J. PHIL MARINE, INC. v.

NLRC (By: Iris Yap)

561 SCRA 676, August 11, 2008
Petitioner/s: J-PHIL MARINE INC. and NORMAN SHIPPING SERVICES
Respondent/s: NATIONAL LABOR RELATIONS COMMISSION and
WARLITO DUMALAOG
Doctrine: Only the employee, not his counsel, who can impugn the
consideration of the compromise as being unconscionable. The relation of
attorney and client is in many respects one of agency, and the general rules
of agency apply to such relationthe circumstances of this case indicate that
the employees counsel acted beyond the scope of his authority in
questioning the compromise agreement.
Facts:
(1) Respondent Warlito Dumaloag served as a cook aboard vessels
plying overseas. He filed a complaint before the NLRC against
petitioners J-Phil, a manning agency, and its foreign principal
Norman Shipping Services, for unpaid money claims, paid leaves,
disability benefits, among others. He claimed to have been disabled
due to enlargement of the heart and severe thyroid enlargement
contacted while discharging his duties as a cook.
(2) In light of this, the NLRC awarded $50,000 disability benefit to
respondent. However, during the pendency of the case, respondent,
against the advice of his counsel, entered into a compromise
agreement with petitioners. He received P450,000. He signed a
Quitclaim and Release subscribed and sworn to before the Labor
Arbiter.
(3) Subsequently, respondents counsel filed a Comment and Opposition
purportedly on behalf of respondent objecting to the absolution of
petitioners from paying respondent the award granted by the NLRC
($50,000). Counsel prayed that the remaining balance be paid.

Issue: W/N counsel, as agent of respondent, acted within the scope of his
authority as to allow him to impugn the consideration of the compromise as
being unconscionable. (NO)
Held:
(1) Art 227 of the Labor Code provides, Any compromise, settlement
voluntarily agreed upon by the parties with assistance of the
Department of Labor, shall be final and binding upon parties. The
NLRC shall not assume jurisdiction over issues involved therein,
except in case of non-complianceor if settlement was obtained
through fraud, misrepresentation or coercion. Such compromise has
the effect and authority of res judicata. It is deemed voluntarily
entered into if there is personal and specific individual consent.
(2) Counsel argues that the amount of P450,000 is unconscionably low.
However, only respondent Dumalaog can impugn the consideration
of the compromise as being unconscionable.
The relation of attorney and client is in many respects one of agency.
The general rules of agency apply to such relation. The acts of an
agent are deemed acts of the principal only if the agent acts within
the scope of his authority. However, the circumstances of this case
indicate that respondents counsel is acting beyond the scope of his
authority in questioning the compromise agreement.
The client has a right to compromise a suit without intervention of the
lawyer, who may only intervene if the compromise is entered into
with the intent to defraud the lawyer of the fees justly due him.
However, there is no showing that respondent intended to defraud
his counsel of his fees. In fact, the Quitclaim and Release notes that
20% attorneys fees (P90,000) would be paid on April 12, 2007.
Case DISMISSED.