G.R. No. 248445 - Dagasdas vs. Trans Global Maritime Agency, Inc.

Case Summary (G.R. No. 248445)

Factual Background

Trans Global hired Dagasdas on September 30, 2015 for and on behalf of Goodwood as Pumpman, with a stated basic monthly salary of US$783.00 and other remunerations. Dagasdas was a registered member of AMOSUP, and his employment was covered by a Collective Bargaining Agreement (CBA) executed between Goodwood (represented by Trans Global) and AMOSUP, specifically the AMOSUP/ITF TCCC NON-IBF CBA.
Before deployment, Dagasdas underwent a pre-employment medical examination and was found fit for sea duties without restriction. During the voyage in January 2016, he experienced shortness of breath, chest pain, dizziness, extreme fatigue, and fever. After informing the ship captain, he was advised to rest and await medical examination at the nearest port. Upon arrival in Fujairah, United Arab Emirates (UAE) on February 7, 2016, a doctor assessed his condition as serious and Dagasdas was repatriated on February 8, 2016.
Dagasdas arrived in the Philippines on February 9, 2016. The following day, Trans Global referred him to Marine Medical Services (MMS). MMS advised a computer tomography (CT) scan and chest x-ray. The CT scan results in February showed: “PTB WITH CAVITARY FORMATION, LEFT CONSOLIDATION PNEUMONIA, LEFT SUBSEGMENTAL ATELECTASIS VERSUS PARENCHYMAL FIBROSIS LEFT LOWER LOBE.” The March 2016 x-ray reading was “CONSIDER PNEUMONIA VERSUS KOCH’S INFECTION, LEFT SUGGEST CLINICAL CORRELATION AND FOLLOW-UP MINIMAL PLEURAL EFFUSION VERSUS PLEURAL THICKENING, LEFT.”
Based on these findings, MMS diagnosed Dagasdas with pulmonary tuberculosis and prescribed anti-tuberculosis medications and follow-ups. A last follow-up report dated August 12, 2016 stated that Dagasdas was on his sixth month of anti-Koch’s treatment and needed to continue medication, with further CT scan and x-ray monitoring.
On August 24, 2016, the company-designated physician, Dr. Percival P. Pangilinan, declared Dagasdas fit to work and issued a corresponding certificate. Dagasdas later sought redeployment, but Trans Global refused to deploy him due to the existing medical condition, notwithstanding the fit-to-work declaration.
Thereafter, Dagasdas consulted his doctor of choice, Dr. May S. Donato-Tan, who advised chest x-rays. The October 4, 2016 x-ray results led Dr. Donato-Tan to conclude that Dagasdas had developed chronic obstructive pulmonary disease (COPD) due to Koch’s pulmonary infection with cavitations, and she issued a certification of permanent disability. She reasoned that the condition was progressive, required continued medical treatment, and would impede his ability to effectively perform duties as a seafarer, including difficulty in breathing and fear of transmitting the disease to others.
Trans Global, through the employment process, thus declined redeployment despite the earlier company declaration of fitness, while Dagasdas persisted with medical treatment and ultimately invoked his disability claim.

Proceedings Before the Labor Tribunals and Voluntary Arbitration

Under the Single-Entry Approach (SEnA), Dagasdas initiated his disability-benefits claim against Trans Global. Trans Global refused to enter into settlement. Consequently, Dagasdas filed a Notice to Arbitrate on March 29, 2017 before the Regional Conciliation and Mediation Board-National Capital Region (RCMB NCR). The parties agreed to submit the matter to voluntary arbitration, with both required to file position papers.
In his position paper, Dagasdas asserted that despite the company physician’s fit-to-work declaration, he remained unemployed because Trans Global refused deployment on medical grounds. He also claimed that his medical condition did not improve despite medication, and he relied on Dr. Donato-Tan’s findings, including x-ray evidence that his pulmonary tuberculosis was not completely healed.
Trans Global responded that Dagasdas underwent medical testing and anti-tuberculosis treatment under MMS, that an interim disability assessment was issued as early as the fourth month, and that the company physician declared him fit to work on August 24, 2016, within the prescribed 240-day period from repatriation. Trans Global further argued that Dagasdas failed to comply with the mandatory conflict-resolution mechanism in the POEA-SEC, because he did not initiate the referral of conflicting assessments to a third doctor whose decision would be final and binding.

