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Republic of the Philippines
SUPREME COURT
Manila

SECOND DIVISION

G.R. No. 168210             June 17, 2008

COASTAL SAFEWAY MARINE SERVICES, INC., petitioner,
vs.
LEONISA M. DELGADO, respondent.

D E C I S I O N

QUISUMBING, J.:

For review are the Decision¹ and Resolution² dated February 10, 2005 and May 25, 2005, respectively, of the Court of Appeals in CA-G.R. SP No. 85961, which had affirmed the Decision³ dated April 30, 2004 of the National Labor Relations Commission (NLRC), Third Division, in NLRC NCR CA No. 036508-03.

The antecedent facts are as follows:

Petitioner Coastal Safeway Marine Services, Inc. (Coastal), with Arabian Marine and Terminal Services Co. Ltd. as its principal, hired Jerry M. Delgado, with the position of General Purpose 2 on board M/V "Lulu 1."⁴ Upon arrival in Saudi Arabia, however, Jerry was instructed to board another vessel, the M/V "Karan 7," and was deployed as a Chief Engineer on August 3, 2001.

On December 22, 2001, while on board, Jerry complained of stomach pain. He was immediately treated, but on December 29, 2001, he again fell ill. On January 8, 2002, while confined at the city hospital in Dharan, Saudi Arabia, Jerry died due to "acute cessation of blood circulation and respiration."⁵ Thereafter, his remains were transported to Manila.

Respondent Leonisa M. Delgado, Jerry's wife, demanded payment of death and other benefits from Coastal, but the latter denied her claims.⁶ Hence, Leonisa went to the NLRC on April 1, 2002 and filed a Complaint.⁷ Labor Arbiter Francisco A. Robles ruled for Leonisa and awarded her death benefits and $7,000 for each of their four children. However, her claims for salary differential, moral and exemplary damages, were denied.⁸

The NLRC, upon appeal of Coastal, affirmed the Labor Arbiter's ruling. It disposed of the case as follows:

Based on records, complainant's husband was issued a fit to work certification by [Coastal's] accredited physician prior to his deployment and was reported by the ship's captain to be "healthy and energetic"…when he joined the vessel, but barely 5 months thereafter he died as a result of illness during the term of his contract and not from his own willful or criminal act. The employer/principal is therefore liable... [Coastal] is also answerable for such death benefits because the law (Sec. 10 of R.A. No. 8042) provides for the solidary liability of the principal and the local agent for any and all claims of an overseas worker.

x x x x

WHEREFORE, the appeal is DENIED. The Decision dated May 20, 2003 is affirmed in toto.

SO ORDERED.⁹

After its motion for reconsideration was denied, Coastal filed a Petition for Certiorari¹⁰ before the Court of Appeals. The Court of Appeals, however, dismissed the petition and ruled that based on Section 20(A)¹¹ of the Philippine Overseas Employment Administration (POEA) Standard Employment Contract,¹² it is sufficient that Jerry's death occurred during the term of his employment as to entitle his beneficiaries to claim death benefits. The fallo of the decision reads:

WHEREFORE, premises considered, the petition is DISMISSED.

SO ORDERED.¹³

Coastal sought reconsideration, but to no avail. Hence, this petition, raising the following as issues:

I.

THE HONORABLE COURT OF APPEALS GRAVELY ERRED WHEN IT AWARDED DEATH BENEFITS TO THE BENEFICIARIES OF DECEASED JERRY DELGADO BASED ON SECTION 20 OF MEMORANDUM CIRCULAR NO. 55, SERIES OF 1996, WHEN THE APPLICABLE LAW IS DEPARTMENT ORDER NO. 4 AND MEMORANDUM CIRCULAR NO. 09, SERIES OF 2000 AS EMBODIED IN THE STANDARD EMPLOYMENT CONTRACT SIGNED BY THE PARTIES.

II.

THE HONORABLE COURT OF APPEALS COMMITTED REVERSIBLE ERROR WHEN IT MANIFESTLY OVERLOOKED CERTAIN MATERIAL FACTS THAT, IF PROPERLY CONSIDERED, WOULD JUSTIFY A DIFFERENT CONCLUSION.

III.

