NOLI DEMONTEVERDE, FOR HERSELF AND IN BEHALF OF HER MINOR CHILD, NOCELYN DEMON­TEVERDE, PETITIONER, VS. WORKMEN’S COMPENSATION COMMISSION AND A-1 PRIME SECURITY AGENCY (MR. MAUR…

Demonteverde versus Workmen's Compensation Commission

The Case

This is a petition for review brought by Noli Demonteverde, for herself and in behalf of her minor child Nocelyn, against the Workmen's Compensation Commission and her late husband's employer, A-1 Prime Security Agency. The petitioner seeks to set aside the Commission's decision reversing an award of death benefits earlier granted by the Acting Chief Referee. The case matters because it fixes the consequence of an employer's failure to controvert a compensation claim within the period fixed by the Workmen's Compensation Act: that failure is a renunciation of the right to controvert, and it forecloses even the most plausible defense that the death was not work-connected.

Procedural History

Noli Demonteverde filed a notice and claim for death benefits with the Workmen's Compensation Unit of the Department of Labor, Regional Office Four. The Acting Chief Referee issued an Award in her favor, holding that the employer had failed to controvert the claim within the required period. The employer moved for reconsideration, but the Acting Chief Referee ruled that the motion was a useless piece of paper for failure to show service on the other party, declared the award final and executory, and later ordered the records elevated to the Commission for review. The Commission set the case for hearing, received evidence from both sides, and then reversed the Award and dismissed the claim for lack of merit. The petitioner came to the Supreme Court by petition for review.

Facts

Zenon Demonteverde was employed as a security guard by A-1 Prime Security Agency and was assigned at the Ysmael Compound. At around seven o'clock in the evening of June 8, 1973, he was struck by a car in front of the Christ the King Compound along E. Rodriguez Boulevard in Quezon City, roughly 500 meters from his place of assignment, and he died of a meningeal hemorrhage with skull fracture.

On August 20, 1973, his widow filed a claim for death benefits. The employer filed its Employer's Report of Accident or Sickness only on November 2, 1973, and there controverted the claim on the ground that the deceased was off duty at the time of the accident, his working hours being from seven in the morning to three in the afternoon. The employer admitted that it learned of the accident on June 9, 1973, the day after it happened.

Before the Commission, the employer presented daily time records and the testimony of its treasurer to show that the deceased's tour of duty ended at three in the afternoon and that he had been relieved by another guard. The claimant, through a co-worker, testified that the deceased actually worked until seven in the evening, the extra hours being recorded in the employer's cover-up record book. The Commission found that the deceased was already off duty and about 500 meters from his post on a public highway when he was killed, and dismissed the claim.

Issues

• Whether or not the employer timely and effectively controverted the claim for death compensation under the Workmen's Compensation Act.
• Whether or not the Commission had authority to reopen the case and allow the employer to prove that the death was not work-connected, despite the failure to controvert.
• Whether or not the deceased was still on duty, and the accident work-connected, at the time of his death.

Applicable Provisions

Section 45 of the Workmen's Compensation Act, as amended, provides:

In case the employer decided to controvert the right to compensation, he shall, either on or before the fourteenth day of disability or within ten days after he has knowledge of the alleged accident, file a notice with the Commissioner, on a form prescribed by him, that compensation is not being paid, giving the name of the claimant, name of the employer, date of the accident and the reason why compensation is not being paid. Failure on the part of the employer or the insurance carrier to comply with this requirement shall constitute a renunciation of his right to controvert the claim unless he submits reasonable grounds for the failure to make the necessary reports, on the basis of which grounds the Commissioner may reinstate the right to controvert the claim.

This is the provision on which the entire case turns, because the employer's late report is measured against its ten-day period.

Ruling

On the first issue, the Court held that the employer did not timely controvert the claim. It knew of the accident on June 9, 1973, yet filed its report only on November 2, 1973, almost five months later. Under Section 37 of the Act in relation to Section 45, the report must be filed on or before the fourteenth day of disability or within ten days after knowledge of the accident, and failure to comply is a renunciation of the right to controvert.

On the second issue, the Court held that the Commission had no authority to reopen the case. An employer may regain its standing only after its right to controvert is reinstated by the Commission on reasonable grounds, and the records show the employer never availed of that remedy. The Court quoted its earlier ruling in Security Services Unlimited versus Workmen's Compensation Commission, which explained the policy behind the short period:

The period provided by law may be of short duration but it must have been intended to protect employees from subsequently concocted defenses upon advice of legal counsel they (employers) could well afford to pay and which may be raised by the employer simply to defeat or delay the legitimate claims of employee.

On the third issue, the Court noted the testimony that the deceased worked until seven in the evening under a cover-up arrangement, and that the employer never directly rebutted it nor presented the guard who supposedly relieved him. The Court nevertheless observed that these findings do not alter the fact that the death occurred after seven o'clock and outside the premises; it discussed them only to expose the employer's attempt to widen the gap between the accident and the end of the shift.

Doctrine

An employer who fails to file its notice of controversion within ten days after knowledge of the accident, or on or before the fourteenth day of disability, renounces its right to controvert the claim. The defenses it might have raised, including the defense that the death was not work-connected, are thereby foreclosed. The employer may recover its right to controvert only by submitting reasonable grounds for the delay, on the basis of which the Commission may reinstate that right. Being social legislation, the Workmen's Compensation Act is interpreted liberally in favor of the employee.

Disposition

The Court reversed and set aside the decision of the Commission and ordered A-1 Prime Security Agency to pay the petitioners 5,200 pesos as death benefits, 200 pesos as burial expenses, attorney's fees equivalent to ten percent of the total award, and administrative fees.

Remember This

Memorize the line that failure to controvert within the statutory period is a renunciation of the right to controvert, and that the employer must first ask the Commission to reinstate that right. Examiners use this case to test the ten-day controversion rule and the limits of an employer's defenses in workmen's compensation claims.