Arriesgado vs. Multinational Maritime, Inc., et al.

An injury sustained by a seafarer during a basketball game on board the vessel is work-related and compensable under the 2010 POEA-SEC, because seafarers are covered by the Bunkhouse Rule and the Personal Comfort Doctrine and the employer bears the burden under Section 20(D) to prove that the injury resulted from the seafarer’s willful or criminal act or intentional breach of duties. The company-designated physician’s failure to issue and give a final, complete, and definite medical assessment within the prescribed 120/240-day period renders the seafarer’s disability total and permanent by operation of law and violates the seafarer’s right to due process.

Ernesto D. Arriesgado was employed by Multinational Maritime, Inc. (MMI), on behalf of its foreign principal MMS. Co., Ltd. (MMS), as an oiler on board MV “Kariyushi Leader” under a nine-month contract. His employment was governed by the 2010 POEA-SEC, deemed incorporated in every seafarer’s employment contract, and by the JSU-AMOSUP Advanced CBA for Japanese Flag. The dispute concerns entitlement to disability benefits, sickness allowance, damages, and attorney’s fees under these instruments and the Labor Code, with the liability of corporate officers governed by the Migrant Workers and Overseas Filipinos Act, as amended.

On October 9, 2020, Ernesto D. Arriesgado was hired by Multinational Maritime, Inc. (MMI), on behalf of its foreign principal MMS. Co., Ltd. (MMS), as an oiler with a basic monthly salary of USD 641.00 on board the vessel MV “Kariyushi Leader” for a period of nine months. He was deployed on October 27, 2020. The employment contract stipulated that the parties were bound by the JSU-AMOSUP Advanced CBA for Japanese Flag between All Japan Seamen’s Union, jointly with AMOSUP-PTGWO-ITF, and Mannex Marine Enterprise Co., Ltd. represented by MMI, effective January 1, 2019 to December 31, 2020, with automatic renewal if a ship was on an incomplete voyage at expiration. The 2010 POEA-SEC applied because Ernesto was hired in 2020.

On January 10, 2021, Ernesto joined a basketball game between the vessel’s deck and engine teams. During a sudden pivot maneuver, his left abdomen was elbowed, causing immense pain and shortness of breath and forcing him out of the game. He complained to the duty officer and was given pain relievers, a pain-relieving patch, and hot compress; he continued light duties as an oiler and was monitored before and after his duties. On January 18, 2021, Captain Cipriano T. Totilla, Jr. communicated the incident to Dr. Jose Emmanuel F. Gonzales, the company-designated physician, and requested medical advice, an offshore medical check-up, and x-ray. Dr. Gonzales advised one tablet of ibuprofen every six hours and warm compress, inquired about the severity of the injury because arranging an offshore medical check-up was difficult due to the pandemic, and ultimately deferred to the shipmaster’s decision on Ernesto’s requests.

On January 25, 2021, Ernesto underwent a general examination, x-ray, and blood examination at Honmoku Hospital, Yokohama, Japan. The report of Dr. Jun Sugiyama showed a fracture of the left costal cartilage, contusion on the left abdominal region, hyperuricemia, and an incomplete fracture on left rib No. 10; Ernesto was declared unfit for duty and recommended to be signed off at the earliest convenient port for further examination and treatment. He was medically repatriated to the Philippines on the same date. The following day, he contacted the ship’s representative, Ms. Haydee Aquino, to request a post-employment medical examination, but she advised him to complete the COVID-19 mandatory quarantine first before proceeding to Dr. Gonzales. After quarantine, Dr. Gonzales assessed him on February 1, 2021; his report stated there was no rib fracture but only a contusion, and he advised Ernesto to refrain from strenuous activity, reapply his chest strap, and take NSAIDs for pain.

On February 3, 2021, Dr. Gonzales issued a report addressed to Capt. Briones, with a copy furnished to Aquino, stating that Ernesto’s contusion secondary to trauma was not work-related because it was not listed under Sections 32 and 32-A of the 2010 POEA-SEC. He stated that Ernesto would be treated conservatively without surgery and was expected to return to work after two to three weeks, but that compensability was a legal issue beyond his competence. In follow-up reports dated February 8, March 4, March 19, March 25, April 12, and April 23, 2021, Dr. Gonzales noted lesser pain on February 8, mild pain on March 4, mild tenderness and Ernesto’s desire for a second opinion and kidney consultation due to decreased urine on March 19, and on March 25 observed Ernesto with a cane and limping gait, doubted the sudden pain in his lower extremities on the day a medical clearance was supposed to be issued, changed his pain medication to dexketoprofen, and advised him to discuss compensation with the agency. On April 12, Dr. Gonzales noted no cane but continued tenderness, expressed uncertainty whether Ernesto was malingering, referred him to a specialist, and prescribed tramadol and paracetamol. On April 23, 2021, he reported that Ernesto was still in moderate pain after three months, told him that more than 120 days [sic] had passed since he first reported for treatment, and advised him to talk to the agency regarding his future treatment due to lack of improvement.

