The Supreme Court has ruled that if a company-designated physician fails to provide a timely and definitive assessment of a seafarer’s fitness to work within the prescribed period (120 or 240 days), the seafarer’s disability is presumed to be total and permanent. This presumption overrides the requirement for a third doctor’s opinion, typically mandatory in cases of conflicting medical assessments, protecting the seafarer’s right to claim full disability benefits. The decision emphasizes the employer’s responsibility to ensure timely medical assessments and highlights the seafarer’s welfare in disability claims.

Navigating Murky Waters: Does a Belated Diagnosis Sink a Seafarer’s Claim?

This case revolves around Jessie C. Esteva, a seafarer who sought total and permanent disability benefits after developing severe back pain while working onboard a vessel. The central legal question is whether Esteva is entitled to these benefits, considering the conflicting medical assessments and the failure to adhere to the third-doctor referral process stipulated in the Philippine Overseas Employment Administration Standard Employment Contract (POEA-SEC). The Court’s decision pivots on the timeliness of the company-designated physician’s assessment and its impact on the procedural requirements for disability claims.

The factual backdrop begins with Esteva’s employment by Wilhelmsen Smith Bell Manning, Inc. He was deployed as a seafarer and, during his service, experienced debilitating back pain. Upon repatriation, he was examined by a company-designated physician who initially suggested a Grade 8 disability, indicating a partial loss of lifting power. Dissatisfied with this assessment, Esteva consulted his own doctors, who declared him unfit for further sea duty. This divergence of medical opinions set the stage for a legal battle concerning the extent of Esteva’s disability and his entitlement to corresponding benefits.

The Labor Arbiter initially ruled in favor of Esteva, awarding him disability compensation, sickness allowance, and attorney’s fees. The National Labor Relations Commission (NLRC) affirmed this decision, emphasizing that Esteva was essentially rendered permanently disabled due to the nature of his condition and the extended treatment required. However, the Court of Appeals reversed these rulings, giving greater weight to the assessment of the company-designated physician. The appellate court highlighted Esteva’s failure to comply with the POEA-SEC’s requirement to seek a third doctor’s opinion, jointly agreed upon by the employer and the seafarer, when disputing the company physician’s assessment.

The Supreme Court, however, took a different view. It acknowledged the general rule that referral to a third doctor is mandatory when there is a disagreement between the company-designated physician and the seafarer’s doctor. The Court cited Marlow Navigation Philippines, Inc. v. Osias, holding that the referral to a third doctor is mandatory when: (1) there is a valid and timely assessment made by the company-designated physician; and (2) the seafarer’s appointed doctor refuted such assessment. However, the Court emphasized that this requirement is contingent upon the company-designated physician providing a valid, final, and definite assessment within the prescribed periods of 120 or 240 days. This timeline is crucial, as it sets the framework for determining the seafarer’s disability status and the corresponding obligations of the employer.

Building on this principle, the Supreme Court scrutinized the timeliness of the company-designated physician’s assessment in Esteva’s case. The Court found that the respondents failed to inform Esteva in a timely manner that the company-designated physician had already made an assessment of his condition. Critically, Esteva only became aware of this assessment after both parties had filed their position papers before the Labor Arbiter. By this time, the prescribed 240-day period had already lapsed. This delay was a significant factor in the Supreme Court’s decision.

The Court emphasized that the employer has a responsibility to ensure that the seafarer is informed of the medical assessment within the stipulated timeframe. The Court reasoned that absent a timely and definite disability assessment from the company-designated physician, the mandatory rule on a third doctor referral does not apply. In such cases, a presumption arises that the seafarer’s disability is total and permanent. This is supported by Kestrel Shipping Company, Inc. v. Munar which stated that, absent a certification 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.

