G.R. No. L-28554 - Unno Commercial Enterprises, Inc. vs. General Milling Corp.

Armando L. Salazar was employed on 11 April 2003 as an Able Seaman by petitioner Sea Power Shipping Enterprises, Inc. (as agency) on behalf of Atlantic Bulk Carriers Limited for a term of nine months with a three‐month consented extension.
Prior to his embarkation on 20 April 2003 aboard the M/V Magellan, Armando had successfully passed his pre-employment medical examination and was declared fit to work.
After completing 17 months of service, Armando’s contract ended and he repatriated on or about 8–9 September 2004.

Shortly after repatriation, Armando was admitted to Tanza Family General Hospital and confined at the Intensive Care Unit (ICU) for three days due to pneumonia.
Because of his hospitalization, he did not undergo the mandatory Post-Employment Medical Examination (PEME) within 72 hours as required under the 2005 POEA Standard Employment Contract for Seafarers.
A few days into his confinement, respondent Nenita P. Salazar (Armando’s widow) contacted petitioners to claim insurance benefits, but her request was denied on the grounds of the absence of the requisite PEME.

Armando’s health continued to decline, leading to admissions in several hospitals. In October 2004, he was transferred to the Philippine General Hospital, where he was diagnosed with lung carcinoma accompanied by brain metastases.
On 1 March 2005, Armando succumbed to metastatic lung carcinoma, the cause of death being cardio-respiratory arrest secondary to acute respiratory failure and multi-organ failure.

Respondent initiated a collection suit before the Labor Arbiter (LA) for seafarer benefits under Section 20 of the POEA Contract, claiming hospitalization and medical expenses, death benefits, minor child’s allowance, burial expenses, moral damages, and attorney’s fees.
The LA denied all claims on the basis that for benefits to be valid under the POEA Contract:

The death or illness must have occurred during the term of the seafarer’s contract.
The seafarer must have undergone the mandatory PEME upon repatriation.

The National Labor Relations Commission (NLRC) later reversed the LA’s decision on the illness benefits, awarding respondent medicine and hospitalization expenses, sickness allowance, moral damages, and attorney’s fees. However, death benefits were not granted by the NLRC since Armando died six months after repatriation.

On appeal via Rule 65, respondent challenged the denial of death benefits, minor child’s allowance, and burial expenses. The CA, relying in part on the case of Wallem Maritime Services, Inc. v. NLRC, inferred that:

Armando was initially declared fit to work.
His exposure to hazardous work conditions (allegedly working in the cargo section) and subsequent confinement in the ICU indicated that his fatal illness was work-related.
The proximity between his ICU confinement shortly after repatriation and his eventual death justified a presumption of a work-related causation despite the expiration of his contractual term and the absence of a timely PEME.

The CA ruled in favor of respondent by granting additional death benefits (USD 50,000), minor child’s allowance (USD 7,000), and burial expenses (USD 1,000), in addition to the NLRC awards.
Petitioners filed motions for reconsideration, arguing both the lack of conclusive evidence establishing that the illness was work-related and that death benefits should be strictly limited to illnesses and injuries occurring during the contract term. These motions were denied at the CA level.

Petitioner’s Rule 45 petition questioned the CA’s reliance on presumptions and its failure to properly address the evidentiary requirements under the POEA Contract concerning work-related causality.
The Supreme Court reviewed whether the CA correctly held that the LA and NLRC had erred in not awarding death benefits when the seafarer’s fatal illness manifested after the termination of his contract.

Whether a seafarer’s death due to a work-related illness, which manifested post-repatriation and after the expiration of the employment contract, is compensable under the POEA Contract.
Whether the absence of the mandatory Post-Employment Medical Examination (PEME) within 72 hours from repatriation precludes the granting of illness and death benefits.
Whether the legal presumption under Section 20(B)(4) of the POEA Contract, which characterizes certain illnesses as work-related, applies to Armando’s lung cancer in the absence of substantial and corroborative evidence.
Whether the CA erred in relying primarily on circumstantial inferences—such as the proximity of ICU confinement and subsequent death—to override the strict provisions of Section 20(A) regarding the period of employment.