Ernesto then consulted Dr. Manuel Fidel M. Magtira, who required him to undergo a CT scan. The CT Scan Report dated April 27, 2021 showed subsegmental atelectasis in the left upper lobe and an otherwise unremarkable plain CT study of the chest, with an incidental note of a 1.7 x 1.5 cm right hepatic hypodense nodule likely a hepatic cyst. On May 5, 2021, Dr. Gonzales reported that Ernesto failed to report for follow-up and had stated during his last checkup that he was no longer interested in returning to sea duties and wanted justice for the basketball incident. In a medical report dated May 10, 2021, Dr. Magtira stated that Ernesto had never suffered left chest pain with difficulty breathing before the injury, declared him permanently unfit in any capacity for further sea duties due to a significant reduction in his pre-injury capacity, and recommended partial permanent disability. On May 18, 2021, Ernesto, through counsel, informed MMI that the company-designated physician had discontinued his treatment and failed to inform him of a final assessment; he stated that an independent physician had declared him totally and permanently unfit, asked MMI to refer the matter to a third doctor, and requested copies of his final medical assessment and all medical reports under Section 20(F) of the 2010 POEA-SEC. On May 28, 2021, MMI, through counsel, responded that Ernesto was still under treatment with the company-designated physician, who was waiting for the CT scan result and other records, requested a copy of the independent physician’s report, and said it would consider the third-doctor referral after receipt. On August 12, 2021, Dr. Gonzales issued his tenth and final report, stating that Dr. Magtira was the preferred physician of seafarers seeking a second opinion and had issued the same “copy-paste” certifications; reiterating that Ernesto failed to undergo the CT scan due to fear of COVID-19; noting that Ernesto initially complied with follow-ups but stopped when he decided to file a claim; concluding that Ernesto’s true intention was to fund his retirement by claiming disability benefits and that he made himself appear seriously incapacitated with a cane and limping gait; and stating that because there were no rib fractures, the injury would not render him unfit to work.

On July 8, 2021, MMI and Capt. Briones received a grievance conference notice from the legal department of the Associated Marine Officers’ and Seamen’s Union of the Philippines regarding Ernesto’s claim; the parties failed to reach an amicable settlement, and the grievance procedure was terminated on September 7, 2021. On September 20, 2021, Ernesto filed a complaint via the single-entry approach before the National Capital Region Arbitration Branch of the NLRC against MMI and Capt. Briones for total and permanent disability benefits, moral and exemplary damages, and attorney’s fees; the SeNA proceedings were closed and terminated after the parties again failed to settle. On November 9, 2021, Ernesto formally filed a complaint for the same claims before the NCR Arbitration Branch of the NLRC. In his Position Paper, Ernesto argued that his injury was work-related because it was sustained while he was employed on board the vessel and that even an accident during rest and recreation is work-related because the employer pays for the employee’s time from leaving home until returning home; he also claimed that his right to due process was violated because the company-designated physician did not furnish him a copy of the final medical assessment, which prompted him to consult an independent physician who declared him permanently unfit. He sought USD 104,866.00 under the CBA’s permanent medical unfitness clause, moral and exemplary damages, attorney’s fees, and joint and solidary liability under the 2016 Revised POEA Rules and Regulations and the Migrant Workers and Overseas Filipinos Act of 1995, as amended. Respondents argued that the injury was not work-related because it was sustained during a basketball game undertaken purely for leisure, recreation, and general well-being; they cited Guerrero vs. Philippine Transmarine Carriers, Inc., where the Court denied the claim of a casino dealer injured while working out in the crew gym, and contended that the ruling applied because playing basketball was not included in or incidental to Ernesto’s duties as an oiler. They also claimed that Ernesto was malingering, that he misrepresented that his chest pain had radiated to his lower extremities without supporting evidence, that he was guilty of medical abandonment for failing to return every two weeks, that his claim was premature because he engaged a lawyer before the lapse of 120 days from his initial consultation, that his claims for moral and exemplary damages and attorney’s fees were baseless, and that Capt. Briones should be dropped as a respondent because he did not commit any act against Ernesto’s interests. The LA found that Ernesto failed to prove by substantial evidence that his injury was work-related, since it was undisputed that it was sustained during a basketball game, a period of rest and recreation. The NLRC found that the basketball activity was work-related because respondents admitted it was intended as a recreational activity for the seafarers, and that Ernesto’s claim was more consistent with the evidence because Dr. Gonzales advised him on April 23, 2021 to talk to the agency about his future treatment. The CA found no reasonable connection between Ernesto’s work as an oiler and the injury he sustained while playing basketball and no record that respondents organized the game.