Furthermore, the Court considered Esteva’s condition since his repatriation, noting that he remained incapacitated and unable to perform his usual duties. Given these circumstances, the Supreme Court concluded that Esteva’s failure to refer the assessment to a third doctor was not fatal to his disability claim. The Court held that Esteva was entitled to total and permanent disability benefits amounting to US$90,000.00 under the Collective Bargaining Agreement. This decision highlights the importance of procedural compliance on the part of the employer and reinforces the seafarer’s right to claim benefits when the employer fails to meet its obligations.

In addition to the disability benefits, the Supreme Court addressed the issue of damages. The Court found that the respondents acted in bad faith by delaying the release of the disability assessment and disregarding the findings of Esteva’s chosen physicians. Such actions, according to the Court, warranted the award of moral and exemplary damages. This aspect of the decision serves as a deterrent against employers who attempt to circumvent their obligations to seafarers. The Court also affirmed the award of sickness allowance, while denying the claim for reimbursement of medical and transportation expenses due to lack of substantiating evidence.

In essence, the Supreme Court’s decision in this case underscores the importance of timely medical assessments and adherence to procedural requirements in seafarer disability claims. While the third-doctor referral process remains a crucial aspect of resolving conflicting medical opinions, it is not an absolute requirement. The Court’s decision provides clarity and guidance on the circumstances under which the third-doctor rule may be relaxed or overridden, particularly when the employer fails to provide a timely assessment. This promotes fairness and protects the rights of seafarers who are injured or become ill during their employment.

FAQs

What was the key issue in this case?	The central issue was whether a seafarer was entitled to total and permanent disability benefits when the company-designated physician’s assessment was delayed, and the seafarer did not seek a third doctor’s opinion. The Court determined that a delayed assessment could lead to a presumption of total and permanent disability.
Is the third doctor referral always mandatory?	Generally, yes, the POEA-SEC mandates referral to a third doctor when there’s conflicting medical assessments. However, the Court clarified that this rule doesn’t apply if the company-designated physician fails to provide a timely assessment.
What is the prescribed period for the company-designated physician’s assessment?	The company-designated physician has 120 days to issue a final medical assessment, which can be extended to a maximum of 240 days if further treatment is needed. Failure to provide an assessment within this period can result in a presumption of total and permanent disability.
What happens if the company fails to inform the seafarer of the assessment?	If the company fails to inform the seafarer of the assessment, it is a breach of their duty and the mandatory third doctor rule is not applied, and there is a basis for considering bad faith. This can lead to a presumption that the disability is total and permanent.
What benefits is the seafarer entitled to in this case?	The seafarer was awarded total and permanent disability benefits (US$90,000.00), sickness allowance (US$2,700.00), moral damages (P100,000.00), exemplary damages (P100,000.00), and attorney’s fees. However, the claim for reimbursement of medical and transportation expenses was denied due to lack of supporting documents.
What is the basis for awarding moral and exemplary damages?	Moral and exemplary damages were awarded because the company acted in bad faith by delaying the release of the disability assessment and disregarding the findings of the seafarer’s chosen physicians. This demonstrated an intent to evade their contractual obligations.
Can a seafarer claim sickness allowance?	Yes, under the POEA-SEC, a seafarer is entitled to sickness allowance equivalent to their basic wage from the time they sign off until they are declared fit to work or assessed with a disability, but not exceeding 120 days.
What is the significance of this ruling for seafarers?	This ruling protects seafarers’ rights by emphasizing the importance of timely medical assessments. It ensures that employers cannot delay assessments to avoid their obligations and clarifies the circumstances under which the third-doctor rule can be overridden.

The Supreme Court’s decision in Esteva v. Wilhelmsen Smith Bell Manning, Inc. offers crucial insights into the adjudication of seafarer disability claims. It reinforces the principle that employers must act diligently and in good faith when assessing a seafarer’s medical condition. The ruling ensures that seafarers are not prejudiced by delays or procedural technicalities, particularly when their health and livelihood are at stake.

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: JESSIE C. ESTEVA v. WILHELMSEN SMITH BELL MANNING, INC., G.R. No. 225899, July 10, 2019