Fraudulent misrepresentation arises from concealment of a pre-existing medical condition. For knowingly concealing his hypertension during the PEME, a seafarer committed fraudulent misrepresentation which unconditionally bars his right to receive any disability compensation from Sea Power, et al.

Lerona vs. Sea Power Shipping Enterprise, Inc.
G.R. No. 210955, August 14, 2019

Fraudulent misrepresentation; Medical abandonment; A seafarer commits medical abandonment when he fails to complete his treatment before the lapse of the 240-day period, which prevents the company physician from declaring him fit to work or assessing his disability; Hypertension; Requirements for hypertension to be considered as compensable occupational disease; Hypertension classified as primary or essential is considered compensable if it causes impairment of function of body organs like kidneys, heart, eyes and brain, resulting in permanent disability; PEME; Estoppel; There is no estoppel upon passing the PEME; A “fit to work” declaration in the PEME is not a conclusive proof that a seafarer is free from any disease prior to his/her deployment


On February 27, 2009, respondent Sea Power Shipping Enterprises, Inc. employed Lerona Danilo A. Lerona (Lerona) on behalf of respondent Neda Maritime Agency Co., Ltd. to work as a fitter on board M/V Penelope (collectively referred to herein as Sea Power, et al.).

Prior to his deployment, Lerona underwent pre-employment medical examination (PEME) where he was declared “FIT TO WORK AS SEAMAN.” Lerona boarded the vessel.

While on board, he felt severe chest pains and dizziness, which prompted him to request for a medical checkup. He was brought to a hospital in China. Lerona was repatriated to the Philippines on August 13, 2009.

Lerona was confined at the De Los Santos Medical Center the following day, and examined by Sea Power, et al.’s team of accredited physicians. In his initial medical report, Dr. Jose Emmanuel F. Gonzales (Dr. Gonzales), Sea Power, et al.’s company-designated physician, stated that Lerona’s chief complaint was body weakness. Lerona disclosed that he had been hypertensive and is taking Norvasc tablet for two years. In consultation with a cardiologist, Dr. Gonzales declared that Lerona might have Coronary Arterial Disease for which pertinent laboratory and diagnostic examinations should be conducted.

Lerona’s laboratory tests showed that he had a high level of triglycerides, although his electrocardiogram (ECG) tracing had no significant findings. The cardiologist requested for Lerona to undergo Stress-Thallium Test to confirm the status and function of his heart’s blood vessels before he can be given medical clearance. The test revealed that Lerona has a mild reversible defect in the apical to basal inferior wall of his heart’s blood vessels. Test results further showed that Lerona was negative for any vessel abnormality. He did not need any surgical intervention, just medical treatment and modification of his lifestyle to address his hypertension.

Significantly, in his Medical Report, Dr. Gonzales stated that the cardiologist cleared Lerona of Coronary Arterial Disease. Nevertheless, Lerona was referred to an ear, nose and throat specialist because he was complaining of dizziness. Lerona was placed under observation for another week prior to the issuance of a medical clearance. He was required to come back for a follow-up checkup on October 23, 2009. However, he did not show up. Consequently, Dr. Gonzales declared him to have absconded.

Unknown to Sea Power, et al., Lerona consulted an independent physician. Dr. Efren R. Vicaldo (Dr. Vicaldo) of the Philippine Heart Center gave Lerona the following diagnosis: Hypertensive Cardiovascular Disease, Angina Pectoris, Impediment Grade VII (41.80%). Dr. Vicaldo declared, among others, that: (1) Lerona is permanently unfit to resume work as a seaman in any capacity; (2) his illness is considered work aggravated/related; and (3) he is not expected to land gainful employment given his medical background.

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Lerona filed a complaint for recovery of disability benefits, reimbursement of medical expenses and attorney’s fees against Sea Power, et al. During the mandatory conference before the labor arbiter (LA), Sea Power, et al. manifested that Lerona failed to report back to their company-designated physician for final assessment. Thus, upon Sea Power, et al.’s insistence, Lerona went back to Dr. Gonzales at which time he was declared “Fit to Resume Sea Duties.”

