[ G.R. No.

L-7636, June 27, 1955 ]

ASIA STEEL CORPORATION, PETITIONER,
vs.
WORKMEN'S COMPENSATION COMMISSION AND ISMAEL CARBAJOSA, RESPONDENTS
Facts: On March 31, 1951, Ismael Carbajosa came to Manila to look for a job. He met Pablo Sesia who at that time
was connected with Asia Steel Corporation as a mechanic. Sesia help him to secure an employment. He introduced
the claimant with Mr. Kim, the one who is in charge of the factory. With the managers approval, claimant was able to
start working as an apprentice the following day. Hardly a week, while working in one of the machines, the claimant
met an accident that resulted to the amputation of his feet. Hospitalization expenses were paid by the corporation.
Thereafter, Carbajosa claimed for compensation with the Workmens Compensation Commission. The latter found
that Carbajosa was employed as apprentice and the accident arose out of the employment. Petitioner was required
to pay Carbajosa for indemnification. However, the petitioner claimed that petitioner was not an employee because
Mr. Kims act of hiring Carbajosa could not bind the corporation since by-laws, it is only Yu Kong Tiong, President
who was authorized to hire employees.
Issue: whether there is an employer-employee relationship created that would make Labor Code applicable when the
said employee was hired by a mere agent of the corporation?
Held: The court held that employee- employer relationship was created. As pointed out by the court, it may be stated
as a general rule that a agent, who with authority express, implied, apparent or actual, employs a help for the benefit
of his principals business, it creates the relationship of employer and employee between such help and his principal.
Although it is true that it is only president of the corporation who is allowed by-laws to hire employees, the court held
that the creation of the relationship should not be adjudged strictly in accordance with technical legal rules, but rather
according to the actualities and realities of industrial or business practice. And in this case, the person-in-charge of
the factory Mr. Kim hired Carbajosa, the contract of employment should be upheld. And he is therefore entitled under
the Compensation Act.