G.R. Nos. L-10708 and L-10709; November 21, 1957
FELIPE CASTILLO AND CRISPIN CANINO, petitioners, vs. MADRIGAL SHIPPING CO., INC., and THE WORKMEN’S COMPENSATION COMMISSION COMMISSIONER, respondents.

FACTS

Two separate petitions for review were consolidated as they involved identical facts and the same legal issue. Dezon Castillo and Federico Canino were crew members of the vessel S.S. Regulus, owned by Madrigal Shipping Co., Inc., which sank on November 2, 1949, and they were presumed dead. Their respective fathers, Felipe Castillo and Crispin Canino, filed claims for death compensation with the Bureau of Labor under the Workmen’s Compensation Act ( Act No. 3428 ). The Bureau issued letters of computation advising the company of the compensation due: P1,359.80 for Castillo and P2,175.68 for Canino. Upon the company’s failure to pay, the claimants, assisted by Bureau of Labor lawyers, filed separate court actions (Civil Case No. 11509 in the Municipal Court of Manila for Castillo and Civil Case No. 10926 in the Court of First Instance of Manila for Canino). Subsequently, both claimants entered into compromise agreements with the shipping company in 1950, whereby each received P332 in full settlement of their claims and executed formal deeds of release and waiver. These agreements were approved by the respective courts, which then dismissed the complaints with prejudice. In 1955, after the enactment of Republic Act No. 772 (which created the Workmen’s Compensation Commission), both claimants filed petitions with the Commission to revive their claims for the balance of the compensation originally computed. The Commission’s referees granted their petitions, ordering payment of the balances. On appeal, the Workmen’s Compensation Commissioner reversed these decisions, holding that the prior court decisions based on the compromise agreements were final and constituted res judicata, barring the revived claims. The claimants then petitioned the Supreme Court for review.

ISSUE

Whether the decisions of the Municipal Court and the Court of First Instance of Manila, which approved the compromise agreements and dismissed the complaints with prejudice, are valid and constitute res judicata, thereby barring any further claim for compensation by the petitioners.

RULING

Yes. The Supreme Court affirmed the decisions of the Workmen’s Compensation Commissioner. The compromise agreements entered into in 1950 were valid under the version of Section 29 of Act No. 3428 as amended by Act No. 3812 (in force at that time), which required such agreements to be in a public instrument acknowledged before a notary public (in Manila) with attestation by witnesses, and with certification that the claimants were fully informed of their rights. The deeds of release and waiver in these cases complied with these formalities, were executed before a notary public, contained the required explanations, and were signed with the assistance of Bureau of Labor lawyers. The court approvals and subsequent dismissals with prejudice rendered the decisions final. The petitioners’ reliance on the amended Section 29 under Republic Act No. 772 (requiring approval by the Workmen’s Compensation Commissioner) and on Section 7 (prohibiting contracts exempting employers from liability) was misplaced, as the law in force at the time of the agreements allowed such court-approved compromises. Since the court decisions were valid and had become final, they constituted res judicata and barred the subsequent claims before the Workmen’s Compensation Commission. The petitions were dismissed.