FIRST DIVISION

[G.R. No. 168716. April 16, 2009.]

HFS PHILIPPINES, INC., RUBEN T. DEL ROSARIO and IUM

SHIPMANAGEMENT AS,AS petitioners, vs . RONALDO R. PILAR,
PILAR
respondent.

DECISION

CORONA J :
CORONA, p

This petition 1 seeks to reverse and set aside the November 22, 2004 decision 2
and June 22, 2005 resolution 3 of the Court of Appeals (CA) in CA-G.R. SP No. 85197.
On October 4, 2001, respondent Ronaldo R. Pilar was engaged by petitioners IUM
Shipmanagement AS and its Philippine manning agent, HFS Philippines, Inc. (HFS), as a
crew member of the Norwegian vessel M/V Hual Triumph under the following terms
and conditions:
Duration of the contract : 9 months
Position : Electrician
Basic monthly salary : US $981 per month
Hours of work : 44 hours per week
Overtime : US $646 per month
Vacation leave with pay : 8 days per month
Point of hire : Manila 4

Respondent boarded the vessel on October 27, 2001. 5

In March 2002 or roughly four months after he boarded M/V Hual Triumph,
respondent complained of loss of appetite, nausea, vomiting and severe nervousness.
Despite being given medical treatment, his condition did not improve.
When the vessel reached Nagoya, Japan on April 3, 2002, respondent was
brought to the Komatsu Hospital where he was diagnosed with depression and gastric
ulcer. 6 The attending physician declared him un t for work and recommended his
hospitalization and repatriation. 7 Respondent returned to Manila on the same day. cDTHIE

Upon reaching Manila, respondent was met by a representative of HFS who

immediately brought him to the Medical Center Manila. HFS-designated physician Dr.
Nicomedes G. Cruz con rmed that respondent was suffering from major depression.
Thus, he placed respondent under continuous medical treatment for several months. 8
On September 19, 2003, respondent was declared fit to work. 9
Meanwhile, respondent likewise sought the opinion of other physicians.
Dr. Anselmo T. Tronco of the Philippine General Hospital 1 0 and Dr. Raymond
Jude L. Changco of the Mary Chiles Hospital 1 1 opined that respondent continued to
suffer from major depression.
Dr. Arlito C. Veneracion of the Mary Chiles Hospital, on the other hand, evaluated
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 the results of respondent's ultrasound and endoscopy. He revealed that respondent
was suffering "cholecystolithiasis, mild fatty liver and chronic gastritis." 1 2 Thus, Dr.
Veneracion declared respondent unfit to work. 1 3
On November 27, 2002, respondent led a complaint for underpayment of
disability and medical bene ts and for moral and exemplary damages in the National
Labor Relations Commission (NLRC). 1 4 Because respondent was a registered member
of the Associated Marine O cers and Seaman's Union of the Philippines (AMOSUP),
the NLRC referred the complaint to the National Conciliation and Mediation Board
(NCMB) on May 6, 2003. 1 5
In his position paper, respondent claimed that, while sleeping during his rest
hours on March 9, 2002, he was suddenly awakened by his o cer who hit him on the
head. He was so traumatized by the incident that thereafter, he lost his appetite,
vomited incessantly and experienced severe nervousness. He claimed to be entitled to
disability compensation under Article 12 of the Collective Bargaining Agreement (CBA)
between AMOSUP and the Norwegian Shipowner's Association which provides:
ARTICLE 12
Disability Compensation
If a seafarer due to no fault of his own, suffers injury as a result
of an accident while serving on board or while traveling to or from the vessel
on the company's business or due to marine peril, and as a result his ability to
work is permanently reduced, totally or partially, the Company shall pay
him a disability compensation which including the amounts stipulated by the
[Philippine Overseas Employment Agency's] rules and regulations shall be
maximum:
Radio officers, chief stewards,
electricians, electro technicians US$90,000
Ratings US$70,000

The disability compensation shall be calculated on the basis of the POEA's

schedule of disability or impediment for injuries at a percentage recommended by
a doctor authorized by the Norwegian authorities for the medical examination of
seafarers. aATHIE

The company shall take out the necessary insurance to cover the bene ts
mentioned above. Coverage arranged with P & I Club recognized by the
Norwegian authorities will meet these requirements. (emphasis supplied)

Petitioners, on the other hand, asserted that in the absence of proof his
depression was caused by an accident, respondent was not entitled to disability and
medical bene ts under Article 12 of the CBA. Instead, he was only entitled to the 120-
day sick pay provided under Article 10 of the CBA which provides:
ARTICLE 10
Sickness and Injury
During the period of employment and at the time of signing off, the o cer
shall submit to a medical examination when requested by the company or its
representative, at the company's expense.

