BERNARTE, DOMINIC I.

BLOCK 2A

TABLE OF CONTENTS

CASE NO. 154 Padillo vs. Rural Bank of Nabunturan

CASE NO. 155 Nazareno vs. Maersk Filipinas Crewings, Inc.
CASE NO. 156 Coastal Safeway Marine Services vs. Esguerra
CASE NO. 157 Rolando L. Cervantes vs. PAL Maritime Corporation
CASE NO. 158 DM Consunji Corp. vs. Bello
CASE NO. 158a Banco Filipino Savings and Mortgage Bank vs. Lazaro
BERNARTE, DOMINIC I. BLOCK 2A

Padillo vs. Rural Bank of Nabunturan

G.R. No. 199338, January 21, 2013

ISSUE:

Whether or not an employee may be validly dismissed on the ground of his poor and failing health

RULING:

Yes. However, the Labor Code provision on termination on the ground of disease under Article
297 does not apply in this case, considering that it was the petitioner and not the Bank who severed
the employment relations. A plain reading of Article 297 of the Labor Code clearly presupposes
that it is the employer who terminates the services of the employee found to be suffering from any
disease and whose continued employment is prohibited by law or is prejudicial to his health as
well as to the health of his co-employees. It does not contemplate a situation where it is the
employee who severs his or her employment ties. This is precisely the reason why Section 8, Rule
1, Book VI of the Omnibus Rules Implementing the Labor Code, directs that an employer shall
not terminate the services of the employee unless there is a certification by a competent public
health authority that the disease is of such nature or at such a stage that it cannot be cured within
a period of six (6) months even with proper medical treatment.

Thus, given the inapplicability of Article 297 of the Labor Code to the instant case, the Court
denied petitioners’ claim for separation pay anchored on such provision.

In this case, it is undisputed that there exists no retirement plan, collective bargaining agreement
or any other equivalent contract between the parties which set out the terms and condition for the
retirement of employees, with the sole exception of the Philam Life Plan which premiums had
already been paid by the Bank. Nevertheless, the Court concurred with the CA that financial
assistance should be awarded but at an increased amount. With a veritable understanding that the
award of financial assistance is usually the final refuge of the laborer, considering as well the
supervening length of time which had sadly overtaken the point of Padillo’s death – an employee
who had devoted twenty-nine (29) years of dedicated service to the Bank – the Court, in light of
the dictates of social justice, held that the CA’s financial assistance award should be increased
from ₱50,000.00 to ₱75,000.00, still exclusive of the ₱100,000.00 benefit receivable by the
petitioners under the Philam Life Plan.
BERNARTE, DOMINIC I. BLOCK 2A

Nazareno vs Maersk Filipinas Crewings

G.R. No. 168703, Feb 26, 2013

ISSUE:

In case of conflict between the findings of the company doctor and independent doctors regarding
the injury sustained by an employee, can the doubt be construed in favor of the laborer?

RULING:

Yes. In any case, the bottomline is this: the certification of the company designated physician
would defeat petitioner’s claim while the opinion of the independent physicians would uphold
such claim. In such a situation, the Court adopts the findings favorable to petitioner. The law looks
tenderly on the laborer. Where the evidence may be reasonably interpreted in two divergent ways,
one prejudicial and the other favorable to him, the balance must be tilted in his favor consistent
with the principle of social justice.

The Court found no cogent reason to depart from the findings of the Labor Arbiter, as affirmed by
the NLRC, that petitioner is entitled to disability benefits corresponding to an Impediment Grade
of 7 (equivalent to a disability assessment of 41.8%) in the Schedule of Disability Allowances
under Section 30-A of the 1996 Standard Employment Contract. Under the said Schedule,
petitioner should be awarded the amount of US$20,900.00 or its equivalent in Philippine currency
at the time of payment.

The Court also agreed with the ruling of the labor arbiter that petitioner is entitled to attorney's
fees following Article 2208 of the New Civil Code, which allows its recovery in actions for
recovery of wages of laborers and actions for indemnity under the employer’s liability laws.
Pursuant to prevailing jurisprudence, petitioner is entitled to attorney's fees of ten percent (10%)
of the monetary award.

