G.R. No.

146964 August 10, 2006

ROSA C. RODOLFO, Petitioner,
vs.
PEOPLE OF THE PHILIPPINES, Respondent.

DECISION

CARPIO MORALES, J.:

Petitioner was charged before the Regional Trial Court (RTC) of Makati for illegal recruitment
alleged to have been committed as follows:

That in or about and during the period from August to September 1984, in Makati, Metro
Manila, Philippines, and within the jurisdiction of this Honorable Court, the said accused
representing herself to have the capacity to contract, enlist and transport Filipino workers for
employment abroad, did then and there willfully and unlawfully, for a fee, recruit and promise
employment/job placement abroad to VILLAMOR ALCANTARA, NARCISO
CORPUZ, 1 NECITAS R. FERRE, GERARDO H. TAPAWAN and JOVITO L. CAMA, without
first securing the required license or authority from the Ministry of Labor and Employment. 2

After trial on the merits, Branch 61 of the Makati RTC rendered its Judgment on the case, 3 the
decretal portion of which reads:

WHEREFORE, PREMISES ABOVE CONSIDERED, the Court finds the accused ROSA C.
RODOLFO as GUILTY of the offense of ILLEGAL RECRUITMENT and hereby sentences her
[to] a penalty of imprisonment of EIGHT YEARS and to pay the costs. 4 (Underscoring
supplied)

In so imposing the penalty, the trial court took note of the fact that while the information
reflected the commission of illegal recruitment in large scale, only the complaint of the two of
the five complainants was proven.

On appeal, the Court of Appeals correctly synthesized the evidence presented by the parties as
follows:

[The evidence for the prosecution] shows that sometime in August and September 1984,
accused-appellant approached private complainants Necitas Ferre and Narciso Corpus
individually and invited them to apply for overseas employment in Dubai. The accused-appellant
being their neighbor, private complainants agreed and went to the former’s office. This office
which bore the business name "Bayside Manpower Export Specialist" was in a building situated
at Bautista St. Buendia, Makati, Metro Manila. In that office, private complainants gave certain
amounts to appellant for processing and other fees. Ferre gave P1,000.00 as processing fee
(Exhibit A) and another P4,000.00 (Exhibit B). Likewise, Corpus gave appellant P7,000.00
(Exhibit D). Appellant then told private complainants that they were scheduled to leave for
Dubai on September 8, 1984. However, private complainants and all the other applicants were
not able to depart on the said date as their employer allegedly did not arrive. Thus, their
departure was rescheduled to September 23, but the result was the same. Suspecting that they
were being hoodwinked, private complainants demanded of appellant to return their money.
Except for the refund of P1,000.00 to Ferre, appellant was not able to return private
complainants’ money. Tired of excuses, private complainants filed the present case for illegal
recruitment against the accused-appellant.

To prove that accused-appellant had no authority to recruit workers for overseas employment,

the prosecution presented Jose Valeriano, a Senior Overseas Employment Officer of the
Philippine Overseas Employment Agency (POEA), who testified that accused-appellant was
neither licensed nor authorized by the then Ministry of Labor and Employment to recruit workers
for overseas employment.

For her defense, appellant denied ever approaching private complainants to recruit them for
employment in Dubai. On the contrary, it was the private complainants who asked her help in
securing jobs abroad. As a good neighbor and friend, she brought the private complainants to the
Bayside Manpower Export Specialist agency because she knew Florante Hinahon, 5 the owner of
the said agency. While accused-appellant admitted that she received money from the private
complainants, she was quick to point out that she received the same only in trust for delivery to
the agency. She denied being part of the agency either as an owner or employee thereof. To
corroborate appellant’s testimony, Milagros Cuadra, who was also an applicant and a companion
of private complainants, testified that appellant did not recruit them. On the contrary, they were
the ones who asked help from appellant. To further bolster the defense, Eriberto C. Tabing, the
accountant and cashier of the agency, testified that appellant is not connected with the agency
and that he saw appellant received money from the applicants but she turned them over to the
agency through either Florantino Hinahon or Luzviminda Marcos. 6 (Emphasis and underscoring
supplied)

In light thereof, the appellate court affirmed the judgment of the trial court but modified the
penalty imposed due to the trial court’s failure to apply the Indeterminate Sentence Law.

The appellate court thus disposed:

WHEREFORE, finding no merit in the appeal, this Court DISMISSES it and AFFIRMS the
appealed Decision EXCEPT the penalty x x x which is hereby changed to five (5) years as
minimum to seven (7) years as maximum with perpetual disqualification from engaging in the
business of recruitment and placement of workers. 7 (Underscoring supplied)

Petitioner’s Motion for Reconsideration having been denied, 8 the present petition was filed,
faulting the appellate court

x x x IN GIVING CREDENCE TO THE TESTIMONIES OF THE COMPLAINING

WITNESSES, [AND]
 II

x x x IN FINDING THE PETITIONER-ACCUSED GUILTY WHEN THE PROSECUTION

FAILED TO PROVE HER GUILT BEYOND REASONABLE DOUBT. 9 (Underscoring
supplied)

Petitioner bewails the failure of the trial court and the Court of Appeals to credit the testimonies
of her witnesses, her companion Milagros Cuadra, and Eriberto C. Tabing who is an accountant-
cashier of the agency.

Further, petitioner assails the trial court’s and the appellate court’s failure to consider that the
provisional receipts she issued indicated that the amounts she collected from the private
complainants were turned over to the agency through Minda Marcos and Florante Hinahon. At
any rate, she draws attention to People v. Señoron 10 wherein this Court held that the issuance or
signing of receipts for placement fees does not make a case for illegal recruitment. 11

The petition fails.

Articles 38 and 39 of the Labor Code, the legal provisions applicable when the offense charged
was committed, 12 provided:

ART. 38. Illegal Recruitment. – (a) Any recruitment activities, including the prohibited practices
enumerated under Article 34 of this Code, to be undertaken by non-licensees or non-holders of
authority shall be deemed illegal and punishable under Article 39 of this Code. x x x

Article 39. Penalties. – x x x x

(c) Any person who is neither a licensee nor a holder of authority under this Title found violating
any provision thereof or its implementing rules and regulations shall, upon conviction thereof,
suffer the penalty of imprisonment of not less than four years nor more than eight years or a fine
of not less than P20,000 nor more than P100,000 or both such imprisonment and fine, at the
discretion of the court;

x x x x (Underscoring supplied)

The elements of the offense of illegal recruitment, which must concur, are: (1) that the offender
has no valid license or authority required by law to lawfully engage in recruitment and placement
of workers; and (2) that the offender undertakes any activity within the meaning of recruitment
and placement under Article 13(b), or any prohibited practices enumerated under Article 34 of
the Labor Code. 13 If another element is present  that the accused commits the act against three
or more persons, individually or as a group, it becomes an illegal recruitment in a large scale. 14

Article 13 (b) of the Labor Code defines "recruitment and placement" as "[a]ny act of
canvassing, enlisting, contracting, transporting, utilizing, hiring or procuring workers,
and includes referrals, contract services, promising or advertising for employment, locally or
abroad, whether for profit or not." (Underscoring supplied)
That the first element is present in the case at bar, there is no doubt. Jose Valeriano, Senior
Overseas Employment Officer of the Philippine Overseas Employment Administration, testified
that the records of the POEA do not show that petitioner is authorized to recruit workers for
overseas employment. 15 A Certification to that effect was in fact issued by Hermogenes C.
Mateo, Chief of the Licensing Division of POEA. 16

Petitioner’s disclaimer of having engaged in recruitment activities from the very start does not
persuade in light of the evidence for the prosecution. In People v. Alvarez, this Court held:

Appellant denies that she engaged in acts of recruitment and placement without first complying
with the guidelines issued by the Department of Labor and Employment. She contends that she
did not possess any license for recruitment, because she never engaged in such activity.

We are not persuaded. In weighing contradictory declarations and statements, greater weight

must be given to the positive testimonies of the prosecution witnesses than to the denial of the
defendant. Article 38 (a) clearly shows that illegal recruitment is an offense that is essentially
committed by a non-licensee or non-holder of authority. A non-licensee means any person,
corporation or entity to which the labor secretary has not issued a valid license or authority to
engage in recruitment and placement; or whose license or authority has been suspended, revoked
or cancelled by the POEA or the labor secretary. A license authorizes a person or an entity to
operate a private employment agency, while authority is given to those engaged in recruitment
and placement activities.

xxxx

That appellant in this case had been neither licensed nor authorized to recruit workers for
overseas employment was certified by Veneranda C. Guerrero, officer-in-charge of the Licensing
and Regulation Office; and Ma. Salome S. Mendoza, manager of the Licensing Branch – both of
the Philippine Overseas Employment Administration. Yet, as complainants convincingly proved,
she recruited them for jobs in Taiwan. 17 (Italics in the original; underscoring supplied)

The second element is doubtless also present. The act of referral, which is included in
recruitment, 18 is "the act of passing along or forwarding of an applicant for employment after an
initial interview of a selected applicant for employment to a selected employer, placement officer
or bureau." 19 Petitioner’s admission that she brought private complainants to the agency whose
owner she knows and her acceptance of fees including those for processing betrays her guilt.

That petitioner issued provisional receipts indicating that the amounts she received from the
private complainants were turned over to Luzviminda Marcos and Florante Hinahon does not
free her from liability. For the act of recruitment may be "for profit or not." It is sufficient that
the accused "promises or offers for a fee employment" to warrant conviction for illegal
recruitment. 20 As the appellate court stated:

x x x Sec. 13(b) of P.D. 442 [The Labor Code] does not require that the recruiter receives and
keeps the placement money for himself or herself. For as long as a person who has no license to
engage in recruitment of workers for overseas employment offers for a fee an employment to
two or more persons, then he or she is guilty of illegal recruitment. 21

Parenthetically, why petitioner accepted the payment of fees from the private complainants
when, in light of her claim that she merely brought them to the agency, she could have advised
them to directly pay the same to the agency, she proferred no explanation.

On petitioner’s reliance on Señoron, 22 true, this Court held that issuance of receipts for
placement fees does not make a case for illegal recruitment. But it went on to state that it is
"rather the undertaking of recruitment activities without the necessary license or authority" that
makes a case for illegal recruitment. 23

A word on the penalty. Indeed, the trial court failed to apply the Indeterminate Sentence Law
which also applies to offenses punished by special laws.

Thus, Section 1 of Act No. 4103 (An Act to Provide for an Indeterminate Sentence and Parole
for All Persons Convicted of Certain Crimes by the Courts of the Philippine Islands; To Create A
Board of Indeterminate Sentence and to Provide Funds Therefor; and for Other Purposes)
provides:

SECTION 1. Hereafter, in imposing a prison sentence for an offense punished by the Revised
Penal Code, or its amendments, the court shall sentence the accused to an indeterminate sentence
the maximum term of which shall be that which, in view of the attending circumstances, could be
properly imposed under the rules of the said Code, and the minimum which shall be within the
range of the penalty next lower to that prescribed by the Code for the offense; and if the offense
is punished by any other law, the court shall sentence the accused to an indeterminate sentence,
the maximum term of which shall not exceed the maximum fixed by said law and the minimum
shall not be less than the minimum term prescribed by the same. (As amended by Act No. 4225)
(Underscoring supplied)

While the penalty of imprisonment imposed by the appellate court is within the prescribed
penalty for the offense, its addition of "perpetual disqualification from engaging in the business
of recruitment and placement of workers" is not part thereof. Such additional penalty must thus
be stricken off.

WHEREFORE, the petition is DENIED. The assailed Decision and Resolution of the Court of
Appeals are AFFIRMED with MODIFICATION in that the accessory penalty imposed by it
consisting of "perpetual disqualification from engaging in the business of recruitment and
placement of workers" is DELETED.

Costs against petitioner.

SO ORDERED.

