Permanent disability is the inability of a worker to perform his job for more than one hundred twenty (120) days, regardless of whether he loses the use of any part of his body. Total disability, on the other hand, means the disablement of an employee o earn wages in the same kind of work of similar nature that he was trained for, or accustomed to perform, or any kind of work which a person of his mentality and attainments could do.

Sestoso vs. United Philippine Lines, Inc.,
G.R. No. 237063, July 24, 2019

Permanent and total disability; 120-day rule; 240-day rule; Legal presumption of Work-relatedness; Compensability; There is no legal presumption of compensability


Respondent UPLI in behalf of its foreign principal Carnival Cruise Lines hired Petitioner Franciviel Derama Sestoso (Sestoso) as Team Headwaiter on board M/V Carnival Inspiration for a period of 6 months.

On October 31, 2014, he did his usual task of cleaning the dining table. But this time, when he knelt to clean the dining table, a sharp pain radiated down his right knee. Hence, as soon as the vessel docked at Los Angeles, California, he underwent a Magnetic Resonance Imaging (MRI) at a shore side clinic. The result showed a complex tear of the medial meniscus and degenerative joint changes. It also revealed the arthroscopy or knee surgery he had in February 2014.

Sestoso, nevertheless, continued working while on pain relievers until he finished his contract and got repatriated on February 13, 2015.

Upon his arrival in the country, company-designated physician Dr. Mylene Cruz-Balbon subjected him to a series of examinations and treatments and eventually referred him to orthopedic surgeon Dr. William Chuasuan, Jr., for further evaluation and management.

On June 25, 2015, Dr. Chuasuan, Jr. recommended him for surgery and suggested a disability rating of Grade 10 – stretching of knee ligaments. Dr. Chuasuan, Jr. opined he had already reached the maximum medical improvement level. In her Medical Report, Dr. Cruz-Balbon noted and referred to Dr. Chuasuan, Jr.’s findings and recommendation. On July 28, 2015, Dr. Cruz-Balbon issued a certification and letter bearing her final diagnosis on him, i.e. Osteoarthritis, Medial Meniscal Tear, Right Knee; SIP Arthroscopic Partial Menisectomy and Debridement of Osteophytes, Right Knee.

Notably, neither of the two documents contained any disability rating or certificate of fitness to work. Dr. Cruz-Balbon stopped giving him medical treatment since June 26, 2015 despite his need for further treatment. Neither Dr. Cruz-Balbon nor Dr. Chuasuan, Jr. gave him a final and definite disability rating within the 120/240-day window.

Sestoso was constrained to consult another orthopedic -Dr. Victor Gerardo E. Pundavela, who diagnosed him with Severe Degenerative Osteoarthritis, right knee; Degenerative Osteoarthritis, left knee; Medial Meniscal Tear, right knee sip Arthroscopic Meniscectomy and Debridement. The latter assessed him to be partially and permanently disabled/unfit to work as a seafarer.

LA Ruling:

The labor arbiter awarded Grade 10 disability benefits to Sestoso.

The labor arbiter ruled that although Sestoso’s illness was found to be pre-existing, he was still entitled to the Grade 10 disability grading given by company-designated Dr. Cruz-Balbon who closely monitored and treated him for months.

NLRC Ruling:

On Sestoso’s appeal, the National Labor Relations Commission (NLRC) awarded him permanent and total disability benefits.

The NLRC ruled that the grading assigned by Dr. Cruz-Balbon was a mere suggestion, hence, it was not a valid and final disability assessment. Dr. Cruz-Balbon’s failure to issue a definite and final disability assessment within two hundred forty (240) days rendered Sestoso’s disability permanent and total.

UPLI, et al.’s motion for reconsideration was denied. Dissatisfied, UPLI, et al. sought to nullify the NLRC dispositions via a petition for certiorari before the Court of Appeals.

CA Ruling:

The Court of Appeals reversed.

It ruled that Sestoso’s disability was not compensable for it was a pre-existing illness, i.e. Osteoarthritis. Too, Sestoso allegedly failed to allege and prove that his illness was aggravated by his working conditions. Thus, the 120/240 window was found to be inapplicable.

Sestoso’s motion for reconsideration was denied.


