LOADSTAR INTERNATIONAL SHIPPING, INC., PETITIONER, VS. ERNESTO AWITEN YAMSON, SUBSTITUTED BY HIS HEIRS GEORGIA M. YAMSON AND THEIR CHILDREN, NAMELY: JENNIE ANN MEDINA YAMSON, KI…

Loadstar International Shipping versus Yamson

The Case

This is a labor case between a shipping company, Loadstar International Shipping, and a seafarer it employed as Third Mate, Ernesto Yamson, who is now substituted by his surviving spouse and children. Ernesto fell ill on board the vessel and later claimed total and permanent disability benefits, sickness allowance, medical and transportation reimbursements, damages, and attorney's fees. The case matters because it is a clean teaching vehicle on the two elements of compensability under the POEA Standard Employment Contract, on the weight given to the company-designated physician against the seafarer's doctor of choice, and on the burden of substantial evidence that the seafarer must discharge.

Procedural History

Ernesto filed a complaint before the Labor Arbiter. The Labor Arbiter dismissed the complaint for lack of merit. Ernesto appealed to the National Labor Relations Commission, which partly granted the appeal, affirming the dismissal of the disability claim but ordering Loadstar to pay sickness allowance and medical and transportation expenses. Both parties then filed separate special civil actions for certiorari before the Court of Appeals. The Court of Appeals denied Loadstar's petition but granted Ernesto's, reversing the Commission and awarding total and permanent disability benefits plus attorney's fees. Loadstar's motion for reconsideration was denied. Loadstar then came to the Supreme Court by petition for review on certiorari under Rule 45.

Facts

Loadstar employed Ernesto as Third Mate aboard the vessel M/V Foxhound under an employment contract executed in May 2012, later extended. In November 2013, while the vessel was loading logs in Papua New Guinea, Ernesto felt dizzy on an extremely hot day. By evening the left side of his body grew numb, and the following day he could no longer move his left side. He was brought to a hospital in Papua New Guinea, where he was diagnosed with a left cerebellar infarct and Stage 2 hypertension, and was ordered to stop working for two weeks.

Ernesto was repatriated in December 2013. He was examined at the Philippine General Hospital and sent home as an out-patient, but because he continued to suffer headache and numbness, he was admitted to a private hospital, where a CT scan showed an old infarct in the left cerebellum. He was discharged after several days. A physician of his own later diagnosed him with hypertensive atherosclerotic cardiovascular disease and cerebrovascular disease and advised him to stop working as a seaman due to neurologic deficits.

On the strength of his own doctor's findings, Ernesto filed the complaint in March 2014. The company-designated physician, for his part, had not completed his assessment, as he was still awaiting the results of a CT angiogram. No third doctor was jointly agreed upon by the parties.

Issues

• Whether or not Ernesto's illnesses were work-related or work-aggravated, such that they are compensable under the POEA Standard Employment Contract.
• Whether or not Ernesto is entitled to total and permanent disability benefits by reason of those illnesses.
• Whether or not Ernesto is entitled to sickness allowance and reimbursement of medical and transportation expenses.

Applicable Provisions

Section 20 of the 2010 Amended Standard Terms and Conditions Governing the Overseas Employment of Filipino Seafarers On-Board Ocean-Going Ships provides:

SECTION 20. COMPENSATION AND BENEFITS A. COMPENSATION AND BENEFITS FOR INJURY OR ILLNESS The liabilities of the employer when the seafarer suffers work-related injury or illness during the term of his contract are as follows: 1. The employer shall continue to pay the seafarer his wages during the time he is on board the ship; 2. If the injury or illness requires medical and/or dental treatment in a foreign port, the employer shall be liable for the full cost of such medical, serious dental, surgical and hospital treatment as well as board and lodging until the seafarer is declared fit to work or to be repatriated. However, if after repatriation, the seafarer still requires medical attention arising from said injury or illness, he shall be so provided at cost to the employer until such time he is declared fit or the degree of his disability has been established by the company-designated physician. 3. In addition to the above obligation of the employer to provide medical attention, the seafarer shall also receive sickness allowance from his employer in an amount equivalent to his basic wage computed from the time he signed off until he is declared fit to work or the degree of disability has been assessed by the company-designated physician. The period within which the seafarer shall be entitled to his sickness allowance shall not exceed 120 days. Payment of the sickness allowance shall be made on a regular basis, but not less than once a month. The seafarer shall be entitled to reimbursement of the cost of medicines prescribed by the company-designated physician. In case treatment of the seafarer is on an out-patient basis as determined by the company-designated physician, the company shall approve the appropriate mode of transportation and accommodation. The reasonable cost of actual traveling expenses and/or accommodation shall be paid subject to liquidation and submission of official receipts and/or proof of expenses. For this purpose, the seafarer shall submit himself to a post-employment medical examination by a company-designated physician within three working days upon his return except when he is physically incapacitated to do so, in which case, a written notice to the agency within the same period is deemed as compliance. In the course of the treatment, the seafarer shall also report regularly to the company-designated physician specifically on the dates as prescribed by the company-designated physician and agreed to by the seafarer. Failure of the seafarer to comply with the mandatory reporting requirement shall result in his forfeiture of the right to claim the above benefits. If a doctor appointed by the seafarer disagrees with the assessment, a third doctor may be agreed jointly between the Employer and the seafarer. The third doctor's decision shall be final and binding on both parties.

This provision fixes the employer's liabilities, the sickness allowance, the reimbursement rules, the mandatory reporting requirement, and the third-doctor mechanism, and it is the measure of Ernesto's claims.

Ruling

On the first issue, the Court held that Ernesto failed to establish that his illnesses were work-related or work-aggravated. For disability to be compensable, two elements must concur: the injury or illness must be work-related, and it must have existed during the term of the employment contract. It is not enough that the seafarer is disabled; there must be a causal connection between the illness and the work. While an illness may be disputably presumed work-related, the claimant must still show a reasonable connection between the nature of the work and the illness, and must present substantial evidence that his working conditions caused or at least increased the risk of the disease. The Court found the medical certificate of Ernesto's physician to be a mere summary based on a one-time consultation, without laboratory tests or diagnostic procedures, and held that an award of compensation cannot rest on speculations, presumptions, and conjectures. It also held that the pre-employment medical examination is not exploratory and does not allow the employer to discover all pre-existing conditions, so a fit-to-work declaration is not conclusive proof of good health.

On the second issue, the Court held that Ernesto is not entitled to any disability compensation, absent substantial evidence from which a reasonable basis for the grant of benefits can be drawn. The Court acknowledged that labor contracts are impressed with public interest and must be construed liberally in favor of Filipino seamen, but stressed that justice is in every case for the deserving, to be dispensed in the light of established facts, the applicable law, and existing jurisprudence.

On the third issue, the Court noted that the company-designated physician did not complete his assessment of Ernesto's condition, as he was still awaiting the results of the CT angiogram. It also observed that both parties failed to present evidence on the mandatory reporting requirement, so the forfeiture of the sickness allowance and reimbursement claims could not be sustained on that ground.

Doctrine

For disability to be compensable under the POEA Standard Employment Contract, two elements must concur: the injury or illness must be work-related, and the work-related injury or illness must have existed during the term of the seafarer's employment contract. The burden is on the claimant to present substantial evidence that his work conditions caused or at least increased the risk of contracting the disease. The company-designated physician is entrusted with assessing the seafarer's disability, but that assessment is not automatically final, binding, or conclusive; the seafarer may seek a second opinion, and if the doctors disagree, a third doctor may be agreed jointly, whose decision is final and binding. The pre-employment medical examination is not exploratory and does not establish the true state of health of the applicant.

Disposition

The Supreme Court granted Loadstar's petition, reversed and set aside the Court of Appeals decision, and reinstated the ruling of the Labor Arbiter and the National Labor Relations Commission denying Ernesto's claim for total and permanent disability benefits.

Remember This

The single line worth memorizing: compensability requires both a work-related illness and its existence during the term of the contract, proven by substantial evidence of a causal connection. Examiners like to use this case to test the weight of the company-designated physician against the seafarer's doctor of choice, and the rule that the pre-employment medical examination is not exploratory.