Republic of the Philippines
SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 180719 August 22, 2008
CENTENNIAL TRANSMARINE, INC., CENTENNIAL MARITIME SERVICES CORPORATION AND/OR B+H EQUIMAR SINGAPORE, PTE. LTD., petitioners,
vs.
RUBEN G. DELA CRUZ, respondent.
D E C I S I O N
YNARES-SANTIAGO, J.:
This petition for review on certiorari assails the August 31, 2007 Decision1 of the Court of Appeals in CA-G.R. SP No. 91054 reversing the Decision of the National Labor Relations Commission and finding that respondent Ruben G. Dela Cruz was illegally dismissed from service, as well as the November 16, 2007 Resolution2 denying the motion for reconsideration.
On May 9, 2000, petitioner Centennial Transmarine, Inc., for and in behalf of its foreign principal, petitioner Centennial Maritime Services, Corp., hired respondent Dela Cruz as Chief Officer of the oil tanker vessel "MT Aquidneck," owned by petitioner B+H Equimar, Singapore, Pte. Ltd., for a period of nine months.
On May 15, 2000, respondent boarded "MT Aquidneck" and performed his functions as Chief Officer. However, on September 14, 2000, respondent was relieved of his duties and repatriated to the Philippines. Failing to get a satisfactory explanation from petitioners for his relief, respondent filed a complaint for illegal dismissal with prayer for payment of his salaries for the unexpired portion of contract, moral and exemplary damages and attorney’s fees on October 7, 2000.
Respondent alleged that while the vessel was docked in Lake Charles in the United States, another Chief Officer boarded the vessel. He inquired from the master of the vessel, Captain Kowalewski, why he had a reliever, however the latter disclaimed any knowledge. At the same time, he showed respondent an electronic mail (e-mail) from petitioner B+H Equimar Singapore, Pte. Ltd. stating that there was an incoming Chief Officer who was to take over the operations upon boarding.
On September 19, 2000, Captain Kowalewski gave respondent his flight schedule. He was subsequently repatriated on September 22, 2000.3
Upon arrival in Manila, respondent inquired from Mr. Eduardo Jabla, President of petitioner Centennial Transmarine, Inc., why he was relieved. However, Jabla could only surmise that his relief was possibly due to the arguments he had with Capt. P. Bajaj, a company superintendent who came on board in August 2000 while the vessel was berthed in Los Angeles,4 regarding deck operations and deck work, and documentation and safety procedures in the cargo control room.5
On the other hand, petitioner alleged that respondent was relieved of his functions as Chief Officer due to his inefficiency and lack of job knowledge. Capt. Kowalewski allegedly informed them of respondent’s lack of experience in tanker operations which exposed the vessel and its crew to danger and caused additional expenses. Petitioners allegedly advised respondent to take a refresher course in order to facilitate his deployment to another vessel. However, instead of taking a refresher course, respondent filed a case for illegal dismissal.
On April 23, 2001,6 Labor Arbiter Francisco A. Robles rendered a Decision dismissing respondent’s complaint. He found that respondent was validly dismissed because he committed acts in violation of his duties as Chief Officer, amounting to breach of trust and confidence. He noted that on September 6, 2000, Capt. Kowalewski wrote in the official log book of the vessel that respondent failed to follow entry procedures in loading oil tanks while the vessel was navigating to Aruba; that the Safety Officer of the vessel also submitted a report on the violations committed by respondent regarding safety rules on entry procedures; that respondent admitted his inadequacy or lack of knowledge in tanker operations; and that respondent was properly apprised of his violations and was given ample opportunity to be heard.
Respondent appealed to the National Labor Relations Commission which rendered its Decision7 on November 24, 2003 dismissing respondent’s appeal for lack of merit.
Respondent filed a motion for reconsideration but it was denied.8 Hence, he filed a petition for certiorari before the Court of Appeals which rendered the herein assailed Decision on August 31, 2007 disposing thus:
WHEREFORE, the petition is granted and the Decision dated November 24, 2003 and Resolution dated April 20, 2005 of public respondent NLRC are reversed and set aside.