Although the general rule under Department Order No. 33, Series of 1996 and Memorandum
Circular No. 55, Series of 1996, that it is the company-designated physician who determines the
fitness or disability of a seafarer who suffered or is suffering from an injury or illness. However,
considering the unanimity of the findings not only of petitioner's independent physicians here in
the Philippines, but also those who were consulted abroad by petitioner's employer, that petitioner
is indeed not fit for duty as a seafarer by reason of the injury he sustained during his fall, the instant
case should be considered as an exception to the general rule abovestated.
BERNARTE, DOMINIC I. BLOCK 2A

The Court has applied the Labor Code concept of disability to Filipino seafarers in keeping with
the avowed policy of the State to give maximum aid and full protection to labor, it holding that the
notion of disability is intimately related to the worker’s capacity to earn, what is compensated
being not his injury or illness but his inability to work resulting in the impairment of his earning
capacity, hence, disability should be understood less on its medical significance but more on the
loss of earning capacity since disability is intimately related to the worker’s capacity to earn, what
is compensated being not his injury or illness but his inability to work resulting in the impairment
of his earning capacity, hence, disability should be understood less on its medical significance but
more on the loss of earning capacity.
BERNARTE, DOMINIC I. BLOCK 2A

Coastal Safeway Marine Services vs. Esguerra

G.R. No. 185352, August 10, 2011

ISSUE:

Whether or not a seafarer is entitled to injury/illness benefits if he fails to submit a post-

employment medical examination conducted by a company-designated physician

RULING:

No. The CA erred in applying POEA Memorandum Circular No. 055-96 instead of the 2000
POEA-SEC which took effect on 25 June 2000. Deemed written in the seafarer's contract of
employment, the 2000 POEA-SEC like its predecessor was designed primarily for the protection
and benefit of Filipino seamen in the pursuit of their employment on board ocean-going vessels.
Anent a seafarer’s entitlement to compensation and benefits for injury and illness, Section 20-B
(3) thereof provides as follows:

Section 20-B. Compensation and Benefits for Injury and Illness.

xxxx
3. Upon sign-off from the vessel for medical treatment, the seafarer is entitled to sickness
allowance equivalent to his basic wage until he is declared fit to work or the degree of permanent
disability has been assessed by the company-designated physician, but in no case shall this period
exceed one hundred twenty (120) days.
For this purpose, the seafarer shall submit himself to a post-employment medical examination by
a company-designated physician within three working days upon his return except when he is
physically incapacitated to do so, in which case, a written notice to the agency within the same
period is deemed as compliance. Failure of the seafarer to comply with the mandatory reporting
requirement shall result in his forfeiture of the right to claim the above benefits.
If a doctor appointed by the seafarer disagrees with the assessment, a third doctor may be agreed
jointly between the employer and the seafarer. The third doctor's decision shall be final and binding
on both parties.

In this case, there is no dispute regarding the fact that Esguerra had altogether failed to comply
with the above-discussed mandatory reporting requirement. Beyond his bare assertion, however,
that CSMSI never gave him referrals to continue his medications as recommended by the foreign
BERNARTE, DOMINIC I. BLOCK 2A

doctor despite his call on 8 July 2003 to inform them that he will report the next day in order to
submit his medical evaluation abroad, Esguerra did not present any evidence to prove justification
for his inability to submit himself to a post-employment medical examination by a company-
designated physician.

Granted that strict rules of evidence are not applicable in claims for compensation, and mere
probability and not the ultimate degree of certainty is regarded as the touchstone or test of proof
in compensation proceedings, it cannot be gainsaid that awards of compensation cannot rest in
speculations or presumptions. In the absence of showing of adequate tests and reasonable findings
to support the same, the divergent Impediment Grades assessed by Dr. Vicaldo and Dr. Saguin
cannot be expediently taken at face value.

Although the Court recognizes the principle that, consistent with the purposes underlying the
formulation of the POEA-SEC, its provisions must be applied fairly, reasonably and liberally in
favor of the seafarers, for it is only then that its beneficent provisions can be fully carried into
effect. The Court ruled that this exhortation cannot, however, be taken to sanction the award
of disability benefits and sickness allowance based on flimsy evidence and/or even in the face of
an unjustified non-compliance with the mandatory reporting requirement under the POEA-
SEC. When the language of the contract is explicit and leaves no doubt as to the intention of its
drafters, the rule is settled that courts may not read into it any other intention that would contradict
its plain import
BERNARTE, DOMINIC I. BLOCK 2A

Rolando Cervantes vs. PAL Maritime Corporation/Western Shipping Agencies

G.R. No. 175209, January 16, 2013

ISSUE:

What constitutes a resignation?

RULING:

Resignation is the voluntary act of an employee who finds himself in a situation where he believes
that personal reasons cannot be sacrificed in favor of the exigency of the service, such that he has
no other choice but to disassociate himself from his employment. According to the Court, this is
precisely what obtained in this case.

In this case, the tenor of petitioner’s telex message was an unmistakable demand that he be relieved
of his assignment:
ANYHOW TO AVOID REPETITION [ON] MORE HARSH REPORTS TO COME. BETTER
ARRANGE MY RELIEVER AND C/O BUSTILLO RELIEVER ALSO. UPON ARR NEXT
USA LOADING PORT FOR THEIR SATISFACTION.

