Illness contracted or developed in the course of employment, if duly proven by the employee, entitles him to compensation.

In the following case, the Supreme Court addressed the issue/s as follows:

Get a re-numbered copy of the Labor Code 2017 per R.A. 10151 and DOLE Department Advisory 01, Series of 2015

C.F. Sharp Crew Management, Inc. and Reederei Claus Peter Offen vs. Clemente M. Perez
G.R. No. 194885, January 26, 2015


Sharp Crew Management, Inc. and Reederei Claus Peter Offen hired Clemente M. Perez (Perez) as Oiler on board the vessel M/V P&O Nedlloyd Rio Grande. The parties signed the 10-month employment contract and they agreed to comply with the 1996 Philippine Overseas Employment Administration Standard Employment Contract (POEA-SEC). Perez’s employment is also covered by a Collective Bargaining Agreement (CBA).

While the Rio Grande was in Singapore, Perez failed to report for duty. But he later showed up at the crew mess confused. The crew got scared of him.

The Master of the Rio Grande decided that Perez will be a high risk for the safety of the ship and its crew and must be repatriated. Perez was diagnosed to have acute psychosis at Gleneagles Maritime Medical Center and was declared unfit for sea duty.

Perez arrived in Manila on November 22, 2000 and C.F. Sharp Crew, et al referred him to Dr. Baltazar V. Reyes, Jr. Dr. Reyes’s psychiatric evaluation stated that Perez did not present any psychiatric difficulty of note, and that it is best to do a psychological test and to observe Perez for another month without medication.

According to Dr. Reyes, Perez felt that his illness was caused by unfair treatment from the German chief engineer. In 1996, Perez was sent home after a similar breakdown in Spain but he was able to return to work in September 1997, said Dr. Reyes. Dr. Reyes’s impression is that Perez has recurrent acute psychotic disorder for it does not show all the time. He may be normal at one time but his psychotic disorder will become manifest once triggered by an outside factor, most probably by a problem with his superiors.

C.F. Sharp Crew also referred Perez to the American Outpatient Clinic for co-management. He was likewise diagnosed with recurrent acute psychotic disorder, per the medical report of Dr. Leticia C. Abesamis. Perez’s psychological evaluation showed that Perez has an average intellectual level and no significant manifestation of personality and mental disturbances. Psychometrician Raquel Arceta reported to Dr. Abesamis that Perez is still fit to work abroad at the time of evaluation.

Meantime, in another medical report, Dr. Abesamis stated that Perez can still go back to sea duty but recurrence of the same psychotic breakdown is possible. According to Dr. Abesamis, Perez denied that he had a psychotic breakdown in 1996.

Perez sued C.F. Sharp Crew, et al for disability benefits, moral and exemplary damages, and attorney’s fees. He claimed that while he was told that he is already fit to work as seaman, the doctor refused to issue a medical certificate on the ground that he has yet to fully recover from his illness. When he sought re-employment, C.F. Sharp Crew, et al rejected him because of his illness.

LA Ruling:

The Labor Arbiter ruled in favor of Perez and ordered C.F. Sharp Crew, et al to pay him disability benefits, sickness allowance and attorney’s fees.

The Labor Arbiter noted that Perez suffered a psychotic disorder during the term of his employment contract. Since his illness is recurrent, his ability to work has been impaired for life and he is no longer fit to work. The Labor Arbiter also noted that Dr. Abesamis even referred Perez to the SSS to claim his disability benefits.

NLRC Ruling:

The NLRC reversed the Labor Arbiter’s ruling but ordered C.F. Sharp Crew, et al to pay Perez sickness allowance.

It ruled that Perez is not entitled to disability benefits since he concealed his psychotic features in his application form when he sought employment with C.F. Sharp Crew, et al. Perez also admitted to Dr. Reyes that he is suffering from a pre-existing illness and that he was sent home in 1996 after experiencing a similar psychotic breakdown.

The NLRC said that the POEA-SEC disqualifies a seaman from any compensation and benefit if he conceals a past medical condition, disability and history in the pre-employment medical examination.

CA Ruling:

The CA reversed the NLRC’s ruling and reinstated the Labor Arbiter’s award of disability benefits and attorney’s fees to Perez.


Whether or not the seafarer who suffered psychotic disorder in the course of employment is entitled to disability benefits

Whether or not there is an obligation on the part of seafarer to disclose medical condition such that failure to do so is concealment of illness

SC Ruling:

The SC found the petition partly meritorious.

Under the 1996 POEA-SEC, it is enough that the seafarer proves that his or her injury or illness was acquired during the term of employment to support a claim for disability benefits.

Here, it is not disputed that Perez became ill when the Rio Grande was in Singapore on November 1, 2000 or during the term of his 10-month employment contract.

The initial diagnosis at the Gleneagles Maritime Medical Center that Perez has acute psychosis confirmed the observation of the Rio Grande’s Master that Perez was confused when he showed up at the crew mess.

Perez’s claim for disability benefits thus finds support from established facts. The Labor Arbiter was therefore correct that Perez suffered a psychotic disorder during the term of his employment contract.

The SC also did not agree that Perez is not entitled to disability benefits because he is guilty of fraud in concealing his pre-existing medical condition.

Section 20(E) of the 1996 POEA-SEC provides that when requested, the seafarer shall be furnished a copy of all pertinent medical reports or records at no cost to the seafarer.

Said provision does not mention unconcealment. It only requires that the seafarer be furnished a copy of all pertinent medical records upon request. On this point, the NLRC appears to have been misled in ruling that Perez is guilty of concealment.


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