Title
Maryville Manila, Inc. vs. EspiNo.
Case
G.R. No. 229372
Decision Date
Aug 27, 2020
Seafarer Lloyd Espinosa claimed disability benefits for mental health issues post-hostage incident. Courts ruled he failed to prove medical repatriation or timely reporting, denying benefits but granting P100,000 as humanitarian aid.
seafarer
repatriation
mental illnesses

Case Summary (G.R. No. 229372)

Factual Background

On September 12, 2010, Maryville Manila deployed Lloyd as a seafarer on board M/V Renuar for and in behalf of Maryville Maritime. From December 11, 2010 to April 23, 2011, Somali pirates held hostage the vessel and its entire crew. Lloyd was repatriated on May 5, 2011.

Lloyd was later re-hired. On January 10, 2012, he was deployed on board M/V Iron Manolis for a period of nine months, but he was repatriated after seven months, or on August 29, 2012.

Claim for Disability Benefits

On July 15, 2013, Lloyd filed a complaint for total and permanent disability benefits against Maryville Manila and Maryville Maritime before the labor arbiter. He alleged that he had been repatriated after suffering “flashbacks” of the hostage incident and a mental breakdown. He further asserted that Maryville Manila refused to provide him medical assistance upon his arrival in the Philippines. He consulted a clinical psychologist on February 12, 2013, and the psychologist diagnosed him with “Occupational Stress Disorder (Work-related); Hypomanic Mood Disorder, to consider; Bipolar Condition; R/O Schizophrenic Episode; and [Post-traumatic] Stress Disorder.” Lloyd claimed that these conditions rendered him permanently incapacitated to work as a seafarer.

Conversely, Maryville Manila and Maryville Maritime argued that Lloyd voluntarily disembarked from the vessel without any medical incident or accident. They also contended that Lloyd did not immediately report to the company-designated physician, and that he only visited the company in July 2013 to request another contract of employment.

Labor Arbiter’s Ruling

On February 28, 2014, the labor arbiter granted Lloyd’s claim for total and permanent disability benefits in the amount of USD 60,000.00 under the POEA-SEC, plus attorney’s fees of ten percent. The labor arbiter found the respondents’ allegation that Lloyd requested his early repatriation unsupported by evidence, noting that they could have presented pertinent documents such as the master’s report.

As to the reportorial requirement, the labor arbiter held that the requirement was only a condition sine qua non for claiming sickness allowance, and not for claiming total and permanent disability benefits. It reasoned that even assuming Lloyd failed to report within three days, any effect would amount only to waiver of sickness allowance, not of the disability claim.

NLRC’s Reversal

Both parties appealed. The National Labor Relations Commission (NLRC) reversed the labor arbiter on August 29, 2014 and dismissed Lloyd’s complaint. The NLRC held that Lloyd failed to establish that he was repatriated for medical reasons. It also ruled that the reportorial requirement applies to disability compensation claims as well. Lastly, it found no basis to relax the requirement in the absence of evidence that Lloyd was incapacitated from submitting to post-employment medical examination, or that he had submitted written notice to that effect.

CA Proceedings and Decision

Lloyd then filed a petition for certiorari before the CA, docketed as CA-G.R. SP No. 138222. On September 1, 2016, the CA reversed the NLRC decision and reinstated the labor arbiter’s award.

The CA relied on jurisprudence, including Baron, et al. v. EPE Transport, Inc., et al. and Barros v. NLRC, and stated that the burden rested on the employer to prove that Lloyd was not medically repatriated. The CA also invoked Career Philippines Shipmanagement, Inc., et al. v. Serna, reasoning that Lloyd sought medical examination but was refused. It further held that the labor tribunal’s conclusion was warranted where the evidentiary circumstances allegedly supported Lloyd’s version and where the employer failed to substantiate its contrary claim.

Issues on Certiorari to the Supreme Court

Maryville Manila moved for reconsideration before the CA, but the motion was denied. It then brought the matter to the Supreme Court, arguing that the CA erred in evaluating evidence in certiorari proceedings and insisting that Lloyd was neither repatriated for medical reasons nor refused medical treatment.

Supreme Court’s Disposition

The Supreme Court granted the petition. It reversed and set aside the CA Decision dated September 1, 2016 and reinstated the NLRC Decision dated August 29, 2014, with modification: Maryville Manila was ordered to pay Lloyd PHP 100,000.00 as financial assistance.