Ruling of the OVA

In its Decision dated April 4, 2018, the OVA held that Dagasdas was entitled to permanent total disability benefits under the AMOSUP/ITF TCCC NON-IBF CBA, awarding US$96,909.00. The OVA accorded greater weight to Dr. Donato-Tan’s findings than to the fit-to-work assessment of the company-designated physician. It reasoned that Dr. Donato-Tan’s diagnosis was supported by the x-ray results dated October 4, 2016, which indicated that the pulmonary tuberculosis remained existing and untreated.
The OVA also found that Dr. Donato-Tan explained why Dagasdas was no longer fit for sea service, emphasizing that continued on-board treatment was not feasible and that difficulty in breathing and stigma associated with the disease would isolate him from the crew due to fear of transmission.

Ruling of the Court of Appeals

Trans Global sought review before the Court of Appeals, which in its Decision dated March 6, 2019 largely sustained the OVA’s factual assessment regarding disability but modified the monetary award. The Court of Appeals held that Trans Global failed to present the August 18, 2016 reevaluation report and the CT scan and x-ray results supposedly conducted on August 12, 2016, that would have supported the fit-to-work declaration. It concluded that the company physician’s assessment lacked the supporting medical record and thus could not be accepted as credible. It reiterated that Dr. Donato-Tan’s permanent disability declaration relied on the latest October 4, 2016 x-ray findings.
However, the Court of Appeals ruled that while Dagasdas was entitled to permanent total disability benefits, the proper rate and basis should be under the POEA-SEC, awarding US$60,000.00, rather than under the CBA awarding US$96,909.00. It reasoned that the permanent medical unfitness clause in the CBA did not apply because the company physician did not issue a disability grading or a certification that Dagasdas was medically unfit to continue seafaring duties, and the required 50% disability or disability certification thresholds under the CBA were not shown to have been met. It further held that even if disability were assessed less than 50%, certification of permanent unfitness must be made by the company doctor, which it found not applicable.

The Parties’ Petitions and Issues for Resolution

The parties filed separate Petitions for Review on Certiorari under Rule 45, later consolidated by the Court. In G.R. No. 248445, Dagasdas prayed for reinstatement of the OVA award under the CBA of US$96,909.00. In G.R. No. 248488, Trans Global challenged the Court of Appeals’ rejection of the company physician’s assessment as a credible basis for fit-to-work certification, arguing for dismissal and/or denial of disability benefits as premature due to lack of compliance with the third-doctor referral mechanism.
The consolidated petitions presented three issues: (one) whether Dagasdas’s claim was premature and dismissible for failure to comply with the third doctor referral provision; (two) whether the company physician’s fit-to-work certification was medically sound; and (three) whether compensation should be determined under the CBA (US$96,909.00) or the POEA-SEC (US$60,000.00).