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 While serving on board, a sick or injured o cer is entitled to
treatment at the company's expense . The company is not responsible for
conservative denial treatment. If the o cer is sick or injured at the termination of
the service period, he has the same entitlement for a maximum period of one
hundred and twenty (120) days from the date of signing off. In accordance with
Part II, Section C of the [Philippine Overseas Employment Agency's (POEA)] rules
and regulations, the o cer must submit to a post-employment medical
examination within three (3) working days after his return to the Philippines to
obtain these bene ts. If he should be unable by reason of physical incapacity to
do so, a written notice to the agency within the same period is deemed as
compliance provided the incapacity is certi ed by the Master or an authorized
physician.
In the event of sickness or injury necessitating signing-off, the
officer is entitled to travel to Manila at the company's expense.
The o cer is entitled to sick pay (at the same rate as basic
wage) for up to 120 days after signing off, provided the sickness or the
injury is veri ed by written statement from an authorized physician . The
sick pay will be in addition to the vacation leave compensation mentioned in Art.
8 but not in the addition to the termination pay compensation mentioned in Art. 5
points a to c.
It is understood that an o cer who is signed off by reason of sickness or
injury must return to the Philippines within the usual period of travel from the date
and place of disembarkation indicated in homeward bound ticket. On arrival in
the Philippines, he shall report to the company's designated physician within three
(3) working days from the time of arrival for post employment medical
examination, otherwise, the employer's liability shall be deemed terminated. In
case however, of failure to report due to o cers' physical incapacity, a written
notice to the company within three (3) working days from arrival is deemed as
compliance provided the incapacity is certi ed by the Master or an authorized
physician. (emphasis supplied) 1 6

Pursuant to this provision, Section 20 (B) of the Standard Employment Contract of the
POEA between respondent and petitioners (employment contract) stated: TaCIDS

B. COMPENSATION AND BENEFITS FOR ILLNESS AND INJURY

The liabilities of the employer when the seafarer suffers injury or illness
during the term of his contract are as follows:
xxx xxx xxx
3. Upon sign-off from the vessel for medical treatment, the
seafarer is entitled to sickness allowance equivalent to his basic wage
until he is declared fit to work or of the degree * of permanent disability has
been assessed by the company-designated physician, but in no
case shall this period exceed one-hundred twenty (120) days .
For this purpose, the seafarer shall submit himself to a post-employment
medical examination by a company designated physician within three working
days upon his return except when he is physically incapacitated to do so, in which
case, a written notice to the agency within the same period is deemed as
compliance. Failure of the seafarer to comply with the mandatory reporting
requirement shall result in his forfeiture of the right to claim the above bene ts.
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 (emphasis supplied)

xxx xxx xxx

The NCMB held that the nature of respondent's occupation signi cantly
contributed to the deterioration of his psychological condition. Respondent's
depression was therefore a compensable sickness since it arose out of his
employment. In view of the principle of social justice (that those who have less in life
should have more in law), the NCMB awarded disability compensation to him: 1 7
WHEREFORE,
WHEREFORE judgment is hereby rendered in favor of [respondent].
[Petitioners], jointly and severally, are hereby ordered to pay disability bene ts
claimed by [respondent] in accordance with the [AMOSUP]-CBA in the amount of
US$90,000 and attorney's fees equivalent to 10% of the total amount awarded.
SO ORDERED.

Aggrieved, petitioners assailed the NCMB decision in the CA via petition for
certiorari 1 8 asserting that it committed grave abuse of discretion in awarding disability
compensation to respondent. The NCMB erred in applying Article 12 of the CBA since
the respondent's depression and gastric ulcer were not due to an accident.
In a decision dated November 22, 2004, the CA held that Article 12 of the CBA
applies when a seafarer suffers an injury (1) as a consequence of an accident that took
place on board the vessel or (2) while traveling to and from the vessel on company
business or (3) due to a marine peril. Since respondent's illnesses were not the result of
any of the said circumstances, he was not entitled to disability compensation granted
by the CBA. Nonetheless, because he proved that his illnesses impaired him, he is
entitled to disability benefits granted by Section 32 1 9 of the employment contract. 2 0
Unsatis ed with the decision of the CA, petitioners moved for reconsideration
but it was denied. 2 1 aDcHIS

