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G.R. No.


February 28, 2001


This petition seeks to annul and set aside the decision dated September 25, 1995 of the National Labor Relations
Commission (NLRC) in NLRC-NCR Case No. 009101-95. Said decision affirmed with modification the judgment
dated March 16, 1995 of the Philippine Overseas Employment Administration (POEA), ordering the herein
petitioner and Pioneer Insurance and Surety Corporation to pay private respondent jointly and severally the sum of
US$21,000 or its peso equivalent at the time of actual payment and P34,114.00 as reimbursement for medical
expenses plus 10% of the total award as attorneys fees in favor of the private respondent. In its Resolution dated
December 29, 1995, the NLRC also denied petitioners motion for reconsideration.
The facts in this case are as follows:
On January 23, 1993, private respondent, Carlos Nietes filed a complaint against Philippine Transmarine Carriers
Inc. (PTC) for payment of disability benefit, sickness wages, refund of medical expenses and attorneys fees.
Pioneer Insurance and Surety Corp. was impleaded as surety of respondent PTC.

Arreza, including the carbon original of the Medical Certificate issued by Dr. Matti of the Seamens Hospital
which certificate states that he was not fit to work.
From November 1992 up to the filing of this petition, Atty. Torres allegedly had not talked to Atty. Arreza. Being a
member of AMOSUP from 1985 to 1990, until he was declared unfit to work, petitioner claimed he was entitled to
"permanent total disability" benefit in the amount equivalent to 86% of the US$18,000.00, sickness wage benefit
in the sum of US$6,000.00 as per Section C, subsection (c) of the POEA Standard Format, plus ten percent (10%)
of the total judgment award and attorneys fee.
In his supplemental complaint, private respondent further asked for refund of medical expenses incurred in the
amount of P30,411.00 plus professional fee of P4,000.00 or a total of P34,411.00. Receipts covering these
payments were submitted as Annexes "I" and "II."
On March 16, 1995, the POEA Adjudication Office issued its decision in favor of the private respondent. It held
WHEREFORE, judgment is hereby rendered, ordering respondents Philippine Transmarine Carriers Inc.
and Pioneer Insurance and Surety Corp. to pay complainant jointly and severally the sum of TWENTY
ONE THOUSAND US DOLLARS (US$21,000.00) or its peso equivalent at the time of actual payment
and P34,114.00 representing reimbursement of medical expenses plus ten percent (10%) thereof of the
total award by way of and/as attorneys fees.
All other causes or actions are dismissed for lack of merit.

Private respondent alleged that he was a licensed Captain and/or Master Mariner. For the period March 1985 to
May 17, 1990, he was employed by PTC. He last boarded M/V MA. ROSARIO where he served as Master from
April 11, 1990 to May 17, 1990. At that time he was a member of good standing of the Associated Marine Officers
and Seamens Union of the Philippines (AMOSUP), an affiliated of the International Transport Federation (ITF) of
London. He paid his union dues, insurance premiums, etc., which were checked-off from his salaries.
As Master on board, he received US$1,500.00 per month. From May 10, 1990 up to May 17, 1990, the date he
was repatriated, he was hospitalized at the Moji Hospital in Moji, Japan, at the instance of the vessels owners.
Upon his arrival in the Philippines, he was instructed by PTC and AMOSUP to report to the Seamens Hospital, a
hospital owned and operated by AMOSUP. On May 19, 1990, Dr. George Matti of the Seamens Hospital issued a
medical certification that he was unfit for work and was instructed to continue treatment/medication.
When he was refused admission at the Seamens Hospital, he was forced to secure medical treatment at the Sto.
Nio Medical Specialist and Emergency Clinic as an out-patient. His attending physician was Dra. Geraldine B.
Emperador. Her diagnosis showed he was unfit to work as Master of the vessel.
On May 25, 1992, he referred his claims to Atty. Oscar Torres who repeatedly informed PTC of the claim for
benefits and refund. Sometime in July 1992, he was informed by Atty. Torres that his claim was being handled by
Atty. Augusto Arreza, Jr., PTCs legal consultant and that they had submitted all the required documents to Atty.

Petitioner appealed said decision to the NLRC which affirmed it except for the award of attorneys fees which is
deleted for lack of factual and legal basis. NLRC later denied petitioners motion for reconsideration.
Petitioner now contends that the NLRC acted with grave abuse of discretion amounting to lack or excess of
jurisdiction in:



On record, private respondent was examined and diagnosed at the Seamens Hospital and was found to be
suffering from congestive heart failure and cardiomyopathy, so that he was declared unfit to work by no less than a
company accredited physician in the person of Dr. George Matti. 4

Petitioner was well aware of the private respondents hospitalization at Moji, Japan, as well as his repatriation on
May 17, 1990. It was upon the advice of petitioner that he was examined and diagnosed at the Seamens Hospital.
There Dr. George Matti, petitioners own accredited physician, declared him unfit to work. Petitioner could not
now feign ignorance of this information. Two licensed physicians examined and diagnosed private respondent and
both of them had issued similar findings, that private respondent was afflicted with congestive heart failure and
cardiomyopathy making him unfit to work.

The main issue is whether the NLRC gravely abused its discretion in affirming with modification, the judgment of
the POEA Adjudication Office.
Petitioner admits that private respondent suffered illness which rendered him unfit for work. However, it points
out that private respondent did not submit proof of the extent of his disability as required by Section C (4) [b] and
[c] of the POEA Standard Contract for Seamen. 1 Without this proof, petitioner argues that the NLRC gravely
abused its discretion when it affirmed the findings of the POEA.1wphi1.nt
Petitioner also contends that public respondents erred in awarding sick wages for 120 days in favor of the private
respondent without evidence on record establishing the extent of his disability, which is essential in determining
the correct amount of disability benefit. Further, petitioner avers private respondents claim for refund of the
medical expenses should have not been granted by the public respondents on the ground that the physician who
treated private respondent was not accredited in violation of the POEA Standard Contract for Seamen.
Public respondents held that "in effect, the complainant has substantially complied with the POEA Standard of
Employment Contract for Seamen when he submitted himself to the Seamens Hospital three days after his
repatriation from Japan."2 They also found that private respondent had in fact substantially complied with the postemployment requirements under paragraph 4 [b] and [c] of Section c, 3 of the POEA Standard Employment
Contract for Seamen. We note that private respondent submitted himself, upon the instructions of the petitioner
and AMOSUP, to the Seamens Hospital, which is owned and operated by AMOSUP, for medical assistance under
the care of Dr. George Matti, a company accredited physician, three days after his May 17, 1990 repatriation from

