SRL International Manpower Agency v. Yarza, Jr., G.R. No.

207828, (14 February 2022)

Facts:
Pedro S. Yarza, Jr. was hired by SRL International Manpower Agency (SRL) and its foreign
principal, Akkila Co. Ltd. UAE (Akkila), as a Project Manager for a two-year contract. Yarza
departed for the UAE on October 14, 2010. On March 24, 2011, he was repatriated to the
Philippines to renew his visa, with instructions to return within 10 days. Despite complying with
all requirements, Yarza received a termination letter from Akkila on May 22, 2011, without prior
notice or due process. Yarza filed a complaint for illegal dismissal, unpaid salaries, and
damages on June 29, 2011.

On the other hand, SRL confirmed that Akkila and Al Salmeen Trading Est. (Al Salmeen),
purportedly both owned by Mr. Haytham Akkila, are its foreign principals. Akkila informed SRL
that it needed manpower for its Qatar project; hence, the latter posted the job opening. In view
of this, Yarza submitted his application as Project Manager. In July 2010, SRL received word
from Akkila that the latter was interested in hiring Yarza. Afterwards, SRL forwarded Yarza's
documents to Akkila for the processing of his employment visa.12

However, unknown to SRL, Akkila and Yarza directly contacted each other regarding Yarza's
deployment. To SRL's surprise, Akkila sent a visit visa for Yarza instead of an employment visa.
SRL protested and informed Akkila that Yarza cannot be deployed under a visit visa since it
would violate the rules of the Philippine Overseas Employment Agency (POEA). Akkila and
Yarza insisted on using the visit visa, stating that they have a mutual and voluntary agreement.
SRL objected as it wanted to strictly follow POEA's requirement that an overseas worker should
be deployed under an employment visa. Nonetheless, SRL turned over to Yarza all of his
documents including the visit visa. From then on, SRL did not facilitate Yarza's deployment
under the visit visa as Yarza handled it on his own. SRL argued that it did not agree to act as
the local manpower agency of Akkila with respect to Yarza's deployment under the visit visa,
given that the employment contract was between Akkila and Yarza only.13

SRL additionally asserted that on April 4, 2011, Akkila informed it that Yarza returned to the
Philippines after working from October 2010 until April 2011 under the visit visa. Akkila claimed
that Yarza will apply for deployment anew under an employment visa. Furthermore, Yarza will
process his POEA Overseas Employment Certificate (OEC) himself. SRL told Akkila and Yarza
that Yarza cannot obtain the OEC on his own, as he needs SRL, the authorized local agency of
Akkila, to secure it for him.14

When SRL started processing Yarza's documents, the latter underwent a medical examination
to assess his fitness for work. SRL informed Yarza that he has to submit to a medical
examination since the deployment will be treated as an entirely new one. SRL then referred
Yarza to its accredited clinic, Seamed Medical Clinic (Seamed). However, Seamed declared
that Yarza was unfit for work due to Uncontrolled Diabetes Mellitus Type II, which was reflected
in a Medical Certificate15 dated May 10, 2011. SRL disclosed the finding to Akkila and informed
the latter that if it is still interested, it should send a waiver indicating its willingness to hire Yarza
notwithstanding his unfitness for work. Akkila replied that it has a strict qualification not to hire
an applicant who is not fit for work. Subsequently, in a letter dated May 22, 2011, Akkila
informed Yarza that he cannot be hired due to medical reasons.
The Labor Arbiter dismissed the complaint, finding no employer-employee relationship. The
National Labor Relations Commission (NLRC) reversed the Labor Arbiter's decision, finding
SRL actively participated in Yarza's recruitment and deployment, ruling his termination as
illegal. The Court of Appeals (CA) upheld the NLRC's decision and held the petitioners solidarily
liable for the monetary awards.

ON E-E Relationship:
The "Offer of Employment" is invalid since it was not approved by the POEA. (being contrary to
the Constitution, as well as existing laws.
Effect: will not bind the OFW concerned.

At the root of the controversy is the validity of the "Offer of Employment" which served as
Yarza's "contract" during his initial deployment under the visit visa. There is no dispute that his
deployment did not pass through the official channel, specifically the POEA. "Under our Labor
Code, employers hiring [Overseas Filipino Workers or] OFWs may only do so through entities
authorized by the Secretary of the Department of Labor and Employment.84 Unless the
employment contract of an OFW is processed through the POEA, the same does not bind the
concerned OFW because if the contract is not reviewed by the POEA, certainly the State has no
means of determining the suitability of foreign laws to our overseas workers."85 Moreover, the
"Offer of Employment" states that the rules and regulations found in UAE's labor laws should
apply,86 which is contrary to our country's policies concerning labor contracts and security of
tenure. To stress,

Security of tenure remains even if employees, particularly the Overseas Filipino Workers
(OFWs), work in a different jurisdiction. Since the employment contracts of OFWs are perfected
in the Philippines, and following the principle of lex loci contractus (the law of the place where
the contract is made), these contracts are governed by our laws, primarily the Labor Code of the
Philippines and its implementing rules and regulations.87 At the same time, our laws generally
apply even to employment contracts of OFWs as our Constitution explicitly provides that the
State shall afford full protection to labor, whether local or overseas.88 Thus, even if a Filipino is
employed abroad, he or she is entitled to security of tenure, among other constitutional rights.89

The "Offer of Employment" was perfected when Yarza agreed to the same while he was still in
the Philippines, and then consented to be deployed abroad. In fact, he already commenced with
his duties under the said contract until his sudden repatriation. However, the "Offer of
Employment" is invalid since it was not approved by the POEA and because it runs contrary to
the Constitution's principles as well as existing labor laws.

Notwithstanding the invalidity of the "Offer of Employment," an employer-employee

relationship exists.

Absent a valid employment contract, the Court must then consider the attendant circumstances
to determine if there is an employer-employee relationship between Akkila and Yarza. To
ascertain the existence of this association, the following elements should be evident: "(1) the
selection and engagement of the employee; (2) the payment of wages; (3) the power of
dismissal; and (4) the employer's power to control the employee's conduct. The most important
element is the employer's control of the employee's conduct, not only as to the result of the
work to be done, but also as to the means and methods to accomplish it. However, the power
of control refers merely to the existence of the power, and not to the actual exercise
thereof. No particular form of evidence is required to prove the existence of an employer-
employee relationship. Any competent and relevant evidence to prove the relationship
may be admitted. However, a finding that such relationship exists must still rest on some
substantial evidence."

