THIRD DIVISION

G.R. No. 179169 : March 3, 2010

LEONIS NAVIGATION CO., INC. and WORLD MARINE PANAMA, S.A., Petitioners, v. CATALINO U. VILLAMATER and/or The Heirs of the Late Catalino U. Villamater, represented herein by Sonia Mayuyu Villamater; and NATIONAL LABOR RELATIONS COMMISSION, Respondents.

D E C I S I O N

NACHURA, J.:

This is a petition for review on certiorari¹c�fa under Rule 45 of the Rules of Court, seeking to annul and set aside the Decision²c�fa dated May 3, 2007 and the Resolution³c�fa dated July 23, 2007 of the Court of Appeals (CA) in CA-G.R. SP No. 85594, entitled "Leonis Navigation Co., Inc., et al. v. Catalino U. Villamater, et al.cra|aw"

The antecedents of this case are as follows:

Private respondent Catalino U. Villamater (Villamater) was hired as Chief Engineer for the ship MV Nord Monaco, owned by petitioner World Marine Panama, S.A., through the services of petitioner Leonis Navigation Co., Inc. (Leonis), as the latters local manning agent. Consequent to this employment, Villamater, on June 4, 2002, executed an employment contract,⁴c�fa incorporating the Standard Terms and Conditions Governing the Employment of Filipino Seafarers on Board Ocean-Going Vessels as prescribed by the Philippine Overseas Employment Administration (POEA).chanroblesvirtua|awlibary

Prior to his deployment, Villamater underwent the required Pre-Employment Medical Examination (PEME). He passed the PEME and was declared "Fit to Work."⁵c�fa Thereafter, Villamater was deployed on June 26, 2002.chanroblesvirtua|awlibary

Sometime in October 2002, around four (4) months after his deployment, Villamater suffered intestinal bleeding and was given a blood transfusion. Thereafter, he again felt weak, lost considerable weight, and suffered intermittent intestinal pain. He consulted a physician in Hamburg, Germany, who advised hospital confinement. Villamater was diagnosed with Obstructive Adenocarcinoma of the Sigmoid, with multiple liver metastases, possibly local peritoneal carcinosis and infiltration of the bladder, possibly lung metastasis, and anemia; Candida Esophagitis; and Chronic Gastritis. He was advised to undergo chemotherapy and continuous supportive treatment, such as pain-killers and blood transfusion.⁶c�fa

Villamater was later repatriated, under medical escort, as soon as he was deemed fit to travel. As soon as he arrived in the Philippines, Villamater was referred to company-designated physicians. The diagnosis and the recommended treatment abroad were confirmed. He was advised to undergo six (6) cycles of chemotherapy. However, Dr. Kelly Siy Salvador, one of the company-designated physicians, opined that Villamaters condition "appears to be not work-related," but suggested a disability grading of 1.⁷c�fa

In the course of his chemotherapy, when no noticeable improvement occurred, Villamater filed a complaint⁸c�fa before the Arbitration Branch of the National Labor Relations Commission (NLRC) for payment of permanent and total disability benefits in the amount of US$80,000.00, reimbursement of medical and hospitalization expenses in the amount of P11,393.65, moral damages in the sum of P1,000,000.00, exemplary damages in the amount of P1,000,000.00, as well as attorneys fees.chanroblesvirtua|awlibary

After the submission of the required position papers, the Labor Arbiter rendered a decision⁹c�fa dated July 28, 2003 in favor of Villamater, holding that his illness was compensable, but denying his claim for moral and exemplary damages. The Labor Arbiter disposed as follows

WHEREFORE, foregoing premises considered, judgment is hereby rendered declaring complainants illness to be compensable and ordering respondents LEONIS NAVIGATION CO., INC. and WORLD MARINE PANAMA, S.A. liable to pay, jointly and severally, complainant CATALINO U. VILLAMATER, the amount of US$60,000.00 or its Philippine Peso equivalent at the time of actual payment, representing the latters permanent total disability benefits plus ten percent (10%) thereof as Attorneys Fees.

All other claims are dismissed for lack of merit.