Strict rules of evidence are not applicable in claims for compensation. In NFD International Manning Agents, Inc.
vs. NLRC, 269 SCRA 486, 494 (1997), we said:
Strict rules of evidence, it must be remembered, are not applicable in claims for compensation and
disability benefits. Private respondent having substantially established the causative circumstances
leading to his permanent total disability to have transpired during his employment, we find the NLRC to
have acted in the exercise of its sound discretion in awarding permanent total disability benefits to
private respondent. Probability and not the ultimate degree of certainty is the test of proof in
compensation proceedings.
Consistently the Court has ruled that "disability should not be understood more on its medical significance but on
the loss of earning capacity. Permanent total disability means disablement of an employment to earn wages in the
same kind of work, or work of similar nature that [he] was trained for on accustomed to perform, or any kind of
work which a person of [his] mentality and attainment could do. It does not mean absolute helplessness." 5 In
disability compensation, we likewise held, it is not the injury which is compensated, but rather it is the incapacity
to work resulting in the impairment of ones earning capacity.6
Finally, petitioner faults public respondent for allowing the reimbursements of private respondents medical
expenses despite the fact that the latters treatment was done by a physician not designated or accredited by the
petitioner in violation of the POEA Standard Contract for Seamen. However, records of the case show that private
respondent had initially sought treatment at Seamens Hospital under the care of Dr. George Matti, a company
accredited physician. Only after he was refused admission thereat was he compelled to seek medical assistance
elsewhere. His life and health being at stake, private respondent did not have the luxury to scout for a companyaccredited physician for was it fair at this late stage for his employer to deny him such refund for medical services
that previously he was admittedly entitled to.
The POEA Standard Employment Contract for Seamen is designed primarily for the protection and benefit of
Filipino seamen in the pursuit of their employment on board ocean-going vessels. Its provisions must, therefore,
be construed and applied fairly, reasonably and liberally in their favor. Only then can its beneficent provisions be
fully carried into effect.7

WHEREFORE, the petition is DISMISSED. The assailed decision of public respondent National Labor
Relations Commission dated September 25, 1995 is AFFIRMED. Petitioner and Pioneer Insurance and Surety
Corporation are ordered to pay jointly and severally the following amounts to private respondent Carlos Nietes:
Twenty One Thousand US Dollars (US$21,000.00) or its peso equivalent at the time of actual payment, as
disability benefits and P34,114.00 representing reimbursement of medical expenses, plus the costs of suit.

of Dumanga, Iloilo on January 7, 1958, at about 6:00 a.m., and brought to said fishpond that same morning, at
about 9: 00 o'clock. At noon time, they took their meal. After their work in the afternoon, they had their dinner
consisting of rice brought by Drilon and fish caught from the fishpond by some members of the group. Soon later,
all of them felt dizzy. As Drilon and Digdigan had convulsions, lost consciousness and appeared to be in serious
condition, they were brought to the Iloilo Provincial Hospital, where Digdigan died the next day. The other
workers, including Drilon, recovered.

As a consequence, two (2) separate claims for compensation were filed, one by Drilon and another by Digdigan's
mother, Lucia Deloritos. After a joint hearing of the two (2) cases, in view of the common questions of fact and
law therein involved, the hearing officer of said Regional Office No. V rendered a decision dismissing both
claims. As adverted to above, said decision was, on appeal, set aside by an order of the Chairman of the
Workmen's Compensation Commission. Del Rosario sought a reconsideration, which was denied by the
Commission sitting en banc. Hence, this petition for review by certiorari.
Petitioner maintains that Drilon and Digdigan were not his employees, he having engaged their services on a
"pakiao" or piece work system, through one Rufo Dimavildo, who, he contends, is an independent contractor. The
Workmen's Compensation Commission rejected such pretense, upon the ground that:

G.R. Nos. L-18995-96

December 29, 1962


This is an appeal from an order of the Workmen's Compensation Commission setting aside a decision in the above
entitled two (2) cases of its Regional Office No. V and ordering the corresponding hearing officer to enter, after
further proceedings, a new decision against Aguedo del Rosario the respondent therein and petitioner herein,
awarding compensation to the claimants in said cases and herein respondents Lucia Deloritos and Eugenio Drilon.
The record shows that in January, 1958, ten (10) men, including Eugenio Drilon and the now deceased Francisco
Digdigan, were engaged by Del Rosario to do some excavation work in his fishpond in the barrio of ColongColong, municipality of Zarraga, province of Iloilo, on a piece work or "pakiao" basis, with the understanding that
the workers were to provide themselves with their own tools and food during the period of the excavation, which
was expected to last for about a month. The workers were picked up by a truck of Del Rosario in the municipality

With respect to the first ground, it should be noted that the Hearing Officer of Regional Office V, Iloilo
City, in rendering his decision on these cases, ruled that there existed employee-employer relation
between the workmen involved and the respondent. However, the respondent did not object to this
finding, and as a matter of fact, he never appealed from the decision which contained this finding. It was
the claimant alone who appealed from such decision. Hence, respondent is estopped from raising this
issue before this Office. But even if we were to resolve the issue squarely we will find that respondent's
contention is not tenable. While the respondent dwelt lengthily on the proposition that the work of the
laborers involved was casual or temporary in nature, it never denied the fact that the work performed
the excavation of the high portions of the fishpond and the fixing of the dikes was not only for the
purpose of the business of the respondent as a fishpond owner, but also a necessary routine for the repair
and maintenance of its operation. The allegation that the laborers were the employees of an independent
contractor has no basis in fact, as the alleged contractor, Rufo Dimavildo, appears more to be of a
foreman of the respondent. He acted as representative of the respondent and herded the workers for the
latter. He had no capital of his own because he himself is a laborer.
This view is in accord with our decision in Caro vs. Rilloraza, L-9569,(September 30, 1957). Moreover, in
Mansal vs. P. P. Gocheco Lumber Co., L-8017 (April 30, 1955), we held:
It will be noted that in order that an employee may not be responsible for an injury to a laborer, it is
necessary that the "employment is purely casual and is not for the purpose of the occupation or business
of the employer". Casual means occasional, coming without regularity. The work is purely casual when
it is not a part of the business of the employer' complements and explains the term "purely casual". In a
sawmill, for example, if a power unit running the mill gets out of order and a mechanic would be
considered as purely casual, because the reparation of the mill is not the actual work or business of the
sawmill but the sawing of lumber. But the piling up of lumber is work directly connected with the