For the first element, Akkila selected and engaged the services of Yarza, precisely because he
was deployed through a visit visa under Akkila's instruction and endorsement. For the second
element, Akkila did not deny that it paid Yarza's wages with the "Offer of Employment" as
reference. Likewise, the third element exists since Akkila has the power to dismiss Yarza. In
fact, it did so when it issued the termination letter dated May 22, 2011. Lastly, the fourth
element is present since Akkila had control over Yarza's work conduct, which included the
means and methods he would employ to produce the results required by the company. Akkila
did not show proof that it took no part in directing Yarza's job output. More importantly, Akkila
did not appeal the finding of employer-employee relationship before the CA. Hence, it is bound
by such conclusion.93 Thence, an employer-employee relationship was established
notwithstanding the absence of a valid and POEA-approved contract.

On Illegal Dismissal:

Since an employer-employee relationship exists, the petitioners should accord Yarza due
process, both substantial and procedural, before terminating his employment. To comply with
substantive due process, Yarza can only be dismissed for a just or authorized cause, the
absence of which renders his dismissal illegal.94 As earlier mentioned, under Article 294 27995
of the Labor Code, as an employee, Yarza is entitled to security of tenure.

Akkila dismissed the services of Yarza on the ground of disease, which is found in Article 299
284 of the Labor Code. The said provision essentially provides that "an employer would be
authorized to terminate the services of an employee found to be suffering from any disease if
the employee's continued employment is prohibited by law or is prejudicial to his health or to the
health of his fellow employees."96 Specifically, it states the following:

ARTICLE 299 284. Disease as Ground for Termination. – An employer may terminate the
services of an employee who has been found to be suffering from any disease and whose
continued employment is prohibited by law or is prejudicial to his health as well as to the health
of his co-employees: x x x97

This provision is supplemented by Section 8, Title 1, Book Six of the Omnibus Rules
Implementing the Labor Code, as follows:

SECTION 8. Disease as a ground for dismissal. – Where the employee suffers from a disease
and his continued employment is prohibited by law or prejudicial to his health or to the health of
his co-employees, the employer shall not terminate his employment unless there is a
certification by competent public health authority that the disease is of such nature or at such a
stage that it cannot be cured within a period of six (6) months even with proper medical
treatment. If the disease or ailment can be cured within the period, the employer shall not
terminate the employee but shall ask the employee to take a leave of absence. The employer
shall reinstate such employee to his former position immediately upon the restoration of his
normal health.
To be considered valid, the dismissal on the ground of disease must satisfy two requisites: "(a)
the employee suffers from a disease which cannot be cured within six months and his/her
continued employment is prohibited by law or prejudicial to his/her health or to the health of
his/her co-employees, and (b) a certification to that effect must be issued by a competent public
health authority."

On Solidary Liability:
One of the safeguards incorporated in R.A. No. 8042 is found in Sec. 10 which provides for the
solidary and continuing liability of recruitment agencies against monetary claims of migrant
workers. These pecuniary claims may arise from employer-employee relationship or by virtue of
law or contract and may include claims of overseas workers for damages. Sec. 10 reads:

SEC. 10. Money Claims. – Notwithstanding any provision of law to the contrary, the Labor
Arbiters of the National Labor Relations Commission (NLRC) shall have the original and
exclusive jurisdiction to hear and decide, within ninety (90) calendar days after the filing of the
complaint, the claims arising out of an employer-employee relationship or by virtue of any law or
contract involving Filipino workers for overseas deployment including claims for actual, moral,
exemplary and other forms of damages.

The liability of the principal/employer and the recruitment/placement agency for any and all
claims under this section shall be joint and several. This provision shall be incorporated in the
contract for overseas employment and shall be a condition precedent for its approval. The
performance bond to be filed by the recruitment/placement agency, as provided by law, shall be
answerable for all money claims or damages that may be awarded to the workers. 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.

Such liabilities shall continue during the entire period or duration of the employment contract
and shall not be affected by any substitution, amendment or modification made locally or in a
foreign country of the said contract.

In the case at bench, even if Yarza's employment contract was not previously approved by the
POEA, he should still be protected by our labor laws precisely because an employer-employee
relationship was established. As found by the NLRC, which the CA quoted with approval, SRL
participated in Yarza's initial deployment despite its insistence that it ceased to process his
documents after discovering that a visit visa was secured instead of a work visa. According to
the time stamps and the contents of the e-mail correspondence, SRL participated, one way or
another, and acted as Akkila's local manning agent.

Based on substantial evidence, Yarza proved SRL's solidary liability with its foreign principal,
Akkila/Al Salmeen. This is notwithstanding Yarza's undocumented status or SRL's insistence on
its supposed non-participation. SRL cannot evade liability by simply refusing to process an
overseas worker's documentation yet at the same time admit to being the local manning agent
of a foreign principal which invalidly dismissed an employee. The CA correctly found that
Yarza's predicament was caused by SRL and Akkila, which should not be countenanced. As the
local placement agency, SRL should have employed measures to ensure that Yarza's
deployment would be in accordance with existing policies, from the beginning of the
employment until its end.
Yarza is entitled to his salaries for the unexpired portion of his contract.

Even if the "Offer of Employment" is invalid, the existence of an employer-employee relationship

entitles Yarza to claim for the payment of his salaries for the unexpired portion of his contract.
Relevantly, both the NLRC and the CA rendered their rulings before the Court resolved anew
the issue on the constitutionality of the cap of three-month pay for every year of service on an
overseas worker's money claims. To recall, the Court, in Serrano, already declared such
provision unconstitutional. Yet, Congress enacted RA 10022 which reinstated the same
notwithstanding the Court's earlier pronouncement in Serrano. Specifically, Section 7 of RA
10022 amended Section 10 of RA 8042, viz.:

In case of termination of overseas employment without just, valid or authorized cause as

defined by law or contract, or any unauthorized deductions from the migrant worker's salary, the
worker shall be entitled to the full reimbursement if his placement fee and the deductions made
with interest at twelve percent (12%) per annum, plus his salaries for the unexpired portion of
his employment contract or for three (3) months for every year of the unexpired term, whichever
is less.

Thus, Yarza should receive his unpaid salaries corresponding to the unexpired portion of his
contract (based on the "Offer of Employment") at the rate of AED 8,000.00 per month. Out of
the 24 months, he still had around 19 months left to work, had he not been abruptly dismissed.
He is thus entitled to a total of AED 152,000.00 (19 months x AED 8,000.00). Additionally, as
provided in RA 8183,123 the peso equivalent of his monetary award should be computed based
on the prevailing exchange rate at the time of payment.

Yarza is entitled to moral and exemplary damages as well as attorney's fees.

The Court likewise finds it proper to award moral and exemplary damages, amounting to
P100,000.00 each.125 According to recent jurisprudence,126 "Sec. 10 of R.A. No. 8042 allows
the migrant worker to claim moral and exemplary damages in connection with the employment
contract or as provided by law. In Becmen,127 the Court imposed moral damages by reason of
misconduct on the part of the employer under Article 2219 (10) of the Civil Code, which allows
recovery of such damages in actions referred to in Article 21.128 The Court also ordered the
payment of exemplary damages to set an example to foreign employers and recruitment
agencies on how to treat and act on the plight of distressed Filipino migrant workers.

