G.R. No. 188595; August 28, 2013
Sea Power Shipping Enterprises, Inc., and/or Bulk Carriers Limited and Special Maritime Enterprises, and M/V Magellan, Petitioners, vs. Nenita P. Salazar, on behalf of deceased Armando L. Salazar, Respondent.

FACTS

Armando L. Salazar was employed as an Able Seaman by petitioner Sea Power Shipping Enterprises, Inc. on April 11, 2003, for a nine-month term plus a three-month extension. He was declared “fit to work” in his pre-employment medical examination. He boarded the M/V Magellan on April 20, 2003, and was repatriated on September 8, 2004, after 17 months. Two days after repatriation, on September 10, 2004, he was confined in the ICU at Tanza Family General Hospital for pneumonia. Due to this confinement, he could not undergo the required post-employment medical examination (PEME) within 72 hours of repatriation. His wife, respondent Nenita P. Salazar, informed petitioners of his condition and requested insurance proceeds, but the agency denied the claim, citing the lack of a PEME. Armando was later diagnosed with lung carcinoma with brain metastases at the Philippine General Hospital in October 2004 and died on March 1, 2005, from cardio-respiratory arrest secondary to acute respiratory failure and multi-organ failure.
Respondent filed a claim for death benefits, minor child’s allowance, burial expenses, sickness allowance, hospitalization expenses, moral damages, and attorney’s fees under the POEA Contract. She alleged that Armando’s work as an Able Seaman exposed him to deleterious elements from the cargo without protective gear, causing constant headaches and worsening his health. Petitioners denied liability, arguing that death benefits under Section 20(A) of the POEA Contract require death during the employment term, which did not occur, and that illness benefits under Section 20(B) were not due because Armando never reported health problems at sea and his lung cancer was not work-related.
The Labor Arbiter denied all claims, ruling that the illness and death did not occur during service and that the lack of a PEME barred benefits. The NLRC reversed in part, awarding illness benefits (hospitalization expenses, sickness allowance), moral damages, and attorney’s fees, but denied death benefits because Armando died after his contract ended. The NLRC held that his immediate post-repatriation confinement indicated a pre-existing deteriorating condition and noted the “evil practice” of denying medical attention to seafarers. Respondent filed a Rule 65 petition with the Court of Appeals, seeking death benefits. The CA granted death benefits, minor child’s allowance, and burial expenses, relying on Wallem Maritime Services, Inc. v. NLRC and reasoning that his advanced illness upon repatriation suggested a work-related cause, despite the lack of medical reports at sea and the missed PEME. Petitioners elevated the case via Rule 45.

ISSUE

Whether the respondent is entitled to death benefits, minor child’s allowance, and burial expenses under Section 20(A) of the POEA Contract, considering that the seafarer died after the termination of his employment contract.

RULING

No. The Supreme Court reversed the Court of Appeals and reinstated the NLRC decision, denying the claim for death benefits, minor child’s allowance, and burial expenses.
The Court held that for death benefits to be compensable under Section 20(A) of the POEA Contract, the seafarer’s death must occur during the term of the employment contract. Since Armando Salazar died on March 1, 2005, approximately six months after his repatriation on September 8, 2004, and after his contract had ended, his death is not compensable under this provision. The Court distinguished this case from Wallem Maritime Services, Inc. v. NLRC, where the seafarer died shortly after repatriation while still in the employer’s custody, making the death deemed to have occurred during the term. Here, Armando died long after his contract terminated, and there was no showing that petitioners prevented him from undergoing the PEME or acted in bad faith.
The Court emphasized that while the NLRC correctly awarded illness benefits under Section 20(B) based on the presumption of work-relatedness for illnesses occurring during the term, this presumption does not extend to death benefits when death occurs after the contract ends. The grant of illness benefits (hospitalization expenses, sickness allowance, moral damages, and attorney’s fees) by the NLRC had already become final and binding, as petitioners did not appeal it. However, death benefits require a separate condition—death during the term—which was not met. Thus, respondent is entitled only to the illness benefits awarded by the NLRC, not to death benefits, minor child’s allowance, or burial expenses.