Furthermore, Respondents met the challenge and accepted petitioner’s resignation. Petitioner even
appeared resigned to his fate by stating:
HV NO CHOICE BUT TO ACCEPT YR DECISION. TKS ANYHOW FOR RELIEVING ME
IN NEXT CONVENIENT PORT WILL EASE THE BURDEN THAT I HV FELT ONBOARD.
REST ASSURE VSL WILL BE TURNED OVER PROPERLY TO INCOMING MASTER.

The foregoing exchange of communications clearly shows that complainant was not dismissed
from the service but he opted to be relieved from his post as master. While it is true that his
resignation was an offshoot of the complaint of the shipowners but the latter were merely
requesting the complainant and the chief officers to improve in their performance. The dismissal
aspect was not dismissed at all. It was complainant who brought out the idea and which was
accepted by the shipowner as shown in the telefax message elated September 20, 1995.

The rule that filing of a complaint for illegal dismissal is inconsistent with resignation does not
hold true in this case. The filing of the complaint one year after his alleged termination, coupled
with the clear tenor or his resignation letter should be taken to mean that petitioner's filing or the
illegal dismissal case was a mere afterthought.
BERNARTE, DOMINIC I. BLOCK 2A

DM Consunji Corp. vs. Bello

G.R. No. 159371 July 29, 2013

ISSUES:

1. Whether or not a project employee who is repeatedly hired acquires regular status
2. Whether or not the existence of a resignation letter is a conclusive proof of voluntary resignation

RULING:

1. Yes. It is settled that the extension of the employment of a project employee long after the
supposed project has been completed removes the employee from the scope of a project employee
and makes him a regular employee. In this regard, the length of time of the employee’s service,
while not a controlling determinant of project employment, is a strong factor in determining
whether he was hired for a specific undertaking or in fact tasked to perform functions vital,
necessary and indispensable to the usual business or trade of the employer.

In this case, Bello acquired in time the status of a regular employee by virtue of his continuous
work as a mason of DMCI. The work of a mason like him – a skilled workman working with stone
or similar material – was really related to building or constructing, and was undoubtedly a function
necessary and desirable to the business or trade of one engaged in the construction industry like
DMCI. His being hired as a mason by DMCI in not one, but several of its projects revealed his
necessity and desirability to its construction business.

2. No. In this case, the handwriting in the supposed resignation letter is undeniably different from
that of complainant, which the DMCI did not rebut. Even if the letter been actually signed by him,
the voluntariness of the resignation could not be assumed from such fact alone. His claim that he
had been led to believe that the letter would serve only as the means of extending his sick leave
from work should have alerted DMCI to the task of proving the voluntariness of the resignation.
It was obvious that, if his claim was true, then he did not fully comprehend the import of the letter,
rendering the resignation farcical. The doubt would then be justifiably raised against the letter
being at all intended to end his employment. Under the circumstances, DMCI became burdened
with the obligation to prove the due execution and genuineness of the document as a letter of
resignation.

It is axiomatic in labor law that the employer who interposes the defense of voluntary resignation
of the employee in an illegal dismissal case must prove by clear, positive and convincing evidence
that the resignation was voluntary; and that the employer cannot rely on the weakness of the
defense of the employee. The requirement rests on the need to resolve any doubt in favor of the
working man.
BERNARTE, DOMINIC I. BLOCK 2A

Banco Filipino Savings and Mortgage Bank vs. Lazaro

G.R. No. 185346, 185442, June 27, 2012

ISSUE:

1. Whether or not the liquidation period of a bank prior to its prior closure shall be included in
computing retirement pay of an employee

2. Whether or not an employee is entitled to salary differential, damages, attorney’s fees, and costs
of the suit if such claims were raised only during appeal with the CA

RULING:

1. Yes. In Philippine Veterans Bank v. NLRC, the Court explained that banks under liquidation
retain their legal personality. In fact, even if they are prohibited from conducting regular banking
business, it is necessary that debts owed to them be collected. In this case, Lazaro performed the
duty of foreclosing debts in favor of Banco Filipino. It cannot rightfully disclaim Lazaro’s work
that benefitted it. Consequently, the Court found no grievous error committed by the CA in
crediting the years covered by the liquidation period as part of Lazaro’s retirement pay.

With respect to Banco Filipino Staff Association v. Banco Filipino Savings and Mortgage Bank,
which Banco Filipino cites in order to prove that this Court had earlier excluded the seven-year
period of closure from the length of service of the banks employees, the Court did not categorically
exclude the seven-year period of closure from the length of service of Banco Filipino employees.
Thus, the bank cannot such pronouncement to defeat Lazaro’s claim for retirement pay differential.

2. No. According to the Court, such claims merits instant dismissal. This ruling is supported by
basic considerations of due process, which prohibits the raising of issues for the first time on
appeal. Points of law, theories, issues, and arguments not brought to the attention of the lower
court will not be considered by the reviewing court. To consider them would be unfair to the
adverse party, who would have no opportunity to present contrary evidence as it could have done
had it been aware of the new theory at the time of the hearing before the trial court.