The Supreme Court ruled that a seafarer’s claim for permanent disability benefits was premature because it was filed before the expiration of the 240-day period for medical assessment by the company-designated physician. This decision clarifies the importance of adhering to the procedural requirements set forth in the Philippine Overseas Employment Administration Standard Employment Contract (POEA-SEC) regarding the timing of disability claims and the role of the company-designated physician in assessing a seafarer’s fitness for duty.

Anchoring Hope: When Can a Seafarer Claim Disability Benefits?

In TSM Shipping Phils., Inc. v. Patiño, the central question revolves around the timing of a seafarer’s claim for disability benefits. Louie Patiño, a seafarer, sustained an injury while working on board a vessel. Following his repatriation, he underwent medical treatment with a company-designated physician, Dr. Cruz. Prior to the lapse of 240 days from the date of repatriation, and while still undergoing treatment, Patiño filed a complaint for total and permanent disability benefits. The core legal issue is whether Patiño’s claim was premature, given that the company-designated physician had not yet issued a final assessment within the prescribed period.

The Supreme Court emphasized the significance of adhering to the provisions of the POEA-SEC and relevant labor laws, which are deemed integrated into the employment contract between the seafarer and the employer. The Court referred to Article 192(c)(1) of the Labor Code, which addresses permanent total disability, and Section 2, Rule X of the Amended Rules on Employees’ Compensation Implementing Title II, Book IV of the Labor Code, which specifies the period of entitlement. Section 20 B(3) of the POEA-SEC was also cited, outlining the seafarer’s entitlement to sickness allowance and the procedure for post-employment medical examination.

Building on these provisions, the Supreme Court reiterated the guidelines established in Vergara v. Hammonia Maritime Services, Inc., which harmonized the aforementioned regulations. According to Vergara, a seafarer must report to the company-designated physician within three days of arrival for diagnosis and treatment. During the treatment period, not exceeding 120 days, the seafarer is considered under temporary total disability and receives his basic wage. This period can be extended up to 240 days if further medical attention is required. The employer retains the right to declare a permanent disability within this extended period.

Based on these established guidelines, the Supreme Court in C.F. Sharp Crew Management, Inc. v. Taok outlined the specific conditions under which a seafarer may validly pursue an action for total and permanent disability benefits. These conditions include instances where the company-designated physician fails to issue a declaration within the prescribed periods, issues a contrary opinion to the seafarer’s chosen physician, acknowledges a partial disability while other doctors believe it to be total, or disputes the disability grading. Essentially, the seafarer must demonstrate that the assessment process has been exhausted or improperly handled by the employer before filing a claim.

In Patiño’s case, the Court found that his complaint was prematurely filed. He was repatriated on May 24, 2010, and received medical attention from Dr. Cruz. An interim assessment of Grade 10 disability was issued on August 17, 2010, while Patiño was still undergoing treatment. However, on September 8, 2010—only 107 days after repatriation—Patiño filed a complaint for disability benefits. At this point, he was still considered under temporary total disability, as the 120/240-day period had not yet lapsed. The Court emphasized that Patiño’s belief that his injury had rendered him permanently disabled did not justify the premature filing of the complaint.

Furthermore, the Supreme Court noted that Patiño only sought the opinion of his own physician, Dr. Escutin, after filing the complaint. This sequence of events further underscored the prematurity of his action. The Labor Arbiter, therefore, should have dismissed the complaint due to a lack of cause of action. This ruling highlights the importance of adhering to the prescribed procedures and timelines in pursuing disability claims.

The Court also addressed the lower tribunals’ reliance on the 120-day rule and Patiño’s perceived inability to work, resulting in a loss of earning capacity. The Court clarified that a temporary total disability only becomes permanent when the company-designated physician declares it so within the 240-day period or fails to make such a declaration after its lapse. Dr. Cruz issued a final assessment of Grade 10 disability on September 29, 2010, well within the 240-day period. Therefore, Patiño could not claim entitlement to the maximum benefit of US$60,000.00, which is typically reserved for permanent total disabilities.

The Supreme Court emphasized the controlling nature of the medical assessment made by the company-designated physician. The POEA-SEC explicitly states that the company-designated physician determines a seafarer’s fitness or unfitness for work. If the seafarer’s physician disagrees with the company-designated physician’s assessment, a third doctor may be jointly agreed upon, whose decision shall be final and binding. In Patiño’s case, this procedure was not followed. He sought a second opinion but did not pursue the process of jointly selecting a third doctor to resolve the conflicting assessments.