business of a lumber yard. Lumber must be sorted and piled up in groups according to sizes to facilitate
handling and sale. The piling up of lumber is, therefore, an ordinary part of the work in a lumber yard.
The case at bar is similar or parallel to that of stevedores unloading cargo from a ship. the fact that the
stevedores work under the control of a contractor, who pays them, and that they may seek other work
under the different carriers, and their work covers a very short period of time as to each carriers, and
their work covers a very short period of time as to each carrier, does not exempt the carrier who had
employed them in the unloading of cargo from paying compensation for death or injuries received by
them because the unloading of the cargo is an ordinary part of the carrier's duty. In this effect is our
decision in the case of Flores vs. Cia. Maritima, 57 Phil. 905, thus:
'There is not the least shadow of doubt that the deceased was a laborer in the legal sense. He
had been recruited by the order of the captain of the ship and he was engaged in the task of
unloading the ship's cargo at the time of the accident. There can be no dispute that this kind of
work is included in the business in which the appellee is engaged. That the deceased had been
recruited or engaged by a contractor is of no moment because the latter, for purposes of the
law, was an agent or representative of the ship's captain, who, in turn, represented the
which was, in effect reiterated in Bautista vs. Murillo, L-13374 (January 31, 1962).
The main issue in the appeal is whether or not the accident which resulted in the death of Digdigan and the illness
of Drilon were due to a cause arising out of or in the course of their employment. Petitioner maintains that the
answer should be in the negative because respondents have failed to establish the specific cause of said accident
and the same has, at best, taken place after working hours.
It appears that the rice consumed by the workers at luncheon, as well as at dinner time, had been brought by
Drilon from Dumanga in the morning of January 7, 1958. It was inside a buri bag placed, in Del Rosario's truck,
beside a can the nature of the contents of which is not known. It was surmised that it must have been endrin an
organic insecticide belonging to the group of chlorinated hydro-carbons which must have leaked owing to the
bumpy and rough condition of part of the road leading to the fishpond and then contaminated at least part of
said rice, inasmuch as the health officer who made an autopsy of Digdigan's body, on January 8, 1958, opined that
his death had been due to poisoning by endrin. However, a chemical-toxicological examination by the National
Bureau of Investigation of specimens of the internal organs of Digdigan, did not confirm said conclusion.
In any event, it seems clear from the record that the accident in question was due to food poisoning in the evening
of January 7, 1958, or after working hours, for which reason petitioner argues that it did not arise out of or in the
course of the employment of Digdigan and Drilon. It should be noted. however, that the nature of their work and
that of their co-workers was such that they were expected to remain in petitioner's premises or fishpond for about a
month. In this connection, the order appealed from states:

Under the personal doctrine "injuries occurring on the premises during a regular lunch hour arise in the
course of employment even though the interval is technically outside the regarding hours of employment
in the sense that the worker receives no pay for that time and is in no degree under the control of
employer, being free to go where he pleases." (Larson's Workmen's Compensation Law, Vol. I, p. 298.)
This principle justified in part 'on a sort of presumption that as long the employee is on the premises he
is subject to all the environment mental hazards associated with the employment, and also that although
he may be free to go elsewhere during the interest he is in some degree subject to the control of the
employer if he actually chooses to remain on the premises, merely by virtue of being on the employer's
property.' (Larson, op. cit., Vol. I, p. 300.)
In other words, it is based on the idea that employment hazards presumably continue for the workman
who remains the employer's premises. Consequently, any lunch-time injury which is traceable to a
danger inherent in the environment and other circumstances surrounding the employment is
compensable. However, the modern trend is to compensate accidents that occur during the lunch-time
period which may be considered as "arising out of the employment" even when no conspicuous
employment hazard contributed to the injury. As Larson observe, "If a particular item of horseplay
would have been compensable during regular hours, it might well be held compensate during the lunch
interval." (Larson, op. cit., Vol. I, p. 301.) We could even go one little step further, and say that if the
modern courts are inclined to compensate a worker on premises during working hours even from neutral
sources harm, we might as well compensate a workman who suffers a similar injured during the lunch
hour. As a matter of fact, we could immediately disclose of the issue by the application the principle
adopted by the Supreme Court that "once it is proved that the employee died in the course of the
employment the legal presumption in the absence of substantial evidence to the contrary, is that claim
"comes within the provisions of compensation law" (See. 43) ; in other words, that the accident arose out
of the workman's employment." (Batangas Transportation Co. vs. Rivera, et al.. G.R. No L-7658, may 8.
1956.) There is a close similarity of the situation which called this ruling in the case at bar, because in
the aforementioned case, the motive for the killing of the employee who was employed as a driver was
not established; in this case the cause of poisoning of the workmen involved had likewise never been
established although circumstances evidence point to the food taken thru the mouth. However, the facts
of the present case do not require us to rely solely on a presumption in order to stretch the application of
the 'arising out of the employment' concept. Here, we have a case of ten temple laborers bodily
transported by the respondent from their house and brought to his fishpond several hours ride away.
There, they were to work and statutory about a month, away from the comforts and convenience, which
nearness to the home offers, and practically left to forage for themselves inasmuch as food was not to be
supplied by the respondent. We assumed responsibility only for the payment of their wages upon
completion of the work. It is therefor not as far-fetched as it seems to say that the nature and condition
petitions of their employment deprived them of the usual accessibility to safe and clean food, or at least
the necessary facilities for preparing such food. Otherwise stated, were it not for the conditions of their
particular employment which took them far away either at home for a protracted period of time, they
could have secured their food cooked in a normal way either at home or at a nearby restaurant. But as a
peculiar feature of their employment contract, they were deprived of the normal facilities of procuring
their food and instead they were forced by necessity to bring along an ample supply of food to last for a
period of time and to supplement it with whatever is available around, which in turn would give rise to