CONCHITA CARPIO MORALES

Associate Justice
G.R. Nos. L-58674-77 July 11, 1990

PEOPLE OF THE PHILIPPINES, petitioner,

vs.
HON. DOMINGO PANIS, Presiding Judge of the Court of First Instance of Zambales &
Olongapo City, Branch III and SERAPIO ABUG, respondents.

CRUZ, J:
The basic issue in this case is the correct interpretation of Article 13(b) of P.D. 442, otherwise
known as the Labor Code, reading as follows:

(b) Recruitment and placement' refers to any act of canvassing, enlisting,

contracting, transporting, hiring, or procuring workers, and includes referrals,
contract services, promising or advertising for employment, locally or abroad,
whether for profit or not: Provided, That any person or entity which, in any
manner, offers or promises for a fee employment to two or more persons shall be
deemed engaged in recruitment and placement.

Four informations were filed on January 9, 1981, in the Court of First Instance of Zambales and
Olongapo City alleging that Serapio Abug, private respondent herein, "without first securing a
license from the Ministry of Labor as a holder of authority to operate a fee-charging employment
agency, did then and there wilfully, unlawfully and criminally operate a private fee charging
employment agency by charging fees and expenses (from) and promising employment in Saudi
Arabia" to four separate individuals named therein, in violation of Article 16 in relation to
Article 39 of the Labor Code. 1

Abug filed a motion to quash on the ground that the informations did not charge an offense
because he was accused of illegally recruiting only one person in each of the four informations.
Under the proviso in Article 13(b), he claimed, there would be illegal recruitment only
"whenever two or more persons are in any manner promised or offered any employment for a
fee. " 2

Denied at first, the motion was reconsidered and finally granted in the Orders of the trial court
dated June 24 and September 17, 1981. The prosecution is now before us on certiorari. 3

The posture of the petitioner is that the private respondent is being prosecuted under Article 39 in
relation to Article 16 of the Labor Code; hence, Article 13(b) is not applicable. However, as the
first two cited articles penalize acts of recruitment and placement without proper authority,
which is the charge embodied in the informations, application of the definition of recruitment
and placement in Article 13(b) is unavoidable.

The view of the private respondents is that to constitute recruitment and placement, all the acts
mentioned in this article should involve dealings with two or mre persons as an indispensable
requirement. On the other hand, the petitioner argues that the requirement of two or more
persons is imposed only where the recruitment and placement consists of an offer or promise of
employment to such persons and always in consideration of a fee. The other acts mentioned in
the body of the article may involve even only one person and are not necessarily for profit.

Neither interpretation is acceptable. We fail to see why the proviso should speak only of an offer
or promise of employment if the purpose was to apply the requirement of two or more persons to
all the acts mentioned in the basic rule. For its part, the petitioner does not explain why dealings
with two or more persons are needed where the recruitment and placement consists of an offer or
promise of employment but not when it is done through "canvassing, enlisting, contracting,
transporting, utilizing, hiring or procuring (of) workers.
As we see it, the proviso was intended neither to impose a condition on the basic rule nor to
provide an exception thereto but merely to create a presumption. The presumption is that the
individual or entity is engaged in recruitment and placement whenever he or it is dealing with
two or more persons to whom, in consideration of a fee, an offer or promise of employment is
made in the course of the "canvassing, enlisting, contracting, transporting, utilizing, hiring or
procuring (of) workers. "

The number of persons dealt with is not an essential ingredient of the act of recruitment and
placement of workers. Any of the acts mentioned in the basic rule in Article 13(b) win constitute
recruitment and placement even if only one prospective worker is involved. The proviso merely
lays down a rule of evidence that where a fee is collected in consideration of a promise or offer
of employment to two or more prospective workers, the individual or entity dealing with them
shall be deemed to be engaged in the act of recruitment and placement. The words "shall be
deemed" create that presumption.

This is not unlike the presumption in article 217 of the Revised Penal Code, for example,
regarding the failure of a public officer to produce upon lawful demand funds or property
entrusted to his custody. Such failure shall be prima facie evidence that he has put them to
personal use; in other words, he shall be deemed to have malversed such funds or property. In
the instant case, the word "shall be deemed" should by the same token be given the force of a
disputable presumption or of prima facie  evidence of engaging in recruitment and placement.
(Klepp vs. Odin Tp., McHenry County 40 ND N.W. 313, 314.)

It is unfortunate that we can only speculate on the meaning of the questioned provision for lack
of records of debates and deliberations that would otherwise have been available if the Labor
Code had been enacted as a statute rather than a presidential decree. The trouble with presidential
decrees is that they could be, and sometimes were, issued without previous public discussion or
consultation, the promulgator heeding only his own counsel or those of his close advisers in their
lofty pinnacle of power. The not infrequent results are rejection, intentional or not, of the interest
of the greater number and, as in the instant case, certain esoteric provisions that one cannot read
against the background facts usually reported in the legislative journals.

At any rate, the interpretation here adopted should give more force to the campaign against
illegal recruitment and placement, which has victimized many Filipino workers seeking a better
life in a foreign land, and investing hard- earned savings or even borrowed funds in pursuit of
their dream, only to be awakened to the reality of a cynical deception at the hands of theirown
countrymen.

WHEREFORE, the Orders of June 24, 1981, and September 17, 1981, are set aside and the four
informations against the private respondent reinstated. No costs.

SO ORDERED.
G.R. Nos. 182978-79               April 7, 2009

BECMEN SERVICE EXPORTER AND PROMOTION, INC., Petitioner,

vs.
SPOUSES SIMPLICIO and MILA CUARESMA (for and in behalf of their daughter,
Jasmin G. Cuaresma), WHITE FALCON SERVICES, INC. and JAIME ORTIZ
(President,White Falcon Services, Inc.), Respondents.

x - - - - - - - - - - - - - - - - - - - - - - -x

G.R. Nos. 184298-99               April 7, 2009

SPOUSES SIMPLICIO and MILA CUARESMA (for and in behalf of their daughter,
Jasmin G. Cuaresma), Petitioners,
vs.
WHITE FALCON SERVICES, INC. and BECMEN SERVICE EXPORTER AND
PROMOTION, INC., Respondents.

DECISION

YNARES-SANTIAGO, J.:

These consolidated petitions assail the Amended Decision1 of the Court of Appeals dated May
14, 2008 in CA-G.R. SP No. 80619 and CA-G.R. SP No. 81030 finding White Falcon Services,
Inc. and Becmen Service Exporter and Promotion, Inc. solidarily liable to indemnify spouses
Simplicio and Mila Cuaresma the amount of US$4,686.73 in actual damages with interest.

On January 6, 1997, Jasmin Cuaresma (Jasmin) was deployed by Becmen Service Exporter and
Promotion, Inc.2 (Becmen) to serve as assistant nurse in Al-Birk Hospital in the Kingdom of
Saudi Arabia (KSA), for a contract duration of three years, with a corresponding salary of
US$247.00 per month.

Over a year later, she died allegedly of poisoning.

Jessie Fajardo, a co-worker of Jasmin, narrated that on June 21, 1998, Jasmin was found dead by
a female cleaner lying on the floor inside her dormitory room with her mouth foaming and
smelling of poison.3

Based on the police report and the medical report of the examining physician of the Al-Birk
Hospital, who conducted an autopsy of Jasmin’s body, the likely cause of her death was
poisoning. Thus:

According to letter No. 199, dated 27.2.1419H, issued by Al-Birk Police Station, for examining
the corpse of Jasmin Cuaresma, 12.20 P.M. 27.2.1419H, Sunday, at Al-Birk Hospital.
 1. The Police Report on the Death

2. The Medical Diagnosis

Sex: Female Age: 25 years Relg: Christian

The said person was brought to the Emergency Room of the hospital; time 12.20 P.M.
and she was unconscious, blue, no pulse, no respiration and the first aid esd undertaken
but without success.

3. Diagnosis and Opinion: Halt in blood circulation respiratory system and brain damage
due to an apparent poisoning which is under investigation.4

Name : Jasmin Cuaresma

Sex : Female
Marital Status : Single Nationality: Philipino (sic)
Religion : Christian
Profession : Nurse
: Al-Birk Genrl. Hospital Birth Place: The
Address
Philippines

On 27.2.1419H, Dr. Tariq Abdulminnem and Dr. Ashoki Komar, both have examined the dead
body of Jasmin Cuaresma, at 12.20 P.M., Sunday, 22.2.14189H, and the result was:

1. Report of the Police on the death

2. Medical Examination: Blue skin and paleness on the Extrimes (sic), total halt to blood
circulation and respiratory system and brain damage. There were no external
injuries. Likely poisoning by taking poisonous substance, yet not determined. There
was a bad smell in the mouth and unknown to us.5 (Emphasis supplied)

Jasmin’s body was repatriated to Manila on September 3, 1998. The following day, the City
Health Officer of Cabanatuan City conducted an autopsy and the resulting medical report
indicated that Jasmin died under violent circumstances, and not poisoning as originally found by
the KSA examining physician. The City Health Officer found that Jasmin had abrasions at her
inner lip and gums; lacerated wounds and abrasions on her left and right ears; lacerated wounds
and hematoma (contusions) on her elbows; abrasions and hematoma on her thigh and legs; intra-
muscular hemorrhage at the anterior chest; rib fracture; puncture wounds; and abrasions on the
labia minora of the vaginal area.6

On March 11, 1999, Jasmin’s remains were exhumed and examined by the National Bureau of
Investigation (NBI). The toxicology report of the NBI, however, tested negative for non-volatile,
metallic poison and insecticides.7
Simplicio and Mila Cuaresma (the Cuaresmas), Jasmin’s parents and her surviving heirs,
received from the Overseas Workers Welfare Administration (OWWA) the following amounts:
P50,000.00 for death benefits; P50,000.00 for loss of life; P20,000.00 for funeral expenses; and
P10,000.00 for medical reimbursement.

On November 22, 1999, the Cuaresmas filed a complaint against Becmen and its principal in the
KSA, Rajab & Silsilah Company (Rajab), claiming death and insurance benefits, as well as
moral and exemplary damages for Jasmin’s death.8

In their complaint, the Cuaresmas claim that Jasmin’s death was work-related, having occurred
at the employer’s premises;9 that under Jasmin’s contract with Becmen, she is entitled to "iqama
insurance" coverage; that Jasmin is entitled to compensatory damages in the amount of
US$103,740.00, which is the sum total of her monthly salary of US$247.00 per month under her
employment contract, multiplied by 35 years (or the remaining years of her productive life had
death not supervened at age 25, assuming that she lived and would have retired at age 60).

The Cuaresmas assert that as a result of Jasmin’s death under mysterious circumstances, they
suffered sleepless nights and mental anguish. The situation, they claim, was aggravated by
findings in the autopsy and exhumation reports which evidently show that a grave injustice has
been committed against them and their daughter, for which those responsible should likewise be
made to pay moral and exemplary damages and attorney’s fees.

In their position paper, Becmen and Rajab insist that Jasmin committed suicide, citing a prior
unsuccessful suicide attempt sometime in March or April 1998 and relying on the medical report
of the examining physician of the Al-Birk Hospital. They likewise deny liability because the
Cuaresmas already recovered death and other benefits totaling P130,000.00 from the OWWA.
They insist that the Cuaresmas are not entitled to "iqama insurance" because this refers to the
"issuance" – not insurance – of iqama, or residency/work permit required in the KSA. On the
issue of moral and exemplary damages, they claim that the Cuaresmas are not entitled to the
same because they have not acted with fraud, nor have they been in bad faith in handling
Jasmin’s case.

While the case was pending, Becmen filed a manifestation and motion for substitution alleging
that Rajab terminated their agency relationship and had appointed White Falcon Services, Inc.
(White Falcon) as its new recruitment agent in the Philippines. Thus, White Falcon was
impleaded as respondent as well, and it adopted and reiterated Becmen’s arguments in the
position paper it subsequently filed.

