Montierro vs. Rickmers Marine Agency Phils., Inc.

The 240-day rule for assessing seafarer disability applies to maritime compensation complaints filed on or after 6 October 2008, the date Vergara vs. Hammonia was promulgated; complaints filed before that date remain governed by the 120-day rule under Crystal Shipping. When the seafarer fails to follow the POEA-SEC procedure for resolving conflicting medical assessments — specifically, the referral to a third doctor jointly agreed upon — the company-designated physician's assessment stands.

Rickmers Marine Agency Phils., Inc., acting on behalf of its foreign principal Global Management Limited, hired Noriel Montierro as an Ordinary Seaman with a basic monthly salary of USD420, assigning him to the vessel MIV CSAV Maresias. The employment relationship was governed by the 2000 POEA Standard Employment Contract, which prescribes the procedure for determining liability for work-related injury or illness of overseas Filipino seafarers, including the respective roles of the company-designated physician and the seafarer's physician of choice.

On 26 February 2010, Rickmers Marine Agency Phils., Inc., on behalf of its foreign principal Global Management Limited, hired Noriel Montierro as Ordinary Seaman with a basic monthly salary of USD420, assigning him to the vessel MIV CSAV Maresias. Sometime in May 2010, while on board the vessel and going down from a crane ladder, Montierro lost his balance and twisted his legs, injuring his right knee. On 31 May 2010, he was examined in Livorno, Spain by Dr. Roberto Santini, who recommended surgical treatment at home and found him unfit for duty. Montierro was repatriated to the Philippines on 2 June 2010 for further medical treatment.

Two days after repatriation, on 4 June 2010, Montierro reported to Dr. Natalio G. Alegre II, the company-designated physician. An MRI scan of his right knee revealed a "meniscal tear, posterior horn of the medical meniscus, and minimal joint fluid." Upon Dr. Alegre's recommendation, Montierro underwent arthroscopic partial medical meniscectomy of his right knee on 29 July 2010 at St. Luke's Medical Center. On 20 August 2010, at his second check-up, Dr. Alegre noted that the surgical wounds had healed but that pain and limitation of motion persisted on gaits and squats, and advised rehabilitation medicine and continued physical therapy.

On 3 September 2010, the 91st day of treatment, Dr. Alegre issued an interim disability grade of 10 for "stretching leg of ligaments of a knee resulting in instability of the joint," and advised Montierro to continue physical therapy and oral medications. Montierro underwent further sessions of treatment and evaluation between 17 September 2010 and 28 December 2010. On 3 January 2011, the 213th day of treatment, Dr. Alegre issued a final assessment confirming a disability grade of 10 under Section 32 of the POEA contract, for "stretching leg of the ligaments of a knee resulting in instability of the joint."

Meanwhile, on 3 December 2010 — one month before Dr. Alegre's final assessment — Montierro filed with the labor arbiter a complaint for recovery of permanent disability compensation in the amount of USD89,000, USD2,100 as sickness allowance, plus moral and exemplary damages and attorney's fees. To support his claim for total permanent disability benefits, Montierro relied on a Medical Certificate dated 3 December 2010 issued by his physician of choice, Dr. Manuel C. Jacinto, who recommended a total permanent disability grading and explained that the patient's symptoms of pain and limited flexion of the right knee persisted, rendering him physically unfit to return to work.

• Applicability of the 120-day rule: Montierro insisted that the 120-day rule laid down in Crystal Shipping, not the 240-day rule from Vergara, should apply, citing the more recent cases of Wallem Maritime Services, Inc. vs. Tanawan, Maersk Filipinas Crewing, Inc. vs. Mesina, and Valenzona vs. Fair Shipping Corp., all of which applied the Crystal Shipping doctrine despite being promulgated after Vergara.
• Primacy of personal physician's assessment: Montierro claimed that the medical assessment of his personal physician, finding his disability permanent and total, should be accorded more weight than that issued by the company-designated physician.
• Entitlement to attorney's fees: Montierro argued he was entitled to attorney's fees because he was compelled to litigate.

• Applicable disability assessment period: Whether the 120-day rule or the 240-day rule should apply to this case.
• Conflicting medical assessments: Whether the opinion of the company-designated physician or that of the seafarer's personal physician should prevail.
• Attorney's fees: Whether Montierro is entitled to attorney's fees.

• Applicable disability assessment period: The 240-day rule applies. Complaints filed on or after 6 October 2008 — the date Vergara was promulgated — are governed by the 240-day rule, while those filed before that date remain under the 120-day rule of Crystal Shipping.
• Conflicting medical assessments: The company-designated physician's assessment prevails. The seafarer failed to follow the POEA-SEC procedure for resolving conflicting assessments, specifically the referral to a third doctor jointly agreed upon by the parties.
• Attorney's fees: No. Montierro is not entitled to attorney's fees because his complaint was premature — filed one month before the company-designated physician issued a final assessment — and there was no unlawful withholding of wages.