Legal Basis and Reasoning of the Supreme Court

The Court held in favor of Dagasdas and found error in the Court of Appeals’ treatment of the medical-dispute mechanism and the evidentiary weight of the medical findings.
On the alleged prematurity grounded on the third-doctor provision, the Court rejected Trans Global’s position that Dagasdas alone had the duty to refer the conflicting medical assessments. The Court emphasized that the submission to a third doctor must be jointly agreed by both employer and seafarer. It cited the unequivocal language of Article 20.1.3.2 of the AMOSUP/ITF TCCC NON-IBF CBA, which required joint agreement between the employer and the seafarer (and the seafarer’s union) for the third doctor, and that the third doctor’s decision would be final and binding. It also referenced Section 20(A)(3) of the POEA-SEC, which contained the same concept of joint agreement.
The Court explained that the POEA-SEC did not impose a specific period for seeking the third-doctor option and that the parties could do so even during mandatory conference before the labor tribunal. It further relied on its prior pronouncements in INC Navigation Co. Philippines, Inc., et al. v. Rosales and Bahia Shipping Services, Inc., et al. v. Constantino, stressing that when a seafarer challenges the company doctor’s assessment with the seafarer’s own doctor’s findings, the seafarer must signify the disagreement and notify the company; thereafter, the employer must activate the third-doctor process. The Court reinforced this allocation of burdens through its discussion in Ilustricimo v. NYK-Fil Ship Management, Inc., et al., where it held that upon being notified of the seafarer’s intent to dispute the company doctors’ findings, the burden to refer to a third doctor shifts to the employer, and a seafarer cannot be faulted for the non-referral if the employer fails to move the process.
Applying these principles, the Court found that no agreement to refer the case to a third doctor was reached. It recognized that Dagasdas filed a SEnA request for assistance, and he informed Trans Global of the conflicting assessments. Yet, Trans Global responded by stating that there was “no offer for settlement of disability benefits,” which the Court treated as an expression of refusal to refer the matter to a third doctor, effectively foreclosing the third-doctor avenue.
Giv

Case Syllabus (G.R. No. 248445)

Parties and Procedural Posture

Nicasio M. Dagasdas filed a Petition for Review on Certiorari under Rule 45 of the Rules of Court seeking reinstatement of the Office of the Voluntary Arbitrator (OVA) Decision awarding total and permanent disability benefits.
Trans Global Maritime Agency, Inc. filed a Petition for Review on Certiorari under Rule 45 assailing the Court of Appeals (CA) and challenging the reliance on Dr. Donato-Tan over the company-designated physician.
The two petitions were consolidated by the Court because they involved the same parties, issues, and assailed CA rulings.
The CA affirmed the OVA finding of total and permanent disability, but modified the monetary award by applying POEA-SEC benefits instead of the AMOSUP/ITF TCCC NON-IBF CBA schedule.
The matter originated from Single-Entry Approach (SEnA) proceedings, followed by a Notice to Arbitrate filed before the Regional Conciliation and Mediation Board-National Capital Region (RCMB NCR), culminating in the OVA arbitration award.

Employment Contract and Covered Agreements

Trans Global hired Dagasdas, for and on behalf of its foreign principal Goodwood Ship Management Pte. Ltd., as Pumpman on board the vessel Ridgebury Pride under a two-month contract.
The employment contract provided a basic monthly salary of US$783.00, among other remunerations.
As a member of AMOSUP, Dagasdas’ employment was covered by the Collective Bargaining Agreement (CBA) executed between Goodwood (represented by Trans Global) and AMOSUP/International Transport Workers’ Federation Total Crew Cost (ITF TCCC) NON-IBF CBA.
The Court treated POEA-SEC as incorporated into the seafarer’s employment contract as the minimum statutory requirements, while also recognizing the binding force of the parties’ CBA provisions.

Pre-Employment Medical Clearance

Prior to engagement, Dagasdas underwent a pre-employment medical examination and was declared fit for sea duties without any restriction.
This clearance formed the factual contrast for evaluating whether his later pulmonary condition was present or developed during employment.

Onboard Incident and Repatriation

In January 2016, while aboard the vessel, Dagasdas experienced shortness of breath, chest pain, dizziness, extreme fatigue, and fever.
He reported his condition to the ship captain, who advised him to rest and wait for arrival at the nearest port for medical examination.
Upon arrival at Fujairah, United Arab Emirates, on February 7, 2016, a doctor assessed his condition as serious and ordered repatriation.
He was repatriated the next day and returned to the Philippines on February 9, 2016.

