given its considerable amount, we find reason in the
respondents claim that to require an appeal bond in such amount could only deprive them of the right to appeal,
even force them out of business and affect the livelihood of their employees. 108 In Rosewood Processing, Inc. v.
NLRC,109 we emphasized: "Where a decision may be made to rest on informed judgment rather than rigid rules, the
equities of the case must be accorded their due weight because labor determinations should not be secundum
rationem but also secundum caritatem."110
What constitutes a reasonable
amount in the determination of the
final amount of appeal bond
As regards the requirement on the posting of a bond in a "reasonable amount," the Court holds that the final
determination thereof by the NLRC shall be based primarily on the merits of the motion and the main appeal.
Although the NLRC Rules of Procedure, particularly Section 6 of Rule VI thereof, provides that the bond to be
posted shall be "in a reasonable amount in relation to the monetary award ," the merit of the motion shall always
take precedence in the determination. Settled is the rule that procedural rules were conceived, and should thus be
applied in a manner that would only aid the attainment of justice. If a stringent application of the rules would hinder
rather than serve the demands of substantial justice, the former must yield to the latter.111
Thus, in Nicol where the appellant posted a bond of P10,000,000.00 upon an appeal from the LAs award
ofP51,956,314.00, the Court, instead of ruling right away on the reasonableness of the bonds amount solely on the
basis of the judgment award, found it appropriate to remand the case to the NLRC, which should first determine the
merits of the motion. In University Plans,112 the Court also reversed the outright dismissal of an appeal where the
bond posted in a judgment award of more than P30,000,000.00 was P30,000.00. The Court then directed the NLRC
to first determine the merit, or lack of merit, of the motion to reduce the bond, after the appellant therein claimed that
it was under receivership and thus, could not dispose of its assets within a short notice. Clearly, the rule on the
posting of an appeal bond should not be allowed to defeat the substantive rights of the parties. 113
Notably, in the present case, following the CAs rendition of its Decision which allowed a reduced appeal bond, the
respondents have posted a bond in the amount of P10,000,000.00. In Rosewood, the Court deemed the posting of
a surety bond of P50,000.00, coupled with a motion to reduce the appeal bond, as substantial compliance with the
legal requirements for an appeal from a P789,154.39 monetary award "considering the clear merits which appear,
res ipsa loquitor, in the appeal from the LAs Decision, and the petitioners substantial compliance with rules
governing appeals."114 The foregoing jurisprudence strongly indicate that in determining the reasonable amount of
appeal bonds, the Court primarily considers the merits of the motions and appeals.
Given the circumstances in this case and the merits of the respondents arguments before the NLRC, the Court
holds that the respondents had posted a bond in a "reasonable amount", and had thus complied with the
requirements for the perfection of an appeal from the LAs decision. The CA was correct in ruling that:
In the case of Nueva Ecija I Electric Cooperative, Inc. (NEECO I) Employees Association, President Rodolfo
Jimenez, and members, Reynaldo Fajardo, et al. vs. NLRC, Nueva Ecija I Electric Cooperative, Inc. (NEECO I) and
Patricio de la Pea (GR No. 116066, January 24, 2000), the Supreme Court recognized that: "the NLRC, in its
Resolution No. 11-01-91 dated November 7, 1991 deleted the phrase "exclusive of moral and exemplary damages
as well as attorneys fees in the determination of the amount of bond, and provided a safeguard against the
imposition of excessive bonds by providing that "(T)he Commission may in meritorious cases and upon motion of
the appellant, reduce the amount of the bond."
In the case of Cosico, Jr. vs. NLRC, 272 SCRA 583, it was held:
"The unreasonable and excessive amount of bond would be oppressive and unjust and would have the effect of
depriving a party of his right to appeal."
xxxx
In dismissing outright the motion to reduce bond filed by petitioners, NLRC abused its discretion. It should have
fixed an appeal bond in a reasonable amount. Said dismissal deprived petitioners of their right to appeal the Labor
Arbiters decision.
xxxx
NLRC Rules allow reduction of appeal bond on meritorious grounds (Sec. 6, Rule VI, NLRC Rules of Procedure).
This Court finds the appeal bond in the amount of P54,083,910.00 prohibitive and excessive, which constitutes a
meritorious ground to allow a motion for reduction thereof. 115
The foregoing declaration of the Court requiring a bond in a reasonable amount, taking into account the merits of
the motion and the appeal, is consistent with the oft-repeated principle that letter-perfect rules must yield to the
broader interest of substantial justice.116
The effect of a denial of the appeal
to the NLRC
In finding merit in the respondents motion for reconsideration, we also take into account the unwarranted results
that will arise from an implementation of the Courts Decision dated September 18, 2009. We emphasize, moreover,
that although a remand and an order upon the NLRC to give due course to the appeal would have been the usual
course after a finding that the conditions for the reduction of an appeal bond were duly satisfied by the respondents,
given such results, the Court finds it necessary to modify the CAs order of remand, and instead rule on the
dismissal of the complaint against the respondents.
Without the reversal of the Courts Decision and the dismissal of the complaint against the respondents, McBurnie
would be allowed to claim benefits under our labor laws despite his failure to comply with a settled requirement for
foreign nationals.
Considering that McBurnie, an Australian, alleged illegal dismissal and sought to claim under our labor laws, it was
necessary for him to establish, first and foremost, that he was qualified and duly authorized to obtain employment
within our jurisdiction. A requirement for foreigners who intend to work within the country is an employment permit,
as provided under Article 40, Title II of the Labor Code which reads:
Art. 40. Employment permit for non-resident aliens. Any alien seeking admission to the Philippines for employment
purposes and any domestic or foreign employer who desires to engage an alien for employment in the Philippines
shall obtain an employment permit from the Department of Labor.
In WPP Marketing Communications, Inc. v. Galera,117 we held that a foreign nationals failure to seek an employment
permit prior to employment poses a serious problem in seeking relief from the Court. 118 Thus, although the
respondent therein appeared to have been illegally dismissed from employment, we explained:
This is Galeras dilemma: Galera worked in the Philippines without proper work permit but now wants to claim
employees benefits under Philippine labor laws.
xxxx
The law and the rules are consistent in stating that the employment permit must be acquired prior to employment.
The Labor Code states: "Any alien seeking admission to the Philippines for employment purposes and any domestic
or foreign employer who desires to engage an alien for employment in the Philippines shall obtain an employment
permit from the Department of Labor." Section 4, Rule XIV, Book I of the Implementing Rules and Regulations
provides:
"Employment permit required for entry. No alien seeking employment, whether as a resident or non-resident, may
enter the Philippines without first securing an employment permit from the Ministry. If an alien enters the country
under a non-working visa and wishes to be employed thereafter, he may be allowed to be employed upon
presentation of a duly approved employment permit."
Galera cannot come to this Court with unclean hands. To grant Galeras prayer is to sanction the violation of the
Philippine labor laws requiring aliens to secure work permits before their employment. We hold that the status quo
must prevail in the present case and we leave the parties where they are. This ruling, however, does not bar Galera
from seeking relief from other jurisdictions.119 (Citations omitted and underscoring ours)
Clearly, this circumstance on the failure of McBurnie to obtain an employment permit, by itself, necessitates the
dismissal of his labor complaint.
Furthermore, as has been previously discussed, the NLRC has ruled in its Decision dated November 17, 2009 on
the issue of illegal dismissal. It declared that McBurnie was never an employee of any of the respondents. 120 It
explained:
All these facts and circumstances prove that McBurnie was never an employee of Eulalio Ganzon or the respondent
companies, but a potential investor in a project with a group including Eulalio Ganzon and Martinez but said project
did not take off because of lack of funds.
McBurnie further claims that in conformity with the provision of the employment contract pertaining to the obligation
of the respondents to provide housing, respondents assigned him Condo Unit # 812 of the Makati Cinema Square