THE HONORABLE COURT OF APPEALS GRAVELY ERRED WHEN IT DISREGARDED THE NOTARIZED QUITCLAIM VOLUNTARILY EXECUTED BY THE DECEASED JERRY DELGADO IN FAVOR OF THE PETITIONER.

IV.

THE HONORABLE COURT OF APPEALS ACTED WITH GRAVE ABUSE OF DISCRETION IN AFFIRMING THE AWARD OF ATTORNEY'S FEES IN FAVOR OF RESPONDENT DESPITE THE WANT OF ANY FACTUAL AND LEGAL BASIS.¹⁴

Simply put, the issues are: (1) Did the Court of Appeals err in awarding death benefits to Jerry's heirs based on Section 20(A) of the POEA Standard Employment Contract? (2) Is the affidavit of waiver executed by Jerry valid? (3) Is Leonisa entitled to attorney's fees?

Petitioner contends that in determining whether Jerry's death is compensable, Department of Labor and Employment (DOLE) Department Order No. 4, series of 2000¹⁵ and POEA Memorandum Circular No. 9, series of 2000¹⁶ should apply because these were the laws embodied in Jerry's employment contract.

On the other hand, respondent argues, together with the Court of Appeals, that it is Section 20(A) of the POEA Standard Employment Contract based on POEA Memorandum Circular No. 055, series of 1996¹⁷ that should apply.

The employment of seafarers, including claims for death benefits, is governed by the contracts they sign every time they are hired or rehired;¹⁸ and as long as the stipulations therein are not contrary to law, morals, public order or public policy, they have the force of law between the parties.¹⁹ While the seafarer and his employer are governed by their mutual agreement, the POEA rules and regulations²⁰ require that the POEA Standard Employment Contract be integrated in every seafarer's contract.²¹

A perusal of Jerry's employment contract²² reveals that what was expressly integrated therein by the parties was DOLE Department Order No. 4, series of 2000 or the POEA Amended Standard Terms and Conditions Governing the Employment of Filipino Seafarers on Board Ocean-Going Vessels, and POEA Memorandum Circular No. 9, series of 2000. However, POEA had issued Memorandum Circular No. 11, series of 2000²³ stating that:

In view of the Temporary Restraining Order issued by the Supreme Court in a Resolution dated 11 September 2000 on the implementation of certain amendments of the Revised Terms and Conditions Governing the Employment of Filipino Seafarers on Board Ocean-Going Vessels as contained in DOLE Department Order No. 04 and POEA Memorandum Circular No. 09, both Series of 2000, please be advised of the following:

1. Section 20, Paragraphs (A), (B) and (D) of the former Standard Terms and Conditions Governing the Employment of Filipino Seafarers on Board Ocean-Going Vessels, as provided in DOLE Department Order No. 33, and POEA Memorandum Circular No. 55, both Series of 1996 shall apply in lieu of Section 20 (A), (B) and (D) of the Revised Version; (Emphasis supplied.)

x x x x

In effect, POEA Memorandum Circular No. 11-00 thereby paved the way for the application of the POEA Standard Employment Contract based on POEA Memorandum Circular No. 055, series of 1996. Worth noting, Jerry boarded the ship on August 2001 before the said temporary restraining order was lifted on June 5, 2002 by virtue of Memorandum Circular No. 2, series of 2002.²⁴ Consequently, Jerry's employment contract with Coastal must conform to Section 20(A) of the POEA Standard Employment Contract based on POEA Memorandum Circular No. 055, series of 1996, in determining compensability of Jerry's death.

Section 20(A) of the POEA Standard Employment Contract, based on POEA Memorandum Circular No. 055, series of 1996, is clear:

SECTION 20. COMPENSATION AND BENEFITS

A. COMPENSATION AND BENEFITS FOR DEATH

1. In case of death of the seafarer during the term of his contract, the employer shall pay his beneficiaries the Philippine Currency equivalent to the amount of Fifty Thousand US dollars (US$50,000) and an additional amount of Seven Thousand US dollars (US$7,000) to each child under the age of twenty-one (21) but not exceeding four (4) children, at the exchange rate prevailing during the time of payment. (Emphasis supplied.)