CA Authority in Certiorari, and the Limits of Burden of Proof

The Court first rejected Maryville Manila’s contention that the CA lacked authority to review the evidence. It held that, in labor cases, the CA may evaluate whether the NLRC gravely abused its discretion in disregarding evidence or in arriving at findings not supported by the record. Because the labor arbiter and the NLRC rendered conflicting factual findings, the Court ruled that it also had the authority to sift through the factual findings of the CA, the NLRC, and the labor arbiter when those findings conflicted.

Misapplication of Baron and Barros

The Court then held that the CA committed reversible error in concluding that Lloyd was medically repatriated and that the burden lay on the employer to prove the lack of medical repatriation. The Supreme Court emphasized that the CA misread Baron and Barros, which involved illegal dismissal cases.

The Court explained that Baron concerned illegal dismissal, where the employer bore the burden to prove a valid or authorized cause. Similarly, Barros involved a seafarer’s illegal dismissal-related claims, where the repatriation was part of the issue. The Court pointed out that Lloyd’s cause of action in the present case was not illegal dismissal or pre-termination of the overseas employment contract, but a claim for total and permanent disability benefits.

Accordingly, the Court ruled that the illegal dismissal burden of proof rule could not be unduly imported into determining whether a seafarer was repatriated for medical reasons. It further stated that Lloyd’s allegation that he was medically repatriated was an affirmative allegation, and thus the burden of proof rested on the party asserting it. The Court observed that a party who denies a fact has no proof of it, and therefore the evidentiary burden falls on the claimant for affirmative assertions.

Failure to Prove Medical Repatriation and Refusal of Examination

The Court agreed with the NLRC that Lloyd failed to discharge his burden of proving repatriation for medical reasons. The Court further found that the CA heavily relied on Career Philippines Shipmanagement, Inc. v. Serna in ruling that Lloyd was refused medical treatment. The Court held that Career Philippines Shipmanagement was materially different.

In Career Philippines Shipmanagement, the lower tribunals’ findings were unanimous that the seafarer reported to the company-designated physician within three working days from return, and the employer failed to provide a meaningful and timely examination. The Court contrasted this with Lloyd’s case, where there was no unanimous and definite finding that Lloyd timely reported to the company-designated physician. It noted that the labor arbiter brushed aside the reportorial issue by treating it as relevant only to sickness allowance. By contrast, the NLRC found that Lloyd failed to substantiate his allegations that he sought help for his purported condition and that such help was refused.

Thus, the Court concluded that Lloyd did not report to the company-designated physician, and he failed to present substantial evidence to prove his affirmative assertion. The employer, which denied the assertion, therefore had no burden to supply proof absent evidence of timely reporting and refusal.

Requirement of Reasonable Linkage and Correct POEA-SEC Provision

The Court also addressed the correct application of the POEA-SEC. It held that, in resolving disability claims, courts must integrate the POEA-SEC with the parties’ contract. It determined that Lloyd’s employment contract executed on January 10, 2012 was covered by the 2010 Amended Standard Terms and Conditions Governing the Overseas Employment of Filipino Seafarers On-Board Ocean-Going Ships.

The Court relied on Ventis Maritime Corporation v. Salenga, clarifying that Section 20-A of the POEA-SEC is irrelevant if the seafarer did not suffer illness or injury during the term of the contract. It reiterated the distinction between: (1) illness that manifests or is discovered during the term of employment, and (2) illness that manifests or is discovered after the seafarer disembarked.

The Court held that the CA erred in relying on Section 20(A) because Lloyd’s illness was diagnosed after the term of the contract. It explained that when illness manifests after the contract, the claim must proceed under the framework for occupational illnesses under Section 32-A or, for illnesses not listed there, under the rule on a reasonable link between the disease and the nature of work.

Application of Section 32-A Framework and Failure to Establish Link

The Court noted that Lloyd’s diagnosed conditions—“Occupational Stress Disorder (Work-related),” hypomanic mood disorder, bipolar condition, possible schizophrenic episode, and post-traumatic stress disorder—were not listed as occupational illnesses under Section 32-A. Therefore, Lloyd had to prove the reasonable linkage between his illnesses and the nature of his work.

The Court held that Lloyd failed this linkage test. It pointed out that Lloyd claimed the relevant hostage period as from December 11, 2010 to April 23, 2011. Yet the clinical report stated a different date of incidence, placing the piracy in February 2012 and stating that Lloyd and fellow seamen were hostage during that period. The Court treated this discrepancy as relevant to the evidentiary weakness of Lloyd’s claim.

The Court further found no substantial evidence linking the risk of hostage conditions to the specific illnesses, emphasizing that piracy is a risk confronting all seafarers during v

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