Condominium owned by the respondents. He was also allowed to use a Hyundai car. If it were true that the contract
of employment was for working visa purposes only, why did the respondents perform their obligations to him?
There is no question that respondents assigned him Condo Unit # 812 of the MCS, but this was not free of charge. If
it were true that it is part of the compensation package as employee, then McBurnie would not be obligated to pay
anything, but clearly, he admitted in his letter that he had to pay all the expenses incurred in the apartment.
Assuming for the sake of argument that the employment contract is valid between them, record shows that
McBurnie worked from September 1, 1999 until he met an accident on the last week of October. During the period of
employment, the respondents must have paid his salaries in the sum of US$26,000.00, more or less.
However, McBurnie failed to present a single evidence that [the respondents] paid his salaries like payslip, check or
cash vouchers duly signed by him or any document showing proof of receipt of his compensation from the
respondents or activity in furtherance of the employment contract. Granting again that there was a valid contract of
employment, it is undisputed that on November 1, 1999, McBurnie left for Australia and never came back. x x
x.121(Emphasis supplied)
Although the NLRCs Decision dated November 17, 2009 was set aside in a Decision dated January 14, 2010, the
Courts resolve to now reconsider its Decision dated September 18, 2009 and to affirm the CAs Decision and
Resolution in the respondents favor effectively restores the NLRCs basis for rendering the Decision dated
November 17, 2009.
More importantly, the NLRCs findings on the contractual relations between McBurnie and the respondents are
supported by the records.
First, before a case for illegal dismissal can prosper, an employer-employee relationship must first be
established.122 Although an employment agreement forms part of the case records, respondent Ganzon signed it
with the notation "per my note."123 The respondents have sufficiently explained that the note refers to the
letter124dated May 11, 1999 which embodied certain conditions for the employments effectivity. As we have
previously explained, however, the said conditions, particularly on the successful completion of the project financing
for the hotel project in Baguio City and McBurnies acquisition of an Alien Employment Permit, failed to materialize.
Such defense of the respondents, which was duly considered by the NLRC in its Decision dated November 17,
2009, was not sufficiently rebutted by McBurnie.
Second, McBurnie failed to present any employment permit which would have authorized him to obtain employment
in the Philippines. This circumstance negates McBurnies claim that he had been performing work for the
respondents by virtue of an employer-employee relationship. The absence of the employment permit instead
bolsters the claim that the supposed employment of McBurnie was merely simulated, or did not ensue due to the
non-fulfillment of the conditions that were set forth in the letter of May 11, 1999.
Third, besides the employment agreement, McBurnie failed to present other competent evidence to prove his claim
of an employer-employee relationship. Given the parties conflicting claims on their true intention in executing the
agreement, it was necessary to resort to the established criteria for the determination of an employer-employee
relationship, namely: (1) the selection and engagement of the employee; (2) the payment of wages; (3) the power of
dismissal; and (4) the power to control the employees conduct.125 The rule of thumb remains: the onus probandi falls
on the claimant to establish or substantiate the claim by the requisite quantum of evidence. Whoever claims
entitlement to the benefits provided by law should establish his or her right thereto. 126 McBurnie failed in this
regard. As previously observed by the NLRC, McBurnie even failed to show through any document such as
payslips or vouchers that his salaries during the time that he allegedly worked for the respondents were paid by the
company. In the absence of an employer-employee relationship between McBurnie and the respondents, McBurnie
could not successfully claim that he was dismissed, much less illegally dismissed, by the latter. Even granting that
there was such an employer-employee relationship, the records are barren of any document showing that its
termination was by the respondents dismissal of McBurnie.
1wphi1
Given these circumstances, it would be a circuitous exercise for the Court to remand the case to the NLRC, more so
in the absence of any showing that the NLRC should now rule differently on the cases merits. In Medline
Management, Inc. v. Roslinda,127 the Court ruled that when there is enough basis on which the Court may render a
proper evaluation of the merits of the case, the Court may dispense with the time-consuming procedure of
remanding a case to a labor tribunal in order "to prevent delays in the disposition of the case," "to serve the ends of
justice" and when a remand "would serve no purpose save to further delay its disposition contrary to the spirit of fair
play."128 In Real v. Sangu Philippines, Inc.,129 we again ruled:
With the foregoing, it is clear that the CA erred in affirming the decision of the NLRC which dismissed petitioners
complaint for lack of jurisdiction. In cases such as this, the Court normally remands the case to the NLRC and
directs it to properly dispose of the case on the merits. "However, when there is enough basis on which a proper
evaluation of the merits of petitioners case may be had, the Court may dispense with the time-consuming
procedure of remand in order to prevent further delays in the disposition of the case." "It is already an accepted rule
of procedure for us to strive to settle the entire controversy in a single proceeding, leaving no root or branch to bear
the seeds of litigation. If, based on the records, the pleadings, and other evidence, the dispute can be resolved by
us, we will do so to serve the ends of justice instead of remanding the case to the lower court for further
proceedings." x x x.130 (Citations omitted)
It bears mentioning that although the Court resolves to grant the respondents motion for reconsideration, the other
grounds raised in the motion, especially as they pertain to insinuations on irregularities in the Court, deserve no
merit for being founded on baseless conclusions. Furthermore, the Court finds it unnecessary to discuss the other
grounds that are raised in the motion, considering the grounds that already justify the dismissal of McBurnies
complaint.
All these considered, the Court also affirms its Resolution dated September 4, 2012; accordingly, McBurnies motion
for reconsideration thereof is denied.
WHEREFORE, in light of the foregoing, the Court rules as follows:
(a) The motion for reconsideration filed on September 26, 2012 by petitioner Andrew James McBurnie is
DENIED;
(b) The motion for reconsideration filed on March 27, 2012 by respondents Eulalio Ganzon, EGI-Managers,
Inc. and E. Ganzon, Inc. is GRANTED.
(c) The Entry of Judgment issued in G.R. Nos. 186984-85 is LIFTED. This Courts Decision dated
September 18, 2009 and Resolutions dated December 14, 2009 and January 25, 2012 are SET ASIDE. The
Court of Appeals Decision dated October 27, 2008 and Resolution dated March 3, 2009 in CA-G.R. SP No.
90845 and CA-G.R. SP No. 95916 are AFFIRMED WITH MODIFICATION. In lieu of a remand of the case to
the National Labor Relations Commission, the complaint for illegal dismissal filed by petitioner Andrew
James McBurnie against respondents Eulalio Ganzon, EGI-Managers, Inc. and E. Ganzon, Inc. is
DISMISSED.
Furthermore, on the matter of the filing and acceptance of motions to reduce appeal bond, as provided in Section 6,
Rule VI of the 2011 NLRC Rules of Procedure, the Court hereby RESOLVES that henceforth, the following
guidelines shall be observed:
(a) The filing o a motion to reduce appeal bond shall be entertained by the NLRC subject to the following
conditions: (1) there is meritorious ground; and (2) a bond in a reasonable amount is posted;
(b) For purposes o compliance with condition no. (2), a motion shall be accompanied by the posting o a
provisional cash or surety bond equivalent to ten percent (10,) of the monetary award subject o the appeal,
exclusive o damages and attorney's fees;
(c) Compliance with the foregoing conditions shall suffice to suspend the running o the 1 0-day reglementary
period to perfect an appeal from the labor arbiter's decision to the NLRC;
(d) The NLRC retains its authority and duty to resolve the motion to reduce bond and determine the final
amount o bond that shall be posted by the appellant, still in accordance with the standards o meritorious
grounds and reasonable amount; and
(e) In the event that the NLRC denies the motion to reduce bond, or requires a bond that exceeds the
amount o the provisional bond, the appellant shall be given a fresh period o ten 1 0) days from notice o the
NLRC order within which to perfect the appeal by posting the required appeal bond.
SO ORDERED.
.R. No. 191455
March 12, 2014
DREAMLAND HOTEL RESORT and WESTLEY J. PRENTICE, Petitioners,