NOTES:

 Invalid Offer: The "Offer of Employment" was invalid as it was not approved by the
Philippine Overseas Employment Agency (POEA) and did not comply with Philippine
labor laws.
 Employer-Employee Relationship: Despite the invalid offer, an employer-employee
relationship existed based on the elements of selection and engagement, payment of
wages, power of dismissal, and control over work conduct.
 Due Process: Both substantive and procedural due process were not observed in
Yarza's dismissal.
 Medical Certification: Akkila failed to provide a certification from a competent public
health authority regarding Yarza's medical condition.
Questcore, Inc. v. Bumanglag, G.R. No. 253020, (07 December 2022)

FACTS:
QUESTCORE, INC. is a corporation engaged in the business of recruitment for overseas
employment. On May 10, 2013, it deployed Melody as operations head for its principal, Cosmo
Seafoods Ltd. (Cosmo), in Ghana, West Africa. The first contract was for a period of 12
months, from May 10, 2013 to May 10, 2014. Melody was later promoted to vice general
manager and her initial one-year contract was renewed for three successive years. The last
Employment Agreement covers the period from May 1, 2016 to April 30, 2017.4 However, on
October 25, 2016, before the expiration of her fourth and last contract, Melody was dismissed
from employment without just cause and was repatriated to the Philippines.5 Melody filed a
Complaint6 before the labor arbiter for illegal dismissal, with claims for non-payment of her one
month salary, 13th month pay, salary for the unexpired portion of the contract, service
incentive leave pay, cash in lieu of prior notice of termination, unused leave, performance
bonus, and damages.

QUESTCORE, INC. denied liability for Melody's dismissal on the ground that its solidary
liability with the foreign employer only extends up to the first contract. It argued that since it is
not privy to the subsequent renewals of Melody's employment contract, it should be released
from any liability resulting from the dismissal.

ISSUE:
whether the solidary liability of a private recruitment agency under Section 10 of RA 8042 is
limited to the original employment contract and the period indicated therein is not novel

RULING:
In this case, the CA correctly ruled that petitioner Questcore's solidary liability with the foreign
principal Cosmo was not terminated when Melody's first contract ended on May 10, 2014.
Section 10 of RA 8042 expressly states that the liability of the recruitment agency "shall
continue during the entire period or duration of the employment contract and shall not
be affected by any substitution, amendment or modification made locally or in a foreign
country of the said contract." Here, the initial contract provides for an option to renew, and it
is unlikely that petitioner was unaware that Melody was actually reemployed by Cosmo. As
keenly observed by the NLRC, there was a subsisting recruitment agreement/contract of
agency between Cosmo and petitioner, which coincided with Melody's entire stint in Ghana,
Africa. The exchange of electronic communications between petitioner and Cosmo shows that
Melody is only one of the many Filipino overseas workers deployed by petitioner to Cosmo's
jobsite in Africa. To be sure, petitioner may not assume liability insofar as the other Filipino
workers it deployed in Cosmo are concerned, while at the same time dispute its responsibilities
as Melody's agent.30 Precisely, this is why petitioner cannot invoke Sunace International
Management Services, Inc. v. NLRC,31 and harp on the alleged lack of privity or knowledge of
the subsequent renewals of Melody's employment contract.

To stress, Article 18 of the Labor Code bans a foreign employer from directly hiring a Filipino
worker for overseas employment. Even assuming that Cosmo dealt directly with Melody for the
renewal of her contract, petitioner is still jointly and solidarily liable with its foreign principal
because under Article 18, the foreign employer does not have a personality to hire an OFW
unless it acts through a licensed local manning agent. The act of petitioner and Cosmo in
excluding Melody from their roster of agency-deployed employees after her initial contract,
despite their subsisting contract of agency, is an attempt to circumvent the ban on direct hiring,
which the Court cannot countenance.

Notes:
Migrant workers or overseas Filipino workers (OFWs) are entitled to security of tenure for the
period stipulated in their contracts. If their employments are severed before the end of the
contract term without due process, this violates their right to security of tenure and the
dismissal is considered illegal.14 In Melody's case, there is no question that she was illegally
dismissed by her foreign employer Cosmo. Melody was simply handed a letter terminating her
employment before the end of her 4th employment contract and was given a return ticket to the
Philippines.

Under Section 1015 of Republic Act No. (RA) 8042, or the Migrant Workers and Overseas
Filipinos Act of 1995, as amended, an illegally dismissed overseas worker is entitled to the full
reimbursement of the placement fee, with interest of 12% per annum, plus salaries for the
unexpired portion of the employment contract.16 Further, the provision states that the foreign
employer and the local employment agency are jointly and severally liable for money claims of
Filipino workers arising out of an employer-employee relationship, or by virtue of any law or
contract, including damages. Section 10 states:

SEC. 10. Money Claims. — Notwithstanding any provision of law to the contrary, the Labor
Arbiters of the National Labor Relations Commission (NLRC) shall have the original and
exclusive jurisdiction to hear and decide, within ninety (90) calendar days after the filing of
the complaint, the claims arising out of an employer-employee relationship or by virtue of
any law or contract involving Filipino workers for overseas deployment including claims for
actual, moral, exemplary and other forms of damages. Consistent with this mandate, the
NLRC shall endeavor to update and keep abreast with the developments in the global
services industry.

The liability of the principal/employer and the recruitment/placement agency for any and all
claims under this section shall be joint and several. This provision shall be incorporated in
the contract for overseas employment and shall be a condition precedent for its approval. x
x x.

Such liabilities shall continue during the entire period or duration of the employment
contract and shall not be affected by any substitution, amendment or modification made
locally or in a foreign country of the said contract.

xxxx

In case of termination of overseas employment without just, valid or authorized cause as

defined by law or contract, or any unauthorized deductions from the migrant worker's
salary, the worker shall be entitled to the full reimbursement of his placement fee and the
deductions made with interest at twelve percent (12%) per annum, plus his salaries for the
 unexpired portion of his employment contract or for three (3) months for every year of the
unexpired term, whichever is less.

As a measure of social legislation, RA 8042 recognizes that the constitutional guarantee17 of

giving full protection to overseas workers is an arduous task. Migrant workers are beyond the
State's protective mantle due to their geographical location which make them more prone to
exploitation. Section 10 of RA 8042 aims to give OFWs greater protection by imposing solidary
liability on the local agent and the foreign principal. This is an assurance that the claims of an
overseas worker will not be hampered by jurisdictional issues, conflict of laws, or other
procedural nuances.