SO ORDERED.¹⁰c�fa

Petitioners appealed to the NLRC. Villamater also filed his own appeal, questioning the award of the Labor Arbiter and claiming that the 100% degree of disability should be compensated in the amount of US$80,000.00, pursuant to Section 2, Article XXI of the ITF-JSU/AMOSUP Collective Bargaining Agreement (CBA) between petitioners and Associated Marine Officers & Seamens Union of the Philippines, which covered the employment contract of Villamater.chanroblesvirtua|awlibary

On February 4, 2004, the NLRC issued its resolution,¹¹c�fa dismissing the respective appeals of both parties and affirming in toto the decision of the Labor Arbiter.chanroblesvirtua|awlibary

Petitioners filed their motion for reconsideration of the February 4, 2004 resolution, but the NLRC denied the same in its resolution dated June 15, 2004.chanroblesvirtua|awlibary

Aggrieved, petitioners filed a petition for certiorari under Rule 65 of the Rules of Court before the CA. After the filing of the required memoranda, the CA rendered its assailed May 3, 2007 Decision, dismissing the petition. The appellate court, likewise, denied petitioners motion for reconsideration in its July 23, 2007 Resolution.

Hence, this petition based on the following grounds, to wit:

First, the Court of Appeals erroneously held that [the] Commissions Dismissal Decision does not constitute grave abuse of discretion amounting to lack or excess of jurisdiction but mere error of judgment, considering that the decision lacks evidentiary support and is contrary to both evidence on record and prevailing law and jurisprudence.chanroblesvirtua|awlibary

Second, the Court of Appeals seriously erred in upholding the NLRCs decision to award Grade 1 Permanent and Total Disability Benefits in favor of seaman Villamater despite the lack of factual and legal basis to support such award, and more importantly, when it disregarded undisputed facts and substantial evidence presented by petitioners which show that seaman Villamaters illness was not work-related and hence, not compensable, as provided by the Standard Terms of the POEA Contract.chanroblesvirtua|awlibary

Third, the Court of Appeals erred in holding that non-joinder of indispensable parties warrant the outright dismissal of the Petition for Review on Certiorari.chanroblesvirtua|awlibary

Fourth, the Court of Appeals erroneously held that final and executory decisions or resolutions of the NLRC render appeals to superior courts moot and academic.chanroblesvirtua|awlibary

Last, the Court of Appeals seriously erred in upholding the award of attorneys fees considering that the grant has neither factual nor legal basis.¹²c�fa

Before delving into the merits of this petition, we deem it fit to discuss the procedural issues raised by petitioners.chanroblesvirtua|awlibary

First. It is worthy to note that the CA dismissed the petition, considering that (1) the June 15, 2004 Resolution of the NLRC had already become final and executory on June 26, 2004, and the same was already recorded in the NLRC Book of Entries of Judgments; and that (2) the award of the Labor Arbiter was already executed, thus, the case was closed and terminated.chanroblesvirtua|awlibary

According to Sections 14 and 15, Rule VII of the 2005 Revised Rules of Procedure of the NLRC

Section 14. Finality of decision of the commission and entry of judgment. a) Finality of the Decisions, Resolutions or Orders of the Commission. Except as provided in Section 9 of Rule X, the decisions, resolutions or orders of the Commission shall become final and executory after ten (10) calendar days from receipt thereof by the parties.chanroblesvirtua|awlibary

b) Entry of Judgment. Upon the expiration of the ten (10) calendar day period provided in paragraph (a) of this Section, the decision, resolution, or order shall be entered in a book of entries of judgment.chanroblesvirtua|awlibary

The Executive Clerk or Deputy Executive Clerk shall consider the decision, resolution or order as final and executory after sixty (60) calendar days from date of mailing in the absence of return cards, certifications from the post office, or other proof of service to parties.chanroblesvirtua|awlibary

Section 15. Motions for reconsideration. Motion for reconsideration of any decision, resolution or order of the Commission shall not be entertained except when based on palpable or patent errors; provided that the motion is under oath and filed within ten (10) calendar days from receipt of decision, resolution or order, with proof of service that a copy of the same has been furnished, within the reglementary period, the adverse party; and provided further, that only one such motion from the same party shall be entertained.chanroblesvirtua|awlibary

