G.R. No. L-43181 October 27, 1986
JOSEPH LU, petitioner, vs. WORKMEN’S COMPENSATION COMMISSION and AUDIPAZ FRANCISCO, respondents.

FACTS

Petitioner Joseph Lu operated a Caltex gasoline station in Zamboanga City. The deceased, Rolando Francisco, was employed as a gasoline attendant. On October 28, 1974, at approximately 11:30 PM, Rolando died in a vehicular accident. Police and insurance investigation reports established that the incident occurred when Rolando, after drinking liquor, took a Ford Fiera jeepney garaged at the station without the owner’s or watchman’s permission. He drove the vehicle at top speed, allegedly attempting to run down a companion, Ricardo Perez, before losing control, toppling into a ditch, and suffering fatal injuries. Rolando possessed no driver’s license, and his regular work schedule was from 7:00 AM to 4:00 PM.
Following Rolando’s death, his widow, private respondent Audipaz Francisco, filed a claim for death benefits under the Workmen’s Compensation Act. The Workmen’s Compensation Unit initially denied the claim, finding the death did not arise from employment. However, the Workmen’s Compensation Commission reversed this decision on appeal, awarding compensation. The Commission held that the employer, Joseph Lu, forfeited his right to contest the claim due to his failure to file a timely Employer’s Report of Accident or a notice of controversion as required by law.

ISSUE

Whether the death of Rolando Francisco is compensable under the Workmen’s Compensation Act.

RULING

No, the death is not compensable. The Supreme Court set aside the Commission’s decision and reinstated the dismissal of the claim by the Workmen’s Compensation Unit. The legal logic is twofold. First, for death to be compensable, it must occur “in the performance of [the employee’s] duties.” The facts conclusively show Rolando was not performing his duties as a gasoline attendant at the time of the accident. The incident happened late at night, outside his working hours. He was engaged in an unauthorized, personal activity—taking and driving a customer’s garaged vehicle without permission while intoxicated and without a license. Driving vehicles was not part of his employment duties.
Second, Section 4 of the Workmen’s Compensation Act expressly excludes compensation for injuries or death caused by the employee’s drunkenness or notorious negligence. The police report categorized the incident as “Homicide, Damage to Property thru Reckless Imprudence,” and the investigation confirmed Rolando was “tipsy” and driving recklessly. Thus, the statutory exclusions apply. The Court clarified that while an employer’s failure to controvert a claim is generally fatal to its defense, this rule presupposes that the claim is inherently compensable under the Act. The forfeiture mechanism cannot operate to award benefits for a death that, based on the substantive facts, clearly falls outside the Act’s coverage due to the circumstances of the incident and the specific statutory exclusions. Therefore, no compensation is due.