Marajas v. People, G.R. No. 244001, June 23, 2021

FACTS:

Aquilina M. Marajas (petitioner) and her co-accused Myrna Melgarejo (Melgarejo), were
charged with violation of Illegal Recruitment under Section 6 of R.A. No. 8042, otherwise known
as "Migrant Workers and Overseas Filipinos Act of 1995", as amended by R.A. No. 10022
before the Regional Trial Court (RTC) of Pasay. Aquilina M. Marajas and Myrna Melgarejo, non-
licensees or non-holders of authority and representing themselves as authorized to deploy
Filipino workers for employment abroad. Marajas, Melgarejo and co-accused Raymond
Marquez Pilac (Pilac) were also charged for violation of Section 5(e) of R.A. No. 9208, or the
"Anti-Trafficking in Persons Act of 2003.

Sometime in May 2012, private complainant Tag-at went to Myron Travel Agency, owned by
Melgarejo, to seek employment abroad as a domestic helper. Melgarejo then told private
complainant to wait for petitioner. When petitioner arrived, private complainant introduced
herself and told petitioner of her desire to seek employment abroad. Petitioner replied that the
agency would just arrange for a sponsor in Beijing, China who would help the private
complainant travel to Beijing, China where she would be engaged as a domestic helper.6

Subsequently, on May 31, 2012, private complainant again went to Myron Travel Agency where
she met petitioner. Petitioner then handed to her a Letter of Invitation and Support dated May
15, 2012 signed by a certain Johnelyn Daquigan (Daquigan), together with copies of Daquigan's
passport and certificate of live birth.7

In the same afternoon, private complainant, accompanied by petitioner, went to the Ninoy
Aquino International Airport (NAIA) Terminal 3 after being told that she would be departing for
Beijing, China later that afternoon. After paying private complainant's travel tax, petitioner told
her to wait for a text message from somebody and to fall in line at the Immigration counter being
manned by a fat and bald person who later turned out to be Pilac.8

At that time, Agent Follosco, Agent Rodrigo Sarno III (Agent Sarno), and Agent Fidel Geli III
(Agent Geli), members of the Inter-Agency Council Against Trafficking (IACAT) of the
Department of Justice (DOJ), were roaming around the Departure Area of NAIA Terminal 3
when they noticed petitioner and private complainant. They overheard the former's instructions
to the latter. They also noticed that after private complainant checked in at the Check-In
Counter, the two (2) women went directly to the Immigration Departure Area. They observed
that the petitioner pointed to the counter being manned by Pilac where private complainant was
asked to fall in line.9

Private complainant then gave her passport to Pilac upon reaching the counter. Pilac asked her
where she was going and she answered, "Beijing, sir." When asked if she had money, private
complainant replied in the affirmative showing One Thousand Pesos (P1,000.00). Pilac then
cleared private complainant for departure by putting a stamp on her passport. Private
complainant then proceeded to the next line.10

Agents Follosco, Sarno, and Geli then proceeded to the Immigration counter and ordered
private complainant to proceed to the Bureau of Immigration Travel Control and Enforcement
Unit (TCEU) for secondary inspection of her travel documents. IO Lagman then checked private
complainant's documents such as her passport, return ticket, boarding pass, Letter of Invitation
and Support, and the birth certificate of Daquigan. IO Lagman also interviewed her in the
process. It was at this point that IO Lagman decided to offload her after she failed to show her
relationship with Daquigan as her alleged sponsor. An Affidavit of Offloading was executed by
IO Lagman afterwards.11

Petitioner left as soon as private complainant was subjected to secondary inspection.

Subsequently, IO Lagman accompanied private complainant to Agents Follosco, Sarno, and

Geli who brought the private complainant to the IACAT Office inside NAIA Terminal 3. There,
Agent Chong, Anti-Human Trafficking Supervisor, interviewed private complainant. During the
interview, private complainant admitted that her real purpose for travelling to Beijing, China was
for employment. She also disclosed that petitioner told her that she could go to Beijing, China
initially as a tourist and later on be given a job there. She showed Agent Chiong a Letter of
Invitation and Support purportedly executed by Daquigan given to her by petitioner. Private
complainant also admitted to Agent Chiong that the Letter of Invitation and Support, as well as
the latter's birth certificate, were both fake.

ISSUE:
Whether petitioner is guilty of Illegal Recruitment under Section 6 of R.A. No. 8042

RULING:

YES.

In order to hold a person liable for illegal recruitment, the following elements must concur: (1)
the offender undertakes any of the activities within the meaning of "recruitment and placement"
under Article 13 (b) of the Labor Code, or any of the prohibited practices enumerated under
Article 34 of the Labor Code (now Section 6 of R.A. No. 8042); and (2) the offender has no valid
license or authority required by law to enable him to lawfully engage in recruitment and
placement of workers. In the case of illegal recruitment in large scale, a third element is added:
that the offender commits any of the acts of recruitment and placement against three or more
persons, individually or as a group.24
In this case, the only disputed element is the first element. As to the second element, it was
already proven by the presentation of a Certification from the POEA stating that petitioner is not
licensed or authorized to recruit workers for overseas employment. This fact was not denied by
the petitioner.

It must be noted that while private complainant mentioned in her testimony that petitioner did not
promise her employment in Beijing, petitioner, nevertheless, told her that there would be work
for her upon arrival in Beijing. This shows that petitioner gave private complainant the distinct
impression that she had the power or ability to send her abroad for employment. Moreover, as
testified by private complainant, petitioner professed her ability to send private complainant
abroad when she gave the latter a Letter of Invitation and Support allegedly executed by a
certain Daquigan, but was actually executed by petitioner, as well as a copy of Daquigan's birth
certificate, when in truth, Daquigan was not known to the private complainant and was not a
relative of the latter. Furthermore, petitioner even personally accompanied private complainant
on the supposed day of the latter's departure for Beijing. All these acts show that petitioner
indeed presented herself as a person who could cause the overseas aspirations of private
complainant come into fruition.

Additionally, petitioner's denial that she did not engage in any recruitment activity cannot prevail
over the positive identification of private complainant of the former who made representations
on her capability of sending private complainant to Beijing, China for employment. The Court
has oft pronounced that denial is an inherently weak defense which cannot prevail over the
positive and credible testimony of the prosecution witness that the accused committed the
crime. Thus, as between a categorical testimony which has the ring of truth on the one hand,
and a mere denial and alibi on the other, the former is generally held to prevail.

Shumali v. Agustin, A.C. No. 13789, (29 November 2023)

FACTS:

This is an administrative complaint filed by Fadi Hasan Mahmoud Shumali (complainant)

against Atty. James Bryan O. Agustin (respondent) before the Integrated Bar of the Philippines
(IBP) for withholding his passport in violation of Rule 16.03, Canon 16 of the Code of
Professional Responsibility (CPR) which states that "[a] lawyer shall deliver the funds and
property of his client when due or upon demand."