Private respondents are ordered to pay petitioner the amount of unpaid salaries from the time of his dismissal on September 22, 2000 up to the expiration of the term of his employment contract, plus moral damages of P50,000.00, exemplary damages of P50,000.00 and attorney’s fees of 10% of the aggregate monetary reward.
SO ORDERED.9
According to the Court of Appeals, petitioners, as employers, have the burden of proof to show by substantial evidence that respondent’s employment was validly terminated; that for a dismissal based on loss of trust and confidence, it is incumbent to establish that the employee holds a managerial position; that petitioners failed to adduce evidence showing that respondent was a managerial employee; that the log book entries of Capt. Kowalewski and the letter dated September 1, 2000 should be disregarded for being self-serving; that respondent was not apprised of the cause for his dismissal; that petitioners failed to observe the two-notice rule hence the dismissal was illegal; consequently, respondent is entitled to his salaries for the unexpired portion of the employment contract, full reimbursement of placement fee, moral and exemplary damages and attorney’s fees.
Petitioners filed a motion for reconsideration but it was denied by the appellate court on November 16, 2007.
Hence, the instant petition raising the following issues:10
I
WHETHER OR NOT THIS CASE FALLS WITHIN THE EXCEPTION TO THE RULE THAT ONLY QUESTIONS OF LAW MAY BE RAISED ON APPEAL TO THIS HONORABLE COURT
II
WHETHER OR NOT THE POSITION OF CHIEF OFFICER OF AN OCEAN GOING VESSEL IS A MANAGERIAL POSITION OR ONE OF TRUST AND CONFIDENCE
III
WHETHER OR NOT ENTRIES IN THE OFFICIAL LOGBOOK OF A VESSEL SHOULD NOT BE GIVEN WEIGHT FOR BEING SELF-SERVING
IV
WHETHER OR NOT LACK OF SKILL OR INCOMPETENCE IN HANDLING AN OIL TANKER VESSEL MAY BE CONSIDERED AS AN ANALOGOUS CAUSE FOR A VALID TERMINATION OF EMPLOYMENT OF A CHIEF OFFICER
V
WHETHER OR NOT A CHIEF OFFICER OF AN OIL TANKER VESSEL REQUIRED TO EXPLAIN WHY HE SHOULD NOT BE RELIEVED FOR BEING INCOMPETENT WAS DEPRIVED OF DUE PROCESS OF LAW
VI
WHETHER OR NOT MORAL DAMAGES AND ATTORNEYS FEES MAY BE AWARDED WITHOUT A CLEAR SHOWING THAT THE DISMISSAL OF AN EMPLOYEE WAS ATTENDED WITH BAD FAITH
The petition lacks merit.
Petitioners allege loss of trust and confidence due to incompetence as the ground for respondent’s dismissal.11 Loss of trust and confidence is premised on the fact that the employee holds a position whose functions may only be performed by someone who has the confidence of management.12 Such employee may be managerial or rank-and-file, but the nature of his position determines the requirements for a valid dismissal.
With respect to a managerial employee, the mere existence of a basis for believing that such employee has breached the trust of his employer would suffice for his dismissal. Proof beyond reasonable doubt is not required, only substantial evidence which must establish clearly and convincingly the facts on which the loss of confidence rests.13
Article 627 of the Code of Commerce defines the Chief Mate, also called Chief Officer or Sailing Mate, as "the second chief of the vessel, and unless the agent orders otherwise, shall take the place of the captain in cases of absence, sickness, or death, and shall then assume all his powers, duties, and responsibilities." A Chief Officer, therefore, is second in command, next only to the captain of the vessel.
Moreover, the Standards of Training, Certification and Watchkeeping for Seafarers 1978 (STCW ’78), to which the Philippines is a signatory, defines a Chief Mate as "the deck officer next in rank to the master and upon whom the command of the ship will fall in the event of incapacity of the master."
In Association of Marine Officers and Seamen of Reyes and Lim Co. v. Laguesma,14 the Court held that the Chief Mate is a managerial employee because the said officer performed the functions of an executive officer next in command to the captain; that in the performance of such functions, he is vested with powers or prerogatives to lay down and execute management policies.