• Work-Relatedness: Petitioner argued that his injury was work-related because it was sustained while he was employed on board the respondents’ vessel; even if the accident happened during rest and recreation, it is considered work-related because the employer pays for the employee’s time from the moment he leaves home until he returns home.
• Due Process and Final Assessment: Petitioner contended that his right to due process was violated because the company-designated physician did not furnish him a copy of his final medical assessment, prompting him to consult an independent physician who declared him permanently unfit; he also argued that the company-designated physician discontinued his treatment without issuing a final assessment.
• Medical Abandonment and Prematurity: Petitioner argued that he was not guilty of medical abandonment because it was Dr. Gonzales who terminated his treatment without issuing a final medical assessment; engaging the services of a lawyer was not tantamount to filing a complaint, and the complaint was filed only on November 9, 2021, after the 120th day from repatriation.
• CBA Benefits: Petitioner claimed entitlement to USD 104,866.00 under the CBA’s permanent medical unfitness clause, which entitles a seafarer deemed permanently unfit for further sea service in any capacity to such amount.
• Damages and Attorney’s Fees: Petitioner sought moral and exemplary damages and attorney’s fees because respondents were allegedly in bad faith in disregarding his medical and financial needs.
• Joint and Solidary Liability: Petitioner argued that respondents are jointly and solidarily liable under the 2016 Revised POEA Rules and Regulations and the Migrant Workers and Overseas Filipinos Act of 1995, as amended.

• Work-Relatedness: Respondents argued that Ernesto’s injury was not work-related because it was sustained during a basketball game undertaken by crew members purely for leisure, recreation, and general well-being; Guerrero vs. Philippine Transmarine Carriers, Inc. was applicable because Ernesto’s activity was not included in or incidental to his duties as an oiler.
• Malingering: Respondents claimed that Ernesto was malingering, as shown by his misrepresentation that his chest pain had radiated to his lower extremities without supporting evidence, and that the supposed pain disappeared during his next consultation.
• Medical Abandonment and Prematurity: Respondents contended that Ernesto was guilty of medical abandonment because he failed to adhere to the company-designated physician’s advice to return every two weeks, and that his claim was premature because he engaged the services of a lawyer before the lapse of 120 days from his initial consultation.
• Damages and Attorney’s Fees: Respondents argued that Ernesto’s claims for moral and exemplary damages and attorney’s fees were baseless because they defrayed the expenses for his treatment and he prematurely filed his claim.
• Capt. Briones: Respondents maintained that Capt. Briones should be dropped as a respondent because he did not commit any act against Ernesto’s interests.
• CBA and Arguilles: Respondents contended that Arguilles vs. Wilhelmsen Smith Bell Manning, Inc. was not applicable because the contract therein was governed by a different CBA that explicitly considered participation in recreational activities such as sports and games as part of board and lodging, whereas the JSU-AMOSUP Advanced CBA did not make sports and games an integral part of a seafarer’s accommodation.

• Grave Abuse of Discretion: Whether the CA erred in ruling that the NLRC committed grave abuse of discretion in granting Ernesto’s claims for total and permanent disability benefits and attorney’s fees.
• Work-Relatedness: Whether the injury sustained during a basketball game on board the vessel is work-related and compensable under the 2010 POEA-SEC.
• Three-Day Reportorial Requirement: Whether Ernesto substantially complied with the three-day reportorial requirement under Section 20(A)(3) of the 2010 POEA-SEC.
• Medical Abandonment: Whether Ernesto is guilty of medical abandonment for failing to report regularly to the company-designated physician.
• Prematurity: Whether Ernesto’s complaint for disability benefits was prematurely filed.
• Final Medical Assessment: Whether the company-designated physician’s failure to issue and give a valid and timely final, complete, and definite medical assessment rendered Ernesto’s disability total and permanent by operation of law.
• Amount of Disability Benefits: Whether Ernesto is entitled to USD 104,866.00 under the CBA or USD 60,000.00 under Section 32 of the 2010 POEA-SEC.
• Sickness Allowance: Whether Ernesto is entitled to differential sickness allowance.
• Moral and Exemplary Damages: Whether Ernesto is entitled to moral and exemplary damages.
• Attorney’s Fees: Whether Ernesto is entitled to attorney’s fees.
• Nominal Damages: Whether Ernesto is entitled to nominal damages due to violation of due process and the 2010 POEA-SEC.
• Joint and Solidary Liability: Whether respondents are jointly and severally liable, including Capt. Briones and the corporate officers and directors of MMI.