Should a motion for reconsideration be entertained pursuant to this SECTION, the resolution shall be executory after ten (10) calendar days from receipt thereof.¹³c�fa

Petitioners received the June 15, 2004 resolution of the NLRC, denying their motion for reconsideration, on June 16, 2004. They filed their petition for certiorari before the CA only on August 9, 2004,¹⁴c�fa or 54 calendar days from the date of notice of the June 15, 2004 resolution. Considering that the above-mentioned 10-day period had lapsed without petitioners filing the appropriate appeal, the NLRC issued an Entry of Judgment dated June 28, 2004.chanroblesvirtua|awlibary

Moreover, by reason of the finality of the June 15, 2004 NLRC resolution, the Labor Arbiter issued on July 29, 2004 a Writ of Execution.¹⁵c�fa Consequently, Leonis voluntarily paid Villamaters widow, Sonia M. Villamater (Sonia), the amount of P3,649,800.00, with Rizal Commercial and Banking Corporation (RCBC) Managers Check No. 0000008550¹⁶c�fa dated August 12, 2004, as evidenced by the Acknowledgment Receipt¹⁷c�fa dated August 13, 2004, and the Cheque Voucher¹⁸c�fa dated August 12, 2004. Following the complete satisfaction of the judgment award, the Labor Arbiter issued an Order¹⁹c�fa dated September 8, 2004 that reads

There being complete satisfaction of the judgment award as shown by the record upon receipt of the complainant of the amount of P3,649,800.00, voluntarily paid by the respondent, as full and final satisfaction of the Writ of Execution dated July 29, 2004; and finding the same to be not contrary to law, morals, good custom, and public policy, and pursuant to Section 14, Rule VII of the Rules of Procedure of the National Labor Relations Commission (NLRC), this case is hereby ordered DISMISSED with prejudice, and considered CLOSED and TERMINATED.

SO ORDERED.chanroblesvirtua|awlibary

Petitioners never moved for a reconsideration of this Order regarding the voluntariness of their payment to Sonia, as well as the dismissal with prejudice and the concomitant termination of the case.chanroblesvirtua|awlibary

However, petitioners argued that the finality of the case did not render the petition for certiorari before the CA moot and academic. On this point, we agree with petitioners.chanroblesvirtua|awlibary

In the landmark case of St. Martin Funeral Home v. NLRC,²⁰c�fa we ruled that judicial review of decisions of the NLRC is sought via a petition for certiorari under Rule 65 of the Rules of Court, and the petition should be filed before the CA, following the strict observance of the hierarchy of courts. Under Rule 65, Section 4,²¹c�fa petitioners are allowed sixty (60) days from notice of the assailed order or resolution within which to file the petition. Thus, although the petition was not filed within the 10-day period, petitioners reasonably filed their petition for certiorari before the CA within the 60-day reglementary period under Rule 65.chanroblesvirtua|awlibary

Further, a petition for certiorari does not normally include an inquiry into the correctness of its evaluation of the evidence. Errors of judgment, as distinguished from errors of jurisdiction, are not within the province of a special civil action for certiorari, which is merely confined to issues of jurisdiction or grave abuse of discretion. It is, thus, incumbent upon petitioners to satisfactorily establish that the NLRC acted capriciously and whimsically in order that the extraordinary writ of certiorari will lie. By grave abuse of discretion is meant such capricious and whimsical exercise of judgment as is equivalent to lack of jurisdiction, and it must be shown that the discretion was exercised arbitrarily or despotically.chanroblesvirtua|awlibary

The CA, therefore, could grant the petition for certiorari if it finds that the NLRC, in its assailed decision or resolution, committed grave abuse of discretion by capriciously, whimsically, or arbitrarily disregarding evidence that is material to or decisive of the controversy; and it cannot make this determination without looking into the evidence of the parties. Necessarily, the appellate court can only evaluate the materiality or significance of the evidence, which is alleged to have been capriciously, whimsically, or arbitrarily disregarded by the NLRC, in relation to all other evidence on record.²²c�fa Notably, if the CA grants the petition and nullifies the

decision or resolution of the NLRC on the ground of grave abuse of discretion amounting to excess or lack of jurisdiction, the decision or resolution of the NLRC is, in contemplation of law, null and void ab initio; hence, the decision or resolution never became final and executory.²³c�fa