The exercise of discretion and judgment in directing a ship’s course is as much managerial in nature as decisions arrived at in the confines of the more conventional board room or executive office. Important functions pertaining to the navigation of the vessel like assessing risks and evaluating the vessel’s situation are managerial in nature.15
Thus, respondent, as Chief Officer, is a managerial employee; hence, petitioners need to show by substantial evidence the basis for their claim that respondent has breached their trust and confidence.
Petitioners’ basis for dismissing respondent was the alleged entry by Captain Kowalewski in the ship’s logbook regarding respondent’s inexperience and inefficiency. A ship’s log/logbook is the official record of a ship’s voyage which its captain is obligated by law to keep wherein he records the decisions he has adopted, a summary of the performance of the vessel, and other daily events. A logbook is a respectable record that can be relied upon when the entries therein are presented in evidence.
In the instant case, however, respondent correctly pointed out that the issue is not whether an official logbook entry is acceptable in evidence, but whether a document purporting to be a copy of a logbook entry has been duly established to be authentic and not spurious.16
The document dated September 6, 2000 (Annex E) purports to be a copy of an entry in the official logbook which reads:
Name of the ship : Aquidneck
Port of registry : Nassau, Bahamas
Official Number : 706596
Gross tonnage : 23709
Register (net) tonnage : 8517
Page : OFFICIAL LOG of the m/t Aquidneck
Entries required by Regulations made under Section 143 of the Merchant Shipping Act 1976
Date of the occurrence: 06.09.00. Pace: At Sea. Date of entry: 06.09.00
It was found today on the 06th September 2000 that C/O Mr. Ruben dela Cruz has breached all international safety rules regarding tank entry procedures. In spite of tank entry form properly filled, non-of safety precautions were implemented. Crew was working in cargo tanks without any supervision and without safety arrangement. Emergency rescue equipment was not readied on the scene. By this neglect safety and lives of working personnel in cargo tanks were put in potential hazard. As the senior officer responsible for the safety of his personnel he should be relieved from his duties as the Chief Officer.
Signed: S. Kowalewski, Master17
In Wallem Maritime Services, Inc. v. National Labor Relations Commission,18 citing Haverton Shipping Ltd. v. National Labor Relations Commission,19 the Court ruled that a copy of an official entry in the logbook is legally binding and serves as an exception to the hearsay rule. In the said case, however, there was no controversy as to the genuineness of the said entry and the authenticity of the copy presented in evidence.
In the instant case, respondent has consistently assailed the genuineness of the purported entry and the authenticity of such copy. He alleged that before his repatriation, there was no entry in the ship’s official logbook regarding any incident that might have caused his relief;20 that Captain Kowalewski’s signature in such purported entry was forged.21 In support of his allegations, respondent submitted three official documents22 bearing the signature of Capt. Sczepan Kowalewski which is different from the one appearing in Annex E. Thus, it was incumbent upon petitioners to prove the authenticity of Annex E, which they failed to do. Likewise, the purported report of Capt. Kowalewski dated September 1, 2000 (Annex D),23 and the statements of Safety Officer Khaldun Nacem Faridi and Chief Officer Josip Milin (Annexes G24 and H25) also cannot be given weight for lack of authentication.
Although technical rules of evidence do not strictly apply to labor proceedings, however, in the instant case, authentication of the above-mentioned documents is necessary because their genuineness is being assailed, and since petitioners offered no corroborating evidence. These documents and their contents have to be duly identified and authenticated lest an injustice would result from a blind adoption of such contents.26 Thus, the unauthenticated documents relied upon by petitioners are mere self-serving statements of their own officers and were correctly disregarded by the Court of Appeals.