Stated differently, for death of a seafarer to be compensable, the death must occur during the term of his contract of employment.²⁵ It is the only condition for compensability of a seafarer's death.²⁶ Once it is established that the seaman died during the effectivity of his employment contract, the employer is liable.²⁷ In Jerry's case, the parties did not dispute that Jerry died due to heart ailment during the term of his employment. Aside from the fact that respondent had submitted Jerry's death certificate, petitioner admits such fact of death as early as the time it had submitted its first position paper with the NLRC.

Petitioner, however, alleges that respondent's claim for death benefits should be denied because there was no reasonable work connection between Jerry's death and his illness. To this allegation, we cannot agree. Compensability of Jerry's death does not depend on whether his illness was work-connected or not. What is material is that his death occurred during the term of his employment contract. By provision of Section 20(A) of the POEA Standard Employment Contract, based on POEA Memorandum Circular No. 055, series of 1996, payment of death benefit pension is mandated in case of death of a seafarer during the term of his employment.

Petitioner further presents an affidavit of waiver²⁸ allegedly executed by Jerry releasing it from any responsibility and liability and contends that the Fit-to-Work Certification was issued only upon his insistence to be deployed after he underwent medical examination and was found to have an unstable blood pressure. Respondent, on the other hand, disputes the validity of such waiver insisting that no waiver can validly renounce the future rights of Jerry's heirs and beneficiaries, it being against sound public policy.

Again, we find petitioner's arguments without merit. It is not necessary, in order to recover compensation benefits, that an employee must have been in perfect health at the time he contracted the disease. A worker brings with him possible infirmities in the course of his employment, but the employer, though not an insurer of the health of his employees, takes them as he finds them.²⁹ Significantly, in issuing a fit-to-work certification to Jerry, petitioner assumed the risk of liability. Based on the certification itself, petitioner's accredited physician had attested that Jerry was fit to work prior to his deployment. The ship's captain had also reported Jerry to be healthy and energetic when he joined the crew.³⁰ Petitioner cannot now evade its liability and deny the compensation for death benefits that respondent deserves. Thus, we are in agreement with the NLRC decision that:

Respondent cannot escape liability on the mere basis of the affidavit of waiver supposedly executed by the deceased seaman. The basic reason is that waivers and quitclaims are against public policy and therefore null and void. More especially, We are inclined to regard said document as spurious or fabricated because it was only brought out on appeal after the Labor Arbiter has awarded death benefits in favor of the complainant and her 4 minor children.³¹ (Emphasis supplied and underscoring ours.)

Factual findings of quasi-judicial agencies like the NLRC, when affirmed by the Court of Appeals, are conclusive upon the parties and binding on this Court.³² In our view, conclusive reliance can be placed on such findings.

Lastly, respondent's prayer for the award of attorney's fees is based on specific provision of the Civil Code.³³ The award of attorney's fees in this case is also consistent with current jurisprudence³⁴ in labor cases. Such award must be upheld, not only because labor cases take much time to litigate, they also require, based on experience, special dedication and expertise on the part of the pro-worker's counsel.

WHEREFORE, the petition is hereby DENIED. The Court of Appeals' Decision dated February 10, 2005 and Resolution dated May 25, 2005 in CA-G.R. SP No. 85961 are hereby AFFIRMED. Costs against the petitioner.

SO ORDERED.

LEONARDO A. QUISUMBING
Associate Justice

WE CONCUR:

*CONSUELO YNARES-SANTIAGO Associate Justice
DANTE O. TINGA Associate Justice	**RUBEN T. REYES Associate Justice
***TERESITA J. LEONARDO-DE CASTRO Associate Justice

ATTESTATION

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.

LEONARDO A. QUISUMBING
Associate Justice
Chairperson

CERTIFICATION

Pursuant to Section 13, Article VIII of the Constitution, and the Division Chairperson's Attestation, it is hereby certified that the conclusions in the above Decision were 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

* Additional member in place of Associate Justice Arturo D. Brion who took no part due to prior action in the Court of Appeals.

** Additional member in place of Associate Justice Presbitero J. Velasco, Jr. who is on official leave.

*** Additional member in place of Associate Justice Conchita Carpio Morales who is on official leave.

¹ Rollo, pp. 47-54. Penned by Associate Justice Eliezer R. De Los Santos, with Associate Justices Eugenio S. Labitoria and Arturo D. Brion (now a member of this Court) concurring.

