G.R. No. L-9807; April 17, 1957
PAN PHILIPPINES CORPORATION, petitioner, vs. WORKMEN’S COMPENSATION COMMISSION and LEONORA FRIAS, respondents.

FACTS

Pascual Castillo, a carpenter of the Pan Philippines Corporation, died by drowning on December 25, 1945, when a company boat capsized off the coast of the Caramoan Peninsula while transporting a cargo of UNRRA goods to the company’s mining concession. The Workmen’s Compensation Division learned of his death in the course of proceedings on another claim. Leonora Frias filed her claim for compensation as his widow on February 11, 1949. A referee of the Bureau of Labor found in her favor on September 9, 1950. After the creation of the Workmen’s Compensation Commission, a referee thereof rendered a decision on February 3, 1955, ordering the corporation to pay P983.84, which was affirmed by the Commissioner. The corporation appealed, raising defenses of prescription, lack of jurisdiction, that the death did not arise out of employment, and that the marriage was not duly proven.

ISSUE

1. Whether the claim had prescribed under the statute of limitations.
2. Whether the Workmen’s Compensation Commission had jurisdiction over the claim given the provisions of Section 42 of Act 3428 regarding “small industries.”
3. Whether the death of Pascual Castillo arose out of and in the course of his employment.
4. Whether the marriage of Leonora Frias to Pascual Castillo was duly established.

RULING

1. No, the claim had not prescribed. The six-year prescriptive period under Act No. 190 was extended to ten years by Article 1144(2) of the new Civil Code, which became effective before the original period expired on December 25, 1951. The new period did not expire until December 25, 1955, after the Commission had taken cognizance of the case. The application of the new Civil Code did not impair any vested right of the corporation.
2. Yes, the Commission had jurisdiction. The corporation was not a “small industry” exempt under Section 42 of Act 3428. The provision refers to trades or occupations for gain with a gross income of less than P20,000 in the year preceding the accident. The corporation was a large mining enterprise with a pre-war capital of over half a million pesos. The phrase “gross income” presupposes business activity; for a company closed due to war, the last year of business activity (1941) should be considered. Interpreting the law otherwise would exempt all employers from liability during their first year of operation, contrary to the law’s intent.
3. Yes, the death arose out of and in the course of employment. The corporation had recalled its pre-war employees for rehabilitation work after liberation. Providing employees with clothing (UNRRA goods) was part of rehabilitating them due to war losses. The assignment of workers to jobs other than actual mining did not negate the employer-employee relationship.
4. Yes, the marriage was duly established. The evidence consisted of affidavits from witnesses to the wedding, an affidavit from a resident who knew the spouses, the verified claim of Leonora Frias, and a certification from the parish priest that the marriage record was lost due to war destruction. This evidence was properly considered under Section 49 of Act 3428, as amended, and the corporation had the opportunity to examine and rebut it.
The decision of the Workmen’s Compensation Commission was affirmed.