On February 28, 2001, the Labor Arbiter rendered a Decision10 dismissing the complaint for lack
of merit. Giving weight to the medical report of the Al-Birk Hospital finding that Jasmin died of
poisoning, the Labor Arbiter concluded that Jasmin committed suicide. In any case, Jasmin’s
death was not service-connected, nor was it shown that it occurred while she was on duty;
besides, her parents have received all corresponding benefits they were entitled to under the law.
In regard to damages, the Labor Arbiter found no legal basis to warrant a grant thereof.
On appeal, the National Labor Relations Commission (Commission) reversed the decision of the
Labor Arbiter. Relying on the findings of the City Health Officer of Cabanatuan City and the
NBI as contained in their autopsy and toxicology report, respectively, the Commission, via its
November 22, 2002 Resolution11 declared that, based on substantial evidence adduced, Jasmin
was the victim of compensable work-connected criminal aggression. It disregarded the Al-Birk
Hospital attending physician’s report as well as the KSA police report, finding the same to be
inconclusive. It declared that Jasmin’s death was the result of an "accident" occurring within the
employer’s premises that is attributable to her employment, or to the conditions under which she
lived, and thus arose out of and in the course of her employment as nurse. Thus, the Cuaresmas
are entitled to actual damages in the form of Jasmin’s lost earnings, including future earnings, in
the total amount of US$113,000.00. The Commission, however, dismissed all other claims in the
complaint.

Becmen, Rajab and White Falcon moved for reconsideration, whereupon the Commission issued
its October 9, 2003 Resolution12 reducing the award of US$113,000.00 as actual damages to
US$80,000.00.13 The NLRC likewise declared Becmen and White Falcon as solidarily liable for
payment of the award.

Becmen and White Falcon brought separate petitions for certiorari to the Court of Appeals.14 On
June 28, 2006, the appellate court rendered its Decision,15 the dispositive portion of which reads,
as follows:

WHEREFORE, the subject petitions are DENIED but in the execution of the decision, it should
first be enforced against White Falcon Services and then against Becmen Services when it is
already impossible, impractical and futile to go against it (White Falcon).

SO ORDERED.16

The appellate court affirmed the NLRC’s findings that Jasmin’s death was compensable, the
same having occurred at the dormitory, which was contractually provided by the employer. Thus
her death should be considered to have occurred within the employer’s premises, arising out of
and in the course of her employment.

Becmen and White Falcon moved for reconsideration. On May 14, 2008, the appellate court
rendered the assailed Amended Decision, the dispositive portion of which reads, as follows:

WHEREFORE, the motions for reconsideration are GRANTED. Accordingly, the award of
US$80,000.00 in actual damages is hereby reduced to US$4,686.73 plus interest at the legal rate
computed from the time it became due until fully paid. Petitioners are hereby adjudged jointly
and solidarily liable with the employer for the monetary awards with Becmen Service Exporter
and Promotions, Inc. having a right of reimbursement from White Falcon Services, Inc.

SO ORDERED.17

In the Amended Decision, the Court of Appeals found that although Jasmin’s death was
compensable, however, there is no evidentiary basis to support an award of actual damages in the
amount of US$80,000.00. Nor may lost earnings be collected, because the same may be charged
only against the perpetrator of the crime or quasi-delict. Instead, the appellate court held that
Jasmin’s beneficiaries should be entitled only to the sum equivalent of the remainder of her 36-
month employment contract, or her monthly salary of US$247.00 multiplied by nineteen (19)
months, with legal interest.

Becmen filed the instant petition for review on certiorari (G.R. Nos. 182978-79). The
Cuaresmas, on the other hand, moved for a reconsideration of the amended decision, but it was
denied. They are now before us via G.R. Nos. 184298-99.

On October 6, 2008, the Court resolved to consolidate G.R. Nos. 184298-99 with G.R. Nos.
182978-79.

In G.R. Nos. 182978-79, Becmen raises the following issues for our resolution:

(THE COURT OF APPEALS) GRAVELY ERRED WHEN IT GAVE MORE CREDENCE

AND WEIGHT TO THE AUTOPSY REPORT CONDUCTED BY THE CABANATUAN
CITY HEALTH OFFICE THAN THE MEDICAL AND POLICE REPORTS ISSUED BY THE
MINISTRY OF HEALTH OF KINGDOM OF SAUDI ARABIA AND AL-BIRK HOSPITAL.

(THE COURT OF APPEALS) GRAVELY ERRED WHEN ON THE BASIS OF THE

POSITION PAPERS AND ANNEXES THERETO INCLUDING THE AUTOPSY REPORT,
IT CONCLUDED THAT THE DEATH OF JASMIN CUARESMA WAS CAUSED BY
CRIMINAL AGGRESSION.

(THE COURT OF APPEALS) GRAVELY ERRED WHEN IT HELD THAT THE DEATH OF
JASMIN CUARESMA WAS COMPENSABLE PURSUANT TO THE RULING OF THE
SUPREME COURT IN TALLER VS. YNCHAUSTI, G.R. NO. 35741, DECEMBER 20, 1932,
WHICH IT FOUND TO BE STILL GOOD LAW.

(THE COURT OF APPEALS) GRAVELY ERRED WHEN IT HELD BECMEN LIABLE FOR
THE DEATH OF JASMIN CUARESMA NOTWITHSTANDING ITS ADMISSIONS THAT
"IQAMA INSURANCE" WAS A TYPOGRAPHICAL ERROR SINCE "IQAMA" IS NOT AN
INSURANCE.

(THE COURT OF APPEALS) GRAVELY ERRED WHEN IT CONCLUDED THAT THE

DEATH OF JASMIN WAS WORK RELATED.

(THE COURT OF APPEALS) GRAVELY ERRED WHEN IT HELD BECMEN LIABLE TO

JASMIN’S BENEFICIARIES FOR THE REMAINDER OF HER 36-MONTH CONTRACT
COMPUTED IN THIS MANNER: MONTHLY SALARY OF US$246.67 MULTIPLIED BY
19 MONTHS, THE REMAINDER OF THE TERM OF JASMIN’S EMPLOYMENT
CONTRACT, IS EQUAL TO US$4,686.73.
(THE COURT OF APPEALS) GRAVELY ERRED WHEN IT HELD BECMEN LIABLE TO
PAY INTEREST AT THE LEGAL RATE FROM THE TIME IT WAS DUE UNTIL FULLY
PAID.

(THE COURT OF APPEALS) GRAVELY ERRED WHEN IT HELD BECMEN AND WHITE
FALCON JOINTLY AND SEVERALLY LIABLE WITH THE EMPLOYER
NOTWITHSTANDING THE ASSUMPTION OF LIABILITY EXECUTED BY WHITE
FALCON IN FAVOR OF BECMEN.

On the other hand, in G.R. Nos. 184298-99, the Cuaresmas raise the following issues:

(THE COURT OF APPEALS) GRAVELY ERRED IN APPLYING THE PROVISIONS OF

THE CIVIL CODE CONSIDERED GENERAL LAW DESPITE THE CASE BEING
COVERED BY E.O. 247, R.A. 8042 AND LABOR CODE CONSIDERED AS SPECIAL
LAWS.

(THE COURT OF APPEALS) GRAVELY ERRED IN NOT APPLYING THE DECEASED’S

FUTURE EARNINGS WHICH IS (AN) INHERENT FACTOR IN THE COMPUTATION OF
DEATH BENEFITS OF OVERSEAS FILIPINO CONTRACT WORKERS.

(THE COURT OF APPEALS) GRAVELY ERRED IN REDUCING THE DEATH BENEFITS

AWARDED BY NLRC CONSIDERED FINDINGS OF FACT THAT CANNOT BE
DISTURBED THROUGH CERTIORARI UNDER RULE 65 OF THE RULES OF COURT.

The issue for resolution is whether the Cuaresmas are entitled to monetary claims, by way of
benefits and damages, for the death of their daughter Jasmin.

The terms and conditions of Jasmin’s 1996 Employment Agreement which she and her employer
Rajab freely entered into constitute the law between them. As a rule, stipulations in an
employment contract not contrary to statutes, public policy, public order or morals have the force
of law between the contracting parties.18 An examination of said employment agreement shows
that it provides for no other monetary or other benefits/privileges than the following:

1. 1,300 rials (or US$247.00) monthly salary;

2. Free air tickets to KSA at the start of her contract and to the Philippines at the end
thereof, as well as for her vacation at the end of each twenty four-month service;

3. Transportation to and from work;

4. Free living accommodations;

5. Free medical treatment, except for optical and dental operations, plastic surgery
charges and lenses, and medical treatment obtained outside of KSA;
 6. Entry visa fees will be shared equally between her and her employer, but the exit/re-
entry visa fees, fees for Iqama issuance, renewal, replacement, passport renewal,
sponsorship transfer and other liabilities shall be borne by her;

7. Thirty days paid vacation leave with round trip tickets to Manila after twenty four-
months of continuous service;

8. Eight days public holidays per year;

9. The indemnity benefit due her at the end of her service will be calculated as per labor
laws of KSA.

Thus, the agreement does not include provisions for insurance, or for accident, death or other
benefits that the Cuaresmas seek to recover, and which the labor tribunals and appellate court
granted variably in the guise of compensatory damages.

However, the absence of provisions for social security and other benefits does not make Jasmin’s
employment contract infirm. Under KSA law, her foreign employer is not obliged to provide her
these benefits; and neither is Jasmin entitled to minimum wage – unless of course the KSA labor
laws have been amended to the opposite effect, or that a bilateral wage agreement has been
entered into.

Our next inquiry is, should Jasmin’s death be considered as work-connected and thus
compensable? The evidence indicates that it is not. At the time of her death, she was not on duty,
or else evidence to the contrary would have been adduced. Neither was she within hospital
premises at the time. Instead, she was at her dormitory room on personal time when she died.
Neither has it been shown, nor does the evidence suggest, that at the time she died, Jasmin was
performing an act reasonably necessary or incidental to her employment as nurse, because she
was at her dormitory room. It is reasonable to suppose that all her work is performed at the Al-
birk Hospital, and not at her dormitory room.

We cannot expect that the foreign employer should ensure her safety even while she is not on
duty. It is not fair to require employers to answer even for their employees’ personal time away
from work, which the latter are free to spend of their own choosing. Whether they choose to
spend their free time in the pursuit of safe or perilous undertakings, in the company of friends or
strangers, lovers or enemies, this is not one area which their employers should be made
accountable for. While we have emphasized the need to observe official work time
strictly,19 what an employee does on free time is beyond the employer’s sphere of inquiry.

While the "employer’s premises" may be defined very broadly not only to include premises
owned by it, but also premises it leases, hires, supplies or uses,20 we are not prepared to rule that
the dormitory wherein Jasmin stayed should constitute employer’s premises as would allow a
finding that death or injury therein is considered to have been incurred or sustained in the course
of or arose out of her employment. There are certainly exceptions,21 but they do not appear to
apply here. Moreover, a complete determination would have to depend on the unique
circumstances obtaining and the overall factual environment of the case, which are here lacking.
But, did Jasmin commit suicide? Rajab, Becmen and White Falcon vehemently insist that she
did; thus, her heirs may not claim benefits or damages based on criminal aggression. On the
other hand, the Cuaresmas do not believe so.

The Court cannot subscribe to the idea that Jasmin committed suicide while halfway into her
employment contract. It is beyond human comprehension that a 25-year old Filipina, in the prime
of her life and working abroad with a chance at making a decent living with a high-paying job
which she could not find in her own country, would simply commit suicide for no compelling
reason.

The Saudi police and autopsy reports – which state that Jasmin is a likely/or apparent victim of
poisoning – are patently inconclusive. They are thus unreliable as evidence.