This Court notes that during the initial proceedings of the case, petitioners contend that respondent was not dismissed but only temporarily relieved from his position due to lack of skill or incompetence. However, as the case progressed, petitioners claimed that respondent was dismissed from employment because he committed certain violations of the vessel’s safety rules. This is objectionable; a party should decide early what cause or defense he is going to advance; he cannot change his theory in the latter stage of the proceeding because it is contrary to the rules of fair play, justice and due process.27
Moreover, records show that respondent was not afforded due process. For officers and crew who are working in foreign vessels involved in overseas shipping, there must be compliance with the applicable laws on overseas employment as well as with the regulations issued by the Philippine Overseas Employment Administration (POEA), such as those embodied in the Standard Contract for Seafarers Employed Abroad (Standard Contract).28 Section 17 of the Standard Contract provides:
SEC. 17. DISCIPLINARY PROCEDURES. – The Master shall comply with the following disciplinary procedures against an erring seafarer:
A. The Master shall furnish the seafarer with a written notice containing the following:
1. Grounds for the charges as listed in Section 33 of this Contract or analogous act constituting the same;
2. Date, time and place for a formal investigation of the charges against the seafarer concerned.
B. The Master or his authorized representative shall conduct the investigation or hearing, giving the seafarer the opportunity to explain or defend himself against the charges. These procedures must be duly documented and entered into the ship’s logbook.
C. If after investigation or hearing, the Master is convinced that imposition of a penalty is justified, the Master shall issue a written notice of penalty and the reasons for it to the seafarer, with copies furnished to the Philippine Agent.
D. Dismissal for just cause may be effected by the Master without furnishing the seafarer with a notice of dismissal if there is a clear and existing danger to the safety of the crew or the vessel. The Master shall send a complete report to the manning agency substantiated by witnesses, testimonies, and other documents in support thereof.
Except for the self-serving allegation that respondent was required to explain why he should not be relieved for being incompetent, petitioners offered no proof to show that they furnished respondent a written notice of the charges against him, or that there was a formal investigation of the charges, or that respondent was furnished a written notice of the penalty imposed upon him. Respondent was verbally ordered to disembark the vessel and was repatriated to the Philippines without being told of the reasons for his relief.
Respondent’s dismissal was not for just cause and without due process. He is therefore entitled to be paid his salaries for the unexpired portion of his employment contract. However, the payment of overtime pay and leave pay should be disallowed in light of our ruling in Cagampan v. National Labor Relations Commission,29 to wit:
[T]he rendition of overtime work and the submission of sufficient proof that said was actually performed are conditions to be satisfied before a seaman could be entitled to overtime pay which should be computed on the basis of 30% of the basic monthly salary. In short, the contract provision guarantees the right to overtime pay but the entitlement to such benefit must first be established.
In the same vein, the claim for the day's leave pay for the unexpired portion of the contract is unwarranted since the same is given during the actual service of the seamen.
Pursuant to Republic Act No. 8042, or the Migrant Workers and Overseas Filipino Act, respondent is also entitled to full reimbursement of his placement fee with interest at 12% per annum. Section 10 thereof provides:
SECTION 10. Money Claims –
x x x x
In case of termination of overseas employment without just, valid or authorized cause as defined by law or contract, the worker shall be entitled to the full reimbursement of his placement fee with interest at twelve percent (12%) per annum, x x x.
We affirm the award of moral damages in the amount of P50,000.00, exemplary damages in the amount of P50,000.00, and attorney’s fees at the rate of 10% of the aggregate monetary award, the dismissal having been effected without just cause and without observance of due process.
WHEREFORE, in view of the foregoing, the petition is DENIED. The August 31, 2007 Decision of the Court of Appeals in CA-G.R. SP No. 91054 and its November 16, 2007 Resolution are AFFIRMED with MODIFICATION. Petitioners Centennial Transmarine, Inc., Centennial Maritime Services, Corp., and B+H Equimar, Singapore, Pte. Ltd. are ordered to pay, jointly and severally, respondent Ruben G. Dela Cruz: (1) his salaries corresponding to the unexpired portion of his employment contract, at the rate of USD1,750.00 monthly, or its peso equivalent at the time of actual payment;30 (2) his placement fee with 12% interest per annum, pursuant to Section 10 of Republic Act No. 8042; (3) P50,000.00 as moral damages; (4) P50,000.00 as exemplary damages; and (5) attorney’s fees of 10% of the aggregate monetary award. Costs against petitioners.