vs.
STEPHEN B. JOHNSON, Respondent.
DECISION
REYES, J.:
Before the Court is a Petition for Review on Certiorari assailing the December 14, 2009 and February 11,
2010 Resolutions of the Court of Appeals (CA) in CA-G.R. SP No. 111693 which dismissed outright the petition for
certiorari on technical grounds.
1
Dreamland Hotel Resort (Dreamland) and its President, Westley J. Prentice (Prentice) (petitioners) alleged the
following facts in the instant petition:
9. Dreamland is a corporation duly registered with the Securities and Exchange Commission on January 15, 2003 to
exist for a period of fifty [50] years with registration number SEC A 1998-6436. Prentice is its current President and
Chief Executive Officer. It is engaged in the hotel, restaurant and allied businesses. Dreamland is presently
undertaking operations of its business at National Highway, Sto. Tomas, Matain Subic, Zambales, 2209.
10. Respondent Stephen B. Johnson is an Australian citizen who came to the Philippines as a businessman/investor
without the authority to be employed as the employee/officer of any business as he was not able to secure his Alien
Employment Permit ["AEP" for brevity], which fact was duly supported by the Certification dated March 14, 2008 of
the Department of Labor and Employment ["DOLE" for brevity] Regional Director, Regional Office No. III, San
Fernando City, Pampanga,
x x x.
11. As a fellow Australian citizen, Johnson was able to convince Prentice to accept his offer to invest in Dreamland
and at the same time provide his services as Operations Manager of Dreamland with a promise that he will secure
an AEP and Tax Identification Number ["TIN" for brevity] prior to his assumption of work.
12. Sometime on June 21, 2007, Prentice and Johnson entered into an Employment Agreement, which stipulates
among others, that the [sic] Johnson shall serve as Operations Manager of Dreamland from August 1, 2007 and
shall serve as such for a period of three (3) years.
13. Before entering into the said agreement[,] Prentice required the submission of the AEP and TIN from Johnson.
Johnson promised that the same shall be supplied within one (1) month from the signing of the contract because the
application for the TIN and AEP were still under process. Thus[,] it was agreed that the efficacy of the said
agreement shall begin after one (1) month or on August 1, 2007. x x x.
14. On or about October 8, 2007, Prentice asked on several occasions the production of the AEP and TIN from
Johnson. Johnson gave excuses and promised that he is already in possession of the requirements. Believing the
word of Johnson, Dreamland commenced a dry run of its operations.
15. Johnson worked as a hotel and resort Operations Manager only at that time. He worked for only about three (3)
weeks until he suddenly abandoned his work and subsequently resigned as Operations Manager starting November
3, 2007. He never reported back to work despite several attempts of Prentice to clarify his issues. x x x.
4
On the other hand, respondent Stephen B. Johnson (Johnson) averred that:

4. There is also no truth to the allegation that it was [Johnson] who "offered" and "convinced" petitioner Prentice to
"invest" in and provide his services to petitioner Dreamland Hotel Resort x x x. The truth of the matter is that it was
petitioners who actively advertised for a resort manager for Dreamland Hotel. x x x
5. It was in response to these advertisements that private respondent Johnson contacted petitioners to inquire on
the terms for employment offered. It was Prentice who offered employment and convinced Johnson to give out a
loan, purportedly so the resort can be completed and operational by August 2007. Believing the representations of
petitioner Prentice, private respondent Johnson accepted the employment as Resort Manager and loaned money to
petitioners [consisting of] his retirement pay in the amount of One Hundred Thousand US Dollars (USD 100,000.00)
to finish construction of the resort. x x x.
6. From the start of August 2007, as stipulated in the Employment Agreement, respondent Johnson already reported
for work. It was then that he found out to his dismay that the resort was far from finished. However, he was
instructed to supervise construction and speak with potential guests. He also undertook the overall preparation of
the guestrooms and staff for the opening of the hotel, even performing menial tasks (i.e. inspected for cracked tiles,
ensured proper grout installation, proper lighting and air-conditioning unit installation, measured windows for curtain
width and showers for shower curtain rods, unloaded and installed mattresses, beddings, furniture and appliances
and even ironed and hung guest room curtains).
xxxx
8. As [Johnson] remained unpaid since August 2007 and he has loaned all his money to petitioners, he asked for his
salary after the resort was opened in October 2007 but the same was not given to him by petitioners. [Johnson]
became very alarmed with the situation as it appears that there was no intention to pay him his salary, which he now
depended on for his living as he has been left penniless. He was also denied the benefits promised him as part of
his compensation such as service vehicles, meals and insurance.
9. [Johnson] was also not given the authority due to him as resort manager. Prentice countermanded his orders to
the staff at every opportunity. Worse, he would even be berated and embarrassed in front of the staff. Prentice
would go into drunken tiffs, even with customers and [Johnson] was powerless to prohibit Prentice. It soon became
clear to him that he was only used for the money he loaned and there was no real intention to have him as resort
manager of Dreamland Hotel.
10. Thus, on November 3, 2007, after another embarrassment was handed out by petitioner Prentice in front of the
staff, which highlighted his lack of real authority in the hotel and the disdain for him by petitioners, respondent
Johnson was forced to submit his resignation, x x x. In deference to the Employment Agreement signed, [Johnson]
stated that he was willing to continue work for the three month period stipulated therein.
11. However, in an SMS or text message sent by Prentice to [Johnson] on the same day at around 8:20 pm, he was
informed that " I consider [yo]ur resignation as immediate". Despite demand, petitioners refused to pay [Johnson]
the salaries and benefits due him.
5
On January 31, 2008, Johnson filed a Complaint for illegal dismissal and non-payment of salaries, among others,
against the petitioners.
On May 23, 2008, the Labor Arbiter (LA) rendered a Decision dismissing Johnsons complaint for lack of merit with
the finding that he voluntarily resigned from his employment and was not illegally dismissed. We quote:
6
There [is] substantial evidence on record that [Johnson] indeed resigned voluntarily from his position by his mere act
of tendering his resignation and immediately abandoned his work as Operations Manager from the time that he filed
said resignation letter on November 3, 2007 and never returned to his work up to the filing of this case. Evidence on
record also show that [Johnson] only served as Operations Manager for a period of three (3) weeks after which he
tendered his voluntary resignation and left his job. This fact was not denied or questioned by him. His claim that
there was breach of employment contract committed by the respondents and that he was not refunded his alleged
investment with the respondent Dreamland Hotel and Resort were not properly supported with substantial evidence
and besides these issues are not within the ambit of jurisdiction of this Commission.
There being competent, concrete and substantial evidence to confirm the voluntary resignation of [Johnson] from his
employment, there was no illegal dismissal committed against him and for him to be entitled to reinstatement to his
former position and backwages.
xxxx
WHEREFORE, premises considered, let this case be as it is hereby ordered DISMISSED for lack of merit.
All the money claims of the complainant are likewise ordered dismissed for lack of legal basis.
SO ORDERED.
Dissatisfied, Johnson appealed to the National Labor Relations Commission (NLRC). The NLRC rendered its
Decision on April 30, 2009, the dispositive portion of which reads:
8
WHEREFORE, the decision appeared from is hereby REVERSED. Respondent Wes[t]ley Prentice and/or
Dreamland Resort & Hotel, Inc[.] are hereby ordered to pay [Johnson] the following:
1. Backwages computed at [P]60,000.00 monthly from November
3, 2007 up to the finality of this decision;
2. Separation pay equivalent to one months salary, or [P]60,000.00;
3. Unpaid salaries from August 1, 2007 to November 1, 2007 amounting to a total of [P]172,800.00.
SO ORDERED.
The NLRC also noted the following:

Insofar as the charge of abandonment against [Johnson] is concerned, it is significant that the contention that
[Johnson] received a total of [P]172,000.00 from the [petitioners] since July 2007 is not supported by the evidence x
x x submitted by the [petitioners]. Except for a promissory note x x x for [P]2,200.00, the pieces of evidence in
question do not bear [Johnsons] signature, and do not therefore constitute proof of actual receipt by him of the
amounts stated therein. Thus, based on the evidence and on the admission by [Johnson] that he received the
amount of [P]5,000.00 from the [petitioners], it appears that [Johnson] received a total of only [P]7,200.00 from the
[petitioners]. Since based on the Employment Agreement, his employment commenced on August 1, 2007, it follows
that as of November 3, 2007, when he tendered his resignation, the [petitioners] had failed to pay him a total of
[P]172,800.00 representing his unpaid salaries for three months ([P]60,000.00 x 3 mos. = [P]180,000.00 [P]7,200
= [P]172,800.00). Even the most reasonable employee would consider quitting his job after working for three months
and receiving only an insignificant fraction of his salaries. There was, therefore, not an abandonment of employment
nor a resignation in the real sense, but a constructive dismissal, which is defined as an involuntary resignation
resorted to when continued employment is rendered impossible, unreasonable or unlikely x x x. Consequently,
[Johnson] is entitled to reinstatement with full backwages. However, due to the strained relation between the parties,
which renders his reinstatement inadvisable, separation pay may be awarded in lieu of reinstatement.
10
Consequently, the petitioners elevated the NLRC decision to the CA by way of Petition for Certiorari with Prayer for
the Issuance of a Temporary Restraining Order and/or Writ of Preliminary Injunction under Rule 47.
In the assailed Resolution dated December 14, 2009, the CA dismissed the petition for lack of proof of authority
and affidavit of service of filing as required by Section 13 of the 1997 Rules of Procedure. The subsequent motion
for reconsideration filed by the petitioners was likewise denied by the CA in a Resolution dated February 11, 2010.
11
12
Undaunted, the petitioners filed before this Court the present Petition for Review on Certiorari, raising the following
issues, viz:
A.
THE HONORABLE [CA] COMMITTED A REVERSIBLE ERROR IN PROMULGATING ITS FIRST
RESOLUTION (DECEMBER 14, 2009) WHICH OUTRIGHTLY DISMISSED PETITIONERS PETITION FOR
CERTIORARI.
B.
THE HONORABLE [CA] COMMITTED A REVERSIBLE ERROR IN PROMULGATING ITS SECOND
RESOLUTION (FEBRUARY 11, 2010) WHICH DENIED FOR LACK OF MERIT PETITIONERS MOTION
FOR RECONSIDERATION.
C.
THE HONORABLE [CA] COMMITTED A REVERSIBLE ERROR IN NOT GIVING DUE CONSIDERATION
TO THE MERITS OF THE PETITIONERS PETITION AND IN NOT GRANTING THEIR PRAYER FOR
TEMPORARY RESTRAINING ORDER[.]
13
The petition is partially granted.