On the contrary, the autopsy report of the Cabanatuan City Health Officer and the exhumation
report of the NBI categorically and unqualifiedly show that Jasmin sustained external and
internal injuries, specifically abrasions at her inner lip and gums; lacerated wounds and
abrasions on her left and right ears; lacerated wounds and hematoma (contusions) on her
elbows; abrasions and hematoma on her thigh and legs; intra-muscular hemorrhage at the
anterior chest; a fractured rib; puncture wounds; and abrasions on the labia minora of the
vaginal area. The NBI toxicology report came up negative on the presence of poison.

All these show that Jasmin was manhandled – and possibly raped – prior to her death.

Even if we were to agree with the Saudi police and autopsy reports that indicate Jasmin was
poisoned to death, we do not believe that it was self-induced. If ever Jasmin was poisoned, the
assailants who beat her up – and possibly raped her – are certainly responsible therefor.

We are not exactly ignorant of what goes on with our OFWs. Nor is the rest of the world blind to
the realities of life being suffered by migrant workers in the hands of some foreign employers. It
is inconceivable that our Filipina women would seek employment abroad and face uncertainty in
a foreign land, only to commit suicide for unexplained reasons. Deciding to leave their family,
loved ones, and the comfort and safety of home, to work in a strange land requires unrivaled
strength and courage. Indeed, many of our women OFWs who are unfortunate to end up with
undesirable employers have been there more times than they care to, beaten up and broken in
body – yet they have remained strong in mind, refusing to give up the will to live. Raped, burned
with cigarettes, kicked in the chest with sharp high-heeled shoes, starved for days or even weeks,
stabbed, slaved with incessant work, locked in their rooms, forced to serve their masters naked,
grossly debased, dehumanized and insulted, their spirits fought on and they lived for the day that
they would once again be reunited with their families and loved ones. Their bodies surrendered,
but their will to survive remained strong.

It is surprising, therefore, that Rajab, Becmen and White Falcon should insist on suicide, without
even lifting a finger to help solve the mystery of Jasmin’s death. Being in the business of sending
OFWs to work abroad, Becmen and White Falcon should know what happens to some of our
OFWs. It is impossible for them to be completely unaware that cruelties and inhumanities are
inflicted on OFWs who are unfortunate to be employed by vicious employers, or upon those who
work in communities or environments where they are liable to become victims of crime. By now
they should know that our women OFWs do not readily succumb to the temptation of killing
themselves even when assaulted, abused, starved, debased and, worst, raped.

Indeed, what we have seen is Rajab and Becmen’s revolting scheme of conveniently avoiding
responsibility by clinging to the absurd theory that Jasmin took her own life. Abandoning their
legal, moral and social obligation (as employer and recruiter) to assist Jasmin’s family in
obtaining justice for her death, they immediately gave up on Jasmin’s case, which has remained
under investigation as the autopsy and police reports themselves indicate. Instead of taking the
cudgels for Jasmin, who had no relative or representative in the KSA who would naturally
demand and seek an investigation of her case, Rajab and Becmen chose to take the most
convenient route to avoiding and denying liability, by casting Jasmin’s fate to oblivion. It
appears from the record that to this date, no follow up of Jasmin’s case was ever made at all by
them, and they seem to have expediently treated Jasmin’s death as a closed case. Despite being
given the lead via the autopsy and toxicology reports of the Philippine authorities, they failed and
refused to act and pursue justice for Jasmin’s sake and to restore honor to her name.

Indeed, their nonchalant and uncaring attitude may be seen from how Jasmin’s remains were
repatriated. No official representative from Rajab or Becmen was kind enough to make personal
representations with Jasmin’s parents, if only to extend their condolences or sympathies; instead,
a mere colleague, nurse Jessie Fajardo, was designated to accompany Jasmin’s body home.

Of all life’s tragedies, the death of one’s own child must be the most painful for a parent. Not
knowing why or how Jasmin’s life was snuffed out makes the pain doubly unbearable for
Jasmin’s parents, and further aggravated by Rajab, Becmen, and White Falcon’s baseless
insistence and accusation that it was a self-inflicted death, a mortal sin by any religious standard.

Thus we categorically hold, based on the evidence; the actual experiences of our OFWs; and the
resilient and courageous spirit of the Filipina that transcends the vilest desecration of her
physical self, that Jasmin did not commit suicide but a victim of murderous aggression.

Rajab, Becmen, and White Falcon’s indifference to Jasmin’s case has caused unfathomable pain
and suffering upon her parents. They have turned away from their moral obligation, as employer
and recruiter and as entities laden with social and civic obligations in society, to pursue justice
for and in behalf of Jasmin, her parents and those she left behind. Possessed with the resources to
determine the truth and to pursue justice, they chose to stand idly for the sake of convenience and
in order that they may avoid pecuniary liability, turning a blind eye to the Philippine authorities’
autopsy and toxicology reports instead of taking action upon them as leads in pursuing justice for
Jasmin’s death. They have placed their own financial and corporate interests above their moral
and social obligations, and chose to secure and insulate themselves from the perceived
responsibility of having to answer for and indemnify Jasmin’s heirs for her death.

Under Republic Act No. 8042 (R.A. 8042), or the Migrant Workers and Overseas Filipinos Act
of 1995,22 the State shall, at all times, uphold the dignity of its citizens whether in country or
overseas, in general, and Filipino migrant workers, in particular.23 The State shall provide
adequate and timely social, economic and legal services to Filipino migrant workers.24 The rights
and interest of distressed25 overseas Filipinos, in general, and Filipino migrant workers, in
particular, documented or undocumented, are adequately protected and safeguarded.26

Becmen and White Falcon, as licensed local recruitment agencies, miserably failed to abide by
the provisions of R.A. 8042. Recruitment agencies are expected to extend assistance to their
deployed OFWs, especially those in distress. Instead, they abandoned Jasmin’s case and allowed
it to remain unsolved to further their interests and avoid anticipated liability which parents or
relatives of Jasmin would certainly exact from them. They willfully refused to protect and tend to
the welfare of the deceased Jasmin, treating her case as just one of those unsolved crimes that is
not worth wasting their time and resources on. The evidence does not even show that Becmen
and Rajab lifted a finger to provide legal representation and seek an investigation of Jasmin’s
case. Worst of all, they unnecessarily trampled upon the person and dignity of Jasmin by
standing pat on the argument that Jasmin committed suicide, which is a grave accusation given
its un-Christian nature.

We cannot reasonably expect that Jasmin’s parents should be the ones to actively pursue a just
resolution of her case in the KSA, unless they are provided with the finances to undertake this
herculean task. Sadly, Becmen and Rajab did not lend any assistance at all in this respect. The
most Jasmin’s parents can do is to coordinate with Philippine authorities as mandated under R.A.
8042, obtain free legal assistance and secure the aid of the Department of Foreign Affairs, the
Department of Labor and Employment, the POEA and the OWWA in trying to solve the case or
obtain relief, in accordance with Section 2327 of R.A. 8042. To our mind, the Cuaresmas did all
that was within their power, short of actually flying to the KSA. Indeed, the Cuaresmas went
even further. To the best of their abilities and capacities, they ventured to investigate Jasmin’s
case on their own: they caused another autopsy on Jasmin’s remains as soon as it arrived to
inquire into the true cause of her death. Beyond that, they subjected themselves to the painful and
distressful experience of exhuming Jasmin’s remains in order to obtain another autopsy for the
sole purpose of determining whether or not their daughter was poisoned. Their quest for the truth
and justice is equally to be expected of all loving parents. All this time, Rajab and Becmen –
instead of extending their full cooperation to the Cuaresma family – merely sat on their laurels in
seeming unconcern.

In Interorient Maritime Enterprises, Inc. v. NLRC,28 a seaman who was being repatriated after
his employment contract expired, failed to make his Bangkok to Manila connecting flight as he
began to wander the streets of Bangkok aimlessly. He was shot to death by Thai police four days
after, on account of running amuck with a knife in hand and threatening to harm anybody within
sight. The employer, sued for death and other benefits as well as damages, interposed as defense
the provision in the seafarer agreement which provides that "no compensation shall be payable in
respect of any injury, incapacity, disability or death resulting from a willful act on his own life
by the seaman." The Court rejected the defense on the view, among others, that the recruitment
agency should have observed some precautionary measures and should not have allowed the
seaman, who was later on found to be mentally ill, to travel home alone, and its failure to do so
rendered it liable for the seaman’s death. We ruled therein that –

The foreign employer may not have been obligated by its contract to provide a companion for a
returning employee, but it cannot deny that it was expressly tasked by its agreement to assure the
safe return of said worker. The uncaring attitude displayed by petitioners who, knowing fully
well that its employee had been suffering from some mental disorder, nevertheless still
allowed him to travel home alone, is appalling to say the least. Such attitude harks back to
another time when the landed gentry practically owned the serfs, and disposed of them
when the latter had grown old, sick or otherwise lost their usefulness.29 (Emphasis supplied)

Thus, more than just recruiting and deploying OFWs to their foreign principals, recruitment
agencies have equally significant responsibilities. In a foreign land where OFWs are likely to
encounter uneven if not discriminatory treatment from the foreign government, and certainly a
delayed access to language interpretation, legal aid, and the Philippine consulate, the recruitment
agencies should be the first to come to the rescue of our distressed OFWs since they know the
employers and the addresses where they are deployed or stationed. Upon them lies the primary
obligation to protect the rights and ensure the welfare of our OFWs, whether distressed or not.
Who else is in a better position, if not these recruitment agencies, to render immediate aid to
their deployed OFWs abroad?

Article 19 of the Civil Code provides that every person must, in the exercise of his rights and in
the performance of his duties, act with justice, give everyone his due, and observe honesty and
good faith. Article 21 of the Code states that any person who wilfully causes loss or injury to
another in a manner that is contrary to morals, good customs or public policy shall compensate
the latter for the damage. And, lastly, Article 24 requires that in all contractual, property or other
relations, when one of the parties is at a disadvantage on account of his moral dependence,
ignorance, indigence, mental weakness, tender age or other handicap, the courts must be vigilant
for his protection.

Clearly, Rajab, Becmen and White Falcon’s acts and omissions are against public policy because
they undermine and subvert the interest and general welfare of our OFWs abroad, who are
entitled to full protection under the law. They set an awful example of how foreign employers
and recruitment agencies should treat and act with respect to their distressed employees and
workers abroad. Their shabby and callous treatment of Jasmin’s case; their uncaring attitude;
their unjustified failure and refusal to assist in the determination of the true circumstances
surrounding her mysterious death, and instead finding satisfaction in the unreasonable insistence
that she committed suicide just so they can conveniently avoid pecuniary liability; placing their
own corporate interests above of the welfare of their employee’s – all these are contrary to
morals, good customs and public policy, and constitute taking advantage of the poor employee
and her family’s ignorance, helplessness, indigence and lack of power and resources to seek the
truth and obtain justice for the death of a loved one.

Giving in handily to the idea that Jasmin committed suicide, and adamantly insisting on it just to
protect Rajab and Becmen’s material interest – despite evidence to the contrary – is against the
moral law and runs contrary to the good custom of not denouncing one’s fellowmen for alleged
grave wrongdoings that undermine their good name and honor.30

Whether employed locally or overseas, all Filipino workers enjoy the protective mantle of
Philippine labor and social legislation, contract stipulations to the contrary notwithstanding. This
pronouncement is in keeping with the basic public policy of the State to afford protection to
labor, promote full employment, ensure equal work opportunities regardless of sex, race or
creed, and regulate the relations between workers and employers. This ruling is likewise
rendered imperative by Article 17 of the Civil Code which states that laws which have for their
object public order, public policy and good customs shall not be rendered ineffective by laws or
judgments promulgated, or by determinations or conventions agreed upon in a foreign country.31

The relations between capital and labor are so impressed with public interest,32 and neither shall
act oppressively against the other, or impair the interest or convenience of the public.33 In case of
doubt, all labor legislation and all labor contracts shall be construed in favor of the safety and
decent living for the laborer.34

The grant of moral damages to the employee by reason of misconduct on the part of the
employer is sanctioned by Article 2219 (10)35 of the Civil Code, which allows recovery of such
damages in actions referred to in Article 21.36

Thus, in view of the foregoing, the Court holds that the Cuaresmas are entitled to moral
damages, which Becmen and White Falcon are jointly and solidarily liable to pay, together with
exemplary damages for wanton and oppressive behavior, and by way of example for the public
good.