• Grave Abuse of Discretion: Yes. The CA erred in ascribing grave abuse of discretion to the NLRC; the NLRC’s findings had basis in the evidence and applicable law, so no grave abuse existed.
• Work-Relatedness: Yes. The basketball injury on board the vessel is work-related under the Bunkhouse Rule and Personal Comfort Doctrine, and respondents failed to discharge their burden under Section 20(D) of the 2010 POEA-SEC.
• Three-Day Reportorial Requirement: Yes. Ernesto substantially complied; the delay was caused by the government-mandated COVID-19 quarantine advised by respondents.
• Medical Abandonment: No. Dr. Gonzales’s April 23, 2021 report effectively discontinued treatment, and Ernesto consistently reported until then.
• Prematurity: No. Engaging counsel is not filing a complaint; the complaint was filed on November 9, 2021, after the 120th day on May 25, 2021.
• Final Medical Assessment: Yes. The company-designated physician’s failure to issue and give a final, complete, and definite assessment within the 120-day period rendered Ernesto’s disability total and permanent by operation of law and violated due process.
• Amount of Disability Benefits: USD 60,000.00 under Section 32 of the 2010 POEA-SEC, not USD 104,866.00 under the CBA, because the company-designated physician did not certify unfitness under the CBA and the independent assessment lacked scientific basis.
• Sickness Allowance: Yes. Ernesto is entitled to USD 2,564.00 as differential sickness allowance, less PHP 91,575.65 already paid.
• Moral and Exemplary Damages: No. Respondents acted on a genuine, albeit mistaken, belief and were not in bad faith.
• Attorney’s Fees: No. Article 111 of the Labor Code and Article 2208(2) and (8) of the Civil Code do not apply.
• Nominal Damages: Yes. PHP 50,000.00 is awarded for failure to furnish medical records and belated payment of sickness allowance, violating due process and Section 20(F) of the 2010 POEA-SEC.
• Joint and Solidary Liability: Yes. Under Section 10 of Republic Act No. 8042, as amended, MMI, MMS, Capt. Briones, and MMI’s corporate officers and directors are jointly and severally liable.

• Grave Abuse of Discretion: Under Rule 45, review is limited to pure questions of law, but the Court may review factual findings when the labor tribunals and the CA conflict. In labor cases, grave abuse of discretion exists when the NLRC’s findings and conclusions are not supported by substantial evidence; if the NLRC’s ruling has basis in evidence and law, no grave abuse exists and the CA should dismiss the petition. Here, the NLRC’s findings on work-relatedness, medical abandonment, and the absence of a final assessment had basis in the evidence and applicable law, so the CA erred in ascribing grave abuse of discretion.

• Work-Relatedness: Entitlement is governed by law (Labor Code Articles 197 to 199 in relation to Rule X, Section 2(a) of the Amended Rules on Employees’ Compensation), contract (2010 POEA-SEC, CBA, employment agreement), and medical findings. The 2010 POEA-SEC applied. In Arguilles vs. Wilhelmsen Smith Bell Manning, Inc., the Court applied the Bunkhouse Rule and Personal Comfort Doctrine to a basketball injury on board a vessel. Under the Bunkhouse Rule, employees required by the nature of their work to stay on the employer’s premises are considered in the course of employment while on those premises, and injuries sustained while administering personal comfort or engaging in recreational activities expressly or impliedly sanctioned by the employer to improve well-being are work-related. Seafarers are covered because they must live and work on the ship for the duration of their contracts. Section 20(D) of the 2010 POEA-SEC allows no compensation only if the employer proves by substantial evidence that the injury resulted from the seafarer’s willful or criminal act or intentional breach of duties and is directly attributable to the seafarer. Respondents failed to show any crime or willful breach; they admitted the basketball game was intended as a recreational activity for the seafarers, and the improvement of their well-being redounded to the employer’s benefit. Guerrero vs. Philippine Transmarine Carriers, Inc. was not controlling because it involved a casino dealer injured while working out in the ship’s gym on his own and for his own leisure, and it also involved conflicting claims, a belatedly raised total-and-permanent claim, and an independent physician’s declaration unsupported by diagnostic tests. The injury was also disputably presumed work-related under Section 20(A)(4) because it was not listed under Section 32, and compensability was justified under the Bunkhouse Rule and Personal Comfort Doctrine. The difference in CBA recreational-facility provisions between Arguilles and the JSU-AMOSUP Advanced CBA had no bearing because work-relatedness is governed by the 2010 POEA-SEC.

• Three-Day Reportorial Requirement: Section 20(A)(3) requires post-employment medical examination by a company-designated physician within three working days from medical repatriation, but the rule admits exceptions for incapacity or employer refusal. Caraan vs. Grieg Philippines, Inc. held that the three-day period is not a bright-line, all-or-nothing requirement. Ernesto was repatriated on January 25, 2021 and contacted the ship’s representative the next day to request examination, but was advised to complete the COVID-19 quarantine first; he was examined on February 1, 2021, seven days after repatriation. The delay was caused by a government-mandated pandemic protocol and respondents did not contest compensability on this ground. Substantial compliance was therefore present, and strict compliance could be dispensed with because neither party was at fault.