the problem of its storage as well as the bother of its preparation at every mealtime. Consequently, if
they happened to eat rice spoiled by storage or used a dirty pot in cooking it and were poisoned thereby,
or if in supplementing their meal they caught fish in the fishpond which later turned out to be poisonous,
could we not say that because of the employment, all these the workmen became the victims of food
poisoning? In our opinion, we discern a distinct link between the food poisoning and the conditions of
employment, in the sense that it was a hazard associated with the employment to which the general
public is not exposed. The safety of food taken by the laborers in an isolated place as a fishpond in this
case is an important matter for the employer to concern himself with.lawphil.net
We even find a close analogy of the cases of these workmen with employees who are required to live on
the premises either by the contract of employment or by the nature of the employment. In such cases,
compensation is usually awarded 'if the source of injury was a risk associated with the conditions under
which the claimant lived because of the requirement of remaining on the premises. (Larson, op. cit., Vol.
I, p. 372.) For this principle to operate, it is not necessary that residence on the premises be required by
the employer, for even in the absence of a requirement in the employment, residence should be deemed
required (whenever there is no reasonable alternative, in view of the distance of the work from
residential facilities or the lack of availability of accommodation elsewhere (Larson, op cit., Vol. I, p.
However, there is even now a growing tendency in some jurisdiction to consider the resident employee
with fixed working hours as no different from the resident employee who continuously on call in the
sense that any injury sustained by the latter type of employee on the employer's premises while engaged
in some activity falling under the general person comfort type is deemed as one arising out of the
employment even if the harm came from a neutral source.

Employees who, within the time and space limits of their employment, engage in acts which minister to
personal comfort do not thereby leave the course of employment, unless the extent of the departure is so
great that an intent to abandon the job temporarily may be inferred, or unless, in some jurisdiction the
method chosen is so unusual and unreasonable that the conduct cannot be considered an incident of the
employment." (Larson's Workmen's Compensation Law, Vol. I, p. 297.) Thus, in Martha Lumber Mills,
Inc. vs. Lagradante (52 Off. Gaz. 4230), this Court said:
We cannot accept petitioner's argument that the death of Felicito Lagradante did not arise out of and in
the course his employment, having been murdered outside of office hours. It appears that the deceased
was required to live and sleep in the quarters provided by the petitioner, and obviously by reason of the
nature of his duties as a concession guard, wit the result that, although he had to observe certain working
hours, he nevertheless was compelled to stay in his quarters thereby in effect making himself available,
regardless of time, for the protection of the rights and interest of the petitioned in its concession.
WHEREFORE, the order and the resolution appealed from are hereby affirmed, with costs against the petitioner. It
is so ordered.

[G.R. No. L-20219. September 28, 1964.]


The foregoing view is in accord with law. In the language of Corpus Juris Secundum:
... the determining factor in construing the statutory has been said to be whether the relationship of
employer and employee may reasonably be said to have existed at the time the accident regardless of
whether the occurrence happened during actual hours of employment, or in proximity thereto.



Where the statute by its terms embraces all injuries by accident arising out of or in the course of the
employment, it is immaterial that the injury occurred outside of working hours. (99 C.J.S., 776-781.)
An injury is said to arise in the course of the employment when it takes place within the period of the
employment, at a place where the employee reasonably may be, and while he is fulfilling his duties or
engaged in doing something incidental thereto. (Larson's Workmen's Compensation Law, Vol. I, p. 193.)
(Emphasis ours.)


ABSENCE; NO PRESUMPTION OF COMPENSABILITY. The presumption of the law that the claim is
deemed to be valid unless the contrary is shown does not apply where the employee was on leave of absence at the
time he was killed by a co-employee.
ARISING OUT OF EMPLOYMENT. The requirement that to be compensable the death must occur while the
worker is performing some work in the course of or arising out of his employment require three things to concur:
the injury must be received during the period covered by the employment, the worker must be shown to have been
injured at the time and place where the performance of his work requires him to be, but was at the time presiding a
meeting of a labor and not doing something in association pursuance of his work.
CASE AT BAR. Facts: the deceased when assaulted was not performing any work in pursuance of his duties
and was neither in the place where his work required him to be, but was at the time presiding a meeting of a labor

association the internal affairs of which are entirely independent of the company where he was then employed.
Held: Not compensable because the requirements that death must arise out of or in the course of employment are
not present.
compensation was filed nearly five months after the death of the deceased employee it was held barred by
prescription under Section 24 of Act 3428, there being no proof that the employer has voluntarily given some
compensation to the employees heirs.
COMMISSION FATAL. The Supreme Court does not acquire jurisdiction over an appeal from a decision of the
Workmens Compensation Commission where the appellant failed to properly perfect its appeal because it did not
file any notice of appeal with said Commission as required by Section 1, Rule 43, of the New Rules of Court.
On April 4, 1961, Josefa Baluis Vda. de Jacob filed with the regional office of the Department of Labor in Naga
City a claim for compensation against the A. L. Ammen Transportation Co., Inc., alleging, among others, that on
October 11, 1960, at about 3:00 oclock p.m., her deceased husband Agripino Jacob, who was then employed by
said company as a line inspector, was attacked by a co-employee with a bolo causing his death on October 12,
1960. The company, upon being informed of Jacobs death, filed within the reglementary period the required
employers report of accident stating therein that it would oppose any claim for death compensation that may be
filed by any party in interest on the ground that the death of Agripino Jacob did not arise out of or in the course of
his employment but it occurred while he was on leave of absence.
The hearing officer to which the case was assigned received the evidence and rendered decision dismissing the
complaint on the ground advanced by the company. Not satisfied with this decision, the complainant moved to
have it reconsidered, and the same having been denied, the hearing officer elevated the case to the Workmens
Compensation Commission for review. On July 3, 1962, the Commission, thru Chairman N. Baens del Rosario,
reversed the decision declaring the claim compensable. Hence, it ordered the company to pay the claimant
P4,000.00 as compensation, P200.00 as funeral expenses, P300.00 as attorneys fees, and P46.00 as docket fee
under Section 55 of the Workmens Compensation Act. In due time, the company filed the present petition for
The stipulation of facts shows that the deceased Agripino Jacob was employed as a line inspector by petitioner
with a salary of P165.00 a month. He was at the time of his death the incumbent president of the Bicol
Transportation Employees Mutual Aid Association, BITEMAA for short, an organization which is entirely
independent of the company and wherein the latter had nothing to do with its internal affairs. He was then on leave
of absence thru a request duly approved by the company and when on October 11, 1960 at about 3:00 p.m. he