Private employment agencies are held jointly and severally liable with the foreign-based
employer for any violation of the recruitment agreement or contract of employment. This joint
and solidary liability imposed by law against recruitment agencies and foreign employers is
meant to assure the aggrieved worker of immediate and sufficient payment of what is due
him.37 If the recruitment/placement agency is a juridical being, the corporate officers and
directors and partners as the case may be, shall themselves be jointly and solidarily liable with
the corporation or partnership for the aforesaid claims and damages.38

White Falcon’s assumption of Becmen’s liability does not automatically result in Becmen’s
freedom or release from liability. This has been ruled in ABD Overseas Manpower Corporation
v. NLRC.39 Instead, both Becmen and White Falcon should be held liable solidarily, without
prejudice to each having the right to be reimbursed under the provision of the Civil Code that
whoever pays for another may demand from the debtor what he has paid.40

WHEREFORE, the Amended Decision of the Court of Appeals dated May 14, 2008 in CA-G.R.
SP No. 80619 and CA-G.R. SP No. 81030 is SET ASIDE. Rajab & Silsilah Company, White
Falcon Services, Inc., Becmen Service Exporter and Promotion, Inc., and their corporate
directors and officers are found jointly and solidarily liable and ORDERED to indemnify the
heirs of Jasmin Cuaresma, spouses Simplicio and Mila Cuaresma, the following amounts:

1) TWO MILLION FIVE HUNDRED THOUSAND PESOS (P2,500,000.00) as moral

damages;

2) TWO MILLION FIVE HUNDRED THOUSAND PESOS (P2,500,000.00) as

exemplary damages;
 3) Attorney’s fees equivalent to ten percent (10%) of the total monetary award; and,

4) Costs of suit.

SO ORDERED.

CONSUELO YNARES-SANTIAGO
Associate Justice

G.R. No. 198408               November 12, 2014

CONCHITA J. RACELIS, Petitioner,
vs.
UNITED PHILIPPINE LINES, INC. and/or HOLLAND AMERICA LINES, INC.,* and
FERNANDO T. LISING, Respondents.

DECISION

PERLAS-BERNABE, J.:

Assailed in this petition for review on certiorari1 are the Decision2 dated March 28, 2011 and the
Resolution3 dated August 26, 2011 of the Court of Appeals (CA) in CA-G.R. SP. No. 113835
which reversed and set aside the Decision4 dated November 10, 2009 of the National Labor
Relations Commission (NLRC) in NLRC LAC Case No. OFW (M)-05- 000277-09, thereby
dismissing the complaint for death benefits, burial assistance, moral and exemplary damages,
and attorney’s fees filed by petitioner Conchita J. Racelis (petitioner).

The Facts

On January 15, 2008, Rodolfo L. Racelis (Rodolfo) was recruited and hired by respondent
United Philippine Lines, Inc. (UPL) for its principal, respondent Holland America Lines,Inc.
(HAL) to serve as "Demi Chef De Partie" on board the vessel MS Prinsendam, with a basic
monthly salary of US$799.55.5 The Contract of Employment6 was for a term of four (4) months,
extendible for another two (2) months upon mutual consent. After complying with the required
pre-employment medical examination where he was declared fit to work, Rodolfo joined the
vessel on January 25, 2008.7 Prior thereto, Rodolfo was repeatedly contracted by said
respondents and was deployed under various contracts since December 17, 1985.8

In the course of his last employment contract, Rodolfo experienced severe pain in his ears and
high blood pressure causing him to collapse while in the performance of his duties. He consulted
a doctor in Argentina and was medically repatriated on February 20, 2008for further medical
treatment.9 Upon arrival in Manila, he was immediately brought to Medical City, Pasig City,
where he was seen by a company-designated physician, Dr. Gerardo Legaspi, M.D.
(Dr.Legaspi), and was diagnosed to be suffering from Brainstem (pontine)
Cavernous10 Malformation.11 He underwent surgery twice for the said ailment but developed
complications12 and died on March 2, 2008.13 Through an electronic mail14 (e-mail) dated July
22, 2008, a certain Dr. Antonio "Toby" Abaya (Dr. Abaya) informed Atty. Florencio L. Aquino,
Managing Associate of the law firm of Del Rosario and Del Rosario,15 counsel for UPL, HAL,
and itsofficer, Fernando T. Lising (respondents),16 that Rodolfo’s illness was congenital and that
there may be familial strains in his case, hence, his death was not work-related.17

Rodolfo’s surviving spouse, herein petitioner, sought to claim death benefits pursuant to the
International Transport Workers’ Federation- Collective Bargaining Agreement (ITWF-
CBA),18 of which her husband was a member, but to no avail. Consequently, she filed a
Complaint19 for death benefits, burial assistance, moral and exemplary damages, and attorney’s
fees against herein respondents before the NLRC, docketed as NLRC OFW Case No. (M) NCR-
06-08452-08. In their defense,20 respondents maintained that petitioner is not entitled to death
benefits under Section 20 (A) (1) of the 2000 Philippine Overseas Employment Administration
Standard Employment Contract (2000 POEA-SEC). They averred that Rodolfo’s illness, i.e.,
Brainstem (pontine) Cavernous Malformation, was not work-related, considering that said illness
is not listed as an occupational disease under the 2000 POEASEC.21 They likewise pointed out
that Rodolfo’s death on March 2, 2008 did not occur during the term of his employment contract
in view of his prior repatriation on February 20, 2008, hence, was non-compensable.22 Moreover,
they denied the claim for damages and attorney’s fees for lack of factual and legal bases.23

The LA Ruling

In a Decision24 dated November 28, 2008,the Labor Arbiter (LA) ruled in favor of petitioner, and
thereby ordered respondents to pay her death benefits pursuant to the ITWF-CBA in the amount
of US$60,000.00, burial assistance in the amount of US$1,000.00, and attorney’s fees equivalent
to 10% of the total monetary awards.25

The LA held that Rodolfo’s death was compensable as the illness that caused his death occurred
in the course of his employment contract.26 It was likewise ruled that while Brainstem (pontine)
Cavernous Malformation is not among the listed occupational diseases under the 2000 POEA-
SEC, the same was still compensable, noting that the same may have been contracted in the
course of his engagement with respondents, which started back in 1985 under various
employment contracts.27 Also, the LA did not give credence to the medical opinion28 of Dr.
Abaya which was unsigned and not certified by said doctor himself, hence, had no evidentiary
value. Further, the LA observed that there is no certainty as to the accuracy of the statement
therein that the disease is congenital in origin.29

Unconvinced, respondents filed an appeal30 before the NLRC.

The NLRC Ruling

In a Decision31 dated November 10, 2009, the NLRC affirmed the LA’s verdict, holding that
Rodolfo’s illness is disputably presumed to be work-related and that since it supervenedin the
course of his employment, the burden is on the respondents to prove otherwise.32 It held that the
medical opinion of the company-designated physician, which showed that Rodolfo’s ailment is
not work-connected and may have pre-existed, is insufficient to rebut the presumption of
compensability.33 It likewise pointed out that the occurrence of death after the term of the
contract was immaterial since the proximate cause of Rodolfo’s death was the illness that
supervened during his employment.34 Finally, the NLRC sustained the award of attorney’s fees
as petitioner was compelled to litigate to protect her rights and interests.35

Dissatisfied, respondents filed a motion for reconsideration36 which was denied by the NLRC in
a Resolution37 dated March 11, 2010; hence, they elevated the matter to the CA viaa petition for
certiorari.38

Meanwhile, petitioner moved for the execution of the affirmed LA Decision, which was granted
by the NLRC.39 In consequence, respondents paid petitioner the amount of ₱3,031,683.0040 as
full and complete satisfaction of the said NLRC Decision, without prejudice to the outcome of
the certiorari case before the CA.41

The CA Ruling

In a Decision42 dated March 28, 2011, the CA granted respondents’ certiorari petition, and
thereby annulled and set aside the ruling of the NLRC granting petitioner’s claim for death
benefits.

It held that Rodolfo’s death on March 2, 2008 did not occur while he was in the employ of
respondents, ashis contract of employment ceased when he was medically repatriated on
February 20, 2008 pursuant to Section 18 (B) (1) of the 2000 POEA-SEC.43 Moreover, it
observed that Rodolfo’s illness cannot be presumed to be work-related, absent any proof to show
that his death was connected to his work orthat his working conditions increased the risk of
contracting Brainstem (pontine) Cavernous Malformation that eventually caused his death.44

Aggrieved, petitioner sought for reconsideration45 but was denied in a Resolution46 dated August

26, 2011, hence, the instant petition.

The Issue Before the Court

The essential issue for the Court’s resolution is whether or not the CA erred in annulling the
NLRC’s grant of death benefits to petitioner on certiorari.

The Court's Ruling

Deemed incorporated in every seafarer’s employment contract, denominated as the POEA-SEC

or the Philippine Overseas Employment Administration-Standard Employment Contract, is a set
of standard provisions determined and implemented by the POEA, called the "Standard Terms
and Conditions Governing the Employment of Filipino Seafarers on Board Ocean Going
Vessels," which are considered to be the minimum requirements acceptable to the government
for the employment of Filipino seafarers on board foreign ocean-going vessels.47
Among other basic provisions, the POEA-SEC – specifically, its 2000 version – stipulates that
the beneficiaries of a deceased seafarer may be able to claim death benefits for as long asthey are
able to establish that (a) the seafarer’s death is work-related, and (b) such death had occurred
during the term of his employment contract. These requirements are explicitly stated in Section
20 (A) (1) thereof, which reads:

SECTION 20. COMPENSATION AND BENEFITS

A. COMPENSATION AND BENEFITS FOR DEATH

1. In the case of work-related death of the seafarer,during the term of his contractthe employer
shall pay his beneficiaries the Philippine Currency equivalent to the amount of Fifty Thousand
US dollars (US$50,000) and an additional amount of Seven Thousand US dollars (US$7,000) to
each child under the age of twenty-one (21) but not exceeding four (4) children, at the exchange
rate prevailing during the time of payment. (Emphases supplied)

After an assiduous examination of the records, and as will be expounded on below, the Court,
similar to both the LA and the NLRC, finds that the above-stated requirements positively attend
petitioner’s claim for death benefits.

I. The Death of the Seafarer is Work-Related.

In the recent case of Canuel v. Magsaysay Maritime Corporation48 (Canuel), the Court clarified
that the term "work-related death"refers to the seafarer’s death resulting from a work-related
injury or illness.

Under the 2000 POEA-SEC, the terms "work-related injury" and "work-related illness" are,
inturn, defined as follows:

Definition of Terms:

For purposes of this contract, the following terms are defined as follows:

xxxx

11. Work-Related Injury – injury(ies) resulting indisability or death arising out of and in the
course of employment.

12. Work-Related Illness – any sickness resulting todisability or deathas a result of an

occupational disease listed under Section 32-A of this contract with the conditions set therein
satisfied. (Emphases supplied)

Case law explains that "[t]he words ‘arising out of’ refer to the origin or cause of the accident,
and are descriptive of its character, while the words ‘in the course of’ refer to the time, place, and
circumstances under which the accident takes place. As a matter ofgeneral proposition, an injury
or accident is said to arise ‘in the course of employment’ when it takes place within the period of
the employment, at a place where the employee reasonably may be, and while he is fulfilling his
duties or is engaged in doing something incidental thereto."49

In this case, respondents submit that petitioner was unable to prove that Rodolfo’s illness, i.e.,
Brainstem (pontine) Cavernous Malformation, which had supposedly supervened during the term
of his employment on board the vessel MS Prinsendam, was not related to his work.50 To bolster
the argument, respondents point to the fact that Brainstem (pontine) Cavernous Malformation is
not listed as an occupational disease under Section 32-A51 of the 2000 POEA-SEC.