Whether or not an illness that is pre-existing renders the claim non-compensable.

Whether or not the seafarer has the burden of proving compensability in a deemed work-related illness

SC Ruling:

The SC found the petition meritorious.

In More Maritime Agencies, Inc. v. NLRC, it was held that compensability of an illness or injury does not depend on whether the injury or disease was pre-existing at the time of employment but rather on whether the injury or illness is work-related or has aggravated the seafarer’s condition.

Under the 2010 PO EA-SEC, “any sickness resulting in disability or death as a result of an occupational disease listed under Section 32-A of this Contract with the conditions set therein satisfied” is deemed to be a “work-related illness.” Section 20 (A) (4) further provides that “Those illnesses not listed in Section 32 of this Contract are disputably presumed as work related.” This provision speaks of a legal presumption of work-relatedness in favor of the seafarer. As such, the employer, and not the seafarer, has the burden of disproving the presumption by substantial evidence.

In Racelis vs. United Philippine Lines. Inc. and David vs. OSG Shipmanagement Manila, Inc., the Court held 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.

It must be emphasized, though, that the presumption under Section 20-B (4)25 is only limited to “work-relatedness” of an illness and does not cover or extend to “compensability.” Unlike “work-relatedness,” no legal presumption of compensability is accorded to the seafarer. As such, the seafarer bears the burden to prove substantial evidence that the conditions of compensability have been satisfied. This applies for both listed occupational disease and non-listed illness.

If the employer fails to successfully dispute the work-relatedness of the seafarer’s illness, and the latter, in tum, has established compliance with the conditions for compensability, the issue now shifts to a determination of the nature of the disability (i.e., permanent and total or temporary and total) and the amount of disability benefits due the seafarer.

Here, UPLI, et al. mainly rely on the alleged pre-existence of Sestoso’s illness and have failed to refute the presumption of its work-relatedness or aggravation by reason of his work. The presumption, therefore, remains in place in Sestoso’s favor, i.e. his injury or illness was work-related or was aggravated by his work condition.

Both the company-designated doctor and Dr. Chuasuan, Jr. agreed that Sestoso suffered from Osteoarthritis and got repatriated after finishing his employment contract. Osteoarthritis is listed as an occupational disease which is presumed to be work-related. Here, it cannot be denied that Sestoso’s work was contributory in causing or, at least, increasing the risk of contracting his illness.

Permanent disability is the inability of a worker to perform his job for more than one hundred twenty (120) days, regardless of whether he loses the use of any part of his body. Total disability, on the other hand, means the disablement of an employee to earn wages in the same kind of work of similar nature that he was trained for, or accustomed to perform, or any kind of work which a person of his mentality and attainments could do.

Here, the records are bereft of any showing that the company-designated physician gave Sestoso a final and definite disability rating within the 120/240 days prescribed. Sestoso was repatriated on February 13, 2015. He was referred to the company-designated physician who gave him medical attention and treatment up to June 26, 2015 or for more than 120 days from his repatriation. Since Sestoso in fact required further treatment and medical attention beyond the 120-day period, his total and temporary disability was deemed extended. The company-designated physician then had until two hundred forty (240) days from repatriation within which to issue his final assessment of disability on Sestoso. As it was, the company-designated physician failed to do so.

The letter issued by the company-designated physician is hardly the final assessment required by law. It merely stated that Sestoso underwent thorough treatment from February 27, 2015 to June 4, 2015 due to his Osteoarthritis. The same holds true for his Medical Report dated June 25, 2015, merely noting Dr. Chuasuan, Jr.’s “comments” on Sestoso’s medical condition, sans any definite, nay final disability rating.

None of the letters and reports issued by the company-designated physician and by Dr. Chuasuan, Jr. can be treated as definite and conclusive because Sestoso remains incapacitated beyond the 240-day period. He still feels recurrent pain in his knee which renders him incapable to perform his usual task as team head waiter in any vessel. Too, there is no showing that he had been re-employed by UPLI, et al. or in any vessel for that matter.

Indeed, Sestoso’s continued unemployment until this very day clearly indicate his total and permanent disability. Verily, by operation of law, Sestoso’s disability became total and permanent for which he is entitled to the corresponding benefits.

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