attended a meeting of the board of directors and officers of BITEMAA he was attacked by a co-employee with a
bolo causing his death on the next day.
Upon the foregoing facts, respondent Commission found Agripino Jacobs death compensable even if it did not
actually arise out of his employment. The factors that were considered by it, are: the deceased at the time of his
aggression was still in the employ of the company though he was then on leave of absence. One of the purposes of
the BITEMAA was to promote better understanding between the employer and its employees and anything taken
up in the meeting would in the long run inure to the welfare of the companys business. The meeting was with the
approval of the company. While it appears that the purpose of the meeting was to consider the lifting of the
expulsion of one Simeon Vellez from its board of directors, there is nothing in the record to show any motive that
could have been the cause of the hacking of the deceased. However, since Agripino Jacob had the role of working
for the benefit of the employees as well as promoting good relations with the management it is possible that what
precipitated his assault was a matter taken up by him which in the eyes of the members was a move in favor of the
management. It is, therefore, fair to consider Jacobs death as one arising out of or in the course of his
Considering the philosophy behind the requirement that to be compensable the death must occur while the worker
is performing some work in the course of his employment or doing something arising out of his employment, the
authorities are to the effect that to come within the purview of such requirement three things must concur: the
injury must be received during the period covered by the employment, the worker must be shown to have been
injured at the time and place where the performance of his work requires him to be, and the worker must have
been doing something in pursuance of his work. 1 And so it has been held that a wound received by a worker
outside the performance of his duties and in a place other than where the performance of his work requires him to
be is injury not "arising out of or in the course of his employment" (Sunga v. City of Manila, 57 Phil., 869).
Here these requirements are not present for admittedly the deceased when assaulted was not performing any work
in pursuance of his duties and was neither in the place where his work required him to be, but was at the time
presiding a meeting of a labor association the internal affairs of which are entirely independent of the company
where he was then employed.
It is true that at the time of his assault the deceased was still an employee of the company for he has not yet
severed his employment with it, but the fact that he was then on leave of absence is clear proof that he was not
then performing his usual duties as inspector, nor doing anything in relation thereto, to come within the purview of
the phrase "arising out of and in the course of employment." The presumption, therefore, of the law that the claim
is deemed to be valid unless the contrary is shown does not here apply, mainly for the reason that the deceaseds
leave of absence takes this case out of its purview.
The finding of respondent Commission that since the deceased was then the president of an association whose
purpose is to promote better understanding between the employer and its employees it is reasonable to suppose
that what precipitated the attack is a matter taken up by him which appears in the eyes of the members as a move
in favor of the management, not only does not find support in the evidence, but is easily refuted by the fact that the
avowed purpose of the meeting was to take up the expulsion of one Simeon Vellez from its board of directors. No
other matter appears in the agenda for discussion, nor is there any inkling as to what had motivated the hacking of

the deceased. While the modern trend of progressive labor legislation tends to foster harmonious relations between
unions and management, a matter which should be encouraged, we are not prepared to relax the rule that
would open the door to abuse and extreme liberalism. A happy medium should be sought which would be fair to
both management and labor without doing violence to the law. The conclusion we have reached is in line with this
point of view.

3) to pay petitioner the sum of P700.00 as funeral expenses; and

4) to pay the petitioner attorney's fees equivalent to 10% of the death benefits.
On June 5, 1980, respondent GSIS filed a motion for reconsideration based on the following grounds:

Another factor that argues against respondents claim is that it was filed nearly five months after the death of the
deceased contrary to Section 24 of Act 3428, which requires that a claim for compensation should be filed within
three months after death. This can only be offset by proof that the employer has voluntarily given some
compensation to the employee in relation to the injury, a situation which does not here obtain. Verily, this claim
has already prescribed. 2

I As the ailment of the deceased is not a listed occupational disease, proof should have been
shown that the cause of the ailment was the working conditions. This Honorable Court only
found a case of aggravation which is different from proof of increased risk of contracting the

WHEREFORE, the decision appealed from is reversed. No costs.

II. Assuming that the ailment is compensable under the new law, the benefits awarded to
petitioner are not in accordance with said law.
III. The grant of attorney's fees in the sum equivalent to ten (10%) percent of the death
benefits is not proper.
On June 14, 1980, respondent ECC likewise filed a motion for reconsideration based essentially on the same
grounds, to wit:

G.R. No. L-49280 February 26, 1981

LUZ G. CRISTOBAL, petitioner,
SYSTEM (National Science Development Board), respondents.

I. The illness of rectal malignancy which caused the death of Fortunato S. Cristobal is not
compensable under the theory of increased risk as provided in PD 626, as amended.
II. The amounts awarded as death benefits, funeral expenses and attorney's fees are not in
accordance with law.
III. The cause of death not being a compensable illness, the order for reimbursement of
medical, surgical and hospital expenses has no basis.


WE cannot sustain respondents' views.