The contention is untenable.

While it is true that Brainstem (pontine) Cavernous Malformation is not listed as an occupational
disease under Section 32-A of the 2000 POEASEC, Section 20 (B) (4) of the same explicitly
provides that "[t[he liabilities of the employer when the seafarer suffers work-related injury or
illness during the term of his contractare as follows:(t)hose illnesses not listed in Section 32 of
this Contract are disputably presumed as work related." In other words, the 2000 POEA-SEC
"has created a disputable presumption in favor of compensability[,] saying that those illnesses
not listed in Section 32 are disputably presumed as work-related. This means that even if the
illness is not listed under Section 32-Aof the POEA-SEC as an occupational disease or illness, it
will still be presumed as work-related, and it becomes incumbent on the employer to overcome
the presumption."52 This presumption should be overturned only when the employer’s refutation
is found to be supported by substantial evidence,53 which, as traditionally defined is "such
relevant evidence as a reasonable mind might accept as sufficient to support a conclusion."54 As
held in the case of Magsaysay Maritime Services v. Laurel:55

Anent the issue as to who has the burden to prove entitlement to disability benefits, the
petitioners argue that the burden is placed upon Laurel to prove his claim that his illness was
work-related and compensable. Their posture does not persuade the Court.

True, hyperthyroidism is not listed as an occupational disease under Section 32-A of the 2000
POEA-SEC. Nonetheless, Section 20 (B), paragraph (4) of the said POEA-SECstates that "those
illnesses not listed in Section 32 of this Contract are disputably presumed as workrelated." The
said provision explicitly establishes a presumption of compensability although disputable by
substantial evidence. The presumption operates in favor of Laurel as the burden rests upon the
employer to overcome the statutory presumption. Hence, unless contrary evidence is presented
by the seafarer’s employer/s, this disputable presumption stands. In the case at bench, other than
the alleged declaration of the attending physician that Laurel’s illness was not work-related, the
petitioners failed to discharge their burden. In fact, they even conceded that hyperthyroidism
may be caused by environmental factor.56

Similarly in Jebsens Maritime, Inc. v. Babol:57

The Principle of Work-relation

The 2000 POEA-SEC contract governs the claims for disability benefits by respondent as he was
employed by the petitioners in September of 2006.
Pursuant to the said contract, the injury or illness must be work related and must have existed
during the term of the seafarer’s employment in order for compensability to arise. Work-relation
must, therefore, be established.

As a general rule, the principle of work-relation requires that the disease in question must be one
of those listed as an occupational disease under Sec. 32-A of the POEA-SEC. Nevertheless,
should it be not classified as occupational in nature, Section 20 (B) paragraph 4 of the POEA-
SEC provides that such diseases are disputed are disputably presumed as work-related.

In this case, it is undisputed that NPC afflicted respondent while on board the petitioners’ vessel.
As a non-occupational disease, it has the disputable presumption of being work-related. This
presumption obviously works in the seafarer’sfavor. Hence, unless contrary evidence is
presented by the employers, the work-relatedness of the disease must be sustained.

And in Fil-Star Maritime Corporation v. Rosete:58

Although Central Retinal Vein Occlusion is not listed as one of the occupational diseases under
Section 32-A of the 2000 Amended Terms of POEA-SEC, the resulting disability which is loss
of sight of one eye, is specifically mentioned in Section 32 thereof (Schedule of Disability or
Impediment for Injuries Suffered and Diseases Including Occupational Diseases or Illness
Contracted). More importantly, Section 20 (B), paragraph (4) states that "those illnesses not
listed in Section 32 of this Contract are disputably presumed as work-related."

The disputable presumption that a particular injury or illness that results in disability, or in some
cases death, is work-related stands in the absence of contrary evidence. In the case at bench, the
said presumption was not overturned by the petitioners. Although, the employer is not the insurer
of the health of his employees, he takes them as he finds them and assumes the risk of liability.
Consequently, the Court concurs with the finding of the courts below that respondent’s disability
is compensable.59

Records show that respondents’ sole evidence to disprove that Rodolfo’s illness is work-related
was the medical opinion of Dr. Abaya, wherein it was explained that Rodolfo’s ailment is a
congenital malformation of blood vessels in the brain that may be due to familial
strains.60 However, as correctly observed by the LA, the document presented cannot be given
probative value as it was a mere print out of an e-mail that was not signed or certified to by the
doctor.61 Moreover, records reveal that Rodolfo was attended by Dr. Legaspi from the time he
was admitted at the Medical City on February 20, 2008 up to his death on March 2, 200862 and
not by Dr. Abaya whose qualifications to diagnose such kind of illness was not even established.
Likewise, the medical opinion was not backed up by any medical findings to substantiate the
claim that Rodolfo’s ailment was congenital in origin or that there were traces of the disease in
Rodolfo’s family history. Under the foregoing premises, the unsubstantiated and unauthenticated
medical findings of Dr. Abaya are therefore highly suspect and cannot be considered as
substantial evidence to support respondents’ postulation. Thus, with no substantial evidence on
the part of the employer and given that no other cogent reason exists to hold otherwise, the
presumption under Section 20 (B) (4) should stand. Accordingly, the Court is constrained to
pronounce that Rodolfo’s death, which appears to have been proximately caused by his
Brainstem (pontine) Cavernous Malformation, was work-related, in satisfaction of the first
requirement of compensability under Section 20 (A) (1) of the 2000 POEA-SEC.

II. The Seafarer’s Death Occurred During the Term of Employment.

Moving to the second requirement, respondents assert that Rodolfo’s death on March 2, 2008
had occurred beyond the term of his employment, considering his prior medical repatriation on
February 20, 2008 which had the effect of contract termination.The argument is founded on
Section 18 (B) (1) of the 2000 POEA-SEC, which reads:

SECTION 18. TERMINATION OF EMPLOYMENT

xxxx

B. The employment of the seafarer is also terminated when the seafarer arrives at the point of
hire for any of the following reasons:

1. when the seafarer signs-off and is disembarked for medical reasons pursuant to Section 20(B)
[5]63 of this Contract.

While it is true that a medical repatriation has the effect of terminating the seafarer’s contract of
employment, it is, however, enough that the workrelated illness, which eventually becomes the
proximate cause of death, occurred while the contract was effective for recovery to be had. A
further exposition is apropos.

Consistent with the State’s avowed policy to afford full protection to labor as enshrined in
Article XIII of the 1987 Philippine Constitution,64 the POEA-SEC was designed primarily for the
protection and benefit of Filipino seafarers in the pursuit of their employment on board ocean-
going vessels. As such, it is a standing principle that its provisions are to be construed and
applied fairly, reasonably, and liberally in their favor.65

Guided by this principle, the Court, in the recent case of Canuel, recognized that a medical
repatriation case constitutes an exception to the second requirement under Section 20 (A) (1) of
the 2000 POEA-SEC, i.e., that the seafarer’s death had occurred during the term of his
employment, in view of the terminative consequences of a medical repatriation under Section 18
(B) of the same. In essence, the Court held that under such circumstance, the work-related death
need not precisely occur during the term of his employment as it is enough that the seafarer’s
work-related injury or illness which eventually causes his death had occurred during the term of
his employment. As rationalized in that case:

With respect to the second requirement for death compensability, the Court takes this
opportunity to clarify that while the general rule is that the seafarer’s death should occur during
the term of his employment, the seafarer’s death occurring after the termination ofhis
employment due to his medical repatriation on account of a work-related injury or illness
constitutes an exception thereto. This is based on a liberal construction of the 2000 POEA-SEC
as impelled by the plight of the bereaved heirs who stand to be deprived of a just and reasonable
compensation for the seafarer’s death, notwithstanding its evident work-connection.1âwphi1 The
present petition is a case in point.

Here, Nancing’s repatriation occurred during the eighth (8th) month of his one (1) year
employment contract. Were it not for his injury, which had been earlier established as work-
related, he would not have been repatriated for medical reasons and his contract consequently
terminated pursuant to Part 1 of Section 18 (B) of the 2000 POEA-SEC as hereunder quoted:

xxxx

The terminative consequence of a medical repatriation case then appears to present a rather
prejudicial quandary to the seafarer and his heirs. Particularly, if the Court wereto apply the
provisions of Section 20 of the 2000 POEA-SEC as above-cited based on a strict and literal
construction thereof, then the heirs of Nancing would stand to be barred from receiving any
compensation for the latter’s death despite its obvious work-relatedness. Again, this is for the
reason that the work-related death would, by mere legal technicality, be considered to have
occurred after the term of his employment on account of his medical repatriation. It equally bears
stressing that neither would the heirs be able to receive any disability compensation since the
seafarer’s death in this case precluded the determination of a disability grade,which, following
Section 20 (B) in relation to Section 32 of the 2000 POEA-SEC, stands as the basis therefor.
However, a strict and literal construction of the 2000 POEA-SEC, especially when the same
would result into inequitable consequences against labor, is not subscribed to in this jurisdiction.
Concordant with the State’s avowed policy to give maximum aid and full protection to labor as
enshrined in ArticleXIII of the 1987 Philippine Constitution, contracts of labor, such as the 2000
POEA-SEC, are deemedto be so impressed with public interest that the more beneficial
conditions must be endeavoured in favor of the laborer. The rule therefore is one of liberal
construction. As enunciated in the case of Philippine Transmarine Carriers, Inc. v. NLRC[(405
Phil. 487 [2001])]:

The POEA Standard Employment Contract for Seamen is designed primarily for the protection
and benefit of Filipino seamen in the pursuit of their employment on board ocean-going vessels.
Its provisions must [therefore] be construed and applied fairly, reasonably and liberally in their
favor [as it is only] then can its beneficent provisions be fully carried into effect. (Emphasis
supplied)

Applying the rule on liberal construction, the Court is thus brought to the recognition that
medical repatriation cases should be considered as an exception to Section 20 of the 2000
POEA-SEC. Accordingly, the phrase "work-related death of the seafarer, during the term of his
employment contract" under Part A (1) of the said provision should not be strictly and literally
construed to mean that the seafarer’s work-related death should have precisely occurred during
the term of his employment. Rather, it is enough that the seafarer’s work-related injury or illness
which eventually causes his death should have occurred during the term of his employment.
Taking all things into account, the Court reckons that it is by this method of construction that
undue prejudice to the laborer and his heirs may be obviated and the State policy on labor
protection be championed. For if the laborer’s death was brought about (whether fully or
partially) by the work he had harbored for his master’s profit, then it is but proper that his demise
be compensated. Here, since it has been established that (a) the seafarer had been suffering from
a workrelated injury or illness during the term of his employment, (b) his injury or illness was
the cause for his medical repatriation, and (c) it was later determined that the injury or illness for
which he was medically repatriated was the proximate cause ofhis actual death although the
same occurred after the term of his employment, the above-mentioned rule should squarely
apply. Perforce, the present claim for death benefits should be granted.66 (Citations omitted)