• Medical Abandonment: Section 20(A)(3) requires regular reporting to the company-designated physician on prescribed dates, and failure forfeits the right to claim disability benefits. However, Ernesto consistently reported from February 1, 2021 until April 23, 2021. Dr. Gonzales’s April 23, 2021 report stated that despite pain management there was no relief and told Ernesto to talk to the agency for the final decision regarding his future treatment. That report effectively discontinued treatment. When Ernesto sought an explanation, Dr. Gonzales referred him to respondents because the reports were confidential; Aquino merely asked for the CT scan result. Respondents’ claim that Dr. Gonzales never recommended a CT scan was inconsistent with his own reports, and nothing showed he issued a referral. Ernesto honestly believed treatment was discontinued, which prompted his consultation with Dr. Magtira. The NLRC’s finding that Ernesto was not guilty of medical abandonment was supported by the evidence.

• Prematurity: Engaging the services of a lawyer is not tantamount to filing a complaint. Ernesto’s May 18, 2021 letter through counsel informed respondents of the discontinuation of treatment, requested a third-doctor referral, and sought copies of medical records; it did not initiate the complaint. The complaint was filed before the NCR Arbitration Branch of the NLRC only on November 9, 2021. Since Ernesto was repatriated on January 25, 2021, the 120th day fell on May 25, 2021. The complaint was therefore not premature.

• Final Medical Assessment: Under Elburg Shipmanagement Phils., Inc. vs. Quiogue, Jr., the company-designated physician must issue a final medical assessment within 120 days from the seafarer’s report, or within 240 days if there is sufficient justification; failure renders the disability total and permanent. Pastrana vs. Bahia Shipping Services clarified that the period is reckoned from the date of repatriation. Ampo-on vs. Reinier Pacific International Shipping, Inc. required the assessment to be final, complete, and definite; otherwise, it is set aside and the disability becomes total and permanent by operation of law. Dr. Gonzales’s final report was issued on August 12, 2021, beyond the 120-day period that expired on May 25, 2021, and it did not reflect the true extent of Ernesto’s injury or his capacity to resume work; it merely suggested malingering and a desire to claim. Respondents’ justification of medical abandonment failed because Dr. Gonzales abruptly discontinued treatment. Under Gere vs. Anglo-Eastern Crew Management Phils., Inc., the company-designated physician must not only issue but also give the final assessment to the seafarer, and failure to do so violates due process. Respondents did not furnish Ernesto copies of the medical reports, which were addressed to Capt. Briones, Aquino, and others, violating Section 20(F) of the 2010 POEA-SEC. Even if respondents were entitled to the independent physician’s report before a third-doctor referral, the lack of a final, complete, and definite assessment left Ernesto with nothing to contest, rendering his disability total and permanent by operation of law.

• Amount of Disability Benefits: The CBA requires the company-nominated doctor to assess the degree of disability and determine capacity to return to work; 100% compensation is due if the disability is assessed at 50% or more, or if the company-nominated doctor certifies permanent unfitness even if the rating is less than 50%. Dr. Gonzales did not issue such a certification and instead doubted Ernesto’s condition and concluded he was malingering. Dr. Magtira’s independent certification could not support the CBA claim because it lacked scientific basis: it merely narrated the physical examination and CT scan results, discussed rib fractures generally, and hastily declared Ernesto unfit without other supporting diagnostic tests. As in Gere, where the CBA was not applied because the company-designated physician did not certify unfitness, Ernesto is entitled to USD 60,000.00 as total and permanent disability benefits under Section 32 of the 2010 POEA-SEC, payable in Philippine currency at the prevailing exchange rate at the time of payment.

• Sickness Allowance: Section 20(A)(3) entitles the seafarer to sickness allowance equivalent to basic wage from sign-off until declared fit to work or until disability is assessed, not exceeding 120 days, and payable at least once a month. Javier vs. Philippine Transmarine Carriers, Inc. held that medical treatment, sickness allowance, and disability benefits are separate and distinct obligations. Ernesto is entitled to USD 2,564.00, representing USD 641.00 monthly salary multiplied by four months or 120 days. Respondents already paid PHP 91,575.65, broken down into PHP 36,801.08 for January 26 to February 28, 2021 and PHP 54,774.57 for March 1 to April 23, 2021. Because Ernesto did not dispute these payments, they must be deducted from the total sickness allowance due. The three-month interval between payments warranted a reprimand, as the second payment appeared to be an afterthought.

• Moral and Exemplary Damages: Moral damages require bad faith, fraud, oppression, or conduct contrary to morals, good customs, or public policy; exemplary damages are deterrent and require wanton, fraudulent, reckless, oppressive, or malevolent conduct. Respondents’ refusal to pay was grounded on a genuine, albeit mistaken, belief that the basketball injury was not work-related, and they shouldered medical treatment and granted prorated sickness allowance until the last consultation. Bad faith was not established, so moral and exemplary damages were properly denied.

• Attorney’s Fees: Under Pacific Ocean Manning, Inc. vs. Bobiles, Article 111 of the Labor Code applies only to unlawful withholding of wages, not disability indemnity; Article 2208(2) of the Civil Code requires litigation expenses incurred in relation to third persons; and Article 2208(8) applies only to actions for indemnity under workmen’s compensation and employer’s liability laws, not contract. This case involves disability compensation under the 2010 POEA-SEC, not unlawful withholding of wages or workmen’s compensation, so attorney’s fees were denied.