In the recent case Bago v. National Labor Relations Commission,²⁴c�fa we had occasion to rule that although the CA may review the decisions or resolutions of the NLRC on jurisdictional and due process considerations, particularly when the decisions or resolutions have already been executed, this does not affect the statutory finality of the NLRC decisions or resolutions in view of Rule VIII, Section 6 of the 2002 New Rules of Procedure of the NLRC, viz.:

RULE VIII

x x x x

SECTION 6. EFFECT OF FILING OF PETITION FOR CERTIORARI ON EXECUTION. A petition for certiorari with the Court of Appeals or the Supreme Court shall not stay the execution of the assailed decision unless a temporary restraining order is issued by the Court of Appeals or the Supreme Court.²⁵c�fa

Simply put, the execution of the final and executory decision or resolution of the NLRC shall proceed despite the pendency of a petition for certiorari, unless it is restrained by the proper court. In the present case, petitioners already paid Villamaters widow, Sonia, the amount of P3,649,800.00, representing the total and permanent disability award plus attorneys fees, pursuant to the Writ of Execution issued by the Labor Arbiter. Thereafter, an Order was issued declaring the case as "closed and terminated." However, although there was no motion for reconsideration of this last Order, Sonia was, nonetheless, estopped from claiming that the controversy had already reached its end with the issuance of the Order closing and terminating the case. This is because the Acknowledgment Receipt she signed when she received petitioners payment was without prejudice to the final outcome of the petition for certiorari pending before the CA.chanroblesvirtua|awlibary

Second. We also agree with petitioners in their position that the CA erred in dismissing outright their petition for certiorari on the ground of non-joinder of indispensable parties. It should be noted that petitioners impleaded only the then deceased Villamater²⁶c�fa as respondent to the petition, excluding his heirs.chanroblesvirtua|awlibary

Rule 3, Section 7 of the Rules of Court defines indispensable parties as those who are parties in interest without whom there can be no final determination of an action.²⁷c�fa They are those parties who possess such an interest in the controversy that a final decree would necessarily affect their rights, so that the courts cannot proceed without their presence.²⁸c�fa A party is indispensable if his interest in the subject matter of the suit and in the relief sought is inextricably intertwined with the other parties interest.²⁹c�fa

Unquestionably, Villamaters widow stands as an indispensable party to this case.chanroblesvirtua|awlibary

Under Rule 3, Section 11 of the Rules of Court, neither misjoinder nor non-joinder of parties is a ground for the dismissal of an action, thus:

Sec. 11. Misjoinder and non-joinder of parties. Neither misjoinder nor non-joinder of parties is ground for dismissal of an action. Parties may be dropped or added by order of the court on motion of any party or on its own initiative at any stage of the action and on such terms as are just. Any claim against a misjoined party may be severed and proceeded with separately.chanroblesvirtua|awlibary

The proper remedy is to implead the indispensable party at any stage of the action. The court, either motu proprio or upon the motion of a party, may order the inclusion of the indispensable party or give the plaintiff an opportunity to amend his complaint in order to include indispensable parties. If the plaintiff ordered to include the indispensable party refuses to comply with the order of the court, the complaint may be dismissed upon motion of the defendant or upon the court's own motion. Only upon unjustified failure or refusal to obey the order to include or to amend is the action dismissed.³⁰c�fa

On the merits of this case, the questions to be answered are: (1) Is Villamater entitled to total and permanent disability benefits by reason of his colon cancer? (2) If yes, would he also be entitled to attorneys fees?

As to Villamaters entitlement to total and permanent disability benefits, petitioners argue, in essence, that colon cancer is not among the occupational diseases listed under Section 32-A of the POEA Standard Terms and Conditions Governing the Employment of Filipino Seafarers On-Board Ocean Going Vessels (POEA Standard Contract), and that the risk of contracting the same was not increased by Villamaters working conditions during his deployment. Petitioners posit that Villamater had familial history of colon cancer; and that, although dietary considerations may be taken, his diet -- which might have been high in fat and low in fiber and could have thus increased his predisposition to develop colon cancer -- might only be attributed to him, because it was he who chose what he ate on board the vessels he was assigned to. Petitioners also cited the supposed declaration of their company-designated physicians who attended to Villamater that his disease was not work-related.

