G.R. No. L-19863. April 29, 1964. NATIONAL DEVELOPMENT COMPANY, petitioner, vs. WORKMEN’S COMPENSATION COMMISSION and LUZ AGUIRRE, respondents.
FACTS:

Luz Aguirre was employed by the National Development Company (NDC) from 1946, eventually becoming a Regular Weaver. Her duties involved operating multiple looms, connecting broken threads, and lifting heavy rolls of cloth. In April 1953, while lifting a roll, she experienced chest pains and spat blood. Clinical records indicated she had shown symptoms of pulmonary tuberculosis (PTB) as early as 1950, with a 1953 X-ray confirming an active lesion. She was laid off on June 30, 1953, due to this sickness. On June 6, 1960, Aguirre filed a compensation claim, attributing her PTB to her employment. The Workmen’s Compensation Commission found her work taxing and frequently involving night shifts, making the illness compensable. It awarded her P3,594.24 in benefits, P900.00 for medical expenses, P36.00 in fees, and P269.57 as attorney’s fees.
NDC appealed, contesting the compensability of the illness, the award of attorney’s fees, and alleging the Commission relied on hearsay evidence.

ISSUE

The primary issues were: (1) whether NDC forfeited its right to contest the claim due to procedural default; (2) the propriety of awarding attorney’s fees payable by the employer; and (3) the admissibility of the evidence used by the Commission.

RULING

The Supreme Court affirmed the Commission’s decision. On the first issue, the Court held that NDC’s failure to file a notice to controvert the claim within the period mandated by Section 45 of the Workmen’s Compensation Act constituted a statutory renunciation of its right to defend against the claim. This forfeiture is absolute and bars all defenses, including any related to the timeliness of the employee’s claim filing. The legal logic is that this procedural requirement is designed to ensure expeditious resolution of compensation cases, and non-compliance results in an automatic loss of the right to challenge the claim’s merits, irrespective of the employer’s intent.
Regarding attorney’s fees, the Court rejected NDC’s argument that the Commission lacked authority. It distinguished between attorney’s fees payable by the laborer (capped by Section 31 to protect the compensation award from excessive diminution) and fees awarded to be paid by the employer. The Court ruled that Section 47 of the Act grants the Commission the power to approve and fix attorney’s fees. Awarding reasonable fees to be paid by the employer is consistent with legislative policy, as it does not reduce the worker’s compensation. The Civil Code provision on indemnity under compensation laws supplements this authority.
Finally, the Court dismissed the hearsay evidence claim as NDC failed to specify which findings were based on such evidence. Thus, the award was upheld in its entirety.