G.R. No. 254586 . July 10, 2023
ROSELL R. ARGUILLES, PETITIONER, VS. WILHELMSEN SMITH BELL MANNING, INC./ WILHELMSEN SHIP MANAGEMENT LTD., AND FAUSTO R. PREYSLER, JR., RESPONDENTS.

FACTS

Petitioner Rosell R. Arguilles was employed as an Ordinary Seaman by respondents. On December 26, 2016, while playing basketball with colleagues during free time on board the vessel, he suffered a left ankle injury diagnosed as a high-grade Achilles tendon tear. He was medically repatriated on January 18, 2017. Upon arrival, he was referred to company-designated physicians, underwent surgery on February 6, 2017, and received physical therapy until June 23, 2017. Petitioner alleged that respondents terminated his treatment on June 28, 2017, as his injury was “too severe to be resolved within 120 days.” He then consulted an independent physician, Dr. Rogelio P. Catapang, who declared him unfit for sea duty. Respondents countered that the injury was not work-related as it occurred during a recreational activity and that a company-designated physician, Dr. Ferdinand Bernal, had declared petitioner fit to work on June 28, 2017, though this “Final Medical Report” was not initially presented as evidence. The Labor Arbiter granted petitioner’s claim for permanent and total disability benefits. The NLRC initially modified the award but, upon reconsideration and after respondents belatedly submitted Dr. Bernal’s medical note, reversed itself and dismissed the complaint. The Court of Appeals affirmed the NLRC’s dismissal.

ISSUE

Whether petitioner’s injury, sustained while playing basketball during off-duty hours, is compensable as a work-related disability.

RULING

Yes. The Supreme Court granted the petition and reinstated the Labor Arbiter’s decision awarding permanent and total disability benefits. The Court held that the injury is compensable under the “Bunkhouse Rule,” which states that seafarers on board a vessel are considered to be in the course of employment at all times, barring gross misconduct or deliberate infliction of self-harm. The injury occurred within the employer’s premises and during an accepted period of rest, making it work-related. The Court found the company-designated physician’s assessment (the June 28, 2017 note) insufficient as it was not a definitive final assessment within the 120/240-day periods required by law and did not state a disability grading. Consequently, petitioner’s disability was deemed permanent and total, entitling him to full disability benefits under the Collective Bargaining Agreement. The Court also awarded moral and exemplary damages due to respondents’ bad faith in unreasonably denying the claim and belatedly submitting evidence, and attorney’s fees.