Complainant alleged that he turned over his passport to respondent in May 2018 for the renewal
of his Philippine tourist visa; however, the latter was unable to facilitate the processing of the
application as the Agency had no available funds at the time. Complainant thereafter made
several demands for the return of his passport, but respondent refused to do so because the
Agency supposedly had outstanding payables with the latter's law office.4

In his Answer,5 respondent clarified that complainant turned over his passport for purposes of
processing his Alien Employment Permit (AEP) with the Department of Labor and Employment
and the extension of his expired tourist visa for another three months.6 He explained that
complainant's applications for tourist visa extension and AEP were never processed because
first, complainant never furnished him the needed information and documentary requirements,
and second, complainant and the Agency did not pay respondent a single centavo for the
purposes.7

Respondent averred that he simply exercised his right to an attorney's lien. Efforts were made
to return the said passport but to no avail; hence, respondent instead delivered the passport to
the Jordanian Honorary Consulate General and informed complainant that he may claim his
passport there.

ISSUE:
whether respondent should be held administratively liable for withholding complainant's
passport in the exercise of his attorney's lien

RULING:
YES.

SECTION 56. Accounting and Turn Over upon Termination of Engagement. — A lawyer who is
discharged from or terminates the engagement shall, subject to an attorney's lien, immediately
render a full account of and turn over all documents, evidence, funds, and properties belonging
to the client.

The lawyer shall cooperate with the chosen successor in the orderly transfer of the legal matter,
including all information necessary for the efficient handling of the client's representation.

A lawyer shall have a lien upon the funds, documents, and papers of the client which have
lawfully come into his or her possession and may retain the same until the fair and reasonable
fees and disbursements have been paid, and may apply such fund to the satisfaction thereof.

Jurisprudence dictates that save for one's retaining lien, lawyers generally should not withhold
the client's funds and/or documents. For a proper exercise of one's retaining lien, the lawyer
must establish the following elements: "(1) lawyer-client relationship; (2) lawful possession of
the client's funds, documents and papers; and (3) unsatisfied claim for attorney's fees."

Applying the International Law doctrine of processual presumption, which means that if a foreign
law is not pleaded/proved, it is presumed to be the same as the laws of the Philippines,22 it
necessarily follows that the passport withheld by respondent belongs to the Kingdom of Jordan
and that complainant is a mere possessor thereof.

In other words, even though respondent may have come into the possession of complainant's
Jordanian Passport for valid purposes, i.e., the processing of AEP and visa applications, such
travel document cannot be deemed as a proper subject of an attorney's retaining lien because it
neither belongs to complainant nor the Agency. To stress, it is highly inappropriate for
respondent to have refused to return complainant's passport in order to satisfy the legal fees
that the Agency owed him or his law firm in the amount of PHP435,110.00.

Besides, respondent knows, or should have known, that a passport cannot be surrendered to
any person or entity other than the government or its representative.23 Worse, the unauthorized
withholding of travel documents from workers is considered a form of coercion that constitutes
illegal recruitment,24 if not trafficking in persons.25 Simply put, a lawyer cannot legally refuse to
return a client's passport for the purpose of exercising his or her retaining lien.

Respondent, having no justifiable reason to retain the subject passport, is guilty of the Less
Serious Offense of Unjustifiable Failure or Refusal to Render an Accounting of the Funds or
Properties of a Client under Section 34(n),26 Canon VI of the CPRA – which includes a lawyer's
unjustified refusal to turn over all properties belonging to the client.

Saking y Anniban v. People, G.R. No. 257805, (12 April 2023)

FACTS:

Saking was criminally charged for three separate offenses: (1) illegal recruitment under Sections
6 and 7 of R.A. No. 8042, (2) estafa under Article 315, paragraph 2 (a) of the Revised Penal
Code, and (3) carnapping under R.A. No. 6539, or the Anti-Carnapping Act of 1972.

Jan Denver Palasi (Palasi) recalled that he met Saking at a car repair shop where he was
having his Mitsubishi Delica van repaired.ℒαwρhi ৷ Saking presented that he was looking for
people interested to work in Australia as grape and apple pickers with a required placement fee
of PHP 300,000.00. Palasi signified his interest to apply for the job. Short with funds, he offered
his van as payment. Saking agreed but required him to pay an additional PHP 100,000.00 in
cash.

To proceed with the application, Palasi was made to fill out the forms. After filling out the
documents, he gave them to Saking, together with his passport. Palasi subsequently paid the
PHP 100,000.00 in three installments. In all these transactions, Saking did not give him any
official receipt.7

Palasi recalled that Saking once brought him to Practice Agency, the office which supposedly
processed the papers. He alleged, however, that Saking made him wait in the car.8

After Saking collected the entire amount of PHP 100,000.00, Palasi could no longer contact him.
Hence, at around June 2013, Palasi went to Practice Agency in order to personally inquire on
the status of his papers and application for the job. To his surprise, he was told that he had no
pending application with the agency. On account of this discovery, he went to the Philippine
Overseas Employment Agency (POEA) where it was confirmed that Saking had no license to
recruit workers for overseas employment.9

To make matters worse, Palasi found out that Saking took his Delica van from the car repair
shop without his knowledge. Although the van was part of the payment for the placement fee, it
was agreed that the vehicle would only be taken with the owner's consent. Nevertheless, Palasi
was able to recover it from a certain Ernesto Buya, the person who bought the vehicle from
Saking.
ISSUE:

Whether the CA correctly affirmed the Joint Decision of the RTC which convicted Lee Saking y
Anniban for the crimes of illegal recruitment and estafa.

RULING:

R.A. No. 8042, or The Migrant Workers Act, as amended by R.A. No. 10022, defines illegal
recruitment in the following manner:

Section 5. Section 6 of Republic Act No. 8042, as amended.XXXX

Jurisprudence parses out the elements of illegal recruitment m the following manner:

[T]o sustain a conviction for illegal recruitment under R.A. 8042 in relation to the Labor Code,
the prosecution must establish two (2) elements: first, the offender has no valid license or
authority required by law to enable one to lawfully engage in the recruitment and placement of
workers; and second, the offender undertakes any of the activities within the meaning of
recruitment and placement defined in Article 13(b) of the Labor Code, or any of the prohibited
practices enumerated under Section 6 of R.A. No. 8042.24

This Court is convinced that the prosecution was able to prove both elements of illegal
recruitment in this case.

First, as found by the CA, Saking does not dispute that he did not possess a license or authority
to engage in any recruitment and placement activities. The certification of the Licensing and
Regulation Branch of the POEA and the testimony of the coordinator of POEA Regional
Extension Unit-Cordillera Administrative Region have sufficiently proven this fact.