On April 30, 1980, We rendered a decision in this case finding that petitioner Luz G. Cristobal, widow of the
deceased Fortunato Cristobal, has shown by clear and convincing evidence that her husband contracted rectal
cancer or at least the risk of contracting the same had been increased by the conditions under which he was
working and accordingly ordered respondent G SI S:

The main issue raised by respondents as to whether or not the illness of the deceased, rectal cancer, is
compensable, actually boils down to the question of sufficiency of evidence. Respondents took note of the
following evidence submitted by petitioner:

1) to pay the petitioner the sum of P12,000.00 as death benefits;

2) to reimburse petitioner medical, surginal and hospital expenses duly supported by proper

a) The affidavit of Angel Peres, a co-employee to the deceased, to this effect

I know personally Fortunato Cristobal because he was my Supervisor in the Bureau of

During the employment to Fortunato Cristobal at the Bureau of Printing; he contracted

sickness which was later diagnosed as anorectal cancer which caused his death;

intense heat which are generally considered as predisposing factors of cancer. At this point, there is need to
reiterate that when the deceased started working in 1964, he was free from any kind of disease.

Fortunato Cristobal continued working at the aforementioned Bureau of Printing even when he
was already suffering from a rectal illness and he had been complaining to me that said illness
became more painful whenever he performs his job in the Bureau;

In ruling on the claim, this Court also applied the theory of increased risk under Section 1(b) Rule Ill of PD 626
which states that:

I also noticed that he oftentimes eat food in the Bureau without washing his hands;
The place where Fortunato Cristobal was assigned in the Bureau of Printing is very hygienic
and polluted with chemicals and he oftentimes complain to me that the odor of the chemicals
make him feel dizzy always.
Fortunato Cristobal always handled chemicals in the Bureau of Printing while in the
performance of his duties ( Annex C, Petition).
b) The medical certificate issued by Dr. Rufo A. Guzman stating that "the illness may be
aggravated by the unhygienic conditions in the Bureau of Printing where he works. handling
of chemicals for printing. eating without proper washing of hands, tension due to the pressure
of work, plus neglected personal necessity which may be attributed to the inadequate facilities
in the Bureau of Printing [Annex D, Petition].
As correctly observed by the respondents herein, these evidence were considered in the light of the foregoing
1. The deceased entered the government service in 1964 free from any kind of disease;
2. He was assigned to the printing department of the NSDB as supervising information officer
where he was exposed to various chemicals and intense heat.
3. The deceased's ailment supervened in the course of his employment with said agency.
Respondents however refuse to appreciate these facts in relation to other equally compelling considerations.
The deceased died of rectal cancer on May 27, 1977. Concededly, the exact cause or etiology of this disease is still
unknown. Even respondent ECC's own medical officer, Dr. Mercia C. Abrenica, certified that "the cause of rectal
carzinoma as of any other malignancies is still unknown" (p. 9, ECC rec.). Its cause and development are
insidious, imperceptible to the naked eye, and defies expert analysis. Therefore, whether or not the disease rectal
cancer was caused or the risk of contracting the same was increased by the decedent's working conditions remains
uncertain. This uncertainty, of course, cannot eliminate the probability that the ailment was work connected as it
had been established that the deceased was exposed to unhygienic "Forking conditions, various chemicals and

For the sickness and the resulting disability or death to be compensable, the sickness must be
the result of an occupational disease listed under Annex 'A' of these Rules with the conditions
set therein satisfied; otherwise, proof must be shown that the risk of contracting the disease is
increased by the working conditions (emphasis supplied),
aside from the possibility that the disease might have been contracted even prior to the effectivity of the new
Labor Code. To establish compensability of the claim under the said theory, the claimant must show proof of
work-connection. Impliedly, the degree of proof required is merely substantial evidence, which means "such
relevant evidence as a reasonable mind might accept as adequate to support a conclusion" (Ang Tibay vs. The
Court of Industrial Relations and National Labor Union, Inc., 69 Phil. 635) or clear and convincing evidence. In
this connection, it must be pointed out that the strict rules of evidence are not applicable in claims for
compensation. Respondents however insist on evidence which would establish direct causal relation between the
disease rectal cancer and the employment of the deceased. Such a strict requirement which even medical experts in
the field cannot support considering the uncertainty of the nature of the disease would negate the principle of
liberality in the matter of evidence. Apparently, what the law merely requires is a reasonable work-connection and
not a direct causal relation. This kind of interpretation gives meaning and substance to the liberal and
compassionate spirit of the law as embodied in Article 4 of the new Labor Code which states that "all doubts in the
implementation and interpretation of the provisions of this Code, including its implementing rules and regulations
shall be resolved in favor of labor. "
In urging that the disease rectal cancer is not compensable since its nature or cause is unknown and petitioner was
not able to show proof of direct causal relation, respondents would instruct us to ignore the above provision of law
and the policy of the State of giving maximum aid and protection to labor as We have stated earlier in the main
decision. As the agents charged by the law to implement the social justice guarantee secured by both the 1935 and
1973 Constitutions, respondents should adopt a more liberal attitude in deciding claims for compensation
especially when there is some basis in the facts for inferring a work-connection. This should not be confused with
the presumption of compensability and theory of aggravation under the Workmen's Compensation Act. While
these doctrines may have been abandoned under the new Labor Code (the constitutionality of such abrogation may
still be challenged), it is significant that the liberality of the law, in general, still subsists. All these factual and
legal grounds' were considered in relation to each other constituting substantial evidence clearly convincing Us to
resolve that rectal cancer is compensable.
With respect to the award of death benefits in the amount of P12,000.00, respondents argue that the same is not in
consonance with Articles 193 (a) and 191(a) of the Labor Code, as amended by PD 891, which provide as follows:

Art. 193. Death (a) Under such regulations as the Com mission may approve the System
shall pay to the primary beneficiaries upon the death of the covered employee under this Title
a monthly income benefit equivalent to the monthly income for permanent total disability plus
ten percent of the basic benefit for each dependent child but not exceeding five, beginning
with the youngest and without substitution: Provided, That the monthly income benefit shall
not be paid for more than five years, but the portion corresponding to the monthly income
benefit for permanent total disability shall be guaranteed for five years: Provided, however,
That total payments shag in no case exceed twelve thousand pesos; Provided, further, that if he
has no primary beneficiary, the System shall pay to his secondary beneficiaries a lump sum
benefit equivalent to the lesser or thirty-five times the monthly income benefit for permanent
total disability and six thousand pesos.