The primordial issue in this petition is whether respondent is entitled to disability

pay.
Petitioners contend that the CA erred in awarding disability pay to respondent.
Section 20 (B) of the employment contract requires that the seafarer should be
declared un t for work by the company physician. Respondent, in this instance, was
declared fit for work by Dr. Cruz.
We deny the petition.
Just like any other contract, a CBA is the law between the contracting parties and
compliance therewith in good faith is required by law. 2 2 Inasmuch as respondent was
a registered member of the AMOSUP, the present controversy should be decided in
accordance with the CBA.
It is undisputed that respondent fell ill while he was onboard M/V Hual Triumph.
This fact was con rmed not only by petitioner's accredited physicians but also by
respondent's own independent physicians.
In view thereof, respondent is clearly entitled to sick-pay. Article 10 of the CBA
and Section 20 (B) of the employment contract apply when a seafarer contracts an
illness in the course of his employment. They provide that if, in the opinion of the
employer-accredited physician, the nature of the seafarer's illness, regardless of its
cause,
cause requires a sign-off (or repatriation to Manila), the seafarer is entitled to sick-pay
equivalent to not more than 120-days worth of regular wage. cSEDTC

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 However, with regard to whether respondent is entitled to disability
compensation, we rule in the negative. Article 12 of the CBA requires:
(a) the seafarer must suffer an injury;
(b) injury must have been the result of an accident while on board or while
traveling to or from the vessel on company's business or it must have
been due to marine peril and
(c) as a result of the injury, he becomes totally or partially disabled.
This provision is limited to injuries. It does not cover all kinds of illnesses such as those
suffered by respondent. Moreover, neither the NCMB nor the CA found that
respondent's illnesses were the result of an accident or a marine peril.
Nonetheless, while respondent is not entitled to disability compensation under
the CBA, Section 20 (B) of the Contract provides:
5. In case of permanent total or partial disability of the seafarer
during the term of employment caused by either injury or illness the
seafarer shall be compensated in accordance with the schedule of bene ts
enumerated in Section [32] of this Contract. Computations arising from any
illness or disease shall be governed by the rates and rules of compensation
applicable at the time the illness or disease was contracted. (emphasis supplied)

Under this provision, a seafarer may be entitled to disability compensation if (1) he is

shown to have contracted an illness or suffered an injury in the course of his
employment and (2) such illness or injury resulted in his total or partial disability.
In this case, the company-accredited doctor opined that respondent was t to
work but respondent's own physicians declared otherwise.
We note that Section 20 (B) of the employment contract states that it is the
company-designated physician who determines a seafarer's tness to work or his
degree of disability. Nonetheless, a claimant may dispute the company-designated
physician's report by seasonably consulting another doctor. In such a case, the medical
report issued by the latter shall be evaluated by the labor tribunal and the court, based
on its inherent merit. 2 3
Dr. Tronco made the following observations about respondent:
The [patient] started to feel weak, anxious, depressed, with loss of interest
and feeling of hopelessness one month before consultation. These symptoms
interfered with work. He was thus repatriated on the fth month of work as a
seaman. He was given anti-depressants which led to his gradual improvement.
Presently, [patient] is energetic and not anxious. AICEDc

Impression: major depression

He will be maintained on Zoloft pills within the next [six to nine] months.
Prognosis is good. 2 4

However, Dr. Chango found that respondent's depression persisted:

Patient is under medication but persists to be depressed. In view of this, I
recommend that in the Schedule of Disability he be graded 6 (moderate mental
disorder) which limits worker to ADL with some directed care. 2 5
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 Dr. Veneracion, on the other hand, issued a certification to the following effect:
This is to certify that I have seen and examined Mr. Ronaldo Pilar on
September 22, 2003 at Mary Chiles General Hospital. Ultrasound done at March
26, 2003 showed cholecystilithiasis and mild fatty liver. Endoscopy with gastric
biopsy done April 2, 2003 revealed chronic gastritis.
Diagnosis: Cholecystilithiasis n
Mild fatty liver
Chronic gastritis
EcaDCI

POEA Disability Grade

Remarks:
7
Unfit to work

This certi cation was issued upon Mr. Rolando Pilar's request for the
purpose of claiming disability benefits. 2 6