As to the second element, referring to Article 13(b) of the Labor Code, there must be a promise
or offer of employment from the person posing as a recruiter. In the trial for this case, Palasi
affirmed in open court that Saking told him that the latter is willing to provide him a working visa
as he had a connection with the Australian embassy. Palasi parted with his money in order for
his papers to be processed.

Estafa

The same set of facts that establish liability for illegal recruitment may be the basis of culpability
for estafa.

The Revised Penal Code, as amended, provides the prohibited acts and penalty for swindling:

Article 315. Swindling (estafa). -Any person who shall defraud another by any of the means
mentioned hereinbelow shall be punished by:
2. By means of any of the following false pretenses or fraudulent acts executed prior to or
simultaneously with the commission of the fraud: (a) By using fictitious name, or falsely
pretending to possess power, influence, qualifications, property, credit, agency, business or
imaginary transactions, or by means of other similar deceits.

Jurisprudence expounds that the following elements must be established to sustain a

conviction:

The elements of the crime estafa under the foregoing provision are: (1) there must be a false
pretense, fraudulent acts or fraudulent means; (2) such false pretense, fraudulent act or
fraudulent means must be made or executed prior to or simultaneously with the commission of
the fraud; (3) the offended party must have relied on the false pretense, fraudulent act or
fraudulent means and was thus induced to part with his money or property; and (4) as a result
thereof, the offended party suffered damage.

We agree with the CA's analysis that all the elements are present in this case:

All the elements are present in this case. The false pretense by the accused-appellant is glaring
from his act of representing himself as someone who could help the private complainant work in
a farm in Australia, when in truth and in fact, he possessed no such power to make it happen.
The private complainant agreed to part with his van and money as payment for the placement
fee believing in good faith on the accused-appellant's misrepresentation. Such reliance is
evident by the fact that the private complainant went to Practice Agency to follow up his papers
being under the belief that the accused-appellant submitted them with the said agency.
Jurisprudence is clear that receipts are not indispensable in proving the element of damage in
cases of illegal recruitment and estafa.

Penalties under R.A. No. 10022:

Paragraph (a) of Section 6, which is pertinent to this case, provides that the range of
imprisonment shall be at least 12 years and one day but not more than 20 years and a fine of
not less than PHP 1,000,000.00 nor more than PHP 2,000,000.00.

Given that there are no modifying circumstances in this case, and with the Indeterminate
Sentence Law in consideration, this Court metes out a penalty of imprisonment of 12 years and
one day to 14 years, and to pay a fine of PHP 1,000,000.00.

For the charge of estafa, entenced to suffer the penalty of imprisonment of two (2) months and
one (1) day of arresto mayor, as minimum, to one (1) year and one (1) day of prision
correccional, as maximum.

People v. Ramos y Garcia, G.R. No. 257675, (13 February 2023)

People v. Marzan, G.R. No. 227093, September 21, 2022

FACTS:

 Complainants were Irene, together with Bal Marzan (Bal), Fely Dulay (Fely), Apolonio
Dulay (Apolonio), Marlon Agoncillo (Marlon), and Alejandro a.k.a "Alex" Navarro, Jr.
(Alex) were charged with multiple counts of Illegal Recruitment in Large Scale and
Estafa.
 The incidents occurred between March and July 2006 in various municipalities in
Pangasinan, Philippines.
 The accused allegedly conspired to recruit individuals for employment in South Korea
without the necessary license or authority from the Philippine Overseas Employment
Administration (POEA).
 Victims paid substantial sums of money based on false promises of overseas
employment.
 The accused failed to provide the promised employment or return the money.
 The Regional Trial Court (RTC) found Irene and her co-accused guilty.
 Irene appealed to the Court of Appeals (CA), which affirmed the RTC's decision and
increased the fines for illegal recruitment.

RULING:
Illegal recruitment in Large Scale under Section 6, RA 8042 constituting economic
sabotage:

First, per DOLE Certification dated August 25, 2006, appellant was not authorized nor licensed
to conduct recruitment activities for overseas employment.224

Second, despite lack of authority or license, appellant and Fely conducted recruitment and
placement activities. They offered and promised to deploy complainants in South Korea for
employment. In exchange, they collected placement, training fees, and other fees despite not
being authorized to do so. Indubitably, these are prohibited activities within the purview of
Article 13(b)225 (now Article 38) of the Labor Code (Renumbered) and Section 6 of RA 8042.

Third. These prohibited practices were committed against three (3) or more persons.
Specifically, there were more or less 30 complainants altogether, albeit only 22 of them testified.

Estafa:
One, appellant falsely and fraudulently represented that she, together with her co-conspirators,
possessed the authority to engage in recruitment and placement activities. They promised
complainants overseas employment in South Korea in exchange for the payment of placement
and other fees. They did so knowing full well that they were not authorized or licensed to do so.

Two, such false pretense and fraudulent representation was made or executed prior to or
simultaneously with the commission of the fraud.
Three, it was appellant's and her co-conspirators' false and fraudulent representations which
induced complainants to part with their hard-earned money as payment for the supposed
placement and other fees. They believed appellants' deceit and held on to the latter's promise to
deploy them for work abroad.

Finally, the victims were not able to leave for work abroad nor get back their money.

The Court, in People v. Estrada,232 sustained Estrada's conviction for three counts of estafa
under Article 315 par. 2(a) concurrent with her culpability for illegal recruitment in large scale.
The Court ratiocinated – she falsely represented herself as possessing power to deploy persons
for overseas placement. By these pretenses, Estrada deceived therein private complainants into
believing that she would provide them their desired jobs in Dubai. This active representation of
having the capacity to deploy the private complainants abroad despite not having the authority
or license to do so from the POEA constituted deceit. More, because of her assurances, the
private complainants parted with their money to pay Estrada the various fees which they
thought were necessary for their deployment abroad resulting in damage to each of the private
complainants.

People v. Mandelma, G.R. No. 238910, (20 July 2022)

Facts:
 The accused-appellant Elnora Mandelma, alias "Lathea Estefanos Stellios," along with
Perlita Castro Urquico, alias "Fhey," and Carlo Villavicencio, Jr., alias "Boyet," were
charged with illegal recruitment in large scale and estafa.
 The events occurred between November 2009 and May 2010 in San Fernando City,
Pampanga.
 Under Mheyman Manpower Agency (MMA), they collected money from at least 31
individuals seeking overseas employment but failed to fulfill their promises.
 Five Informations were filed against them for violations of Republic Act No. 8042
(Migrant Workers and Overseas Filipinos Act of 1995) and estafa under Article 315,
paragraph 2 (a) of the Revised Penal Code (RPC).
 The Regional Trial Court (RTC) of San Fernando City, Pampanga, Branch 41, convicted
Mandelma and sentenced her to life imprisonment for illegal recruitment and various
prison terms for estafa.
 The Court of Appeals (CA) affirmed the RTC's decision with some modifications to the
penalties.
 Mandelma appealed to the Supreme Court, which further affirmed the CA's decision with
additional modifications to the penalties.

