G.R. No. 207344 , November 18, 2020
OSG SHIPMANAGEMENT MANILA, INC., MICHAELMAR SHIPPING SERVICES, INC., AND/OR MA. CRISTINA PARAS, PETITIONERS, VS. VICTORIO B. DE JESUS, RESPONDENT.

FACTS

Respondent Victorio B. De Jesus was hired by petitioner OSG Shipmanagement Manila, Inc. for its foreign principal as a Second Cook on January 15, 2008, with an eight-month contract. He was declared “Fit to work” prior to boarding. During the voyage, he experienced pain and nausea, attributing it to salty and dirty drinking water. He was diagnosed with Costen Syndrome in Rotterdam, and later with urethritis and kidney stones in Singapore and China. He was repatriated to the Philippines on November 14, 2008. Respondent alleged that upon repatriation, petitioner refused him a medical examination due to the absence of a master’s medical pass. He sought personal medical treatment, underwent a nephrectomy (removal of a kidney), and was later certified as unfit for maritime duties. He filed a complaint for full disability compensation. Petitioners contended respondent was repatriated due to a finished contract, not a medical condition, and that he failed to report for a post-employment medical examination. They argued his illnesses were not occupational or work-related. The Labor Arbiter and the NLRC dismissed the complaint, finding repatriation was due to a finished contract and a failure to prove work-relatedness. The Court of Appeals reversed, holding the illnesses were presumed work-related and that petitioners failed to rebut this presumption, awarding permanent total disability benefits.

ISSUE

1. Whether the Court of Appeals erred in awarding total and permanent disability benefits notwithstanding the completion of his employment contract and his failure to submit to a post-medical examination within three days from arrival.
2. Whether the Court of Appeals erred in awarding total and permanent disability benefits notwithstanding evidence that his condition (loss of one kidney) does not constitute permanent total disability under the POEA Contract.
3. Whether the Court of Appeals erred in awarding attorney’s fees.

RULING

The Supreme Court ruled in favor of the petitioners, granting the petition.
1. On the failure to report for post-employment medical examination: The Court emphasized the mandatory nature of the three-day reporting requirement under the POEA-SEC for a seafarer to claim disability benefits. Respondent’s failure to comply with this requirement, by not submitting himself to a company-designated physician within three working days upon his return, results in the forfeiture of his right to claim disability benefits. The Court cited precedents (Jebsens Maritime Inc. v. Undag) establishing that non-compliance is fatal to the claim, regardless of the reason for repatriation.
2. On the nature of disability: The Court found that respondent’s condition, the loss of one kidney, is classified as a Grade 7 disability (moderate rigidity or loss of motion or lifting power of one-half) under the POEA Contract, not a permanent total disability. A Grade 7 disability entitles a seafarer to a specific amount of compensation, not the full US$60,000 for permanent total disability. The certification from his personal doctor declaring him unfit for sea duty did not automatically equate to permanent total disability under the terms of the POEA-SEC.
3. On attorney’s fees: Since the petitioners’ refusal to pay disability benefits was justified based on respondent’s non-compliance with the procedural requirements and the correct disability grading, the award of attorney’s fees by the Court of Appeals had no legal basis. Attorney’s fees are not awarded where the defendant’s refusal to pay is grounded on a justified reason.
The Supreme Court reversed the Court of Appeals Decision and Resolution, and reinstated the NLRC Decision dismissing the complaint for lack of merit.