Sickness allowance filed within the 120 days from repatriation does not render the disability complaint premature.

Oscar D. Gaboa vs. Maunlad Trans, Inc. and/or Rainbow Maritime Co., Ltd. and Capt. Silvino Fajardo
G.R. No. 232905, August 20, 2018

120-day rule; 240-day rule; Disability Sickness allowance filed within 120 days and amended thereafter does not render the disability claim premature; Interim assessment; Third Doctor


Petitioner Oscar Gaboa (Gaboa) entered into a nine (9)-month contract of employment as Bosun with Respondent Maunlad Trans, Inc. (MTI), for its principal, Rainbow Maritime Co., Ltd. (RMCL), on board the vessel, MV Oriente Shine, a cargo vessel transporting logs from Westminster, Canada to several Asian countries. Prior thereto, he was likewise hired by MTI on board MN Global Mermaid, also a cargo vessel.

After undergoing the required pre-employment medical examination (PEME) where Gaboa was declared fit for duty, he disembarked and joined the vessel that was then docked at Tokushima, Japan. The following day, he assisted in the unloading of raw logs from the vessel, as well as in the cleanup thereafter of the debris and log residue that were meter-deep. As he could not withstand the strong odor of the logs and was gasping for breath, the latter asked for leave which was granted, and as such, was excused from the activity.

However, the incident already triggered an asthma attack on Gaboa which initially started as a cough that was later accompanied by wheezing breath. Thereafter, during the voyage back to Westminster, Canada, he claimed that he slipped and lost his footing while going down the ship’s galley, which caused a writhing pain on the upper left side of his back. The shipmaster, Captain Julius B. Cloa (Captain Cloa), gave him Salonpas for his back, as well as medicine for his persistent cough.

During the rigging operation, Gaboa experienced back pain and difficulty in breathing that prompted Captain Cloa to disembark him for medical consultation at the Mariner’s Clinic, Ltd., in Canada. While the foreign port doctor, Dr. Stanley F. Karon, took note of his back pain, it was his diagnosed asthma that prompted the said doctor to declare him unfit for duty.

On February 15, 2014, Gaboa was medically repatriated and brought to Marine Medical Services where he was seen by a company-designated physician, Dr. Mylene Cruz-Balbon, who confirmed his bronchial asthma. Subsequent check-ups further disclosed that he was suffering from “Degenerative Changes, Thoracolumbar Spine” and was found to have a “metallic foreign body on the anterior cervical area noted on x-ray,” which, as pointed out by the company-designated physician, was not related to the cause of his repatriation.

Gaboa was thereafter referred to orthopedic doctors, Dr. Pollyana Gumba Escano (Dr. Escano), for rehabilitation and therapy, and Dr. William Chuasuan, Jr. (Dr. Chuasuan), for expert evaluation and management. On May 14, 2014, the company-designated physician, Dr. Hao-Quan, issued a medical report to MTI Captain Silvino Fajardo (Captain Fajardo) stating that Gaboa still has occasional asthma attacks that have not been totally controlled despite three (3) months of maintenance medication. She also noted that Gaboa still has tenderness and muscle spasm on his left paraspinal muscle. As such, the company-designated physician gave an interim assessment of “Grade 8 (orthopedic) -2/3 loss of lifting power and Grade 12 -(pulmonary) slight residual or disorder.

Likewise, the orthopedic specialist, Dr. Escano, consistently reported that Gaboa has not been relieved of his back pain despite rehabilitation, and further recommended that the latter undergo MRI (Magnetic Resonance Imaging) of the spine, which she pointed out could be done only after the removal of the foreign bodies embedded in Gaboa’s neck area. She added that there was a need to control Gaboa’s blood pressure and asthma which prevented them from doing spiral stabilization exercises on him.

Since MTI refused to shoulder the extraction procedure as it was not part of the cause for Gaboa’s repatriation, the latter had the procedure done at his expense. However, MTI still denied Gaboa’s request for MRI, and instead, issued medical certificates indicating Gaboa’s illness as “Bronchial Asthma; Degenerative Changes, Thoracolumbar Spine, Left Parathoracic Muscle Strain.”

On June 4, 2014, Gaboa filed a complaint for non-payment of his sickness allowance, medical expenses, and rehabilitation fees, against MTI, before the NLRC. The complaint was subsequently amended on June 18, 2014 to include a claim for permanent total disability benefits pursuant to the IBF JSU/ AMOS UP (IMMAJ) Collective Bargaining Agreement (CBA) for failure of the company-designated physician to make a final assessment within the mandated 120-day period, and further impleaded RMCL and Captain Fajardo (MTIs) as parties thereto.

On June 20, 2014, Gaboa’s pulmonologist, Dr. Edgardo O. Tanquieng, issued a note to the company-designated physician suggesting Gaboa’s disability to be “Grade 12 -slight residual or disorder.” On the other hand, Gaboa’s orthopedic specialist, Dr. Chuasuan, in his letter dated July 10, 2014, explicated that Gaboa’s degenerative changes may have occurred overtime and could not have developed during his 22-day stay on board the vessel, hence, was a pre-existing condition.

Meanwhile, Gaboa claimed that he still suffered from severe back pain and asthma attacks, which prompted him to consult on June 27, 2014, an independent physician, Dr. Sonny Edward Urbano of the Eastern Pangasinan District Hospital, who declared him unfit for work or maritime voyage given that he was found to be suffering from “Hypertension stage II, Hypertensive cardiovascular disease, Bronchial asthma, Community acquired pneumonia.

In their defense, MTIs denied liability contending, among others, that the complaint was prematurely filed given that the 120-day period had not yet expired at the time Gaboa filed his complaint on June 4, 2014, and that the latter even returned for a follow-up check-up with his attending specialist on June 20, 2014. They further contended that Gaboa was not entitled to disability benefits under the CBA as his condition was not due to an accident, and that his illnesses were not compensable, considering that his degenerative changes (back condition) was declared by the specialist to be a pre-existing condition, while his bronchial asthma was not work-related since he already manifested its symptoms at the time he joined the vessel on January 24, 2014.

They likewise averred that Gaboa failed to follow the procedure in contesting the findings of the company-designated physician. Lastly, they asserted that the claims for sickness allowance and reimbursement for medical and transportation expenses had already been paid, while the damages and attorney’s fees sought were without factual and legal bases.

LA Ruling:

The Labor Arbiter (LA) ruled in favor of Gaboa, and accordingly ordered MTIs to jointly and severally pay him permanent total disability benefits pursuant to the CBA in the amount of US$127,932.00, Pl00,000.00 moral damages, PS0,000.00 exemplary damages, and ten percent ( 10%) of the total judgment award as attorney’s fees.

Essentially, according to the LA the complaint was not prematurely filed given that it was initially for non-payment of sickness allowance and reimbursement of medical expenses, and that even if it subsequently sought payment of disability benefits, there was already an interim assessment made by the company-designated physician on May 14, 2014 equivalent to Grade 8 (orthopedic) -2/3 loss of lifting power, and Grade 12 (pulmonary) -slight residual or disorder, notwithstanding that petitioner was still continuously suffering from back pain.

Aggrieved, MTIs appealed the LA Decision to the NLRC.

NLRC Ruling:

The NLRC affirmed with modification the LA Decision by deleting the award of moral and exemplary damages.

It ruled that Gaboa’s illnesses, i.e., bronchial asthma and degenerative changes or osteoarthritis, were work-related diseases arising out of and in the course of Gaboa’s employment.

MTIs moved for partial reconsideration which was denied, prompting them to elevate the matter to the CA on certiorari.

CA Ruling:

The CA annulled and set aside the NLRC Decision, and instead, dismissed the complaint.

It ruled that Gaboa had no cause of action at the time he filed his complaint given that the May 14, 2014 assessment was not final, and that he was still undergoing treatment well within the allowable 240-day treatment period.

It likewise found no basis to support Gaboa’s claim that he is entitled to permanent total disability benefits, holding that the latter’s independent physician examined him only once and that the lapse of the 120-day period did not automatically entitle him thereto.

Gaboa’s motion for reconsideration was denied; hence, the petition.


Whether or not the interim assessment of Grade 8 disability within the 120-day period discharges the duty of employer under the law and prevented the disability from becoming total and permanent in accordance with law

Whether or not the filing of the complaint for sickness allowance medical expenses, and rehabilitation fees within the 120-day period renders the claim for disability premature which was asserted subsequently in an amended complaint that was filed after the 120 days had lapsed

Whether or not the 120-day period can be extended to 240 days without sufficient justification

Whether or not failure on the part of seafarer to refer the findings to the third doctor rendered his complaint premature

SC Ruling:

The SC found the petition meritorious.

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Gaboa was diagnosed with “Bronchial Asthma; Degenerative Changes, Thoracolumbar Spine, Left Parathoracic Muscle Strain.” In a medical report dated May 14, 2014, the company-designated physician gave Gaboa an “interim” assessment of Grades 8 and 12 for his orthopedic and pulmonary conditions, respectively.

While the orthopedic specialist, in his medical report dated July 10, 2014, opined that Gaboa’s Degenerative Changes, Thoracolumbar Spine, Left Parathoracic Muscle Strain “may be [a] pre-existing” condition, and therefore not work-related, the pulmonary specialist, on the other hand, merely reiterated the previous disability rating of Grade 12, i.e., slight residual or disorder. From the foregoing medical report, the SC held that it can be reasonably inferred that Gaboa’s bronchial asthma was deemed a work-related illness unlike his degenerative changes of the spine (back condition), which was declared by the specialist to be not work-related in view of the specialist’s observation that it was a pre-existing condition that “could not have developed during his [22-day] period on board.

There are conditions that should be met before an illness, such as degenerative changes of the spine, can be considered as pre-existing under the 2010 POEA-SEC, namely: (a) the advice of a medical doctor on treatment was given for such continuing illness or condition; or (b) the seafarer had been diagnosed and has knowledge of such illness or condition but failed to disclose the same during PEME, and such cannot be diagnosed during the PEME, none of which had been established in this case.

Here, Gaboa, as Bosun of MTIs’ cargo vessel that transported logs, undeniably performed tasks that clearly involved unduly heavy physical labor and joint strain. Hence, the SC concluded that the NLRC cannot be faulted in finding Gaboa’s back problem to be work-related.

In the same vein, Gaboa’s bronchial asthma, which is also a listed occupational disease, undeniably progressed while in the performance of his duties and in the course of his last employment contract. Per SC, Gaboa’s assertion that the said illness also existed prior to Gaboa’s embarkation, and therefore a pre-existing ailment, was not substantiated given that no such declaration was made by the company-designated physician or the attending specialist. Besides, such fact alone does not detract from the compensability of an illness.

It is not required that the employment be the sole factor in the growth, development or acceleration of the illness to entitle the claimant to the benefits incident thereto. It is enough that the employment had contributed, even in a small measure, to the development of the disease. Perforce, absent controverting proof that Gaboa’s illnesses were not work-related, no grave abuse of discretion was committed by the NLRC in declaring Gaboa’s bronchial asthma and degenerative changes of the thoracolumbar spine to be compensable ailments.

Pursuant to Section 20 (A) of the 2010 POEA-SEC, when a seafarer suffers a work-related injury or illness in the course of employment, the company-designated physician is obligated to arrive at a definite assessment of the former’s fitness or degree of disability within a period of 120 days from repatriation. During the said period, the seafarer shall be deemed on temporary total disability and shall receive his basic wage until he is declared fit to work or his temporary disability is acknowledged by the company to be permanent, either partially or totally, as his condition is defined under the POEA-SEC and by applicable Philippine laws.