• Applicable disability assessment period: The Court had already delineated the effectivity of the Crystal Shipping and Vergara rulings in Kestrel Shipping Co., Inc. vs. Munar (2013), explaining that the principle of prospectivity dictates that Vergara should not operate to strip a seafarer of a cause of action that had already accrued before its promulgation. Accordingly, if the maritime compensation complaint was filed prior to 6 October 2008, the 120-day rule applies; if the complaint was filed from 6 October 2008 onwards, the 240-day rule applies. Montierro filed his complaint on 3 December 2010, after Vergara was promulgated, so the 240-day rule governs. The cases Montierro cited in support of the 120-day rule — Wallem Maritime Services, Maersk Filipinas Crewing, and Valenzona — all involved complaints filed before 6 October 2008, which explains their application of the Crystal Shipping doctrine. Applying the 240-day rule, the company-designated physician's final assessment was issued on the 213th day of treatment, well within the 240-day extended period. The extension was justified because Dr. Alegre issued an interim disability grade of 10 on 3 September 2010, the 91st day, within the initial 120-day period, signaling that further medical attention was required and a final assessment could not yet be made. Montierro's condition therefore could not be deemed a permanent total disability.

• Conflicting medical assessments: Vergara definitively settled how a conflict between the company-designated physician's assessment and the seafarer's chosen physician's assessment should be resolved. The 2000 POEA-SEC prescribes a procedure: the company-designated physician determines fitness for work within 120 days, or 240 days if validly extended; if the seafarer's physician disagrees, a third doctor may be jointly agreed upon by the employer and the seafarer, whose decision shall be final and binding. This procedure must be strictly followed; otherwise, the company-designated physician's assessment stands. Montierro preempted the procedure by filing his complaint on 3 December 2010, one month before the company-designated physician issued the final disability grading on 3 January 2011. For failure to observe the POEA-SEC procedure, the company doctor's assessment prevails. Moreover, Rickmers exerted real efforts to provide medical assistance: the company-designated physician monitored Montierro's case from beginning to end, recommended and oversaw arthroscopic surgery, prescribed medications, and gave physical therapy. A comparison of the two assessments further favored the company doctor — the personal physician's certification was a one-page medical certificate that did not indicate any test or procedure performed, while the company-designated physician's finding was arrived at after regular examinations in coordination with other doctors, prescribed medications, and physical therapy and rehabilitation sessions over a seven-month period.

• Attorney's fees: The general rule is that attorney's fees may not be awarded absent a sufficient showing of bad faith in a party's persistence in a case other than an erroneous conviction of the righteousness of one's cause. In labor cases, however, the withholding of wages need not be coupled with malice or bad faith to warrant attorney's fees under Article 111 of the Labor Code; all that is required is that lawful wages be not paid without justification, thus compelling the employee to litigate. The CA relied on the wrong consideration — absence of bad faith — but even applying the correct labor-law rule, Montierro was not entitled to attorney's fees. He filed his complaint prematurely, one month before the company-designated physician issued the final disability grading. Because he was still under treatment and awaiting final assessment, there was no unlawful withholding of benefits to speak of.

• 120-day vs. 240-day rule for seafarer disability assessment — Under the 120-day rule from Crystal Shipping, Inc. vs. Natividad (2005), a seafarer's inability to perform work for more than 120 days equates to permanent total disability. Under the 240-day rule from Vergara vs. Hammonia Maritime Services, Inc. (2008), the period is extended to 240 days when, within the first 120-day period, a final assessment cannot be made because the seafarer requires further medical attention, provided a declaration to that effect has been made. The Court in Kestrel Shipping Co., Inc. vs. Munar (2013) resolved the prospectivity issue: if the complaint was filed before 6 October 2008, the 120-day rule applies; if filed on or after that date, the 240-day rule applies. In this case, the complaint was filed on 3 December 2010, so the 240-day rule governed, and the company doctor's assessment on the 213th day was within the extended period.

• Primacy of company-designated physician's assessment — Under the 2000 POEA-SEC, when a seafarer sustains a work-related illness or injury, fitness for work is determined by the company-designated physician, who has 120 days (or 240 days if validly extended) to make the assessment. If the seafarer's chosen physician disagrees, a third doctor may be jointly agreed upon by the employer and the seafarer, whose decision shall be final and binding. If the seafarer fails to avail of or strictly follow this procedure, the company-designated physician's assessment stands. The company-designated physician's assessment is also entitled to greater weight when it is based on regular examinations, coordination with other doctors, prescribed medications, and physical therapy over an extended period, as contrasted with a bare one-page certification from the seafarer's personal physician.

• Attorney's fees in labor cases for unlawful withholding of wages — Under Article 111 of the Labor Code, in cases of unlawful withholding of wages, attorney's fees equivalent to ten percent of the amount recovered may be assessed. The withholding of wages need not be coupled with malice or bad faith; all that is required is that lawful wages be not paid without justification, compelling the employee to litigate. However, no attorney's fees are warranted when the employee's claim is premature — filed before the employer's obligation to pay has accrued — because there is no unlawful withholding to speak of.

