G.R. No. 255802 - One Shipping Corporation vs. Heirs of the Late Ricardo R. Abarrientos

Case Summary (G.R. No. 255802)

Factual Background Relating to Employment and Death

Petitioner hired Ricardo as Chief Officer for a nine-month period aboard M/V “Dyna Crane,” but Ricardo was repatriated on February 20, 2014. Ricardo executed an Affidavit of Receipt, Release, Waiver, and Quitclaim on April 14, 2014 evidencing receipt of his final salary and benefits and indicating full release from further claims.

Respondents alleged that after his early return, Ricardo’s illness was connected to his work conditions. According to respondents, six months after arriving—on August 19, 2014—Ricardo was hospitalized in Cagayan de Oro for pancreatic cancer that later metastasized, and that he died on September 3, 2014.

Respondents further narrated work-related incidents that allegedly preceded Ricardo’s hospitalization and death. They claimed that in December 2013, Ricardo experienced dizziness and an upset stomach while manning the vessel in inclement weather and rough seas for two days without rest. They alleged that Ricardo requested a medical check-up but was denied, with the Master advising pain relievers instead. Respondents also alleged recurrence of severe stomach pain on February 10, 2014, and that Ricardo was allowed to disembark only on February 18, 2014. Upon arrival, they alleged petitioner refused to refer Ricardo to the company-designated physician for post-employment medical examination because Ricardo’s principal had not approved his medical treatment. Respondents claimed Ricardo was compelled to seek treatment from his personal doctor in Cagayan de Oro. They also asserted that they demanded death benefits but petitioner refused or ignored their demands.

Respondents’ Complaint and Petitioner’s Denials

On March 2, 2018, respondents initiated a complaint against petitioner before the Panel of Voluntary Arbitrators, asserting entitlement to death benefits under the CBA. They maintained that Ricardo’s death was work-related because he was allegedly declared fit to work before embarkation and then exposed to the sea’s harsh conditions and perils, including stress due to being away from family and long hours of duties.

Petitioner denied liability. It asserted that Ricardo’s repatriation was due to a valid pre-termination of contract when the vessel was sold, as reflected in Ricardo’s service records, and that Ricardo completed the contract without any recorded medical issue aboard the vessel. Petitioner emphasized that Ricardo did not submit himself to any mandatory post-employment examination and that, after repatriation, Ricardo reported to petitioner on April 14, 2014 to receive his final salary and benefits, as proven by the quitclaim.

On prescription, petitioner argued that respondents’ claim was filed more than three years after Ricardo’s death, and thus it was already barred under the applicable prescriptive rules for money claims arising from employer-employee relations.

Panel of Voluntary Arbitrators: Award of Death Benefits and Treatment of Prescription and Medical Examination

The Panel, by a 2-1 vote, granted respondents’ claim. It ordered petitioner to pay respondents death benefits, burial expenses, minor child’s benefits, and attorney’s fees.

As to prescription, the Panel applied Article 291 of the Labor Code and reasoned that respondents’ cause of action accrued not on Ricardo’s death on September 3, 2014, but on petitioner’s alleged denial of the claim on September 3, 2015. The Panel thus held that the complaint filed on March 2, 2018 was still within the three-year period.

Regarding the alleged failure to undergo a post-employment medical examination within three days from repatriation, the Panel relied on respondents’ allegation that Ricardo immediately reported to petitioner upon arrival but was refused the medical examination. Consequently, the Panel held that the lack of post-employment medical examination could not be taken against respondents.

On compensability, the Panel concluded that Ricardo’s death was caused by a work-related illness. It relied primarily on respondents’ allegations that Ricardo was already ill before disembarkation and on the view that as Chief Officer he was the “most burdened personnel of the vessel” and was exposed to chemicals emitted by machinery and equipment, which allegedly decreased stamina and made him susceptible to the disease that caused his death.

Court of Appeals: Affirmance in Full

On appeal, petitioner insisted that the evidence on record did not support the Panel’s factual conclusions and that the findings were based on conjectures and misapprehensions. The Court of Appeals, in its October 30, 2020 Decision, affirmed the Panel’s ruling in its entirety. It later denied reconsideration in the February 5, 2021 Resolution.

Petitioner then proceeded to the Supreme Court via Rule 45, acknowledging that it raised factual issues but invoking exceptions, particularly that the Panel’s and CA’s conclusions were allegedly not supported by substantial evidence and were grounded on speculation.

Issues Presented to the Supreme Court

The Supreme Court identified the primordial question as whether the CA committed a reversible error in sustaining the grant of death benefits. This question necessarily involved two interrelated matters: first, whether respondents’ claim was filed within the prescriptive period; and second, whether Ricardo’s death was compensable under the CBA and the POEA-SEC.