At its inception, the Court takes note of the Resolutions dated December 14, 2009 and February 11, 2010 of the CA
dismissing the Petition for Certiorari due to the following infirmities:
1. The affiant has no proof of authority to file the petition in behalf of petitioner Dreamland.
2. The petition has no appended affidavit of service to show proof of service of filing as required by Sec. 13
of the 1997 Rules of Civil Procedure.
14
To justify their stance that the CA should have considered the merits of the case, instead of dismissing merely on
procedural grounds, the petitioners cited numerous cases wherein the Court has decided to waive the strict
application of the Rules in the interest of substantial justice. While "[u]tter disregard of [the rules of procedure]
cannot justly be rationalized by harking on the policy of liberal construction," the Court recognizes badges of
15
16
inequity present in the case at bar, which would be seemingly branded with approval should the Court turn a blind
eye and dismiss this petition on procedural grounds alone.
"While it is desirable that the Rules of Court be faithfully observed, courts should not be so strict about procedural
lapses that do not really impair the proper administration of justice. If the rules are intended to ensure the proper
and orderly conduct of litigation, it is because of the higher objective they seek which are the attainment of justice
and the protection of substantive rights of the parties. Thus, the relaxation of procedural rules, or saving a particular
case from the operation of technicalities when substantial justice requires it, as in the instant case, should no longer
be subject to cavil."
17
Time and again, this Court has emphasized that procedural rules should be treated with utmost respect and due
regard, since they are designed to facilitate the adjudication of cases to remedy the worsening problem of delay in
the resolution of rival claims and in the administration of justice. "From time to time, however, we have recognized
exceptions to the Rules but only for the most compelling reasons where stubborn obedience to the Rules would
defeat rather than serve the ends of justice." "It is true that procedural rules may be waived or dispensed with in the
interest of substantial justice."
18
19
Brushing aside technicalities, in the utmost interest of substantial justice and taking into consideration the varying
and conflicting factual deliberations by the LA and the NLRC, the Court shall now delve into the merits of the case.
The petitioners contend that the employment of Johnson as operations manager commenced only on October 8,
2007 and not on August 1, 2007. However, the employment contract categorically stated that the "term of
employment shall commence on [August 1, 2007]." Furthermore, the factual allegations of Johnson that he actually
worked from August 1, 2007 were neither sufficiently rebutted nor denied by the petitioners. As Johnson has
specifically set forth in his reply before the LA:
Although the resort did not open until approximately 8th October 2007, [Johnsons] employment began, as per
Employment Agreement, on 1st August 2007. During the interim period[, Johnson] was frequently instructed by
[Prentice] to supervise the construction staff and speak with potential future guests who visited the site out of
curiosity. Other duties carried out by [Johnson] prior to [the] opening included the overall preparation of the guest
rooms for eventual occupation ensuring cracked tiles were replaced, ensuring grout was properly installed between
tiles, ensuring all lighting and air conditioning [were] functioning, measuring windows for curtain width, measuring
showers for shower curtain rods and installing shower curtains. Other duties included the unloading, carrying and
installation of mattresses, bedding[s], TVs, refrigerators and other furnishings and ironing curtains x x x.
20
Notably, it was only in their Motion for Reconsideration of the NLRC decision where the petitioners belatedly
disagreed that Johnson performed the abovementioned tasks and argued that had Johnson done the tasks he
enumerated, those were tasks foreign and alien to his position as operations manager and [were done] without their
knowledge and consent.
21
22
Nevertheless, Prentice did not deny that he ordered Johnson to speak with potential guests of the hotel. In fact, the
petitioners admitted and submitted documents which showed that Johnson has already taken his residence in the
hotel as early as July 2007a part of Johnsons remuneration as the hotel operations manager. In presenting such
documents, the petitioners would want to impress upon the Court that their act of accommodating Johnson was
merely due to his being a fellow Australian national.
23
As it could not be determined with absolute certainty whether or not Johnson rendered the services he mentioned
during the material time, doubt must be construed in his favor for the reason that "the consistent rule is that if doubt
exists between the evidence presented by the employer and that by the employee, the scales of justice must be
tilted in favor of the latter." What is clear upon the records is that Johnson had already taken his place in the hotel
since July 2007.
24
For the petitioners failure to disprove that Johnson started working on August 1, 2007, as stated on the employment
contract, payment of his salaries on said date, even prior to the opening of the hotel is warranted.
The petitioners also maintain that they have paid the amount of P7,200.00 to Johnson for his three weeks of service
from October 8, 2007 until November 3, 2007, the date of Johnsons resignation, which Johnson did not controvert.
25
Even so, the amount the petitioners paid to Johnson as his three-week salary is significantly deficient as Johnsons
monthly salary as stipulated in their contract is P60,000.00 . Thus, the amount which Johnson should have been
paid is P45,000.00 and not P7,200.00. In light of this deficiency, there is more reason to believe that the petitioners
withheld the salary of Johnson without a valid reason. If they indeed believed that Johnson deserves to be paid only
for three-week worth of service as operations manager, then they should still have paid him the amount due for
three weeks of work rendered.
26
Another argument posited by the petitioners is that the employment contract executed by the parties is inefficacious
because the employment contract is subject to the presentation of Johnson of his Alien Employment Permit (AEP)
and Tax Identification Number (TIN).
Again, this statement is wanting of merit.
Johnson has adduced proof that as a permanent resident, he is exempted from the requirement of securing an AEP
as expressed under Department Order No. 75-06, Series of 2006 of the Department of Labor and Employment
(DOLE), which we quote:
Rule I- Coverage and Exemption
xxxx
2. Exemption. The following categories of foreign nationals are exempt from securing an employment permit:
xxxx
2.7 Resident foreign nationals
Furthermore, Johnson submitted a Certification from DOLE Regional Office III, stating that he is exempted from
securing an AEP as a holder of Permanent Resident Visa. Consequently, the condition imposed upon Johnsons
employment, if there is any, is in truth without effect to its validity.
27
Anent the requirement of securing a TIN to make the contract of employment efficacious, records show that
Johnson secured his TIN only on December 2007 after his resignation as operations manager. Nevertheless, this
does not negate the fact that the contract of employment had already become effective even prior to such date.
28
In addition to the foregoing, there is no stipulation in the employment contract itself that the same shall only be
effective upon the submission of AEP and TIN. The petitioners did not present any proof to support this agreement
prior to the execution of the employment contract. In the case of Ortaez v. CA , the Court held:
29
Spoken words could be notoriously unreliable unlike a written contract which speaks of a uniform language. Thus,
under the general rule in Section 9 of Rule 130 of the Rules of Court, when the terms of an agreement were
reduced to writing, as in this case, it is deemed to contain all the terms agreed upon and no evidence of such terms
can be admitted other than the contents thereof. x x x. (Citations omitted)
30
As regards the NLRC findings that Johnson was constructively dismissed and did not abandon his work, the Court is
in consonance with this conclusion with the following basis:
Even the most reasonable employee would consider quitting his job after working for three months and receiving
only an insignificant fraction of his salaries. There was, therefore, not an abandonment of employment nor a
resignation in the real sense, but a constructive dismissal, which is defined as an involuntary resignation resorted to
when continued employment is rendered impossible, unreasonable or unlikely x x x.
31
The petitioners aver that considering that Johnson tendered his resignation and abandoned his work, it is his burden
to prove that his resignation was not voluntary on his part.
32
With this, the Court brings to mind its earlier ruling in the case of SHS Perforated Materials, Inc. v. Diaz where it
held that:
33
"There is constructive dismissal if an act of clear discrimination, insensibility, or disdain by an employer becomes so
unbearable on the part of the employee that it would foreclose any choice by him except to forego his continued
employment. It exists where there is cessation of work because continued employment is rendered impossible,
unreasonable or unlikely, as an offer involving a demotion in rank and a diminution in pay."
34
It is impossible, unreasonable or unlikely that any employee, such as Johnson would continue working for an
employer who does not pay him his salaries. Applying the Courts pronouncement in Duldulao v. CA , the Court
construes that the act of the petitioners in not paying Johnson his salaries for three months has become unbearable
on the latters part that he had no choice but to cede his employment with them. The Court quotes the pertinent
sections of Johnsons resignation letter which reflects the real reason why he was resigning as operations manager
of the hotel:
35
I hereby tender my resignation to you, Mr[.] Wes Prentice, Dreamland Resort, Subic, Zambales, Philippines.
Since joining Dreamland Resort & Hotel over three months ago I have put my heart and soul into the business. I
have donated many hours of my personal time. I have frequently worked seven days a week and twelve to thirteen
hours a day. I am now literally penniless, due totally to the fact that I have lent you and your resort/hotel well over
$200,000AU (approx 8million pesos) and your non-payment of wages to me from 1st August 2007 as per
Employment Agreement. x x x. (Emphasis and underscoring ours)
36
The above preceding statement only goes to show that while it was Johnson who tendered his resignation, it was
due to the petitioners acts that he was constrained to resign. The petitioners cannot expect Johnson to tolerate
working for them without any compensation.
Since Johnson was constructively dismissed, he was illegally dismissed. As to the reliefs granted to an employee
who is illegally dismissed, Golden Ace Builders v. Talde referring to Macasero v. Southern Industrial Gases
Philippines is instructive:
37
38
Thus, an illegally dismissed employee is entitled to two reliefs: backwages and reinstatement. The two reliefs
provided are separate and distinct. In instances where reinstatement is no longer feasible because of strained
relations between the employee and the employer, separation pay is granted. In effect, an illegally dismissed
employee is entitled to either reinstatement, if viable, or separation pay if reinstatement is no longer viable, and
backwages.
The normal consequences of respondents illegal dismissal, then, are reinstatement without loss of seniority rights,
and payment of backwages computed from the time compensation was withheld up to the date of actual
reinstatement. Where reinstatement is no longer viable as an option, separation pay equivalent to one (1) month
salary for every year of service should be awarded as an alternative. The payment of separation pay is in addition to
payment of backwages. (Emphasis and underscoring supplied)
39
The case of Golden Ace further provides:

"The accepted doctrine is that separation pay may avail in lieu of reinstatement if reinstatement is no longer
practical or in the best interest of the parties. Separation pay in lieu of reinstatement may likewise be awarded if the
employee decides not to be reinstated." x x x
Under the doctrine of strained relations, the payment of separation pay is considered an acceptable alternative to
reinstatement when the latter option is no longer desirable or viable. On one hand, such payment liberates the
employee from what could be a highly oppressive work environment. On the other hand, it releases the employer
from the grossly unpalatable obligation of maintaining in its employ a worker it could no longer trust.
1wphi1
40
In the present case, the NLRC found that due to the strained relations between the parties, separation pay is to be
awarded to Johnson in lieu of his reinstatement.
The NLRC held that Johnson is entitled to backwages from November 3, 2007 up to the finality of the decision;
separation pay equivalent to one month salary; and unpaid salaries from August 1, 2007 to November 1, 2007
amounting to a total of P172,800.00.
41
While the Court agrees with the NLRC that the award of separation pay and unpaid salaries is warranted, the Court
does not lose sight of the fact that the employment contract states that Johnson's employment is for a term of three
years.
Accordingly, the award of backwages should be computed from November 3, 2007 to August 1, 2010 - which is
three years from August 1, 2007. Furthermore, separation pay is computed from the commencement of employment
up to the time of termination, including the imputed service for which the employee is entitled to backwages. As
one-month salary is awarded as separation pay for every year of service, including imputed service, Johnson should
be paid separation pay equivalent to his three-month salary for the three-year contract.
42
WHEREFORE, the Resolutions dated December 14, 2009 and February 11, 2010 of the Court of Appeals in CAG.R. SP No. 111693 are hereby SET ASIDE. The Decision of the NLRC dated April 30, 2009 in NLRC LAC No. 07002711-08 is REINSTATED and AFFIRMED with MODIFICATIONS in the computation of backwages and separation
pay. Dreamland Hotel Resort and Westley Prentice are ORDERED to PAY Stephen Johnson backwages
of P60,000.00 per month which should be computed from November 3, 2007 to August 1, 2010 less the P.7,200.00
already paid to him. Likewise, separation pay of P180.000.00, representing Stephen Johnson's three-year contract
should be awarded.
SO ORDERED.