Ruling:
The Supreme Court affirmed the conviction of Elnora Mandelma for illegal recruitment in large
scale, sentencing her to life imprisonment and a fine of Php2,000,000.00.

Thus, under the Labor Code, to constitute Illegal Recruitment in Large Scale, three elements
must concur:
1. The accused undertook any recruitment activity defined under Art. 13 (b) or any prohibited
practice enumerated under Art. 34 of the Labor Code.
2. He did not have the license or the authority to lawfully engage in the recruitment and
placement of workers.

3. He committed the same against three or more persons, individually or as a group.[68]

RA 8042, otherwise known as the "Migrant Workers and Overseas Filipinos Act of 1995,"
established a higher standard of protection and promotion of the welfare of the migrant workers,
their families and overseas Filipinos in distress.[69] RA 8042 also broadened the concept of
illegal recruitment for overseas employment and increased the penalties, especially for Illegal
Recruitment in Large Scale and Illegal Recruitment Committed by a Syndicate, which are
considered offenses involving economic sabotage.[70] Part II of RA 8042 defines and penalizes
illegal recruitment for employment abroad, whether undertaken by a non-licensee or non-holder
of authority or by a licensee or holder of authority.

(1) Regarding the first element that the accused undertook any recruitment activity defined
under Article 13(b), or any prohibited practice enumerated under Article 34 of the Labor Code,
the prosecution was able to prove through the testimony of its witnesses that accused-appellant
was introduced by her coA-accused as the job broker for Cyprus, "Lathea Estefanos Stellios."
Under this fake identity, accused-appellant committed various overt acts of recruitment such as
giving orders to her co-accused to check the names of applicants who already paid, calling the
names of applicants who will undergo PDOS, giving a supposed contract to the applicants for
their signature and collecting it afterwards, and even writing the names of applicants ready for
deployment, among other things.[74] There is no doubt that accused-appellant participated in
recruitment or placement activities.

(2) For the second element, it was satisfactorily established that accusedA-appellant clearly did
not have a license or authority to lawfully engage in the recruitment and placement of workers.
Merrera, a Senior Labor and Employment Officer of the POEA, Satellite Office III, San Fernando
City, Pampanga,[75] testified that Dir. Dizon, POEA's Director for Licensing and Adjudication
Branch, issued a certification dated May 25, 2011 stating the following, among others:
This is to certify that based on available records of this Office, MHEYMAN MANPOWER
INTERNATIONAL, with office address at 94 Gil Puyat Avenue, Makati City, represented by
Elena M. Buenaventura, Proprietor, is a landbased agency whose licence is valid until
September 21, 2010.

It is further clarified that Perlita Urquico a.k.a. Perlita Ramos, Claro Aniceta Villavicencio, Jr.,
Lathea Estefanos Stellios are not included in the list of employees submitted to this office by the
above agency.

Moreover, the agency has no registered branch office in San Fernando City, Pampanga.[76]
Aside from this public document issued by the POEA, Merrera also testified that he personally
verified in their system whether the persons mentioned in the certification were licensed or not,
but he found no records of them having authority to recruit workers for overseas employment.
[77] Clearly, the prosecution was able to show that accused-appellant and her cohorts have no
lawful authority to engage in recruitment and placement activities.

(3) Lastly, the prosecution has established that there were at least four victims in this case a
Galendez, Lozano, Lopez, and Calma.
Estafa:

Article 315, par. 2 (a) of the RPC provides:

Article 315. Swindling (estafa). a Any person who shall defraud another by any of the means
mentioned herein below x x x

...

2. By means of any of the following false pretenses or fraudulent acts executed prior to or
simultaneously with the commission of the fraud:

(a) By using fictitious name, or falsely pretending to possess power, influence, qualifications,
property, credit, agency, business or imaginary transactions, or by means of other similar
deceits.[80]
Arias v. People[81] enumerated the following elements of this kind of Estafa. The elements of
estafa under Article 315, paragraph 2(a) of the RPC, are the following:
That there must be a false pretense, fraudulent act or fraudulent means;

That such false pretense, fraudulent act or fraudulent means must be made or executed prior to
or simultaneously with the commission of the fraud;

That the offended party must have relied on the false pretense, fraudulent act, or fraudulent
means, that is, he was induced to part with his money or property because of the false
pretense, fraudulent act or fraudulent means; and

That as a result thereof, the offended party suffered damage.

In this case, all the elements of Estafa are present. The testimonies of the private complainants,
coupled with the documentary and object evidence, demonstrated that accused-appellant,
under the false pretense of being a legitimate overseas worker recruiter, fraudulently induced
private complainants to part with their money as part of the supposed recruitment process.
Given that none of the private complainants was deployed abroad as they were just being
scammed, they clearly suffered damage.

The RTC and the CA were correct in finding that accused-appellant deceived private
complainants into believing that she had the authority and capability to send them to Cyprus for
employment. Particularly, the RTC aptly found that Mandelma used a fictitious-sounding name,
"Lathea Estefanos Stellos," to conceal her true identity and spoke English with a feigned foreign
accent or diction to induce private complainants, who relied on these false pretenses, to part
with their money amounting to P51,500.00 each in exchange for the promise of future work
abroad. However, this promise of overseas employment was never fulfilled.

People v. Dela Concepcion y Valdez, G.R. No. 251876, (21 March 2022)
Note:
The absence of receipts issued by the accused in an illegal recruitment case is not fatal
to their conviction if the prosecution establishes, through credible evidence, that the
accused has engaged in illegal recruitment.

FACTS:
Dela Concepcion, also known under the aliases "Judith A. Valdez" and "Ofelia Andaya," was
accused of promising overseas employment to more than 30 individuals in 2014. Dela
Concepcion allegedly collected more than P1,000,000.00 in the guise of using the money to
process their documents for deployment.

RULING:

Illegal recruitment is deemed committed by a syndicate if carried out by a group of three (3) or
more persons conspiring or confederating with one another. It is deemed committed in large
scale if committed against three (3) or more persons individually or as a group.

All the elements are present in this case.

Accused-appellant admitted collecting fees for medical requirements and Department of Foreign
Affairs documents, preparatory to the supposed deployment of private complainants. She may
have denied being the actual recruiter, but she admitted asking for sums of money to process
documents. Apart from this, accused-appellant had no license or authority to recruit and deploy
workers abroad. Accused-appellant's acts gave the impression that she could deploy private
complainants overseas. She also recruited more than three individuals.