SO ORDERED.
CONSUELO YNARES-SANTIAGO
Associate Justice
Chairperson
WE CONCUR:
MA. ALICIA AUSTRIA-MARTINEZ
Associate Justice |
MINITA V. CHICO-NAZARIO
Associate Justice |
ANTONIO EDUARDO B. NACHURA
Associate Justice |
RUBEN T. REYES
Associate Justice |
A T T E S T A T I O N
I attest that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Court’s Division.
CONSUELO YNARES-SANTIAGO
Associate Justice
Chairperson
C E R T I F I C A T I O N
Pursuant to Section 13, Article VIII of the Constitution and the Division Chairperson’s Attestation, I certify that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Court’s Division.
REYNATO S. PUNO
Chief Justice
Footnotes
1Rollo, pp. 48-59; penned by Associate Justice Fernanda Lampas Peralta and concurred in by Associate Justices Edgardo P. Cruz and Normandie B. Pizarro.
2 Id. at 60-61.
3 Records, p. 16.
4 Id. at 38.
5 Id. at 13.
6 Rollo, pp. 89-107.
7 Records, pp. 180-188; penned by Commissioner Vicente S.E. Veloso and concurred in by Presiding Commissioner Roy V. Señeres and Commissioner Romeo L. Go.
8 Id. at 214.
9 CA rollo, p. 246.
10 Rollo, pp. 17-18.
11 CA rollo, p. 146.
12 Mercury Drug Corp. v. Serrano, G.R. No. 160509, March 10, 2006, 484 SCRA 434, 444.
13 Velez v. Shangri-La’s Edsa Plaza Hotel, G.R. No. 148261, October 9, 2006, 504 SCRA 13, 26.
14 G.R. No. 107761, December 27, 1994, 239 SCRA 460.
15 Id. at 467.
16 Rollo, p. 163.
17 Id. at 67.
18 331 Phil. 476, 486 (1996).
19 220 Phil. 356, 362 (1985).
20 Records, p. 16.
21 Id. at 104.
22 Respondent’s Seafarer’s Identification and Record Book, Certificate of Sea Service, and Certification on the Pressure-Testing of Deck Cargo Lines and Manifold Valves.
23 Rollo, pp. 64-65. The report reads:
M/t "Aquidneck" Date 01st Sept.2000
To: The Managing Director
B+H Equimar Singapore
CC: Fleet Personnel Department
Subject: Ch.Officer Mr. Ruben Dela Cruz Performance.
I took command of m/t Aquidneck on 17th July 2000.
The previous master told me that Ch. Officer has a very little experience on the tankers but he learns fast, he needs only a little guidance. The full assistance was given to Mr. R. Dela Cruz but hardly he even asked for assistance or guidance.
Same time I was watching his performance providing any assistance that was required. Ch.Eng. was also ready to assist and to give any advice required on technical aspects.
The following is the statement of facts in respect of Ch.Off. performance.
1. Loading plan and stress calculations were not prepared as per requirement. Not all sequences of discharging/loading were covered. Lacks of signature of the officers were only minor omission.
2. Not all cargo v/vs were closed in pump room prior loading.
3. Have asked Ch.Off. to explain cargo pumps emergency shut off system. Being three months on board he was still not aware of location of emergency shut off.
4. He accepted stowage of paint inside of accommodation (in gymnasium) instead in paint locker.
5. He was asked if vessel has MMC sampler. He was unable to give a right answer. He said that vessel do not have one. It was located later on in Pump man workshop. This almost cased extra expenses for the company.
6. He does not consult technical work with Ch.Eng.
7. During discharge in Long Beach he have discharged last tank (9C) by this way loosing main COP priming ability. This caused delay in discharging/stripping.
8. Upon completion of discharge in Long Beach Berth 77 he was unable to drain cargo manifolds causing oil spill to manifold drip tray. Excessive time was used for disconnecting causing air pollution. He shows lack of understanding of basic physics. Liquid can not run upward. He did not opened drain valves on manifolds. Only cargo tank and manifold cross over valves were opened, therefore it took so long to disconnect manifolds.
