UNITED PHILIPPINE LINES, INC., PETITIONER, VS. GODOFREDO DEANG, RESPONDENT.

United Philippine Lines versus Deang

The Case

This is a petition brought by United Philippine Lines, Incorporated against Godofredo Deang, a claimant in a workmen's compensation proceeding. The employer asks the Supreme Court to undo the orders of the Workmen's Compensation Commission that allowed the execution of a compensation award despite the employer's claim that it had already paid most of the amount in installments. The case matters because it fixes a quiet but practical boundary: an order that merely works out how an award is to be executed is not an amendment of the award, and a party who is shut out from proving receipts of payment is entitled to relief, though the Court gave that relief without disturbing the award itself.

Procedural History

The case began in the regional office of the Workmen's Compensation Commission, where a hearing officer and referee made an award in favor of Godofredo Deang after the employer failed to controvert the claim. The employer moved to set aside the award, and the referee denied the motion, adding in his order of denial that benefits already received by the claimant for temporary total disability should be deducted from the award. The employer sought reconsideration, and the record went up to the Commission. The chairman ordered the record remanded to the regional office on the ground that the award had already become final and executory. The employer appealed to the Commission en banc, and that appeal was not sustained. A writ of execution then issued, and the sheriff garnished funds deposited in the employer's name with a Manila bank. The employer moved to set aside the writ, attaching fifty-nine receipts signed by the claimant, and the hearing officer refused to admit the originals of those receipts. The Commission finally denied the motion to set aside the writ. The employer came to the Supreme Court by petition, and the Court resolved the case in the decision now before us.

Facts

On the eighth of January, 1969, Hearing Officer and Referee Exequiel E. Sison made an award in favor of Godofredo Deang against United Philippine Lines, Incorporated, in a workmen's compensation case, the employer having failed to controvert the claim. On the thirteenth of February, 1969, the employer filed a motion to set aside the award. The referee denied the motion, and the order of denial provided that benefits received by the claimant under the temporary total disability provision should be deducted from the amount of the award.

The employer moved for reconsideration, and the record was elevated to the Workmen's Compensation Commission. On the eighteenth of May, 1970, the chairman ordered the record remanded to the regional office on the ground that the award sought to be set aside had already become final and executory. The employer appealed to the Commission en banc, but the appeal was not sustained. On the fourth of August, 1970, the chairman issued a writ of execution, and the sheriff garnished the sum of five thousand nine hundred ninety-three pesos and thirty-three centavos deposited in the employer's name with a bank in Manila.

The employer then moved to set aside the writ, attaching fifty-nine receipts signed by the claimant showing receipt of four thousand two hundred forty-nine pesos and seventy-eight centavos as benefits due under the order of February 25, 1969, and claiming that only one thousand six hundred thirty-six pesos and eighty centavos remained due. At the hearing, the hearing officer refused to allow the employer to present the originals of the receipts as evidence. On the twenty-eighth of January, 1971, the Commission denied the motion to set aside the writ. It appeared, however, that as early as October 27, 1970, before resolving that motion, the Commission had already authorized payment to the claimant of one thousand six hundred thirty-six pesos and eighty centavos, retaining the remainder of the garnished amount in its custody.

Issues

• Whether or not the referee's order providing for the deduction of benefits already received by the claimant from the total amount of the award constituted an amendment of the award.
• Whether or not the employer was denied the right to prove, through the presentation of the receipts, the actual payments already made to the claimant on account of the award.

Applicable Provisions

The decision refers to the temporary total disability benefit provision of the Workmen's Compensation Act, which the referee's order of denial invoked when it directed the deduction, in these terms:

Benefits received under Section 14 (temporary total disability) by the claimant (respondent) shall be deducted from the amount of the award (of January 8, 1966).

This provision bears on the case because the deduction it authorizes is what the employer relied upon to show that part of the award had already been satisfied, and the Court treated that deduction as a mere incident of execution rather than a change in the award.

Ruling

On the first issue, the Court held that the referee's order of February 25, 1969, providing for the deduction of the benefits received by the respondent from the total amount of the award in his favor, did not constitute an amendment of the award of compensation, because the deduction was in reality a mere incident in the execution of that award. The Court's reasoning rests on the distinction between changing what is owed and working out how what is owed is to be collected. A deduction of sums already paid does not enlarge or diminish the award; it simply prevents double recovery in the course of execution.

On the second issue, the Court found that the employer was denied the right to prove, with the presentation of relevant receipts, the actual payments already made to the respondent on account of the award. Having been refused the chance to present the originals of the fifty-nine receipts, the employer could not establish the extent of its payments. The Court therefore dismissed the petition, but without prejudice to two things: first, to the right of the employer to present, either to the Commission or to the sheriff in charge of executing the award, the fifty-nine receipts mentioned in the petition; and second, to the deduction of the total amount evidenced by those receipts from the amount of the award in favor of the respondent, should the receipts be proven to be authentic.

Doctrine

An order directing that benefits already received by a claimant be deducted from the amount of a compensation award is not an amendment of the award. It is a mere incident in the execution of that award, and it therefore does not reopen or alter the award's finality. The rule a Bar candidate should retain is that finality of an award bars changes in its substance, but it does not bar the ordinary mechanics of satisfying it, including the crediting of sums already paid.

Second, a party may not be deprived of the opportunity to prove payment. Where an employer holds receipts evidencing actual payments on account of an award and is refused leave to present them, the denial of that right is a ground for relief. The relief, however, is calibrated: the Court did not annul the award or the writ, but left the employer free to prove the receipts before the Commission or the sheriff, and to claim the corresponding deduction should authenticity be established.

Disposition

The Supreme Court dismissed the petition, without prejudice to the employer's right to present the fifty-nine receipts to the Commission or to the sheriff and to claim the deduction of the amounts they evidence should the receipts be proven authentic.

Remember This

Memorize this line: a deduction of benefits already received is a mere incident in the execution of an award, not an amendment of it. Examiners use this case to test the boundary between finality of judgment and the mechanics of execution, and to test whether a party shut out from proving payment is entitled to relief without overturning the award.