Supreme Court’s Standards for Review Under Rule 45

The Court recognized that the petition assailed common factual conclusions of the Panel and the CA, which would ordinarily require re-examination of the record. Under Rule 45, factual review is generally not the function of the Court. However, the Court held that the rule admits exceptions when, among others, the findings are grounded entirely on speculation, involve misapprehension of facts, or are unsupported by specific evidence. The Court applied this framework and found that the Panel’s and CA’s conclusions, though consistent, were grounded on mere surmises and were not supported by the evidence on record. Accordingly, the Court treated factual reassessment as proper to resolve both the legal and factual underpinnings of compensability and prescription.

Legal Analysis on Prescription of the Death Benefits Claim

The Court first addressed prescription and held that respondents’ claim was already barred under Article 291 of the Labor Code and Section 30 of the POEA-SEC, both requiring filing within three (3) years from the accrual of the cause of action, otherwise the claim is forever barred.

The Panel had held that the cause of action accrued upon petitioner’s alleged denial on September 3, 2015, reasoning that only then could petitioner be deemed to have breached its obligation. The Supreme Court rejected that approach. It invoked Article 1150 of the Civil Code, explaining that time for prescription counts from the day the action may be brought.

The Court treated the death benefits obligation as arising from the employment contract, the CBA provisions, and the POEA-SEC. It cited Article 29.1 of the CBA, which provided that if a seafarer dies through any cause whilst in the employment—including natural causes or death occurring while traveling to and from the vessel—the company shall pay the sums specified. It also cited Section 20-B(1) and Section 20-D of the POEA-SEC, which required payment for work-related death during the term of the contract and allowed proof by the employer to attribute death directly to the seafarer. The Court emphasized that the agreed stipulations made the obligation demandable upon the seafarer’s demise, meaning the employer’s omission to pay upon death constituted breach and gave rise to the cause of action.

Therefore, the Court held that the prescriptive period for death benefits starts from the seafarer’s death, which in this case was September 3, 2014. It added that in cases where death occurs after contract ends but is still considered “while in employment,” the same rule applies because the operative fact giving rise to the claim remains the seafarer’s death.

The Court further held that none of the interruptions under Article 1155 of the Civil Code applied. Interruption would require a filing in the proper forum, a written extrajudicial demand, or a written acknowledgment of debt. The Court found the complaint was filed only on March 2, 2018, which was beyond three years from September 3, 2014. It also found no evidence of a written extrajudicial demand or written acknowledgment. Respondents’ claims of demands were treated as unsubstantiated, and the Court reiterated evidentiary doctrine that a party making an affirmative allegation bears the burden of proving it, and mere allegation is not evidence.

The Court criticized both the Panel and the CA for omitting discussion on why the lack of proof of alleged timely demands was disregarded. It thus declared that respondents’ claim should have been dismissed for prescription alone.

Legal Analysis on Compensability Under the CBA and the POEA-SEC

Even assuming the claim was not dismissed on prescription, the Court held it was still dismissible for failure to substantially prove compensability of Ricardo’s death.

The Court explained that entitlement to death benefits under the CBA required that the seafarer’s death occur while in the company’s employment, and it examined the relevant CBA provisions. Article 29.1 provided for death benefits when a seafarer dies through any cause whilst in employment, with exclusions for death due to willful acts. Article 29.3 clarified that a seafarer is regarded as “in the employment” for purposes of the clause for up to the period where the CBA’s provisions on medical examination apply, conditioned on death directly attributable to sickness or injury that caused termination in accordance with Article 22.1(b).

The Court then examined the CBA’s medical-related structure. Article 22.1(b) linked termination due to si

Case Syllabus (G.R. No. 255802)

One Shipping Corporation (petitioner) was a domestic corporation engaged in the crewing and recruitment of Filipino seafarers.
Heirs of the late Ricardo R. Abarrientos as represented by Romana R. Abarrientos (respondents) claimed entitlement to death benefits under the IBF JSU/AMOSUP IMMAJ Collective Bargaining Agreement (CBA).
The dispute reached the Supreme Court via a Petition for Review on Certiorari under Rule 45, assailing the Court of Appeals (CA) rulings that affirmed the Panel of Voluntary Arbitrators (Panel).
The Supreme Court treated the case as a proper occasion to re-examine factual conclusions because the challenged findings were grounded on speculation and lacked evidentiary support.

Parties and Procedural Posture

Petitioner and respondents were bound by the employment terms implementing the CBA and the POEA-SEC.
Respondents initiated proceedings before a labor arbitral forum after grievance steps within AMOSUP failed to yield a settlement.
The Panel rendered a Decision dated June 21, 2019 granting the death benefits claim with a specific monetary award and attorney’s fees.
Petitioner sought reconsideration, but the Panel denied it through a Resolution dated August 30, 2019.
The CA affirmed the Panel’s award in a Decision dated October 30, 2020, and later denied petitioner’s motion for reconsideration in a Resolution dated February 5, 2021.
Petitioner filed the present Rule 45 petition, acknowledging that factual issues were generally improper, but invoking exceptions grounded on insufficient evidentiary support.

Key Factual Allegations

Petitioner hired Ricardo R. Abarrientos as Chief Officer aboard M/V “Dyna Crane” for nine months, but Ricardo was repatriated earlier on February 20, 2014.
Ricardo executed an Affidavit of Receipt, Release, Waiver, and Quitclaim on April 14, 2014, evidencing receipt of full final salary and benefits and absence of further claims.
About six months after arrival or on August 19, 2014, Ricardo was hospitalized in Cagayan de Oro and was diagnosed with pancreatic cancer that metastasized to the liver and lungs.
Ricardo died on September 3, 2014 due to liver cirrhosis.
Respondents filed a complaint on March 2, 2018, asserting Ricardo’s death was work-related and compensable under the CBA.
Respondents alleged that Ricardo was declared fit before embarkation and that stressful and hazardous conditions at sea contributed to illness and death.
Respondents narrated an incident in December 2013 when Ricardo experienced dizziness and an upset stomach while manning the vessel amid inclement weather and rough seas, and alleged denial of medical check-up at the nearest port.
Respondents further alleged recurrence of pain on February 10, 2014, limited permission to disembark on February 18, 2014, and petitioner’s alleged refusal to refer Ricardo to a company-designated physician upon arrival.
Respondents claimed they made demands for payment after Ricardo’s death, including a demand through a letter dated February 25, 2015 and another demand on September 3, 2015, but were allegedly rejected.
Petitioner denied liability and argued that Ricardo was not medically repatriated but repatriated due to contractual termination following the sale of the vessel, and that Ricardo reported only to receive final wages and benefits with no post-employment medical examination.
Petitioner asserted that the claim was prescribed for being filed more than three years from Ricardo’s death.

Issues Framed

The primordial issue was whether the CA committed reversible error in sustaining the grant of death benefits.
The issues were interrelated and required determination of:
- Whether respondents filed their claim within the applicable prescriptive period; and
- Whether Ricardo’s death was compensable under the CBA and the 2010 POEA-SEC.

Rule on Factual Review

The Supreme Court recognized that Rule 45 generally restricts review to questions of law.
The Court acknowledged exceptions when the factual findings are not supported by the record or are otherwise defective.
The Court cited Internal Rules of the Supreme Court (Rule 3, Section 4) instances allowing review of factual issues, including findings grounded entirely on speculation, misapprehension of facts, conflicting findings, and conclusions without citation of specific evidence.
The Court held that it is bound by factual findings only when sufficiently supported by evidence and when the deduction from evidence is not arbitrary or unfair.
The Court concluded that the Panel and CA findings, though uniform, were grounded on surmises and were not supported by evidence, justifying review.

Applicable Law and Contract Provisions

The Court identified death benefits entitlement as governed by law, the CBA, and the 2010 POEA-SEC integrated into the employment contract as it sets minimum acceptable terms.
For prescription of money claims, the Court relied on Article 291 of the Labor Code providing a three-year period from accrual of the cause of action.
For prescription under the employment contract, the Court cited Section 30 of the POEA-SEC stating that all claims arising from the contract must be made within three years from the date the cause of action arises.
The Court also invoked Article 1150 of the New Civil Code, which provides that when no special provision applies, prescription is counted from the day the action may be brought.
For interruption of prescription, the Court applied Article 1155 of the New Civil Code, recognizing interruption by filing before the court, written extrajudicial demand, or written acknowledgment of debt.

Prescriptive Period Governing Death Benefits

The Court treated death-benefit claims as money claims arising from the employer-employee relationship governed by Article 291 of the Labor Code and consistent with Section 30 of the POEA-SEC.
The Court used the three-element concept of a cause of action: legal right, corresponding duty, and an act or omission violating the right.
The Panel and CA had ruled that accrual occurred on petitioner’s alleged denial of the claim on September 3, 2015 rather than upon Ricardo’s death.
The Supreme Court rejected that approach and held that the prescriptive period started to run from Ricardo’s death because the agreed CBA and POEA-SEC stipulate that d