• Nominal Damages: Article 2221 of the Civil Code allows nominal damages to vindicate a violated right where no actual loss is shown, but nominal damages cannot co-exist with actual or compensatory damages. Gere held that failure of the company-designated physician to fully and properly inform the seafarer of his medical condition violates due process, and Section 20(F) of the 2010 POEA-SEC requires furnishing medical reports upon request. Respondents failed to furnish Ernesto copies of his medical records despite repeated requests and belatedly paid the second tranche of sickness allowance. Following Agabon vs. NLRC and the examples in Jaka Food Processing Corp. vs. Pacot, nominal damages of PHP 50,000.00 were awarded to deter future violations and vindicate Ernesto’s rights.

• Joint and Solidary Liability: Section 10 of Republic Act No. 8042, as amended by Section 7 of Republic Act No. 10022, makes the principal/employer and recruitment/placement agency jointly and severally liable for money claims, and if the agency is a juridical entity, its corporate officers and directors are themselves jointly and solidarily liable. Accordingly, MMI, MMS, Capt. Briones as President of MMI, and the corporate officers and directors of MMI are jointly and severally liable for the monetary award. Interest at 6% per annum is imposed on the total monetary award from finality until full satisfaction under Lara’s Gifts & Decors, Inc. vs. Midtown Industrial Sales, Inc.

• Bunkhouse Rule — When the contract of employment contemplates that the employee shall sleep, take meals, or both on the employer’s premises, the employee is considered performing services growing out of, incidental to, or in the course of employment while on those premises before or after regular working hours. Its basis is that the nature of the work requires the employee to stay within employer-controlled premises. Seafarers fall within this rule because they must live and work on the vessel for the duration of their contracts. The Court applied it to hold Ernesto’s basketball injury work-related.
• Personal Comfort Doctrine — The course of employment is not broken by acts relating to the employee’s personal comfort, because such acts aid efficient performance; only departures effecting temporary abandonment of employment are unprotected. Injuries sustained while administering to personal comfort or engaging in recreational activities expressly or impliedly sanctioned by the employer to improve well-being are compensable. The Court applied it together with the Bunkhouse Rule to Ernesto’s basketball injury.
• Work-Related Injury under the 2010 POEA-SEC — A work-related injury is one arising out of and in the course of employment; it does not require that the seafarer be actually performing his or her duties at the time of injury. The employment contract remains effective until the seafarer’s arrival at the point of hire upon termination. The Court held that Ernesto’s injury, sustained on board during an employer-sanctioned recreational activity, fell within this definition.
• Employer’s Burden under Section 20(D) of the 2010 POEA-SEC — No compensation is payable for injury resulting from the seafarer’s willful or criminal act or intentional breach of duties, provided the employer proves that the injury is directly attributable to the seafarer. To negate compensability, the employer must prove by substantial evidence: (1) the injury is directly attributable to the seafarer; (2) the seafarer committed a crime or willful breach of duties; and (3) causation between the injury and the crime or breach. Respondents failed to discharge this burden.
• Three-Day Reportorial Requirement and Substantial Compliance — A seafarer seeking disability benefits must submit to post-employment medical examination by a company-designated physician within three working days from medical repatriation, except when incapacitated or when the employer refuses. The requirement is not a bright-line, all-or-nothing rule. The Court found substantial compliance because Ernesto contacted the ship’s representative the day after repatriation but was advised to complete the government-mandated COVID-19 quarantine first.
• Medical Abandonment and Forfeiture — Section 20(A)(3) requires the seafarer to report regularly to the company-designated physician on prescribed dates; failure forfeits the right to claim disability benefits. The Court found no abandonment because Ernesto consistently reported until Dr. Gonzales’s April 23, 2021 report effectively discontinued treatment by telling him to talk to the agency about his future treatment.
• 120/240-Day Rule and Final, Complete, and Definite Medical Assessment — The company-designated physician must issue a final medical assessment within 120 days from the seafarer’s report, extendible to 240 days only with sufficient justification; failure renders the disability total and permanent. The period is reckoned from repatriation. The assessment must be final, complete, and definite; otherwise it is set aside and the law considers the disability total and permanent. Dr. Gonzales’s August 12, 2021 report was late and indefinite, so Ernesto’s disability became total and permanent by operation of law.
• Due Process in the Giving of Medical Assessment — The company-designated physician must not only issue but also give the final medical assessment to the seafarer, fully and properly informing him or her of the medical condition, treatment, diagnosis, prognosis, and disability grading. Failure violates due process. Respondents failed to furnish Ernesto copies of the medical reports despite request, violating Section 20(F) of the 2010 POEA-SEC.
• Separate and Distinct Obligations of the Employer — The employer’s obligations to shoulder medical treatment, grant sickness allowance, and pay disability benefits under the 2010 POEA-SEC are separate and distinct; the grant of one does not preclude the others. Ernesto was awarded differential sickness allowance in addition to disability benefits.
• Nominal Damages for Violation of Due Process — Nominal damages are adjudicated to vindicate or recognize a violated right, not to indemnify loss, and are recoverable where a legal right is technically violated without actual present loss. They cannot co-exist with actual or compensatory damages. The Court awarded PHP 50,000.00 because respondents failed to furnish medical records and belatedly paid sickness allowance, violating Ernesto’s due process rights and the 2010 POEA-SEC.
• Attorney’s Fees in Labor Cases — Attorney’s fees under Article 111 of the Labor Code are recoverable only for unlawful withholding of wages, not for disability indemnity; Article 2208(2) of the Civil Code requires litigation expenses incurred in relation to third persons; Article 2208(8) applies only to workmen’s compensation and employer’s liability laws, not contract. The Court denied attorney’s fees.
• Joint and Solidary Liability under the Migrant Workers Act — Under Section 10 of Republic Act No. 8042, as amended by Section 7 of Republic Act No. 10022, the principal/employer and recruitment/placement agency are jointly and severally liable for money claims, and corporate officers and directors are themselves jointly and solidarily liable if the agency is a juridical entity. The Court held MMI, MMS, Capt. Briones, and MMI’s corporate officers and directors jointly and severally liable.