Lerona claimed that he is entitled to total and permanent disability benefits because he was unable to work for more than 120 days as a result of his illness.

For their part, Sea Power, et al. claimed that Lerona was declared fit for sea duty by their company-designated physician, hence, he is not entitled to any disability benefit. Further, Lerona failed to disclose that he has hypertension during his PEME. The concealment of his pre-existing condition disqualifies him from any compensation and benefit under Section 20(E) of the 2000 PO EA-SEC. Also, the findings of Dr. Gonzales should prevail over the declarations of Dr. Vicaldo, who only examined Lerona once.

LA Ruling:

The LA rendered a Decision ordering Sea Power, et al. to jointly and severally pay Lerona permanent and total disability benefits in the amount of US$60,000.00 and attorney’s fees equivalent to 10% of the total monetary award.

The LA held that Dr. Gonzales did not issue any disability rating/grading to Lerona within the mandatory 120-day period. He declared Lerona “fit to resume sea duties” on April 21, 2010, long after Dr. Vicaldo pronounced him “unfit to resume sea duties in any capacity” on December 17, 2009. Furthermore, if it were true that Lerona had already become fit to work, then why was he not re-engaged by Sea Power, et al.?

The LA also ruled that Lerona’s pre-existing hypertension does not disqualify him from claiming disability benefits. Sea Power, et al. were estopped from denying that in all of Lerona’s six previous contracts with them, including the last one, the company doctors always declared him fit to work after his PEME. Finally, Sea Power, et al.’s defense that Lerona absconded from his checkup does not avail since Sea Power, et al. could have easily issued the result to Lerona and told him to report for duty.

NLRC Ruling:

The National Labor Relations Commission (NLRC) reversed the LA.

The NLRC held that the medical examination of Sea Power, et al.’s accredited doctors, Dr. Gonzales and Dr. Ana Ma. Luisa D. Javier, the internist-cardiologist, was more extensive than the examination made by Dr. Vicaldo on Lerona. The latter’s findings were not supported by laboratory results or diagnostic examinations. No proof was presented to show that Lerona has a cardiovascular disease that was acquired during the term of his employment.

Moreover, the doctors on both sides of the case had the same medical findings as regards Lerona’s hypertension. Under Section 32(A)(20) of the 2000 POEA-SEC, hypertension is compensable if it causes impairment of functions of body organs like kidneys, heart, eyes and brain, resulting to permanent disability as substantiated by certain documents. However, Lerona’s ECG tracing revealed no significant findings. His coronary angiogram was also negative for any vessel abnormalities.

Finally, the NLRC held that Lerona failed to observe the third doctor referral rule under the 2000 POEA-SEC. Consequently, his claim for disability compensation must be denied.

Acting on Lerona’s motion for reconsideration, the NLRC reversed itself and reinstated the ruling of the LA. In its Resolution, it held that the 2000 POEA-SEC does not require the parties to at all times assign a  third doctor to assess the seafarer’s disability. Hence, a seafarer is not precluded from filing a complaint before the NLRC even if the parties failed to secure the opinion of the third doctor. More, the record is bereft of showing that Lerona’s health condition was restored to its status quo so as to enable him to return to his former work as a fitter.

The fact that Lerona did not need to undergo any surgical procedure or intervention does not conclusively show that he is already fit to work. The NLRC held that at the time Lerona filed the case on January 14, 2010, five months after his repatriation, he is still unable to return to his work as a fitter for Sea Power, et al. His inability to perform his customary work for more than 120 days constitutes total and permanent disability.

Sea Power, et al. filed a motion for reconsideration, but the NLRC denied it. Undaunted, Sea Power, et al. filed a petition for certiorari with the Court of Appeals (CA).

CA Ruling:

In its assailed Decision, the CA set aside the NLRC Resolution for having been issued with grave abuse of discretion and reinstated its initial decision to dismiss Lerona’s complaint.