We disagree.chanroblesvirtua|awlibary

It is true that under Section 32-A of the POEA Standard Contract, only two types of cancers are listed as occupational diseases (1) Cancer of the epithelial lining of the bladder (papilloma of the bladder); and (2) cancer, epithellematous or ulceration of the skin or of the corneal surface of the eye due to tar, pitch, bitumen, mineral oil or paraffin, or compound products or residues of these substances. Section 20 of the same Contract also states that those illnesses not listed under Section 32 are disputably presumed as work-related. Section 20 should, however, be read together with Section 32-A on the conditions to be satisfied for an illness to be compensable,³¹c�fa to wit:

For an occupational disease and the resulting disability or death to be compensable, all the following conditions must be established:

cralaw1. The seafarers work must involve the risk described herein;

2. The disease was contracted as a result of the seafarers exposure to the described risks;

3. The disease was contracted within a period of exposure and under such other factors necessary to contract it;

4. There was no notorious negligence on the part of the seafarer.

cralawColon cancer, also known as colorectal cancer or large bowel cancer, includes cancerous growths in the colon, rectum and appendix. With 655,000 deaths worldwide per year, it is the fifth most common form of cancer in the United States of America and the third leading cause of cancer-related deaths in the Western World. Colorectal cancers arise from adenomatous polyps in the colon. These mushroom-shaped growths are usually benign, but some develop into cancer over time. Localized colon cancer is usually diagnosed through colonoscopy.³²c�fa

Tumors of the colon and rectum are growths arising from the inner wall of the large intestine. Benign tumors of the large intestine are called polyps. Malignant tumors of the large intestine are called cancers. Benign polyps can be easily removed during colonoscopy and are not life-threatening. If benign polyps are not removed from the large intestine, they can become malignant (cancerous) over time. Most of the cancers of the large intestine are believed to have developed as polyps. Colorectal cancer can invade and damage adjacent tissues and organs. Cancer cells can also break away and spread to other parts of the body (such as liver and lung) where new tumors form. The spread of colon cancer to distant organs is called metastasis of the colon cancer. Once metastasis has occurred in colorectal cancer, a complete cure of the cancer is unlikely.³³c�fa

Globally, colorectal cancer is the third leading cause of cancer in males and the fourth leading cause of cancer in females. The frequency of colorectal cancer varies around the world. It is common in the Western world and is rare in Asia and in Africa. In countries where the people have adopted western diets, the incidence of colorectal cancer is increasing.³⁴c�fa

Factors that increase a persons risk of colorectal cancer include high fat intake, a family history of colorectal cancer and polyps, the presence of polyps in the large intestine, and chronic ulcerative colitis.³⁵c�fa

Diets high in fat are believed to predispose humans to colorectal cancer. In countries with high colorectal cancer rates, the fat intake by the population is much higher than in countries with low cancer rates. It is believed that the breakdown products of fat metabolism lead to the formation of cancer-causing chemicals (carcinogens). Diets high in vegetables and high-fiber foods may rid the bowel of these carcinogens and help reduce the risk of cancer.³⁶c�fa

A persons genetic background is an important factor in colon cancer risk. Among first-degree relatives of colon-cancer patients, the lifetime risk of developing colon cancer is 18%. Even though family history of colon cancer is an important risk factor, majority (80%) of colon cancers occur sporadically in patients with no family history of it. Approximately 20% of cancers are associated with a family history of colon cancer. And 5% of colon cancers are due to hereditary colon cancer syndromes. Hereditary colon cancer syndromes are disorders where affected family members have inherited cancer-causing genetic defects from one or both of the parents.³⁷c�fa