• "Prescinding from the foregoing, one can discern that the basis of compensability under the Bunkhouse Rule is when employees are required by the nature of their work to stay within the premises of their respective employers." — This states the rationale for applying the Bunkhouse Rule to seafarers, who must live and work on the vessel, and supports the holding that Ernesto’s on-board basketball injury was work-related.
• "Under the definition of terms of the POEA SEC, a work-related injury is an 'injury arising out of and in the course of employment.' Nowhere in this definition is it required that a seafarer must suffer an injury while he or she is actually performing his or her duties." — This defines work-related injury under the 2010 POEA-SEC and rejects the argument that compensability requires the seafarer to be performing actual duties at the time of injury.
• "Failure of the company-designated physician to arrive at a definite assessment of the seafarer's fitness to work or permanent disability within the prescribed periods and if the seafarer's medical condition remains unresolved, the law steps in to consider the latter's disability as total and permanent." — This is the ratio for holding that Dr. Gonzales’s late and indefinite final report rendered Ernesto’s disability total and permanent by operation of law.
• "For indeed, proper notice is one of the cornerstones of due process, and the seafarer must be accorded the same especially so in cases where his/her well-being is at stake." — This articulates the due process requirement that the company-designated physician must give the final medical assessment to the seafarer, which respondents violated.

• Arguilles vs. Wilhelmsen Smith Bell Manning, Inc., 943 Phil. 733 (2023) — The principal precedent applied; the Court adopted its Bunkhouse Rule and Personal Comfort Doctrine analysis and held that a basketball injury on board a vessel is work-related under the 2010 POEA-SEC.
• Guerrero vs. Philippine Transmarine Carriers, Inc., 841 Phil. 407 (2018) — Cited by respondents and the CA but distinguished; it denied benefits to a casino dealer injured while working out in the ship’s gym on his own and involved conflicting claims, a belatedly raised total-and-permanent claim, and an unsupported independent physician’s declaration.
• Uy vs. Workmen’s Compensation Commission, 186 Phil. 156 (1980) — Cited in Arguilles for the Bunkhouse Rule: injuries sustained by an employee required to stay in employer-furnished premises are in the course of employment regardless of the time they occurred.
• Elburg Shipmanagement Phils., Inc. vs. Quiogue, Jr., 765 Phil. 341 (2015) — Laid down the 120/240-day guidelines for the company-designated physician’s final medical assessment and the effect of failure on the seafarer’s disability.
• Pastrana vs. Bahia Shipping Services, 873 Phil. 892 (2020) — Clarified that the 120/240-day periods are reckoned from the date of the seafarer’s repatriation.
• Ampo-on vs. Reinier Pacific International Shipping, Inc., 853 Phil. 483 (2019) — Required the company-designated physician’s assessment to be final, complete, and definite; otherwise, it is set aside and the disability becomes total and permanent by operation of law.
• Gere vs. Anglo-Eastern Crew Management Phils., Inc., 830 Phil. 695 (2018) — Held that the company-designated physician must issue and give the final medical assessment to the seafarer, and that failure violates due process; also declined to apply the CBA and awarded USD 60,000.00 under the 2010 POEA-SEC.
• Caraan vs. Grieg Philippines, Inc., 902 Phil. 310 (2021) — Held that the three-day reportorial requirement is not a bright-line, all-or-nothing rule and may be relaxed.
• Javier vs. Philippine Transmarine Carriers, Inc., 738 Phil. 374 (2014) — Held that medical treatment, sickness allowance, and disability benefits are separate and distinct obligations.
• Pacific Ocean Manning, Inc. vs. Bobiles, 959 Phil. 878 (2024) — Clarified the limited grounds for attorney’s fees under Article 111 of the Labor Code and Article 2208(2) and (8) of the Civil Code.
• Jaka Food Processing Corp. vs. Pacot, 494 Phil. 114 (2005) — Explained the difference between just-cause and authorized-cause dismissals for purposes of nominal damages, which the Court used by analogy in awarding PHP 50,000.00.
• Agabon vs. NLRC, 485 Phil. 248 (2004) — Cited for the award of nominal damages to deter violations of procedural due process.
• Lara’s Gifts & Decors, Inc. vs. Midtown Industrial Sales, Inc., 929 Phil. 754 (2022) — Cited for the imposition of 6% per annum legal interest on the total monetary award from finality until full satisfaction.
• Kho, Sr. vs. Magbanua, 858 Phil. 409 (2019) — Cited for the definition of grave abuse of discretion and the substantial-evidence standard in labor cases.
• Chan vs. Magsaysay Maritime Corp., 872 Phil. 1061 (2020) — Cited for the requisites of moral and exemplary damages.
• Bunayog vs. Foscon Shipmanagement, Inc., 941 Phil. 383 (2023) — Recognized the employer’s right to be furnished the independent physician’s medical assessment, subject to the seafarer first being properly informed of the company-designated physician’s assessment.