Post-Repatriation Medical Evaluations

After repatriation, Dagasdas reported to Trans Global, which referred him to Marine Medical Services (MMS) for evaluation and management.
MMS required additional diagnostic tests, including a CT scan and a chest x-ray.
The CT scan showed PTB with cavitary formation, left consolidation pneumonia, left subsegmental atelectasis versus parenchymal fibrosis, in the left lower lobe.
The x-ray results showed findings consider pneumonia versus Koch’s infection, with clinical correlation and follow-up, and minimal pleural effusion versus pleural thickening on the left.
Based on these results, MMS diagnosed pulmonary tuberculosis and prescribed anti-tuberculosis medications with medical follow-ups.
The last follow-up report dated August 12, 2016 showed Dagasdas was on his sixth month of anti-Koch’s treatment and required continued medication and further CT scan and x-ray monitoring.
On August 24, 2016, the company-designated physician Dr. Percival P. Pangilinan issued a certificate declaring Dagasdas fit to work.

Conflict in Medical Assessments

Despite the fit-to-work declaration, Trans Global refused to deploy Dagasdas on account of his condition.
Dagasdas consulted his doctor of choice, Dr. May S. Donato-Tan, who ordered further chest x-ray views.
The October 4, 2016 x-ray led Dr. Donato-Tan to find the pulmonary tuberculosis was not completely healed, and she assessed permanent disability.
Dr. Donato-Tan diagnosed COPD (Chronic Obstructive Pulmonary Disease) secondary to Koch’s pulmonary with cavitation and opined that the condition was progressive and required continued treatment.
Dr. Donato-Tan also tied permanent disability to functional limitations, including difficulty of breathing and inability to perform effectively as a seafarer, with stigma and social isolation concerns stated in her medical assessment.

SEnA and Initiation of Arbitration

Dagasdas initiated a claim for disability benefits through the SEnA process and Trans Global declined settlement discussions.
Dagasdas filed a Notice to Arbitrate on March 29, 2017 before the RCMB NCR.
During arbitral proceedings, the parties agreed to submit the dispute to voluntary arbitration and filed position papers.

Parties’ Positions Before the OVA

Dagasdas argued that although he was declared fit to work, he remained unemployed because Trans Global refused deployment for medical reasons.
He asserted that his condition did not improve despite treatment and relied on Dr. Donato-Tan’s view that tuberculosis remained incompletely treated.
Trans Global claimed MMS monitored and treated Dagasdas with anti-tuberculosis medications, and it issued an interim disability assessment of Grade 12 during the fourth month of treatment.
Trans Global further claimed that in June 2016, the company-designated physician noted Dagasdas was asymptomatic and required completion of therapy, and that further CT scan and x-ray were required for objective assessment.
Trans Global maintained that within the 240-day period from repatriation, August 24, 2016, its physician declared Dagasdas fit to work, and it treated that declaration as conclusive.
Trans Global additionally alleged prematurity and noncompliance with the mandatory conflict resolution mechanism under POEA-SEC, based on Dagasdas’ failure to initiate the appointment of a third doctor.

OVA’s Decision and Basis for Disability

The OVA held that Dagasdas was entitled to permanent total disability benefits under the AMOSUP/ITF TCCC NON-IBF CBA, awarding US$96,909.00.
The OVA gave more weight to the findings of Dr. Donato-Tan than to the unsupported fit-to-work assessment of the company-designated physician.
The OVA reasoned that Dr. Donato-Tan’s diagnosis was supported by the October 4, 2016 x-ray showing that pulmonary tuberculosis remained existing and untreated.
The OVA accepted Dr. Donato-Tan’s explanation that continued onboard medical treatment could not be performed and that breathing difficulty and stigma would isolate Dagasdas from other crew members for fear of transmission.
The OVA awarded further benefits, including sickness allowances and attorney’s fees, in line with the parties’ contractual entitlements as found in the record.

CA’s Ruling and Modification

The CA affirmed the OVA’s disability conclusion, agreeing that the company-designated physician’s fit-to-work assessment lacked cred