New Labor Cases

Caricato da

Informazioni sul documento

Copyright

Formati disponibili

Condividi questo documento

Condividi o incorpora il documento

Opzioni di condivisione

Hai trovato utile questo documento?

Questo contenuto è inappropriato?

Copyright:

Formati disponibili

New Labor Cases

Caricato da

Copyright:

Formati disponibili

G.R. No.

170139, August 05, 2014

Joy appealed36 to the National Labor Relations Commission.

(b) Gross and habitual neglect by the employee of his duties;

(e) Other causes analogous to the foregoing.

no protection; it creates no office; it is inoperative as if it has not been passed at all.85

(b) Suspension for not more than ninety (90) days; or

But it seems that we have not said enough.

G.R. No. 169247

Ruling of the Labor Arbiter

Nahas appealed to the NLRC.

Ruling of the Court of Appeals

The Parties Arguments

Aggrieved, Arriola elevated the LA decision before the NLRC.

Hence, this petition, anchored on the following

This is based on the cases of Sameer Overseas and PCL Shipping.

G.R. No. 195666

The Information reads:

Aggrieved, Abella appealed before the Court of Appeals.

Hence, the present appeal.

1. Salary is $400 excluding overtime. There is a probationary period of 3 months.

November 24, 2014

VILMA M. SULIMAN, Petitioner,

The factual and procedural antecedents of the case are as follows:

WHEREFORE, premises considered, the Court finds as follows:

Petitioner then filed an appeal with the CA.

Hence, the instant petition based on the following grounds:

The petition lacks merit.

April 20, 2015

WILHELMSEN-SMITH BELL MANNING/WILHELMSEN SHIP MANAGEMENT, LTD./ FAUSTO R. PREYSLER,

The Rulings on Compulsory Arbitration

The Courts Ruling

On the other hand, Rule X, Section 2 of the ECC Rules provides:

To reiterate, we find merit in the petition.

April 20, 2015

NICANOR CERIOLA, Petitioner,

1. The Labor Arbiter dismissed the complaint of petitioner:

April 20, 2015

DEL CASTILLO, J.:

Ruling of the Labor Arbiter (LA)

Ruling of the National Labor Relations Commission

Thus, the present Petition for Review on Certiorari.

April 15, 2015

DARIO A. CARCEDO (substituted by his wife PRISCILLA DELA CRUZ-CARCEDO), Petitioner,

On his follow-up consultation on 15 June 2009, Dr. Cruz noted that:

The Court of Appeals summarized the positions of the parties, thus:

the CBA further stated:

The Ruling of the Labor Arbiter

The Ruling of the Court of Appeals

Hence, this petition.

The Courts Ruling

Assessment of Disability Grading

Carcedos final disability assessment, yet he gave none.

Certification of Fitness for Sea Service

Moral and Exemplary Damages

PEOPLE OF THE PHILIPPINES, Appellee,

CRIM. CASE NO. 02-756

CRIM. CASE NO. 02-757

CRIM. CASE NO. 02-758

CRIM. CASE NO. 02-759

CRIM. CASE NO. 02-760

The Ruling of the Court of Appeals

October 17, 2013

ANDREW JAMES MCBURNIE, Petitioner,