² Id. at 56-57.

³ Records, pp. 187-193.

⁴ CA rollo, p. 47.

⁵ Records, pp. 49-51, 88.

⁶ Id. at 52-53. Respondent reiterated her claim against petitioner, through the International Transport Workers' Federation (ITF) FOC Phils., Inc. in a letter dated March 12, 2002.

⁷ Id. at 1 (NLRC-NCR Case No. (M)-2002-04-00099-30).

⁸ Id. at 86-97.

⁹ Id. at 192-193.

¹⁰ Id. at 403-429.

¹¹ SECTION 20. COMPENSATION AND BENEFITS

A. COMPENSATION AND BENEFITS FOR DEATH

1. In case of death of the seafarer during the term of his contract, the employer shall pay his beneficiaries the Philippine Currency equivalent to the amount of Fifty Thousand US dollars (US$50,000) and an additional amount of Seven Thousand US dollars (US$7,000) to each child under the age of twenty-one (21) but not exceeding four (4) children, at the exchange rate prevailing during the time of payment. (Emphasis supplied.)

¹² Philippine Overseas Employment Administration (POEA) Memorandum Circular No. 055-96 (December 16, 1996).

¹³ Rollo, p. 54.

¹⁴ Id. at 16-18.

¹⁵ Amended Standard Terms and Conditions Governing the Employment of Filipino Seafarers On-Board Ocean-Going Vessels, adopted on May 31, 2000.

¹⁶ Amended Standard Terms and Conditions Governing the Employment of Filipino Seafarers on Board Ocean-going Vessels, adopted on June 14, 2000.

¹⁷ Revised Standard Employment Terms and Conditions Governing the Employment of Filipino Seafarers on Board Ocean-Going Vessels, adopted on December 16, 1996.

¹⁸ NYK-Fil Ship Management, Inc. v. National Labor Relations Commission, G.R. No. 161104, September 27, 2006, 503 SCRA 595, 603-604; Pentagon International Shipping, Inc. v. Adelantar, G.R. No. 157373, July 27, 2004, 435 SCRA 342, 348, citing Millares v. National Labor Relations Commission, G.R. No. 110524, July 29, 2002, 385 SCRA 306, 318.

¹⁹ Delos Santos v. Jebsen Maritime, Inc., G.R. No. 154185, November 22, 2005, 475 SCRA 656, 664.

²⁰ Millares v. National Labor Relations Commission, supra note 18.

²¹ Pentagon International Shipping, Inc. v. Adelantar, supra note 18.

²² Records, p. 3.

²³ Temporary Restraining Order on Certain Amendments of the Revised Terms and Conditions Governing the Employment of Filipino Seafarers on Board Ocean-Going Vessels, adopted on September 12, 2000.

²⁴ Subject: Section 20 of the Revised Standard Terms and Conditions Governing the Employment of Filipino Seafarers on Board Ocean-Going Ships.

²⁵ Rosario v. Denklav Marine Services Ltd., G.R. No. 166906, March 16, 2005, pp. 1, 5 (Unsigned Resolution).

²⁶ Hermogenes v. Osco Shipping Services, Inc., G.R. No. 141505, August 18, 2005, 467 SCRA 301, 309.

²⁷ Prudential Shipping and Management Corporation v. Sta. Rita, G.R. No. 166580, February 8, 2007, 515 SCRA 157, 168.

²⁸ CA rollo, p. 75.

²⁹ Seagull Shipmanagement and Transport, Inc. v. NLRC, G.R. No. 123619, June 8, 2000, 333 SCRA 236, 243.

³⁰ Records, p. 31.

³¹ Id. at 192.

³² Ramos v. Court of Appeals, G.R. No. 145405, June 29, 2004, 433 SCRA 177, 182.

³³ Civil Code, Art. 2208, par. 2.

Art. 2208. In the absence of stipulation, attorney's fees and expenses of litigation, other than judicial costs, cannot be recovered, except:

x x x x

(2) When the defendant's act or omission has compelled the plaintiff to litigate with third persons or to incur expenses to protect his interest;

x x x x

³⁴ Pentagon International Shipping, Inc. v. Adelantar, supra note 18.

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