• Labor Code, Articles 197 to 199 — Govern entitlement to temporary total, permanent total, and permanent partial disability benefits by law; cited as part of the legal framework for seafarer disability claims.
• Rule X, Section 2(a), Amended Rules on Employees’ Compensation — Provides the period of entitlement for income benefits and the 120/240-day framework; cited in the same framework.
• 2010 POEA-SEC, Section 20(A)(3) — Requires post-employment medical examination within three working days from repatriation, regular reporting to the company-designated physician, and payment of sickness allowance equivalent to basic wage for up to 120 days, payable at least once a month.
• 2010 POEA-SEC, Section 20(A)(4) — Creates a disputable presumption that an injury is work-related if it is not among the illnesses listed under Section 32.
• 2010 POEA-SEC, Section 20(D) — Bars compensation for injury resulting from the seafarer’s willful or criminal act or intentional breach of duties, provided the employer proves direct attribution; the Court placed the burden on respondents and found it unmet.
• 2010 POEA-SEC, Section 20(F) — Requires the employer, upon request, to furnish the seafarer a copy of all pertinent medical reports or records at no cost; respondents violated this when they failed to provide Ernesto copies.
• 2010 POEA-SEC, Section 32 — Lists occupational diseases; Ernesto’s injury was not among those listed, giving rise to the disputable presumption of work-relatedness.
• Presidential Decree No. 626, Article 178 (formerly Article 172), as amended — Provides limitations on compensability for injuries during free time or beyond regular working hours, subject to which the Employees’ Compensation Commission Board Resolution No. 24-12-40 declared such seafarer injuries compensable.
• Civil Code, Article 2221 — Defines nominal damages as those adjudicated to vindicate or recognize a violated right, not to indemnify loss; basis for the PHP 50,000.00 award.
• Labor Code, Article 111 — Governs attorney’s fees in labor cases; held inapplicable because the case involves disability compensation, not unlawful withholding of wages.
• Civil Code, Article 2208(2) and (8) — Govern attorney’s fees; held inapplicable because there was no litigation expense in relation to third persons and the action was on contract, not workmen’s compensation or employer’s liability laws.
• Republic Act No. 8042, Section 10, as amended by Republic Act No. 10022, Section 7 — Makes the principal/employer and recruitment/placement agency jointly and severally liable for money claims and extends liability to corporate officers and directors; basis for holding MMI, MMS, Capt. Briones, and MMI’s corporate officers and directors liable.
• JSU-AMOSUP Advanced CBA, Article XXI, Sections 2 and 4 — Provides that the company-appointed doctor determines disability and that 100% compensation is due if disability is 50% or more or if the company-nominated doctor certifies permanent unfitness; not applied because no such certification was issued.
• JSU-AMOSUP Advanced CBA, Article XXVII, Section 1 — Requires the company to provide accommodation, recreational facilities, and food and catering services under ILO Maritime Labour Convention 2006 Title 3; cited but held not to control work-relatedness.
• ILO Maritime Labour Convention 2006, Title 3, Standard A3.1 and Guideline B3.1.11 — Set standards for seafarers’ recreational facilities, including sports equipment where practicable; cited in the CBA analysis.
• Rules of Court, Rule 45, Section 1 — Limits a petition for review on certiorari to questions of law; the Court applied the exception for conflicting factual findings of labor tribunals and the CA.

Gesmundo, C.J. (Chairperson), Zalameda, Rosario, and Marquez, JJ., concur.