The CA ruled that the findings of the LA, as affirmed by the NLRC, are not supported by substantial evidence. It is undisputed that Lerona’s hypertension was a pre-existing condition, yet, he did not indicate it in his PEME form. Thus, Lerona committed misrepresentation which disqualifies him from recovering any disability benefits under Section 20(E) of the 2000 POEA-SEC.

Even assuming that Lerona did not conceal his condition, the CA held that a seafarer’s inability to resume his work after the lapse of more than 120 days from the time he suffered illness is not a  magic wand that would automatically warrant the grant of total and permanent disability benefits. None of the instances when a seafarer may be allowed to pursue an action to claim total and permanent disability exists. Dr. Gonzales pronounced Lerona fit to work on April 10, 2010, or approximately 200 days after his repatriation. The delay was solely attributable to Lerona since he failed to report after his 5th medical examination. The fit to work certification could have been issued earlier had he not absconded.

Moreover, the CA held that there is no reason to depart from the settled rule that it is the company-designated physician who is entrusted with the task of assessing the seafarer’s disability. The medical finding of Lerona’s doctor of choice was made on the same day that Lerona consulted him.

Lerona was not required to undergo medical tests to confirm the doctor’s diagnosis. On the other hand, the findings of the company-designated physician were made after Lerona underwent laboratory examinations.

Finally, the CA noted that Lerona did not follow the third doctor-referral rule under the 2000 PO EA-SEC. Lerona moved for reconsideration, but the CA denied it. Hence, the petition before the SC.


Whether or not the failure of the seafarer to indicate in the appropriate box in his PEME form that he has hypertension for four times, although he had been taking Norvasc as maintenance medicine for two years, amounts to fraudulent misrepresentation

Whether or not inability to work beyond the period of 120 days while during the treatment automatically renders the  seafarer permanently disabled

Whether or not the failure of seafarer to complete the medical treatment by the company-designated physician constitutes medical abandonment

Whether or not a disability claim filed before the completion of medical treatment has no cause of action

SC Ruling:

The SC affirmed the Decision of the CA.

Lerona cannot claim disability benefits because he committed fraudulent misrepresentation. The contract of employment between the parties is subject to the terms and conditions of the 2000 POEA-SEC, Section 20(E) of which provides that deliberate concealment by a seafarer of a pre-existing medical condition in his PEME constitutes fraudulent misrepresentation which shall disqualify him from any disability compensation and benefits.

Lerona did not indicate in the appropriate box in his PEME form that he has hypertension, although he had been taking Norvasc as maintenance medicine for two years. He only disclosed his pre-existing medical condition after he was repatriated to the Philippines. Lerona claims that he did not reveal his hypertension during his PEME out of an honest belief that it had been “resolved.”

However, the SC did not find this persuasive. That Lerona continues to take maintenance medicine indicates that his condition is not yet resolved. Additionally, within the two years that Lerona had been taking maintenance medication for his hypertension, he had boarded Sea Power, et al.’s ships four times.

Since PEME is mandatory before a  seafarer is able to board a  ship, it goes to show that Lerona concealed his hypertension no less than four times as well. This circumstance negates any suggestion of good faith that Lerona makes in defense of his misdeed.

The SC held that the Court had on many occasions disqualified seafarers from claiming disability benefits on account of fraudulent misrepresentation arising from their concealment of a pre-existing medical condition. This case is not an exception. For knowingly concealing his hypertension during the PEME, Lerona committed fraudulent misrepresentation which unconditionally bars his right to receive any disability compensation from Sea Power, et al.

The SC held that even if it disregard Lerona’s misrepresentation, his claim for disability benefits would still fail. Section 32(A)(20) of the 2000 POEA-SEC provides for certain requirements before hypertension may be considered a compensable occupational disease.

Hypertension classified as primary or essential is considered compensable if it causes impairment of function of body organs like kidneys, heart, eyes and brain, resulting in permanent disability; Provided, that the following documents substantiate it: (a) chest x-ray report, (b) ECG report, ( c) blood chemistry report, ( d) funduscopy (sic) report, and (f) (sic) C-T scan.

