In Franciviel Derama Sestoso v. United Philippine Lines, Inc., the Supreme Court ruled in favor of the seafarer, affirming that a pre-existing illness does not automatically disqualify a claim for disability benefits if the employment conditions aggravated the condition. The Court emphasized the importance of the company-designated physician issuing a final and definitive disability assessment within the prescribed 120/240-day period. Failure to do so results in the seafarer’s disability being deemed total and permanent, entitling them to corresponding benefits. This decision underscores the protection afforded to seafarers under Philippine law, ensuring their right to compensation when their work contributes to the worsening of their health, irrespective of pre-existing conditions.

When a Seafarer’s Duty Aggravates a Pre-Existing Condition: A Fight for Disability Benefits

Franciviel Derama Sestoso, a Team Headwaiter, filed a complaint against United Philippine Lines, Inc. (UPLI), Carnival Cruise Lines, and Fernandino T. Lising, seeking total and permanent disability benefits, moral and exemplary damages, and attorney’s fees. Sestoso’s claim stemmed from a knee injury he sustained while working on board M/V Carnival Inspiration. He argued that the company-designated physician failed to provide a final and definite disability assessment within the 120/240-day period, entitling him to total and permanent disability benefits. The respondents countered that Sestoso’s condition was pre-existing and not work-related, thus not compensable.

The Labor Arbiter initially awarded Grade 10 disability benefits, but the National Labor Relations Commission (NLRC) reversed this decision, granting Sestoso permanent and total disability benefits. The NLRC emphasized the absence of a valid and final disability assessment from the company-designated physician. Dissatisfied, the respondents appealed to the Court of Appeals, which reversed the NLRC’s decision, stating that Sestoso’s condition was pre-existing and not aggravated by his working conditions. This led Sestoso to elevate the case to the Supreme Court.

The Supreme Court addressed the central issue of whether the Court of Appeals erred in denying the award of total and permanent disability benefits to Sestoso. The Court began by establishing that the compensability of an illness does not solely depend on whether it was pre-existing at the time of employment. Instead, the focus should be on whether the illness is work-related or if the employment aggravated the seafarer’s condition. As the Court articulated in More Maritime Agencies, Inc. v. NLRC:

But even assuming that the ailment of Homicillada was contracted prior to his employment with the MV Rhine, this fact would not exculpate petitioners from liability. Compensability of an ailment does not depend on whatever the injury or disease was pre­existing at the time of the employment but rather if the disease or injury is work-related or aggravated his condition.

Building on this principle, the Court examined the burden of proof regarding whether Sestoso’s illness was work-related or aggravated by his work. Under the 2010 POEA-SEC, illnesses not listed in Section 32 are disputably presumed as work-related. This presumption places the burden on the employer to disprove the work-relatedness of the illness with substantial evidence. The case of Romana v. Magsaysay Maritime Corporation clarified that:

The legal presumption of work-relatedness of a non-listed illness should be overturned only when the employer’s refutation is found to be supported by substantial evidence, which, as traditionally defined, is “such relevant evidence as a reasonable mind might accept as sufficient to support a conclusion.”

However, the Court also clarified that the presumption of work-relatedness does not automatically equate to compensability. As explained in Atienza v. Orophil, there is a distinction between the two concepts:

Nonetheless, the presumption provided under Section 20 (B) (4) is only limited to the “work-relatedness” of an illness. It does not cover and extend to compensability. In this sense, there exists a fine line between the work-relatedness of an illness and the matter of compensability.

Thus, while the employer must disprove the work-relatedness of the illness, the seafarer must still demonstrate that the conditions for compensability have been met. In Sestoso’s case, the respondents failed to refute the presumption that his Osteoarthritis was either work-related or aggravated by his work. The Court noted that Osteoarthritis is listed as an occupational disease under Section 32-A (21) of the 2010 POEA-SEC, especially in occupations involving joint strain, heavy loads, or strenuous physical labor. As the Court held in Centennial Transmarine, Inc. V. Quiambao, where a seafarer diagnosed with Osteoarthritis performed strenuous activities, the illness could reasonably be deemed work-related.

The Court also considered Sestoso’s work as a headwaiter, which involved carrying heavy food provisions, cleaning, and constant strenuous usage of joints. These conditions, the Court reasoned, could have contributed to the development or aggravation of his Osteoarthritis. The Court also looked into the timeline of events, noting that Sestoso had experienced symptoms of his illness as early as January 2014, while working for the respondents. Despite undergoing surgery and physical therapy, he resumed work with the respondents and subsequently suffered another knee injury in October 2014.

Having established the work-relatedness and compensability of Sestoso’s illness, the Court turned to the matter of determining the nature of his disability. Here, the importance of the 120/240-day rule came into play. The Court emphasized that the company-designated physician must issue a final and definite disability assessment within this period. Failure to do so results in the seafarer’s disability being deemed total and permanent. Pastor v. Bibby Shipping Philippines, Inc. clarifies this point:

If the 120-day period is exceeded and no definitive declaration is made because the seafarer requires further medical attention, then the temporary total disability period may be extended up to a maximum of 240 days, subject to the right of the employer to declare within this period that a permanent partial or total disability already exists.

In Sestoso’s case, the company-designated physician did not provide a final and definite disability rating within the prescribed period. The Court dismissed the letter issued by the company-designated physician on July 28, 2015, as not constituting a final assessment. Thus, the Court concluded that Sestoso’s disability had become total and permanent by operation of law, entitling him to corresponding benefits. The Court also awarded attorney’s fees, as Sestoso was compelled to litigate to protect his rights. Furthermore, the Court imposed a legal interest of six percent (6%) per annum on the monetary awards from the date of finality of the decision until full payment, citing C.F. Sharp Crew Management, Inc. v. Santos and Nacar v. Gallery Frames.

FAQs

What was the key issue in this case?	The key issue was whether a seafarer is entitled to total and permanent disability benefits when a pre-existing illness is aggravated by working conditions, and the company-designated physician fails to issue a final disability assessment within the 120/240-day period.
What is the 120/240-day rule?	The 120/240-day rule refers to the period within which a company-designated physician must provide a final and definite disability assessment. The initial period is 120 days, extendable to 240 days if the seafarer requires further medical treatment.
What happens if the company-designated physician fails to issue a final assessment within the 120/240-day period?	If the company-designated physician fails to issue a final assessment within the 120/240-day period, the seafarer’s disability is deemed total and permanent by operation of law, entitling them to corresponding benefits.
Does a pre-existing illness automatically disqualify a seafarer from claiming disability benefits?	No, a pre-existing illness does not automatically disqualify a seafarer from claiming disability benefits. The crucial factor is whether the working conditions aggravated the illness.
Who has the burden of proving that an illness is work-related?	For illnesses not listed as occupational diseases in the POEA-SEC, there is a legal presumption that they are work-related. The employer bears the burden of disproving this presumption with substantial evidence.
What constitutes substantial evidence to disprove work-relatedness?	Substantial evidence is relevant evidence that a reasonable mind might accept as sufficient to support a conclusion. It must be more than a mere scintilla of evidence.
What is the difference between work-relatedness and compensability?	Work-relatedness refers to the connection between the illness and the seafarer’s work. Compensability refers to the entitlement to receive compensation and benefits, requiring a showing that the work conditions caused or increased the risk of contracting the disease.
What benefits is a seafarer entitled to if their disability is deemed total and permanent?	If a seafarer’s disability is deemed total and permanent, they are entitled to disability benefits as specified in the POEA-SEC, which may include a lump-sum payment, medical expenses, and other forms of compensation.

The Supreme Court’s decision in Sestoso v. United Philippine Lines, Inc. reaffirms the rights of seafarers under Philippine law. It highlights the importance of timely and definitive medical assessments by company-designated physicians and underscores that pre-existing conditions do not automatically bar disability claims when work conditions contribute to their aggravation. This ruling serves as a reminder to employers of their obligations to seafarers and ensures that those who are injured or become ill due to their work receive the compensation they deserve.

For inquiries regarding the application of this ruling to specific circumstances, please contact ASG Law through contact or via email at frontdesk@asglawpartners.com.

Disclaimer: This analysis is provided for informational purposes only and does not constitute legal advice. For specific legal guidance tailored to your situation, please consult with a qualified attorney.
Source: FRANCIVIEL DERAMA SESTOSO vs. UNITED PHILIPPINE LINES, INC., CARNIVAL CRUISE LINES, FERNANDINO T. LISING, G.R. No. 237063, July 24, 2019