The elements of estafa by means of deceit under Article 315(2)(a) of the [Revised Penal Code]
are:

(a) that there must be a false pretense or fraudulent representation as to his power, influence,
qualifications, property, credit, agency, business or imaginary transactions; (b) that such false
pretense or fraudulent representation was made or executed prior to or simultaneously with the
commission of the fraud; (c) that the offended party relied on the false pretense, fraudulent act,
or fraudulent means and was induced to part with his money or property; and (d) that, as a
result thereof the offended party suffered damage.97 (Citation omitted)

These elements were proven in this case. Private complainants Parial, Aileene, Jennifer, and
Dulay were made to believe that accused-appellant could legally deploy them overseas.

To recall, accused-appellant presented job orders to private complainant Parial.98 Private

complainant Aileene believed accused-appellant could deploy workers because of the
documents shown to her.99 On the other hand, private complainants Jennifer100 and Dulay101
parted with their money because accused-appellant told them that they could be deployed.
Lastly, private complainant Oberez testified during cross-examination that accused-appellant
admitted that she had no Philippine Overseas Employment Administration registration, but that
her brother-in-law would directly hire Oberez.102
Accused-appellant's false pretenses led private complainants to part with various amounts of
money, hoping for a better life abroad. Unfortunately, they were never deployed and were never
reimbursed. Thus, they suffered damage.

People v. Centeno, G.R. No. 225960, (13 October 2021)

FACTS:
 The events took place between December 2005 and June 2006 in Manila, Philippines.
 They allegedly recruited individuals for overseas jobs without the necessary licenses
from the Department of Labor and Employment (DOLE).
 In Criminal Case No. 08-259342, they were accused of recruiting complainants,
including Danilo Pactol and Elizabeth Castillo, and collecting P854,540.00 in placement
fees exceeding the allowable amounts set by the Philippine Overseas Employment
Administration (POEA).
 Complainants testified that they were promised overseas employment in exchange for
fees but were never deployed.
 The prosecution presented witnesses, including a POEA officer, confirming the absence
of requisite licenses for recruitment.
 The Regional Trial Court (RTC) found Centeno guilty of two counts of syndicated illegal
recruitment and three counts of estafa, sentencing him to life imprisonment and
imposing fines.
 Centeno appealed to the Court of Appeals (CA), which upheld the RTC's ruling with
modifications to the penalties.

RULING:
The Supreme Court affirmed the lower courts' findings, declaring Centeno guilty beyond
reasonable doubt of two counts of syndicated illegal recruitment and three counts of estafa.

Arguilles v. Wilhelmsen Smith Bell Manning, Inc, G.R. No. 254586, July 10, 2023

Facts:
 Rosell R. Arguilles filed a complaint for disability benefits against Wilhelmsen Smith Bell
Manning, Inc., Wilhelmsen Ship Management Ltd., and Fausto R. Preysler, Jr.
 On June 15, 2016, Arguilles entered into a Contract of Employment with Wilhelmsen
Manning as an Ordinary Seaman on the vessel M/V Toronto.
 He began his duties on July 24, 2016.
 On December 26, 2016, Arguilles injured his left ankle while playing basketball on board,
diagnosed as a high-grade partial tear of the Achilles tendon.
 He was medically repatriated to the Philippines on January 18, 2017, and underwent
surgery and physical therapy.
 Despite treatment, Dr. Rogelio P. Catapang declared Arguilles unfit for sea duty.
 Arguilles filed for disability benefits, claiming his injury was work-related and that the
company-designated physician failed to issue a final evaluation within the required
period.
 The Labor Arbiter (LA) ruled in favor of Arguilles, awarding him US$90,000.00 in
disability benefits.
  The National Labor Relations Commission (NLRC) initially affirmed the LA's decision but
later reversed it, dismissing Arguilles' claim.
 The Court of Appeals (CA) upheld the NLRC's dismissal.
 Arguilles then filed a Petition for Review on Certiorari before the Supreme Court.

Issues:
1. Work-Relatedness of Injury: Whether Arguilles’ injury, sustained during a recreational
activity while off duty but on board the vessel, is compensable under the employment
contract and relevant laws (Bunkhouse Rule and Personal Comfort Doctrine).

2. Disability Benefits: Whether respondents’ failure to provide a definitive assessment or

declaration within the prescribed periods (120/240 days) results in Arguilles’ injury being
classified as permanent and total, entitling him to disability benefits.

Court’s Decision:
1. Work-Relatedness of Injury: The Supreme Court ruled that Arguilles’ injury, sustained
during an employer-sanctioned recreational activity, qualifies as work-related under the
NSA-AMOSUP/NSU CBA and POEA SEC definitions. The Court recognized the
Bunkhouse Rule and Personal Comfort Doctrine, establishing that injuries during
employer-sanctioned activities on company premises or during acts necessary for
personal comfort are compensable.

2. Disability Benefits Finalization:** The Court found respondents failed to issue a final
medical assessment within 120/240 days, thus under Elburg Shipmanagement Phils.,
Inc. v. Quiogue, Jr., Arguilles’ condition is considered permanent and total, entitling him
to full disability benefits.

3. Monetary Awards and Joint Liability: The decision reinstated the LA’s award of
US$90,000.00 in total and permanent disability benefits, holding respondents and their
corporate officers jointly and severally liable, with an imposed interest rate of six percent
(6%) per annum on the total monetary award from the date of finality of the judgment
until full satisfaction.

Doctrine:
1. Bunkhouse Rule: Injuries sustained by employees required to live on employer premises
are compensable if they arise out of and in the course of employment, regardless of the
time the injuries occurred.
2. Personal Comfort Doctrine:** Employee activities necessary for personal comfort during
work hours are incidental to employment and any injuries sustained are compensable.
3. Total and Permanent Disability:** Absence of definitive medical assessment within the
mandated 120/240 days results in disability classification as total and permanent,
entitling the employee to full disability benefits.

SOLIDARY LIABILITY;

The Court declares the corporate officers of Wilhelmsen Manning jointly and severally liable for
the total judgment award. This is based on Section 10 of Republic Act (R.A.) No. 8042,
otherwise known as the Migrant Workers and Overseas Filipinos Act of 1995, as amended by
Section 7 of R.A. No. 10022, which states:

SECTION 10. Money Claims. — x x x

The liability of the principal/employer and the recruitment/ placement agency for any and all
claims under this section shall be joint and several. This provision shall be incorporated in the
contract for overseas employment and shall be a condition precedent for its approval. The
performance bond to be filed by the recruitment/placement agency, as provided by law, shall be
answerable for all money claims or damages that may be awarded to the workers. 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. x x x" (Underscoring Ours)

In view of this provision, the corporate officers of Wilhelmsen Manning must be held jointly and
severally liable with Wilhelmsen Manning and WSML for the monetary awards due petitioner.