Here, there is no showing that Lerona’s hypertension impaired the functioning of any of his vital organs, resulting in permanent disability. Moreover, Lerona did not submit any of the enumerated medical test results. Lerona’s physician, Dr. Vicaldo, did not subject him to any tests. He concluded that Lerona was permanently unfit to resume work as a seaman in any capacity, without stating the basis for his prognosis other than an elevated blood pressure.

On the contrary, Lerona’s ECG tracing showed no significant findings and his coronary angiogram gave negative results for vessel abnormalities. Having failed to satisfy the requisites under Section 32(A)(20) of the 2000 POEA-SEC, Lerona’s hypertension is not compensable.

Finally, the SC rejected Lerona’s argument that Sea Power, et al. are estopped from denying him disability benefits because he passed his PEME. A “fit to work” declaration in the PEME is not a conclusive proof that a seafarer is free from any disease prior to his/her deployment. Citing Status Maritime Corporation vs. Spouses Delalamon the SC held that PEME is not exploratory and does not allow the employer to discover any and all pre-existing medical condition with which the seafarer is  suffering and for which he may be presently taking medication.

Lerona also cannot claim disability benefits because he committed medical abandonment. Citing C.F. Sharp Crew Management, Inc. vs. Orbeta, the SC held that a seafarer commits medical abandonment when he fails to complete his treatment before the lapse of the 240-day period, which prevents the company physician from declaring him fit to work or assessing his disability. Section 20(0) of the 2000 POEA-SEC provides that “[n]o compensation and benefits shall be payable in respect of any injury, incapacity, disability or death of the seafarer resulting from his willful or criminal act or intentional breach of his duties.”

A seafarer is duty-bound to complete his medical treatment until declared fit to work or assessed with a permanent disability rating by the company-designated physician. In this case, after undergoing several tests, Lerona was placed under observation. Dr. Gonzales advised him to return for his medical clearance on October 23, 2009, or 71 days from his repatriation, but Lerona did not do so. He argues that he could still feel the symptoms of his ailment despite having been cleared by Sea Power, et al.’s cardiologist from coronary arterial disease on October 15, 2009. Hence, he was prompted to consult another doctor.

However, while indeed a seafarer has the right to seek the opinion of other doctors under Section 20(8)(3) of the 2000 POEA-SEC, this is on the presumption that the company-designated physician had already issued a certification on his fitness or disability and he finds this disagreeable.

As case law holds, the company-designated physician is expected to arrive at a definite assessment of the seafarer’s fitness to work or to determine his disability within a period of 120 or 240 days from repatriation. The 120-day period applies if the duration of the seafarer’s treatment does not exceed 120 days. On the other hand, the 240-day period applies in case the seafarer requires further medical treatment after the lapse of the initial 120-day period. In case the company-designated doctor failed to issue a declaration within the given periods, the seafarer is deemed totally and permanently disabled.

When Lerona chose not to show up at the appointed date of consultation, effectively preventing Dr. Gonzales from making a fitness or disability assessment, he breached his duty under the 2000 POEA-SEC. Without any final assessment from the company-designated physician, Lerona’s claim for permanent total disability benefits must fail.

The SC held further that when Lerona filed his complaint before the LA on January 14, 2010, or 154 days after his repatriation, he had no cause of action against Sea Power, et al. because Dr. Gonzales has not yet issued an assessment on his fitness or unfitness for sea duty. The 240-day maximum period for treatment has not yet lapsed. The SC refused to subscribe to Lerona’s theory that the company-designated physician only had 120 days from repatriation to issue a disability assessment.

Case law teaches that the 120-day rule applies only when the complaint was filed prior to October 6, 2008. However, if the complaint was filed from October 6, 2008 onwards, as in this case, the 240-day rule applies. It was thus error on the part of Lerona to reckon his entitlement to permanent and total disability benefits based on the 120-day rule.

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