There was clearly a discrepancy between the certi cation of the company-
designated physician and those of respondent's chosen doctors. The company-
designated physician expectedly downplayed his ndings on the ratings. 2 7 It is for this
reason that the employment contract affords the seaman the option to seek the
opinion of an independent physician. 2 8
The company-designated physician declared respondent as having suffered a
major depression but was already cured and therefore t to work. On the other hand,
the independent physicians stated that respondent's major depression persisted and
constituted a disability. More importantly, while the former totally ignored the diagnosis
of the Japanese doctor that respondent was also suffering from gastric ulcer, the latter
addressed this. The independent physicians thus found that respondent was suffering
from chronic gastritis and declared him unfit for work.
The bottomline is this: the certi cation of the company-designated physician
would defeat respondent's claim while the opinion of the independent physicians would
uphold such claim. In such a situation, we adopt the ndings favorable to respondent.
CacISA

The law looks tenderly on the laborer. Where the evidence may be reasonably
interpreted in two divergent ways, one prejudicial and the other favorable to him, the
balance must be tilted in his favor consistent with the principle of social justice. 2 9
WHEREFORE, the petition is hereby DENIED. The November 22, 2004 decision
and June 22, 2005 resolution of the Court of Appeals in CA-G.R. SP No. 85197 a rming
the May 27, 2002 decision of the National Conciliation Mediation Board in NCMB Case
No. NCMB-NCR-CRN Case No. 06-007-03 are AFFIRMED.
Costs against petitioners.
SO ORDERED.
Puno, C.J., Carpio, Leonardo-de Castro and Bersamin, JJ., concur.

Footnotes

1. Under Rule 45 of the Rules of Court.

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 2. Penned by Associate Justice Rosalinda Asuncion-Vicente and concurred in by Associate
Justices Eugenio S. Labitoria (retired) and Bienvenido L. Reyes of the Third Division of
the Court of Appeals. Rollo, pp. 12-20.
3. Id., pp. 21-22.
4. Standard contract of employment of the Philippine Overseas Employment Agency, entered
into by petitioners and respondent. Id., p. 483.
5. October 29, 2001 in some parts of the record.
6. Declaration of illness/accident. Rollo, p. 524.
7. Doctor's report. Id., p. 525.
8. Diagnoses dated April 4, 2003, April 11, 2003, April 16, 2003, April 24, 2003, May 27, 2003,
June 25, 2003, June 27, 2003, July 2, 2003, August 9, 2003 and August 20, 2003. Id., pp.
530-542.
9. According to respondent's SSS claim form, he last visited Dr. Cruz on September 19, 2002.
Id., p. 543.
10. Diagnosis dated January 15, 2003. Id., p. 542.
11. Diagnosis dated August 20, 2003. Id., p. 544.
12. Medical certificate issued by Dr. Veneracion. Id., p. 552.
13. Id. Respondent's disability was classified under POEA Grade 7. See POEA Standard
Contract of Employment for Seafarers, Sec. 32. It provides:
Section 32. Schedule of Disability or Impediment for Injuries Suffered and Diseases
Including Occupational Diseases or Illness Contracted. —
xxx xxx xxx
ABDOMEN
xxx xxx xxx
4. Moderate residuals of disorder of the intra-abdominal organs Grade 7 secondary to
trauma resulting to impairment of nutrition, moderate tenderness, nausea, vomiting,
constipation or diarrhea.
14. Docketed as NCR-OFW(M) 02-11-3032-00.
15. Order penned by Facundo L. Leda. Rollo, pp. 448-450. The case was re-docketed as NCMB-
NCR-CRN Case No. 06-007-03. TIESCA

16. Id., pp. 376-377.

17. Decision penned by voluntary arbitrator Hermenegildo C. Dumlao. Dated May 27, 2002. Id.,
p. 269-276.
18. Under Rule 65 of the Rules of Court.
19. Schedule of Disability or Impediment for Injuries Suffered and Diseases Including
Occupational Diseases or Illness Contracted.
20. Supra note 2.
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 21. Supra note 3.
22. Kimberly Clark Philippines v. Lorredo, G.R. No. 103090, 21 September 2008, 226 SCRA 639,
643.
23. Maunlad Transport, Inc. and/or Nippon Merchant Marine Company, Ltd., Inc. v. Manigo,
G.R. No. 161416, 13 June 2008.
24. Supra note 10.
25. Supra note 11.
26. Supra note 12.
27. Seagull Maritime Corporation v. Dee, G.R. No. 165156, 22 April 2007, 520 SCRA 109.
28. Id.
29. In essence, this is similar to the equipoise rule in criminal law. See CIVIL CODE, Art. 1702.
Labor legislation and contracts shall be construed in favor of the safety and decent
living of the laborer.
n Note from the Publisher: The term "cholecystilithiasis" should read as "cholecystolithiasis".

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