PILLSBURY MINDANAO FLOUR MILLING COMPANY, INC., AND DONALD MORAZA, PETITIONERS, VS. FELIX MURILLO AND THE WORK­MEN’S COMPENSATION COMMIS­SION, RESPONDENTS.

Pillsbury Mindanao Flour Milling versus Murillo

The Case

This is a consolidated decision in five workmen's compensation cases, decided by the Supreme Court on the last day of January 1978. On one side are employers and the Workmen's Compensation Commission; on the other are five claimants — Felix Murillo, Dionisio Soriano, Pedro Hortizuela, Aquilino Maico, and Perpetua Yap — whose claims the Commission either affirmed with modifications or reversed. The case matters because it gathers into one ruling the two pillars of the old Workmen's Compensation Act: the presumption of compensability under Section 44, and the fatal effect of an employer's failure to controvert a claim seasonably under Section 45. It also settles that optional retirement brought about by a disabling ailment does not defeat a compensation claim.

Procedural History

Each claim began before a referee of the Workmen's Compensation Unit. In the case of Felix Murillo, the referee awarded disability compensation, medical expenses, attorney's fees, and administrative fees in his favor. In the cases of Dionisio Soriano, Pedro Hortizuela, Aquilino Maico, and Perpetua Yap, the referees likewise awarded compensation in their favor. On review, the Workmen's Compensation Commission affirmed the referee's award to Murillo in substance, with modifications. In the four other cases, the Commission reversed the referees and denied the claims. The claimants and the employer then elevated the matters to the Supreme Court, which consolidated the five cases and rendered one decision.

Facts

Felix Murillo worked as a mechanic for Pillsbury Mindanao Flour Milling Company. He suffered repeated attacks of bronchial asthma in the course of his employment, and these led to pulmonary emphysema and cor pulmonale, which caused his separation from work. The employer's maintenance superintendent knew of his illness on August 29, 1966, but the employer's report controverting the claim was received by the Workmen's Compensation Unit only on October 17, 1966.

Dionisio Soriano served as a public school teacher from October 1945. He contracted rheumatoid arthritis of the knees and ankle joints, stopped working, and was optionally retired on November 30, 1973. Pedro Hortizuela taught for twenty-four years, contracted bronchial asthma and bronchiectasis aggravated by chalk dust, and obtained optional retirement. Perpetua Yap taught from October 1947, collapsed while conducting classes on October 22, 1973 because of hypertensive vascular disease and chronic diabetes mellitus, and retired optionally on February 8, 1974 at the age of sixty-three.

Aquilino Maico incurred medical expenses, duly supported by receipts, for psoriasis, and was confined in two hospitals in Tacloban City during his sick leave. The Commission reversed the referees in these four cases on varying grounds: that no causal relation to the work was shown, that optional retirement was voluntary, that there was no showing of disability, and that there was no showing of hospital confinement for hypertension.

Issues

• Whether or not the employer's failure to file a seasonable controversion barred it from interposing defenses and from demanding a hearing.
• Whether or not the disabling ailments of the claimants are presumed to have arisen out of or been aggravated by their employment.
• Whether or not optional retirement because of a disabling ailment defeats the claim for disability compensation.
• Whether or not the claimant in the medical expense case is entitled to reimbursement.

Applicable Provisions

Section 44 of the Workmen's Compensation Act provides:

In the absence of substantial evidence to the contrary, the claim is presumed to be compensable.

This presumption relieves the employee of proving causation and shifts the burden to the employer.

Section 45 of the same Act, as discussed in the decision, fixes the period for controversion:

Within fourteen days from the date of disability or within ten days from knowledge of the accident or sickness, the employer shall controvert the right to compensation.

Failure to controvert within this period operates as a renunciation of the right to interpose defenses.

Ruling

On the first issue, the Court held that the employer in the Murillo case failed to controvert seasonably. The illness was known on August 29, 1966, yet the controversion was received only on October 17, 1966, beyond the ten or fourteen day period, and no petition for reinstatement of the right to controvert was filed. Following Victorias Milling, the employer is deemed to have renounced its defenses and waived the right to be heard.

On the second issue, the Court applied the presumption of compensability. Even assuming the illness is not occupational or the causal link is insufficiently shown, the law presumes that an illness supervening during employment arose out of or was aggravated by that employment. The employer failed to discharge the burden of disproving the claim by substantial evidence.

On the third issue, the Court held that optional retirement does not defeat the claim. Citing Gomez, it noted that optional retirement is approved only where the employee below sixty-five is physically incapacitated to render further efficient service, so approval by the Government Service Insurance System indicates such incapacity.

On the fourth issue, the Court held that the finding of disability and hospital confinement was supported by substantial evidence, and the medical expenses were undisputed, so reimbursement was properly awarded.

Doctrine

First, an illness supervening during employment is presumed compensable under Section 44; the burden shifts to the employer to disprove causation by substantial evidence. Second, failure to controvert within the statutory period under Section 45 is a renunciation by operation of law of the right to interpose defenses and to be heard. Third, optional retirement due to a disabling ailment does not negate compensability, since approval of optional retirement below sixty-five implies physical incapacity.

Disposition

The Court affirmed the award to Felix Murillo, set aside the Commission's reversals in the four other cases, reinstated the referees' awards to Soriano, Hortizuela, Maico, and Yap, and increased the attorney's fees in three cases to ten percent.

Remember This

Memorize the line that failure to controvert seasonably is a renunciation by operation of law of the right to contest and to be heard. Examiners use this case to test the Section 44 presumption of compensability and the effect of optional retirement on workmen's compensation claims.