9. During subsequent tank cleaning he was not stripping washed tanks simultaneously, allowing build up wash waters in cargo tanks. This caused substantial delay in tank cleaning and greater fuel consumption.
10. He was attempting to wash cargo tanks having 2-kg pressure in main tank cleaning line.
11. The understanding of suction gauge indication or pump suction creates some problems to him.
12. The problem of fault finding is almost non existent.
13. During tank ventilation it seems that he do not understand basic methods of tanker operation. Ventilation by dispersment was mixed with dilution methods. Which one was which and how to apply them he does not understand. As the example he was trying to ventilate 10 tanks at the same time. In this case the dilution method only could be used. The worst of that he do not like to consult any operation or he does not understand the needs for consultation. He is convinced that he knows everything.
14. The vetting surveyor inspecting the vessel in Long Beach in private conversation has stated "Your Ch. Off. Do not understand basics of tanker operation and should understudy first before Ch.Off. duties can be assigned to him".
15. Supervision and assistance given has a very little effect as he has his own ideas how to work and coming with not accurate information.
16. On the positive side he is good in paper work and can work long hours without complain.
The following are true reconciliation of Ch.Off. Performance. Without any prejudice and in spite of all assistance given to Mr. Ruben Dela Cruz it is understood that at present state of his knowledge Mr. Ruben Dela Cruz should take a refreshment course of tanker operation first. The new Ch. Off should join the vessel ASAP to take over cargo related duties.
Mr. Ruben Dela Cruz should be relieved from his duties as the Ch.Off. to avoid delays in
operation and extra unnecessary expenses for the company.
Capt. S. Kowalewski
Master m/t "Aquidneck"
24 Id. at 68. The statement reads:
"On 06th Sept.2000 while vessel was bound for Aruba for orders crew were engaged in testing the cargo valves to prepare the vessel for next loading. Capt. D. Smith MSS safety consultant who joined the vessel in Panama on 5th Sept. was taking rounds on the deck on 06th September. He observed that enclosed space entry procedures were not being followed and completely overlooked, endangering crews lives working in cargo oil tanks. He informed the Master regarding this requesting to take proper action. Capt. Smith latter called all the officers and crew and said that enclosed space entry procedures not being followed is a serious breach of the IMO regulations and held Chief Officer Mr. Ruben Dela Cruz responsible for it."
25 Id. at 69. The statement reads:
"During Loading Gasoline in Lake Charles No. 8C cargo tank was over presurised creating potential risk of tank rupture, explosion and oil pollution.
Loading into tank 8C was immediately stopped and pressure from the tank was released.
After investigation it has been found that inert gas vent line into tank 8C was blanked off and blank was not removed prior commencement of loading. Mr. Ruben Dela Cruz told me that he forgot to inform me about.
During inspection of pump room it was found that cargo is leaking from holed section of Stripping pump No 1 and Eductor No. 2. On investigation pumpman Mr. R. Alvarez told me that he informed Mr. Ruben Dela Cruz about holed in cargo system during tank washing prior arrival Lake Charles.
Cargo, deck maintenance and safety papers were totally disorganized. Safety equipment was wrongly tested and calibrated by Mr. Ruben Dela Cruz and therefore unsafe to use."
26 Wallem Maritime Services, Inc. v. National Labor Relations Commission, supra note 18 at 486.
27 Dalisay v. Mauricio, Jr., G.R. No. 148893, July 12, 2006, 479 SCRA 307, 316.
28 Timoteo B. Aquino and Ramon Paul L. Hernando, Notes and Cases on the Law of Transportation and Public Utilities (Manila: Rex Book Store, Inc. 2004), Chap. 8, p. 550.
29 Legahi v. National Labor Relations Commission, G.R. No. 122240, November 18, 1999, 318 SCRA 446, 457.
30 Skippers United Pacific, Inc. v. National Labor Relations Commission, G.R. No. 148893, July 12, 2006, 494 SCRA 661, 673.
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