25% of the next P300.................................................. 75.00

9% of each succeeding P100....................... 9.00
9% of P100..................................................... 9.00
9% of Pl00....................................................... 9.00
9% of P 92 (refraction of P100)................... 8.28
Basic Benefit.................................................................. P235.28
Consequently, the monthly income benefit (115 % of P235.28) would amount to P270.57.

Art. 191 (a) Under such regulations as the Commission may approve, any employee under
this Title who contracts sickness or sustains an injury resulting in permanent total disability
shall, for each month until his death but not exceeding five years, be paid by the System
during such disability an income benefit equivalent to one hundred fifteen percent of the basic
benefit which shall be computed as follows:

In addition, the law grants an additional 10%, of the basic benefit (P235.28) for each dependent child not
exceeding 5. The deceased left, at the time of his death, 7 dependent children. Petitioner would therefore be
entitled to an additional grant of P23.53 (rounded) for each child or a total of P117.65 for 5 dependent children,
observing the limitation. ln summation, petitioner should be receiving a monthly income benefit of P270.57 plus
P117.65 or a total of P388.22. In a year's time, this would amount to P4,658.64 and in 5 years time, the total would
be P23,293.20. This Court in compliance with the proviso set forth in Article 193 (a) " that total payment shall in
no case excedd twelve thousand pesos [P12,000.000]" limited its award to P12,000.00.

Forty-five percent of the first three hundred pesos of average monthly

salary credit or fraction thereof, plus

Respondent likwise question the award of attorney's fees equivalent to 10% of the death benefits. Its objection is
based primarily on article 203 of the Code which provides that :

Twenty-five percent of the next three hundred pesos of average, monthly

salary credit for each month or fraction thereof; plus

No agent , attorney or other person pursuing or in charge of the preparation or filing of any
claim for benefit under this title shall demand or charge for his service any fee, and any
stipulation to the contrary shall be null and void. the retention or deduction of any amount
from any benefit gramated under this title for the payment of fees of such services is
prohibited. Violation of any provisions of this Article shall be punished by a fine of not less
than five thousand pesos (P5,000.00), or imprisonment for not less than six (6) months nor
more than one (1) year, or both, at the descretion of the court.

Nine percent of each succeeding one hundred pesos of average monthly

salary credit or fraction thereof; plus
One-tenth of one percent of the average monthly salary credit for each
month of paid coverage in the System in excess of one hundred twenty
months of paid coverage prior to the semester of disability: Provided, That
the monthly income benefit shall not less than forty-five pesos.
This argument is untenable A computation of the death benefits in accordance with the underlined procedure
would disclose that the amount, awarded by this Court is well within the limitations provided therein. To illustrate:
The husband of petitioner received an annual salary of P11,904.00. His average monthly
salary, therefore, is P992.00.
The monthly income benefit is 115% of the basic benefit which is computed as follows:
45%, of the first P300
of the P992..................................................... P125.00

A close examination of the aforequoted provision reveals that the intent of the law is to free the awrad from any
liability or charge so that the claimaint who is exempt from liabitity for attorney's fees. The defaulting employer or
governement agency remains libale for attorney's fees; because it compelled the claimant to employ the services of
counsel by unjustly refusing to recognize the validity of the claim of peitioner. This actually is the rationale behind
the prohibition. Nothing is wrong with the court's award of attorney's fees which is separate and distinct from the
other benefits awarded. Besides, in the instant case, the participation of petitioner's counsel was not limited to the
preparation or filling of the claim but in appealling petitioner's case before this Court necessitating submission of
pleadings to establish his cause of action and to rebut or refute the arguments of herein respondents. Fairness
dictates that the counsel should receive compensation for his services; otherwise, it would be entirely difficult for
claimants, majority of whom are notlearned in the intrecacies of the law, to get good legal service. To deny counsel
compensation for his professional services, would amount to deprivation of property without due process of law.

Petitioner appealed to this Court in forma pauperis. Respondents are of the mistaken belief that such manner of
appeal is incompatible with the award of attorney's fees. It must be pointed out that Section 22, Rule 3 of the Rules
of Court merely exempts a pauper litigant from the payment of legal fees and from the filing of appeal bond,
printed record and printed brief, but does not exempt him from the payment of attorney's fees. Therefore, the
award of attorney's fees in the instant case is proper.
With respect to the award of medical benefits, suffice it to say that Article 166 of the Labor Code provides that:
Policy The State shall promote and develop a tax-exempt employees' compensation
program whereby employees and their dependents in the event of work-connected disability or
death may promptly secure adequate income benefit and medical or related benefits.
In line with this provision, this Court ordered the reimbursement of medical, surgical and hospital expenses duly
supported by proper receipts. On the award of funeral benefits in the amount of P700.00, We find that the same
should be increased to Pl,000.00 pursuant to PD 1146, Section 19 in relation to Section 45, and PD 1641, Section
6(d), which took effect on May 31, 1977. This is also consistent with this Court's award in the cases of Mitra vs.
Employees' Compensation Commission (96 SCRA 284 119801); Vda. de Torbela vs. ECC (96 SCRA 260 119801);
and Tuquero vs. ECC (96 SCRA 291 [19801).