The Court has consistently held that non-observance of the third doctor requirement results in the company-designated physician’s assessment prevailing. As reiterated in Veritas Maritime Corporation v. Gepanaga, Jr., the failure to adhere to the agreed procedure leaves the Court with no option but to uphold the certification issued by the company-designated physician. In this case, Dr. Cruz’s assessment was deemed final and binding due to Patiño’s failure to properly dispute it through the prescribed channels.

Moreover, the Court noted that Dr. Cruz had closely monitored Patiño’s condition from repatriation until his last follow-up examination. This continuous supervision allowed Dr. Cruz to gain a detailed understanding of Patiño’s medical status. The extensive medical attention, including surgery and physical therapy, further solidified the reliability of Dr. Cruz’s assessment. In contrast, Dr. Escutin’s opinion, obtained after Patiño had already filed his complaint, carried less weight due to the limited scope of his evaluation.

In conclusion, the Supreme Court underscored the importance of adhering to the procedural requirements and timelines outlined in the POEA-SEC. A seafarer’s claim for disability benefits must be filed after the company-designated physician has had the opportunity to fully assess the seafarer’s condition within the prescribed period. Failure to follow these procedures, including the proper disputing of the company-designated physician’s assessment, can result in the denial or reduction of disability benefits. The Court ultimately ruled that Patiño was entitled only to the amount corresponding to a Grade 10 disability, as certified by Dr. Cruz, highlighting the significance of properly navigating the legal framework governing seafarers’ disability claims.

Section 32 of the POEA-SEC provides for a schedule of disability compensation which is often ignored or overlooked in maritime compensation cases. Section 32 laid down a Schedule of Disability or Impediment for Injuries Suffered and Diseases including Occupational Diseases or Illness Contracted, in conjunction with Section 20 (B)(6) which provides that in case of a permanent total or partial disability, the seafarer shall be compensated in accordance with Section 32. Section 32 further declares that any item in the schedule classified under Grade 1 shall be considered or shall constitute total and permanent disability. Therefore, any other grading constitutes otherwise. We stressed in Splash Philippines, Inc. v. Ruizo that it is about time that the schedule of disability compensation under Section 32 be seriously observed.

FAQs

What was the key issue in this case?	The key issue was whether the seafarer’s claim for disability benefits was premature because it was filed before the expiration of the 240-day period for assessment by the company-designated physician.
What is the POEA-SEC?	The Philippine Overseas Employment Administration Standard Employment Contract (POEA-SEC) is a standard contract that governs the employment of Filipino seafarers on foreign vessels. It outlines the rights and obligations of both the seafarer and the employer.
What is the role of the company-designated physician?	The company-designated physician is responsible for assessing the seafarer’s medical condition, determining fitness for work, and providing medical treatment. Their assessment is crucial in determining the extent of disability and entitlement to benefits.
What is the 120/240-day rule?	The 120/240-day rule refers to the period within which the company-designated physician must assess the seafarer’s condition. The initial period is 120 days, which can be extended to 240 days if further medical treatment is required.
What happens if the seafarer’s doctor disagrees with the company doctor?	If the seafarer’s doctor disagrees with the company-designated physician’s assessment, a third doctor may be jointly agreed upon by the employer and the seafarer. The third doctor’s decision shall be final and binding on both parties.
What is the effect of not following the third doctor procedure?	Failure to follow the third doctor procedure means that the assessment of the company-designated physician prevails. This highlights the importance of adhering to the agreed-upon process for resolving conflicting medical opinions.
What disability grade was the seafarer initially assessed with?	The seafarer, Louie Patiño, was initially given an interim assessment of Grade 10 disability by the company-designated physician, Dr. Cruz, while he was still undergoing treatment.
What amount was the seafarer ultimately awarded?	The Supreme Court ultimately ruled that Patiño was entitled to the amount corresponding to a Grade 10 disability, which amounted to US$10,075.00, based on the certification issued by Dr. Cruz.

This case underscores the importance of adhering to the established procedures and timelines in pursuing disability claims under the POEA-SEC. Seafarers must ensure that they follow the prescribed steps, including undergoing medical assessment by the company-designated physician and properly disputing any conflicting assessments, to protect their rights and ensure fair compensation for work-related injuries or illnesses.

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: TSM SHIPPING PHILS., INC. VS. PATIÑO, G.R. No. 210289, March 20, 2017