As elucidated in Canuel, the foregoing liberal approach was applied in Inter-Orient Maritime,
Incorporated v. Candava,67 Interorient Maritime Enterprises, Inc. v. Remo,68 and Wallem
Maritime Services, Inc. v. NLRC,69 wherein the Court had previously allowed the recovery of
death benefits even if the seafarers in those cases had died after repatriation, given that there was
proof of a clear causal connection between their work and the illness which was contracted in the
course of employment, and their eventual death. The converse conclusion was reached in the
cases of Gau Sheng Phils., Inc. v. Joaquin70 (Gau Sheng), Spouses Aya-ay, Sr. v. Arpaphil
Shipping Corp.71 (Spouses Aya-ay, Sr.), Hermogenes v. Osco Shipping Services,
Inc.,72 Prudential Shipping and Management Corp. v. Sta. Rita73 (Prudential), and Ortega v.
CA74 (Ortega),since the element of work relatedness had not been established. All in all, the
sense gathered from these cases, as pointed out in Canuel, is that it is crucial to determine
whether the death of the deceased was reasonably connected with his work, or whether the
working conditions increased the risk of contracting the disease that resulted in the seafarer’s
death. If the injury or illness is the proximate cause, or at least increased the risk of his death for
which compensation is sought, recovery may behad for said death, or for that matter, for the
injury or illness. Thus, in Seagull Ship management and Trans., Inc. v. NLRC,75 the Court
significantly observed that:

Even assuming that the ailment of the worker was contracted prior to his employment, this still
would not deprive him of compensation benefits. For what matters is that his work had
contributed, even in a small degree, to the development of the disease and in bringing about his
eventual death. Neither is it necessary, in order to recover compensation, that the employee must
have been in perfect health at the time he contracted the disease. A worker brings with him
possible infirmities in the course of his employment, and while the employer is not the insurer of
the health of the employees, he takes them as he finds them and assumes the risk of liability. If
the disease is the proximate cause of the employee’s death for which compensation is sought, the
previous physical condition of the employee is unimportant, and recovery may be had for said
death, independently of any pre-existing disease.76 (Emphases and underscoring supplied;
citations omitted)

Employing the same spirit of liberality as fleshed out in Canuel, the Court finds that it would be
highly inequitable and even repugnant to the State’s policy on labor to deny petitioner’s claim
for death benefits for the mere technicality triggered by Rodolfo’s prior medical repatriation. As
it has been clearly established that Rodolfo had been suffering from a work-related illness during
the term of his employment that caused his medical repatriation and, ultimately, his death on
March 2, 2008, it is but proper to consider the same as a compensable work-related death despite
it having occurred after his repatriation. To echo Canuel, "it is enough that the seafarer’s work-
related injury orillness which eventually causes his death should have occurred during the term
of his employment. Taking all things into account, the Court reckons that it is by this method of
construction that undue prejudice to the laborer and his heirs may be obviated and the State
policy on labor protection be championed. For if the laborer’s death was brought about (whether
fully or partially) by the work he had harbored for his master’s profit, then it is but proper that
his demise be compensated."77

Lest it be misunderstood, the conclusion above-reached does not run counter to the Court’s
ruling in Klaveness Maritime Agency, Inc. v. Beneficiaries of the Late Second Officer Anthony
s. Allas (Klaveness),78 which the CA inaccurately relied on. As similarly pointed out in Canuel,
the Klaveness case involved a seafarer who was not medically repatriated but was actually
signed off from the vessel after the completion of his contract, his illness not proven to be work-
related,and died almost two (2) years after the termination of his contract. Since the employment
contract was terminated without any connection toa work-related cause, but rather because of its
mere lapse, death benefits were denied to the seafarer’s heirs.79 This is definitely not the case
here since Rodolfo’s employment contract was terminated only because ofhis medical
repatriation. Were it not for his illness, Rodolfo would not havebeen medically repatriated and
his employment contract, in turn, terminated. Evidently, the termination of employment was
forced upon by a work-related cause and it would be in contrast to the State’s policy on labor
todeprive the seafarer’s heirs of death compensation despite its ascertained work-connection.80

This variance also exists as to the cases of Gau Sheng,81 Spouses Ayaay, Sr.,82 Prudential,83 and
Ortega,84 which respondents invoke in their Comment dated February 16, 2012.85 As a common
denominator, the element of work-relatedness was not established in those cases. Thus, being the
primary factor considered in granting compensation, the Court denied the beneficiaries’
respective claims. Again, the Court has pored over the records and remains satisfied that
Rodolfo’s death is work-related. Accordingly, this precludes the application of the above-stated
rulings.

III. Amount of Death Benefits.

With the compensability of Rodolfo’s death now traversed, a corollary matter to determine is the
amount of benefits due petitioner.

Records show that respondents do not deny – and therefore admit – the late Rodolfo’s
membership in the AMOSUP that had entered into a collective bargaining agreement with HAL,
or the ITWF-CBA.86 Its provisions therefore must prevail over the standard terms and benefits
formulated by the POEA in its Standard Employment Contract.87 Hence, the NLRC’s award of
US$60,000.00as compensation for the death of Rodolfo in accordance with Article 21.2.188 of
the ITWF-CBA was in order. The same holds true for the award of burial assistance in the
amount of US$1,000.00which is provided under Section 20 (A) (4) (c)89 of the 2000 POEA-SEC.
Moreover, conformably with existing case law, the NLRC’s grant of attorney’s fees in the
amount of US$6,100.00was called for since petitioner was forced to litigate to protect her valid
claim. Where an employee is forced to litigate and incur expenses to protect his right and
interest, he is entitled to an award of attorney’s fees equivalent to 10% of the award.90

All in all, the NLRC’s award of US$67,100.0091 – which, as the records bear, had already been
paid92 by respondents – is hereby sustained.
IV. A Final Point.

As a final point of rumination, it must be highlighted that the CA’s parameter of analysis in cases
elevatedto it from the NLRC is the existence of the latter’s grave abuse of discretion, considering
that they come before the appellate court through petitions for certiorari. This delimitation, in
relation to the Court’s task of reviewing the case eventually appealed before it, was explained in
Montoya v. Transmed Manila Corporation93 as follows:

[W]e review in this Rule 45 petition the decision of the CA on a Rule 65 petition filed by
Montoya withthat court.1âwphi1 In a Rule45 review, we consider the correctness of the assailed
CA decision, in contrast with the review for jurisdictional error that we undertake under Rule 65.
Furthermore, Rule 45 limits us to the review of questions of law raised against the assailed CA
decision. In ruling for legal correctness, we have to view the CA decision in the same context
that the petition for certiorari it ruled upon was presented to it; we have to examine the CA
decision from the prism of whether it correctly determined the presence or absence of grave
abuse of discretion in the NLRC decision before it, not on the basis of whether the NLRC
decision on the merits of the case was correct. In other words, we have to be keenly aware that
the CA undertook a Rule 65 review, not a review on appeal, of the NLRC decision challenged
before it. This is the approach that should be basic in a Rule 45 review ofa CA ruling in a labor
case. In question form, the question to ask is: Did the CA correctly determine whether the NLRC
committed grave abuse of discretion in ruling on the case?94

Given that the NLRC’s ruling was amply supported by the evidence on record and current
jurisprudence on the subject matter, the Court, in opposition to the CA, finds that no grave abuse
of discretion had been committed by the labor tribunal. Hence,the CA’s grant of respondents’
certiorari petition before it ought to be reversed, and consequently the NLRC Decision be
reinstated.

WHEREFORE, the petition is GRANTED. The Decision dated March 28, 2011 and the
Resolution dated August 26, 2011 of the Court of Appeals in CA-G.R. SP. No. 113835 are
hereby REVERSED and SET ASIDE and the Decision dated November 10, 2009 of the National
Labor Relations Commission is REINSTATED.

SO ORDERED.

ESTELA M. PERLAS-BERNABE
Associate Justice
G.R. No. 162053             March 7, 2007

ST. LUKE'S MEDICAL CENTER EMPLOYEE'S ASSOCIATION-AFW (SLMCEA-

AFW) AND MARIBEL S. SANTOS, Petitioners,
vs.
NATIONAL LABOR RELATIONS COMMISSION (NLRC) AND ST. LUKE'S
MEDICAL CENTER, INC., Respondents.

DECISION

AZCUNA, J.:

Challenged in this petition for review on certiorari is the Decision1 of the Court of Appeals (CA)
dated January 29, 2004 in CA-G.R. SP No. 75732 affirming the decision2 dated August 23, 2002
rendered by the National Labor Relations Commission (NLRC) in NLRC CA No. 026225-00.
The antecedent facts are as follows:

Petitioner Maribel S. Santos was hired as X-Ray Technician in the Radiology department of
private respondent St. Luke's Medical Center, Inc. (SLMC) on October 13, 1984. She is a
graduate of Associate in Radiologic Technology from The Family Clinic Incorporated School of
Radiologic Technology.

On April 22, 1992, Congress passed and enacted Republic Act No. 7431 known as the
"Radiologic Technology Act of 1992." Said law requires that no person shall practice or offer to
practice as a radiology and/or x-ray technologist in the Philippines without having obtained the
proper certificate of registration from the Board of Radiologic Technology.

On September 12, 1995, the Assistant Executive Director-Ancillary Services and HR Director of
private respondent SLMC issued a final notice to all practitioners of Radiologic Technology to
comply with the requirement of Republic Act No. 7431 by December 31, 1995; otherwise, the
unlicensed employee will be transferred to an area which does not require a license to practice if
a slot is available.

On March 4, 1997, the Director of the Institute of Radiology issued a final notice to petitioner
Maribel S. Santos requiring the latter to comply with Republic Act. No. 7431 by taking and
passing the forthcoming examination scheduled in June 1997; otherwise, private respondent
SLMC may be compelled to retire her from employment should there be no other position
available where she may be absorbed.

On May 14, 1997, the Director of the Institute of Radiology, AED-Division of Ancillary
Services issued a memorandum to petitioner Maribel S. Santos directing the latter to submit her
PRC Registration form/Examination Permit per Memorandum dated March 4, 1997.

On March 13, 1998, the Director of the Institute of Radiology issued another memorandum to
petitioner Maribel S. Santos advising her that only a license can assure her of her continued
employment at the Institute of Radiology of the private respondent SLMC and that the latter is
giving her the last chance to take and pass the forthcoming board examination scheduled in June
1998; otherwise, private respondent SLMC shall be constrained to take action which may include
her separation from employment.

On November 23, 1998, the Director of the Institute of Radiology issued a notice to petitioner
Maribel S. Santos informing the latter that the management of private respondent SLMC has
approved her retirement in lieu of separation pay.

On November 26, 1998, the Personnel Manager of private respondent SLMC issued a "Notice of
Separation from the Company" to petitioner Maribel S. Santos effective December 30, 1998 in
view of the latter's refusal to accept private respondent SLMC's offer for early retirement. The
notice also states that while said private respondent exerted its efforts to transfer petitioner
Maribel S. Santos to other position/s, her qualifications do not fit with any of the present vacant
positions in the hospital.
In a letter dated December 18, 1998, a certain Jack C. Lappay, President of the Philippine
Association of Radiologic Technologists, Inc., wrote Ms. Judith Betita, Personnel Manager of
private respondent SLMC, requesting the latter to give "due consideration" to the organization's
three (3) regular members of his organization (petitioner Maribel S. Santos included) "for not
passing yet the Board of Examination for X-ray Technology," "by giving them an assignment in
any department of your hospital awaiting their chance to pass the future Board Exam."

On January 6, 1999, the Personnel Manager of private respondent SLMC again issued a "Notice
of Separation from the Company" to petitioner Maribel S. Santos effective February 5, 1999
after the latter failed to present/ submit her appeal for rechecking to the Professional Regulation
Commission (PRC) of the recent board examination which she took and failed.

On March 2, 1999, petitioner Maribel S. Santos filed a complaint against private respondent
SLMC for illegal dismissal and non-payment of salaries, allowances and other monetary
benefits. She likewise prayed for the award of moral and exemplary damages plus attorney's fees.

In the meantime, petitioner Alliance of Filipino Workers (AFW), through its President and Legal
Counsel, in a letter dated September 22, 1999 addressed to Ms. Rita Marasigan, Human
Resources Director of private respondent SLMC, requested the latter to accommodate petitioner
Maribel S. Santos and assign her to the vacant position of CSS Aide in the hospital arising from
the death of an employee more than two (2) months earlier.