G.R. No. L-10675

April 29, 1960


ERNESTA CABAGNOT VDA. DE HIO, for herself and as Guardian-ad-litem of her minor children,
AGENCY, respondents.
Appeal by certiorari from a decision of the Workmen's Compensation Commission.
The petitioner, Compaia Maritima, is a domestic corporation organized under Philippine laws for the purpose of
engaging in interisland trade, while the respondent Pablo Velez Special Watchmen's Agency is a single
proprietorship owned and operated by Mr. Pablo Velez, engaged in the business of supplying watchmen and
protective services to shipping companies requesting such services. The watchmen supplied by the said agency are
recruited from the Manila Bay Watchmen's Association, a duly registered labor organization with whom Velez had
a collective bargaining contract under which fifteen percent (15%) of the total wages of the watchmen are
collected by the latter as commission. The members of the Manila Bay Watchmen's Association compose the
membership of the Pablo Velez Watchmen's Agency.
On or about the later part of August, 1954, a strike was staged by the Marine Officer's Guild and the petitioner
contracted with the Pablo Velez Special Watchmen's Agency for the latter to give security to the officers of the
said petitioner who did not join the strike. Among the members of the Pablo Velez Watchmen's Agency detailed
with the company was the late Dionisio Hio. On September 4, 1954, the said Dionisio Hio was on a night shift
duty as gangwayman of the M/V BASILAN, a vessel owned by petitioner. At about 8:30 o'clock in the evening of
that same day, the said Dionisio Hio and several others were picked on a jeep by the Chief Engineer of the vessel
in order to escort him to his home at Perla, Harrison, Pasay City. Upon their arrival at his residence, the said
engineer offered some drinks to the deceased and the other watchmen who accompanied him home. After having
several rounds of liquor, the watchmen left the engineer's house and they arrived at their respective posts at about
2:00 a.m. the following day, September 5. At about 6 o'clock that morning, the body of Dionisio Hio was found
floating near the side of the M/V BASILAN along the gangway of which he was assigned for duty.
The deceased is survived by his wife Ernesta Cabagnot Hio and three minor children all of whom were dependent
on his wages at the time of his death.

Upon a claim for compensation made by the widow, in her behalf, and in behalf of her children, the Workmen's
Compensation Commission, finding that Dionisio Hio died of an accident that occurred in the course of his
employment, and declaring the Compaia Maritima as employer thereof, ordered that company to pay these
survivors the sum of P4,000.00 as death compensation, P200.00 as reimbursement for burial expenses and P41.00
as fees required under section 55 of the Workmen's Compensation Act, as amended.
In this appeal, we are asked to rule on (1) whether or not the deceased was an employee of the Compaia
Maritima, entitled to compensation under the Workmen's Compensation Act; and (2) whether or not the deceased
was intoxicated while performing his duty as watchman at the time of his death.
The petitioner claims that it never had any employer-employee relationship with the deceased. The claim is
without merit. While it is true that no written employment contract between the petitioner and the deceased was
presented in evidence, it is not disputed that the petitioner company owns the vessel where the deceased was
assigned as gangwayman, and it was found by the Commission that the salary of the deceased was paid directly
from the funds of petitioner. From these circumstances, it would the appear that at the time of the accident the
deceased was under petitioner's employ.
There is nothing to the contention that the deceased was but a casual employee whose services were engaged only
for the duration of the strike and, not entitled to compensation. The section of the law cited by the petitioner in
support of this contention reads:
SEC. 39 (b). "Laborer" is used as a synonym of "employee" and means every person who has entered
the employment of, or works under a service or apprenticeship contract for an employer. It does not
include a person whose employment is purely casual and is not for the purpose of the occupation or
business of the employer. . . .
It is clear from the above that for an employee to be excluded from the term "laborer" or "employee" under the
Act, his employment must be "purely casual and is not for the purpose of the occupation or business of the
employer". In a case (Cajes vs. Philippine Manufacturing Co., 40 Off. Gaz., p. 1251), where this Court had
occasion to interpret the above-quoted section, it was held that the casual service that the law speaks of must be
construed, interpreted and concluded by the circumstance of whether or not the aforesaid service is related with
the occupation of business of the employer. We have reason to believe that the work of the deceased in the case at
bar was in connection with the business of petitioner. It has been shown that it was not only during the strike that
the Compaia Maritima needed the services of watchmen. In fact, the petitioner admitted having its own
permanently employed watchmen doing the same duties as that of the deceased. The duties referred to must be that

of giving security not only to the cargo of the vessel but also to the lives of its officers and crew, and they are,
undoubtedly, in connection with the business of the petitioner. Without security, any shipping company could not
possibly go on with its maritime business.
In disclaiming liability, the petitioner further insists that the deceased was intoxicated while performing his duty as
gangwayman in the early morning of September 5, 1954. The Workmen's Compensation Commission, however,
upon examination of the evidence on this point, noted serious contradictions in the testimony of the witnesses.
While one witness for the Pablo Velez Watchmen's Agency testified that after the alleged drinking spree at the
house of the Chief Engineer of the M/V BASILAN the deceased together with his companions proceeded to their
respective posts at Pier 8, another witness averred that they went to other night spots in Pasay City. On the other
hand, the testimony of the claimant widow that the deceased never got drunk while on duty, and the autopsy report
and testimony of Dr. Cabreira of the Manila Police Department to the effect that there were no indications of
alcohol in the body of the deceased would show that the deceased was not drunk at the time of his death. There is
authority to the effect that where the testimony or evidence shows a conflict in the testimony as to whether or not
the deceased was intoxicated at the time of the injury, it is not error to fail to find that the deceased was
intoxicated, for such ruling is necessarily included in a finding that the accident arose out of the employment
(Napoleon vs. McCullough, 89 N.J.L. 716; 99 Atl. 385, cited in Labor Laws by Francisco, Vol. 2, p. 156). The
defense of drunkenness in workmen's compensation cases must be supported by clear and convincing proof to the
effect that such intoxication or drunkenness rendered the employee incapable of doing his work so that he could
not be said to be engaged in his employment. The accident or injury must be shown to have arisen out of his
drunken condition and not out of the work. No such evidence was adduced in the present case.
It is worthy to note that the witnesses who testified on the alleged drunkenness of the deceased were witnesses for
the Pablo Velez Watchmen's Agency, and not for petitioner. The latter could have presented as witness its Chief
Engineer to bolster its defense of drunkenness, but it failed to do so. It has been ruled that the burden of
establishing intoxication and that it caused the injury is on the employer (Ruprecht vs. Red Lumber Co., 2 Cal.
Ind. Acc. Comm. 860; 12 N.C.C.A. 79, cited in The Workmen's Compensation Law by Morabe and Inton, p 115).
Having failed in this case to prove that the deceased died in a state of drunkenness, the petitioner is not excused
from its obligation as employer to pay compensation to the widow and children of the deceased.
Wherefore, the decision appealed from is affirmed at petitioner's costs.