ABOITIZ SHIPPING CORPORATION, PETITIONER, VS. VIVENCIA ANDO PEPITO, AND THE MINORS, LOLITA, ALBERTO, NELSON, MARYLEN & MARIA, ALL SURNAMED PEPITO, REPRESENTED BY THEIR MOTHER, T…

Aboitiz Shipping versus Pepito

The Case

This is a petition for certiorari brought by Aboitiz Shipping Corporation against Vivencia Ando Pepito and her minor children, all surnamed Pepito, to annul a decision of the Workmen's Compensation Commission awarding them death benefits for the disappearance of Demetrio Pepito, a crew member of the vessel P. Aboitiz. The case matters because it draws a sharp line between two very different things: the fact of disappearance and the fact of death. It teaches that an employer's failure to controvert a claim admits only the facts alleged, never the legal conclusion that the worker is dead, and that an award of compensation cannot rest on a presumption of death that the law does not yet allow.

Procedural History

Vivencia Ando Pepito, for herself and in behalf of her children, filed a notice and claim for compensation with the Regional Office of the Department of Labor in Cebu City. Without holding a hearing, the Regional Administrator issued an award for death benefits, on the ground that the employer had not controverted the claim within the period fixed by law. The employer's motion for reconsideration was denied. Aboitiz Shipping then sought review before the Workmen's Compensation Commission, which affirmed the award in its decision of March 8, 1963. Its motion for reconsideration was likewise denied by the Commission sitting en banc on April 5, 1963. The employer then came to the Supreme Court on certiorari to review that decision and that resolution.

Facts

Between the night of November 30 and the early morning of December 1, 1961, Demetrio Pepito, a crew member of the vessel P. Aboitiz, disappeared while the vessel was on voyage from Surigao to Tandag. On December 26, 1961, the employer received a letter from Vivencia Ando Pepito dated December 21, 1961, notifying it that Demetrio Pepito had been reported missing per the deck log book of the vessel, that she believed he was already dead, and that a diligent search had been made but proved futile.

On January 12, 1962, Vivencia filed a notice and claim for compensation, asking for death benefits and describing the event as one in which the deceased was lost or reported missing while the vessel was navigating. On February 16, 1962, after receiving the claim from the regional office, the employer filed its report of accident or sickness, controverting the claim and alleging that Pepito disappeared while off duty, near Bucas Grande Island, on a calm sea and in good weather, and that it did not know whether he purposely jumped and swam ashore.

On March 21, 1962, without any hearing, the Regional Administrator issued an award for death benefits, holding that the right to compensation had not been controverted within the period provided by law. The Commission affirmed. More than four years had elapsed from the event by the time the case reached the Supreme Court.

Issues

• Whether or not the employer's controversion was filed beyond the period fixed by law and the rules of the Workmen's Compensation Commission.
• Whether or not the employer's failure to controvert timely amounted to an admission of the actual death of Demetrio Pepito.
• Whether or not the award of death benefits, made without a hearing on the fact and circumstances of death, violated the employer's right to due process.
• Whether or not the investigation report of the constabulary sergeant could supply the proof of death.
• Whether or not the case falls within the presumption of death under the Civil Code.

Applicable Provisions

Section 1(1) of Article III of the Constitution provides:

No person shall be deprived of life, liberty, or property without due process of law.

This is the provision the Court invokes to nullify an award rendered without giving the employer a chance to be heard on the debatable fact of death.

Section 7 of the Workmen's Compensation Law provides:

All ex parte evidence received by the Commissioner shall be reduced to writing and any party in interest shall have the opportunity to examine and rebut the same.

This governs the constabulary investigation report, which the employer was never given the opportunity to examine or contradict.

Paragraph 3 of Article 391 of the Civil Code provides:

The following shall be presumed dead for all purposes, including the division of estate among the heirs: A person who has been in danger of death under other circumstances and his existence has not been known for four years.

This is the presumption the Court directs the Commission to apply on remand, since more than four years had elapsed and the missing man had been in danger of death at sea.

Ruling

On the first issue, the Court held that the controversion filed on February 16, 1962 was decidedly beyond the periods set by law and the rules, namely fourteen days from the date of the accident or ten days from knowledge thereof. The employer knew of the disappearance on December 1, 1961, and received the claimant's letter on December 26, 1961.

On the second issue, the Court held that non-controversion admits only facts, not conclusions of law. The claim merely stated that the deceased was lost or reported missing, and at that time no presumption existed that he was dead. The Court ruled that the employer's non-controversion admits but the fact that Demetrio Pepito was lost or missing, but is not an admission of the actual fact of death.

On the third issue, the Court held that the award, made without inquiry into the fact and circumstances of death, trenched upon the employer's right to due process, and nullified the award as a violation of the constitutional proscription.

On the fourth issue, the Court held that the constabulary report did not prove death. At best it confirmed the known fact of disappearance, with the circumstance that no one knew what happened to the missing man. It was never brought up at any hearing and was hearsay twice removed, and since the employer was not afforded the opportunity to examine or rebut it, the report was of no value as evidence.

On the fifth issue, the Court noted that the employer-employee relationship was conceded and that the event arose out of and in the course of employment, it mattering not that the disappearance occurred while the worker was off duty, for he had no choice but to be in the vessel. With more than four years elapsed, the Court held that the case could come within the presumption of death under paragraph 3 of Article 391 of the Civil Code, subject to evidence that his existence had not been known for four years or thereafter.

Doctrine

First, non-controversion admits facts, not conclusions of law. An employer's failure to timely controvert a compensation claim admits only the facts alleged in the claim, such as the fact of disappearance, and never the legal conclusion of death.

Second, death benefits require proof of death. An award of death benefits cannot stand where the fact and circumstances of death have not been established through a hearing, for to do so deprives the employer of property without due process of law.

Third, ex parte evidence must be disclosed. A report never offered at a hearing, which the adverse party had no opportunity to examine or rebut, has no evidentiary value.

Fourth, the presumption of death under Article 391 applies where a person has been in danger of death under other circumstances and his existence has not been known for four years.

Disposition

The Court set aside the Commission's decision and resolution and remanded the record to the Workmen's Compensation Commission, directing it to hold a hearing with notice to the parties to determine whether Demetrio Pepito is alive, whether he should be presumed dead under paragraph 3 of Article 391 of the Civil Code, and the circumstances of death if death be found or presumed, and to render judgment accordingly, without costs.

Remember This

Memorize the line: non-controversion admits the fact of disappearance, not the fact of death. Examiners use this case to test the limits of non-controversion in workmen's compensation and the interplay of due process with the Civil Code presumption of death.