In a letter dated September 24, 1999, Ms. Rita Marasigan replied thus:

Gentlemen:

Thank you for your letter of September 22, 1999 formally requesting to fill up the vacant regular
position of a CSS Aide in Ms. Maribel Santos' behalf.

The position is indeed vacant. Please refer to our Recruitment Policy for particulars especially on
minimum requirements of the job and the need to meet said requirements, as well as other pre-
employment requirements, in order to be considered for the vacant position. As a matter of fact,
Ms. Santos is welcome to apply for any vacant position on the condition that she possesses the
necessary qualifications.

As to the consensus referred to in your letter, may I correct you that the agreement is, regardless
of the vacant position Ms. Santos decides to apply, she must go through the usual application
procedures. The formal letter, I am afraid, will not suffice for purposes of recruitment
processing. As you know, the managers requesting to fill any vacancy has a say on the matter
and correctly so. The manager's inputs are necessarily factored into the standard recruitment
procedures. Hence, the need to undergo the prescribed steps.

Indeed we have gone through the mechanics to accommodate Ms. Santos' transfer while she was
employed with SLMC given the prescribed period. She was given 30 days from issuance of the
notice of termination to look for appropriate openings which incidentally she wittingly declined
to utilize. She did this knowing fully well that the consequences would be that her application
beyond the 30-day period or after the effective date of her termination from SLMC would be
considered a re-application with loss of seniority and shall be subjected to the pertinent
application procedures.

Needless to mention, one of the 3 X-ray Technologists in similar circumstances as Ms. Santos at
the time successfully managed to get herself transferred to E.R. because she opted to apply for
the appropriate vacant position and qualified for it within the prescribed 30-day period. The other
X-ray Technologist, on the other hand, as you may recall, was eventually terminated not just for
his failure to comply with the licensure requirement of the law but for cause (refusal to serve a
customer).

Why Ms. Santos opted to file a complaint before the Labor Courts and not to avail of the
opportunity given her, or assuming she was not qualified for any vacant position even if she tried
to look for one within the prescribed period, I simply cannot understand why she also refused the
separation pay offered by Management in an amount beyond the minimum required by law only
to re-apply at SLMC, which option would be available to her anyway even (if she) chose to
accept the separation pay!

Well, here's hoping that our Union can timely influence our employees to choose their options
well as it has in the past.

(Signed)
RITA MARASIGAN

Subsequently, in a letter dated December 27, 1999, Ms. Judith Betita, Personnel Manager of
private respondent SLMC wrote Mr. Angelito Calderon, President of petitioner union as follows:

Dear Mr. Calderon:

This is with regard to the case of Ms. Maribel Santos. Please recall that last Oct. 8, 1999, Ms.
Rita Marasigan, HR Director, discussed with you and Mr. Greg Del Prado the terms regarding
the re-hiring of Ms. Maribel Santos. Ms. Marasigan offered Ms. Santos the position of Secretary
at the Dietary Department. In that meeting, Ms. Santos replied that she would think about the
offer. To date, we still have no definite reply from her. Again, during the conference held on
Dec. 14, 1999, Atty. Martir promised to talk to Ms. Santos, and inform us of her reply by Dec.
21, 1999. Again we failed to hear her reply through him.

Please be informed that said position is in need of immediate staffing. The Dietary Department
has already been experiencing serious backlog of work due to the said vacancy. Please note that
more than 2 months has passed since Ms. Marasigan offered this compromise. Management
cannot afford to wait for her decision while the operation of the said department suffers from
vacancy.

Therefore, Management is giving Ms. Santos until the end of this month to give her decision. If
we fail to hear from her or from you as her representatives by that time, we will consider it as a
waiver and we will be forced to offer the position to other applicants so as not to jeopardize the
Dietary Department's operation.

For your immediate action.

(Signed)
JUDITH BETITA
Personnel Manager

On September 5, 2000, the Labor Arbiter came out with a Decision ordering private respondent
SLMC to pay petitioner Maribel S. Santos the amount of One Hundred Fifteen Thousand Five
Hundred Pesos (₱115,500.00) representing her separation pay. All other claims of petitioner
were dismissed for lack of merit.

Dissatisfied, petitioner Maribel S. Santos perfected an appeal with the public respondent NLRC.

On August 23, 2002, public respondent NLRC promulgated its Decision affirming the Decision
of the Labor Arbiter. It likewise denied the Motion for Reconsideration filed by petitioners in its
Resolution promulgated on December 27, 2002.

Petitioner thereafter filed a petition for certiorari with the CA which, as previously mentioned,
affirmed the decision of the NLRC.

Hence, this petition raising the following issues:

I. Whether the CA overlooked certain material facts and circumstances on petitioners'

legal claim in relation to the complaint for illegal dismissal.

II. Whether the CA committed grave abuse of discretion and erred in not resolving with
clarity the issues on the merit of petitioner's constitutional right of security of tenure.3

For its part, private respondent St. Luke's Medical Center, Inc. (SLMC) argues in its
comment4 that: 1) the petition should be dismissed for failure of petitioners to file a motion for
reconsideration; 2) the CA did not commit grave abuse of discretion in upholding the NLRC and
the Labor Arbiter's ruling that petitioner was legally dismissed; 3) petitioner was legally and
validly terminated in accordance with Republic Act Nos. 4226 and 7431; 4) private respondent's
decision to terminate petitioner Santos was made in good faith and was not the result of unfair
discrimination; and 5) petitioner Santos' non-transfer to another position in the SLMC was a
valid exercise of management prerogative.

The petition lacks merit.

Generally, the Court has always accorded respect and finality to the findings of fact of the CA
particularly if they coincide with those of the Labor Arbiter and the NLRC and are supported by
substantial evidence.5 True this rule admits of certain exceptions as, for example, when the
judgment is based on a misapprehension of facts, or the findings of fact are not supported by the
evidence on record6 or are so glaringly erroneous as to constitute grave abuse of
discretion.7 None of these exceptions, however, has been convincingly shown by petitioners to
apply in the present case. Hence, the Court sees no reason to disturb such findings of fact of the
CA.

Ultimately, the issue raised by the parties boils down to whether petitioner Santos was illegally
dismissed by private respondent SLMC on the basis of her inability to secure a certificate of
registration from the Board of Radiologic Technology.

The requirement for a certificate of registration is set forth under R.A. No. 74318 thus:

Sec. 15. Requirement for the Practice of Radiologic Technology and X-ray Technology. - Unless
exempt from the examinations under Sections 16 and 17 hereof, no person shall practice or offer
to practice as a radiologic and/or x-ray technologist in the Philippines without having obtained
the proper certificate of registration from the Board.

It is significant to note that petitioners expressly concede that the sole cause for petitioner Santos'
separation from work is her failure to pass the board licensure exam for X-ray technicians, a
precondition for obtaining the certificate of registration from the Board. It is argued, though, that
petitioner Santos' failure to comply with the certification requirement did not constitute just
cause for termination as it violated her constitutional right to security of tenure. This contention
is untenable.

While the right of workers to security of tenure is guaranteed by the Constitution, its exercise
may be reasonably regulated pursuant to the police power of the State to safeguard health,
morals, peace, education, order, safety, and the general welfare of the people. Consequently,
persons who desire to engage in the learned professions requiring scientific or technical
knowledge may be required to take an examination as a prerequisite to engaging in their chosen
careers.9 The most concrete example of this would be in the field of medicine, the practice of
which in all its branches has been closely regulated by the State. It has long been recognized that
the regulation of this field is a reasonable method of protecting the health and safety of the public
to protect the public from the potentially deadly effects of incompetence and ignorance among
those who would practice medicine.10 The same rationale applies in the regulation of the practice
of radiologic and x-ray technology. The clear and unmistakable intention of the legislature in
prescribing guidelines for persons seeking to practice in this field is embodied in Section 2 of the
law:

Sec. 2. Statement of Policy. - It is the policy of the State to upgrade the practice of radiologic
technology in the Philippines for the purpose of protecting the public from the hazards posed by
radiation as well as to ensure safe and proper diagnosis, treatment and research through the
application of machines and/or equipment using radiation.11

In this regard, the Court quotes with approval the disquisition of public respondent NLRC in its
decision dated August 23, 2002:
The enactment of R.A. (Nos.) 7431 and 4226 are recognized as an exercise of the State's inherent
police power. It should be noted that the police power embraces the power to prescribe
regulations to promote the health, morals, educations, good order, safety or general welfare of
the people. The state is justified in prescribing the specific requirements for x-ray technicians
and/or any other professions connected with the health and safety of its citizens. Respondent-
appellee being engaged in the hospital and health care business, is a proper subject of the cited
law; thus, having in mind the legal requirements of these laws, the latter cannot close its eyes and
[let] complainant-appellant's private interest override public interest.

Indeed, complainant-appellant cannot insist on her "sterling work performance without any
derogatory record" to make her qualify as an x-ray technician in the absence of a proper
certificate of Registration from the Board of Radiologic Technology which can only be obtained
by passing the required examination. The law is clear that the Certificate of Registration cannot
be substituted by any other requirement to allow a person to practice as a Radiologic
Technologist and/or X-ray Technologist (Technician).12

No malice or ill-will can be imputed upon private respondent as the separation of petitioner
Santos was undertaken by it conformably to an existing statute. It is undeniable that her
continued employment without the required Board certification exposed the hospital to possible
sanctions and even to a revocation of its license to operate. Certainly, private respondent could
not be expected to retain petitioner Santos despite the inimical threat posed by the latter to its
business. This notwithstanding, the records bear out the fact that petitioner Santos was given
ample opportunity to qualify for the position and was sufficiently warned that her failure to do so
would result in her separation from work in the event there were no other vacant positions to
which she could be transferred. Despite these warnings, petitioner Santos was still unable to
comply and pass the required exam. To reiterate, the requirement for Board certification was set
by statute. Justice, fairness and due process demand that an employer should not be penalized for
situations where it had no participation or control.13

It would be unreasonable to compel private respondent to wait until its license is cancelled and it
is materially injured before removing the cause of the impending evil. Neither can the courts step
in to force private respondent to reassign or transfer petitioner Santos under these circumstances.
Petitioner Santos is not in the position to demand that she be given a different work assignment
when what necessitated her transfer in the first place was her own fault or failing. The
prerogative to determine the place or station where an employee is best qualified to serve the
interests of the company on the basis of the his or her qualifications, training and performance
belongs solely to the employer.14 The Labor Code and its implementing Rules do not vest in the
Labor Arbiters nor in the different Divisions of the NLRC (nor in the courts) managerial
authority.15

While our laws endeavor to give life to the constitutional policy on social justice and the
protection of labor, it does not mean that every labor dispute will be decided in favor of the
workers. The law also recognizes that management has rights which are also entitled to respect
and enforcement in the interest of fair play.16 Labor laws, to be sure, do not authorize
interference with the employer's judgment in the conduct of the latter's business. Private
respondent is free to determine, using its own discretion and business judgment, all elements of
employment, "from hiring to firing" except in cases of unlawful discrimination or those which
may be provided by law. None of these exceptions is present in the instant case.

The fact that another employee, who likewise failed to pass the required exam, was allowed by
private respondent to apply for and transfer to another position with the hospital does not
constitute unlawful discrimination. This was a valid exercise of management prerogative,
petitioners not having alleged nor proven that the reassigned employee did not qualify for the
position where she was transferred. In the past, the Court has ruled that an objection founded on
the ground that one has better credentials over the appointee is frowned upon so long as the latter
possesses the minimum qualifications for the position.17 Furthermore, the records show that Ms.
Santos did not even seriously apply for another position in the company.

WHEREFORE, the petition is DENIED for lack of merit. Costs against petitioners.

SO ORDERED.

ADOLFO S. AZCUNA
Associate Justice