In the case of Villamater, it is manifest that the interplay of age, hereditary, and dietary factors contributed to the development of colon cancer. By the time he signed his employment contract on June 4, 2002, he was already 58 years old, having been born on October 5, 1943,³⁸c�fa an age at which the incidence of colon cancer is more likely.³⁹c�fa He had a familial history of colon cancer, with a brother who succumbed to death and an uncle who underwent surgery for the same illness.⁴⁰c�fa Both the Labor Arbiter and the NLRC found his illness to be compensable for permanent and total disability, because they found that his dietary provisions while at sea increased his risk of contracting colon cancer because he had no choice of what to eat on board except those provided on the vessels and these consisted mainly of high-fat, high-cholesterol, and low-fiber foods.chanroblesvirtua|awlibary

While findings of the Labor Arbiter, which were affirmed by the NLRC, are entitled to great weight and are binding upon the courts, nonetheless, we find it also worthy to note that even during the proceedings before the Labor Arbiter, Villamater cited that the foods provided on board the vessels were mostly meat, high in fat and high in cholesterol. On this matter, noticeably, petitioners were silent when they argued that Villamaters affliction was brought about by diet and genetics. It was only after the Labor Arbiter issued his Decision, finding colon cancer to be compensable because the risk was increased by the victuals provided on board, that petitioners started claiming that the foods available on the vessels also consisted of fresh fruits and vegetables, not to mention fish and poultry. It is also worth mentioning that while Dr. Salvador declared that Villamaters cancer "appears to be not work-related," she nevertheless suggested to petitioners Disability Grade 1, which, under the POEA Standard Contract, "shall be considered or shall constitute total and permanent disability."⁴¹c�fa During his confinement in Hamburg, Germany, Villamater was diagnosed to have colon cancer and was advised to undergo chemotherapy and medical treatment, including blood transfusions. These findings were, in fact, confirmed by the findings of the company-designated physicians. The statement of Dr. Salvador that Villamaters colon cancer "appears to be not work-related" remained at that, without any medical explanation to support the same. However, this statement, not definitive as it is, was negated by the same doctors suggestion of Disability Grade 1. Under Section 20-B of the Philippine Overseas Employment Administration-Standard Employment Contract (POEA-SEC), it is the company-designated physician who must certify that the seafarer has suffered a permanent disability, whether total or partial, due to either injury or illness, during the term of his employment.⁴²c�fa

On these points, we sustain the Labor Arbiter and the NLRC in granting total and permanent disability benefits in favor of Villamater, as it was sufficiently shown that his having contracted colon cancer was, at the very least, aggravated by his working conditions,⁴³c�fa taking into consideration his dietary provisions on board, his age, and his job as Chief Engineer, who was primarily in charge of the technical and mechanical operations of the vessels to ensure voyage safety. Jurisprudence provides that to establish compensability of a non-occupational disease, reasonable proof of work-connection and not direct causal relation is required. Probability, not the ultimate degree of certainty, is the test of proof in compensation proceedings.⁴⁴c�fa

The Labor Arbiter correctly awarded Villamater total and permanent disability benefits, computed on the basis of the schedule provided under the POEA Standard Contract, considering that the schedule of payment of benefits under the ITF-JSU/AMOSUP CBA refers only to permanent disability as a result of an accident or injury.⁴⁵c�fa

By reason of Villamaters entitlement to total and permanent disability benefits, he (or in this case his widow Sonia) is also entitled to the award of attorneys fees, not under Article 2208(2) of the Civil Code, "[w]hen the defendants act or omission has compelled the plaintiff to litigate with third persons or to incur expenses to protect his interest," but under Article 2208(8) of the same Code, involving actions for indemnity under workmens compensation and employers liability laws.chanroblesvirtua|awlibary

WHEREFORE, the petition is DENIED and the assailed May 3, 2007 Decision and the July 23, 2007 Resolution of the Court of Appeals are AFFIRMED. Costs against petitioners.

SO ORDERED.

ANTONIO EDUARDO B. NACHURA
Associate Justice

WE CONCUR:

RENATO C. CORONA
Associate Justice
Chairperson

JOSE CATRAL MENDOZA
Associate Justice

A T T E S T A T I O N

I attest that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Courts Division.

RENATO C. CORONA
Associate Justice
Chairperson, Third Division

C E R T I F I C A T I O N

Pursuant to Section 13, Article VIII of the Constitution and the Division Chairperson's Attestation, I certify that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Courts Division.

REYNATO S. PUNO
Chief Justice

cralaw Endnotes: