Title
Sestoso vs. United Philippine Lines, Inc.
Case
G.R. No. 237063
Decision Date
Jul 24, 2019
Seafarer with pre-existing knee injury aggravated by strenuous work duties; company failed to issue final disability assessment within 240 days, deemed total/permanent disability.
seafarer
timely disability assessment
labor arbiter

Case Summary (G.R. No. 237063)

Facts Giving Rise to the Claim

Petitioner alleged that on July 2014, respondent UPLI, in behalf of its foreign principal Carnival Cruise Lines, hired him as Team Headwaiter on board M/V Carnival Inspiration for a six-month term. On October 31, 2014, while performing his usual cleaning duties at the dining table, he knelt and experienced sharp pain radiating down his right knee. After the vessel docked at Los Angeles, California, he underwent a shore-side Magnetic Resonance Imaging (MRI). The MRI allegedly showed a complex tear of the medial meniscus and degenerative joint changes, and it also revealed the arthroscopy or knee surgery he had in February 2014.

Petitioner continued working while taking pain relievers until he finished his contract and was repatriated on February 13, 2015. Upon arrival, company-designated physician Dr. Mylene Cruz-Balbon examined and treated him, and eventually referred him to orthopedic surgeon Dr. William Chuasuan, Jr. On June 25, 2015, Dr. Chuasuan, Jr. recommended surgery and suggested a disability rating corresponding to Grade 10 stretching of knee ligaments, and opined that petitioner had reached the maximum medical improvement level. In a Medical Report dated June 25, 2015, Dr. Cruz-Balbon noted and referred to Dr. Chuasuan, Jr.’s findings and recommendation.

On July 28, 2015, Dr. Cruz-Balbon issued a certification and a letter bearing her final diagnosis as of June 4, 2015, stating Osteoarthritis, Medial Meniscal Tear, Right Knee; S/P Arthroscopic Partial Menisectomy and Debridement of Osteophytes, Right Knee. The Court noted that neither the documents dated July 28, 2015 included any disability rating or any certificate of fitness to work. Dr. Cruz-Balbon ceased providing medical treatment starting June 26, 2015, even though petitioner allegedly needed further treatment. Critically, neither Dr. Cruz-Balbon nor Dr. Chuasuan, Jr. gave petitioner a final and definite disability rating within the legally prescribed period.

Because the company-designated assessment remained incomplete, petitioner consulted another orthopedic physician, Dr. Victor Gerardo E. Pundavela, who diagnosed Severe Degenerative Osteoarthritis on the right knee, Degenerative Osteoarthritis on the left knee, and a Medial Meniscal Tear, right knee s/p Arthroscopic Meniscectomy and Debridement. Dr. Pundavela assessed petitioner as partially and permanently disabled/unfit to work as a seafarer.

Respondents countered that petitioner was not entitled to disability benefits because the recurring knee pain was a pre-existing illness, which they contended was not compensable. They argued, in the alternative, that if any benefit were due, petitioner’s entitlement should be limited to Grade 10, as recommended by Dr. Chuasuan, Jr., and that they offered Grade 10 benefits out of goodwill. They further asserted that petitioner refused to accept the offered Grade 10 benefits.

Labor Arbiter and NLRC Dispositions

In the Decision dated May 24, 2016, the Labor Arbiter awarded petitioner Grade 10 disability benefits. The Labor Arbiter ruled that although the illness was found to be pre-existing, petitioner remained entitled to the Grade 10 grading given by the company-designated doctor, emphasizing that Dr. Cruz-Balbon closely monitored and treated him for months.

On appeal, the NLRC awarded petitioner permanent and total disability benefits through its Decision dated August 31, 2016. The NLRC held that the grading assigned by Dr. Cruz-Balbon was merely a suggestion and was therefore not a valid and final disability assessment. It further ruled that Dr. Cruz-Balbon’s failure to issue a definite and final disability assessment within the two hundred forty (240) days rendered petitioner’s disability permanent and total. The NLRC ordered respondents to pay petitioner US$60,000.00 plus ten percent (10%) attorney’s fees. Respondents’ motion for reconsideration was denied by the Resolution dated December 22, 2016.

Proceedings in the Court of Appeals

Respondents then sought certiorari from the Court of Appeals, arguing that petitioner’s illness was not compensable due to its pre-existing character and that petitioner failed to allege and prove that his condition was aggravated by his working conditions. They also argued that if the illness were compensable at all, the applicable disability rating should be Grade 10 consistent with the POEA Contract schedule. They further contended that the award of attorney’s fees was improper for lack of evidence of bad faith.

The Court of Appeals reversed the NLRC. In its Decision dated August 24, 2017, it ruled that petitioner’s disability was not compensable because it was a pre-existing illness, namely Osteoarthritis. The Court of Appeals added that petitioner allegedly failed to allege and prove aggravation by employment conditions, and it concluded that the 120/240-day window was inapplicable. Petitioner’s motion for reconsideration was denied in a Resolution dated January 25, 2018.

Parties’ Contentions Before the Supreme Court

Petitioner sought reversal of the Court of Appeals’ dispositions, insisting that his illness was work-related and compensable. He argued that the company-designated physician’s Grade 10 disability rating demonstrated work-relatedness. He also maintained that he should be awarded total and permanent disability benefits because the company-designated physician failed to issue a definite and final disability assessment within the 120/240-day window.

Respondents insisted that petitioner was not entitled to disability benefits because his illness was pre-existing and, in their view, not work-related and thus not compensable. They maintained that consequently, the 120/240-day window did not apply. They also argued that at most, petitioner was entitled only to disability benefits corresponding to Grade 10.

Legal Issues Framed for Resolution

The central question before the Supreme Court was whether the Court of Appeals committed reversible error in denying petitioner’s claim for total and permanent disability benefits, considering (a) the alleged pre-existing nature of the illness and the purported lack of proof of aggravation, and (b) the consequences of the company-designated physician’s failure to issue a final and definite disability assessment within the required period.

Legal Basis and Reasoning of the Supreme Court

The Supreme Court ruled for petitioner and set aside the Court of Appeals.

On compensability despite alleged pre-existence, the Court relied on More Maritime Agencies, Inc. v. NLRC. It held that compensability does not turn on whether the injury or ailment existed prior to employment. Instead, the controlling factor was whether the disease or injury was work-related or had aggravated the seafarer’s condition. The Court emphasized that prior physical condition was not decisive when the work-related occurrence or aggravation was the proximate cause of the sought disability benefits.

The Court then addressed the burden of proof. Under the 2010 POEA-SEC, the Court noted that “any sickness resulting in disability or death as a result of an occupational disease listed under Section 32-A” with the conditions therein satisfied was deemed work-related. It further pointed to Section 20 (A) (4), which provides that illnesses not listed in Section 32 are disputably presumed work-related. The Court explained that this statutory presumption placed the burden on the employer, not the seafarer, to disprove work-relatedness by substantial evidence.

However, the Court drew a doctrinal distinction between work-relatedness and compensability. It relied on the explanation in Atienza v. Orophit, holding that the presumption under Section 20 (B) (4) was limited to work-relatedness and did not extend to compensability. Thus, while the seafarer benefited from a presumption on work-relatedness, the seafarer still had to prove by substantial evidence that the conditions for compensability were satisfied. The Court noted that this requirement applied both to listed occupational diseases and non-listed illnesses.

Applying these doctrines, the Court found that respondents mainly relied on alleged pre-existence yet failed to refute the presumption of work-relatedness or aggravation attributable to petitioner’s work. It observed that both the company-designated physician and Dr. Chuasuan, Jr. agreed that petitioner suffered Osteoarthritis and that he was repatriated after finishing his contract. The Court treated Osteoarthritis as a listed occupational disease which, under Section 32-A of the 2010 POEA-SEC, is presumed work-related but requires satisfaction of the conditions for compensability.

The Court discussed the occupational-risk criteria under Section 32-A (21) for Osteoarthritis, including joint strain from heavy loads or unduly heavy labor, minor or major joint injuries, excessive use or constant strenuous usage of a particular joint, extreme temperature changes, and faulty work posture or use of vibratory tools. In support, the Court cited Centennial Transmarine, Inc. V. Quiambao, where it had ruled that carrying heavy loads and other strenuous activities could reasonably lead to the conclusion that Osteoarthritis was caused or aggravated by work. It also cited De Leon v. Maunlad Trans., Inc., where it considered a headwaiter’s work as a contributory factor in developing the illness due to symptoms manifesting during employment.

The Court then analyzed petitioner’s specific job functions as headwaiter, which included carrying heavy food provisions; cleaning the galley, pantries, and store rooms; washing, cleaning, and preparing tables; serving food; restocking supplies in pantries; and exposure to extreme temperature changes. It reasoned that these tasks supported the conclusion that osteoarthritis could be considered as having arisen during employment either by direct causation or by aggravation. The Court also noted petitioner’s long exposure to the same risks, including durin

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