The Labor Code of the Philippines 2018 Edition, Re-numbered and Updated

However, 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’s 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. But before the company-designated physician may avail of the allowable 240-day extended treatment period, he must perform some significant act to justify the extension of the original 120-day period. Otherwise, the law grants the seafarer the relief of permanent total disability benefits due to such non-compliance.

Case law states that without a valid final and definitive assessment from the company-designated physician within the 120/240-day period, the law already steps in to consider Gaboa’s disability as total and permanent. Thus, a temporary total disability becomes total and permanent by operation of law.

In the case at bar, there is no dispute that the company-designated physician issued an “interim” assessment on May 14, 2014, or just 88 days from Gaboa’s repatriation on February 15, 2014, declaring his disability to be “Grade 8 (orthopedic) -213 loss of lifting power and Grade 12 -(pulmonary) slight residual or disorder.”

According to the SC, the gradings were based on the findings that Gaboa’s asthma was “still not totally controlled,” while his back problem “still presents with tenderness and muscle spasm on the left paraspinal muscle.” Being an interim disability grade, the declaration was merely an initial determination of Gaboa’s condition for the time being and therefore cannot be considered as a definite prognosis. Notwithstanding the temporariness of his findings, the company-designated physician, however, failed to indicate the need for further treatment/rehabilitation or medication, and provide an estimated period of treatment to justify the extension of the 120-day treatment period. In fact, while Gaboa had subsequent follow-up sessions, the company-designated physician still failed to arrive at a definitive assessment within the 120-day period or indicate the need for further medical treatment.

Evidently, without the required final medical assessment declaring Gaboa fit to resume work or the degree of his disability, the characterization of the latter’s condition after the lapse of the 120-day period as total and permanent ensued in accordance with law, since the ability to return to one’s accustomed work before the applicable periods elapse cannot be shown. Thus, because of these circumstances, Gaboa should be entitled to permanent total disability benefits by operation of law.

What was filed on June 4, 2014 was for non-payment of sickness allowance, medical expenses, and rehabilitation fees. Gaboa only sought permanent total disability benefits when he filed his amended complaint therefor on June 18, 2014. At that time, the 120-day period within which the company-designated physician should have issued a final assessment of Gaboa’s condition already lapsed.

Further, according to the SC there was no reason for MTIs to extend this period to 240 days since no sufficient justification exists to extend the treatment period for another 120 days. As such, contrary to the findings of the CA, Gaboa had rightfully commenced his complaint for disability compensation on June 18, 2014, or after the expiration of the 120-day period from the time of his repatriation on February 15, 2014 (i.e., 123 days). As aptly ruled in C.F Sharp Crew Management, Inc. v. Taok, “a seafarer may pursue an action for total and permanent disability benefits if the company-designated physician failed to issue a declaration as to his fitness to engage in sea duty or disability even after the lapse of the 120-day period and there is no indication that further medical treatment would address his temporary total disability, hence, justify an extension of the period to 240 days,” as in this case.

According to the SC, neither is Gaboa’s complaint for disability compensation rendered premature by his failure to refer the matter to a third-doctor pursuant to Section 20 (A) (3) of the 2010 POEA-SEC. A seafarer’s compliance with the conflict-resolution procedure under the said provision presupposes that the company-designated physician came up with an assessment as to his fitness or unfitness to work before the expiration of the 120-day or 240-day periods.

Citing Kestrel Shipping Co., Inc. vs. Munar, the SC held that absent a final assessment from the company-designated physician, the seafarer had nothing to contest and the law steps in to conclusively characterize his disability as total and permanent. Hence, although Gaboa did consult an independent physician regarding his ailment, the lack of a conclusive and definite assessment from MTIs left him nothing to properly contest and as such, negates the need for him to comply with the third-doctor referral provision under the 2010 POEA-SEC.

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