• "Thus, based on Kestrel, if the maritime compensation complaint was filed prior to 6 October 2008, the 120-day rule applies; if, on the other hand, the complaint was filed from 6 October 2008 onwards, the 240-day rule applies." — This passage states the controlling rule for determining which disability assessment period governs a seafarer's claim, establishing the prospectivity cut-off date based on the promulgation of Vergara.

• "Vergara ruled that the procedure in the 2000 POEA-SEC must be strictly followed; otherwise, if not availed of or followed strictly by the seafarer, the assessment of the company-designated physician stands." — This articulates the mandatory nature of the POEA-SEC third-doctor referral procedure and the consequence of the seafarer's failure to comply.

• "Montierro, however, preempted the procedure when he filed on 3 December 2010 a Complaint for permanent disability benefits based on his chosen physician's assessment, which was made one month before the company-designated doctor issued the final disability grading on 3 January 2011, the 213th day of Montierro's treatment. Hence, for failure of Montierro to observe the procedure provided by the POEA-SEC, the assessment of the company doctor should prevail." — This applies the POEA-SEC procedure to the facts, explaining why the company-designated physician's Grade 10 assessment controls over the personal physician's total permanent disability finding.

• "Montierro, as earlier mentioned, jumped the gun when he filed his complaint one month before the company-designated doctor issued the final disability grading. Hence, there was no unlawful withholding of benefits to speak of. Precisely because Montierro was still under treatment and awaiting the final assessment of the company-designated physician, the former's act was premature." — This explains the denial of attorney's fees on the ground that the premature filing negated any unlawful withholding of wages.

• Crystal Shipping, Inc. vs. Natividad, 510 Phil. 332 (2005) — Originated the 120-day rule equating a seafarer's inability to perform work for more than 120 days to permanent total disability. The Court distinguished this case as applicable only to complaints filed before 6 October 2008.
• Vergara vs. Hammonia Maritime Services, Inc., 588 Phil. 895 (2008) — Introduced the 240-day rule, extending the assessment period when further medical attention is required within the initial 120 days. Also established the procedure for resolving conflicting physician assessments under the 2000 POEA-SEC. Applied as the controlling rule for complaints filed on or after 6 October 2008.
• Kestrel Shipping Co., Inc. vs. Munar, G.R. No. 198501, 30 January 2013, 689 SCRA 795 — Resolved the prospectivity issue between Crystal Shipping and Vergara, setting the cut-off date of 6 October 2008. Applied directly to determine that the 240-day rule governs Montierro's complaint.
• Wallem Maritime Services, Inc. vs. Tanawan, G.R. No. 160444, 29 August 2012 — Cited by petitioner as applying the 120-day rule after Vergara, but distinguished by the Court because the complaint therein was filed on 26 November 1998, before Vergara.
• Maersk Filipinas Crewing, Inc. vs. Mesina, G.R. No. 200837, 5 June 2013 — Cited by petitioner but distinguished because the LA's Decision was rendered on 14 April 2008, before Vergara was promulgated.
• Valenzona vs. Fair Shipping Corp., G.R. No. 176884, 19 October 2011 — Cited by petitioner but distinguished because the complaint was filed sometime before 31 January 2003, before Vergara.
• Philman Marine Agency, Inc. vs. Cabanban, G.R. No. 186509, 29 July 2013, 702 SCRA 467 — Cited as having reiterated the Vergara ruling on the POEA-SEC procedure for conflicting assessments.
• Philippine Hammonia Ship Agency, Inc. vs. Dumadag, G.R. No. 194362, 26 June 2013 — Cited as having reiterated the Vergara ruling on the POEA-SEC procedure for conflicting assessments.
• Car Cool Philippines, Inc. vs. Ushio Realty & Development Corp., 515 Phil. 376 (2006) — Cited for the general rule that attorney's fees may not be awarded absent bad faith in a party's persistence in a case.
• Kaisahan at Kapatiran ng mga Manggagawa at Kawani sa MWC-East Zone Union vs. Manila Water Company, Inc., G.R. No. 174179, 16 November 2011, 660 SCRA 263 — Cited for the labor-law rule that withholding of wages need not be coupled with malice or bad faith to warrant attorney's fees under Article 111 of the Labor Code.

• Section 32, 2000 POEA Standard Employment Contract — Prescribes the schedule of disability gradings for work-related injuries and illnesses. Dr. Alegre applied this provision in assigning a Grade 10 disability for "stretching leg of the ligaments of a knee resulting in instability of the joint," classified under Lower Extremities #20.
• Articles 191–193, Labor Code, as amended, in relation to Section 2, Rule X, Rules and Regulations Implementing Book IV of the Labor Code — Provide the legal basis for the extension of the disability assessment period to 240 days under the POEA-SEC, as referenced in Vergara.
• Article 111, Labor Code — Governs attorney's fees in cases of unlawful withholding of wages, permitting assessment of attorney's fees equivalent to ten percent of the amount of wages recovered. The Court applied this provision but found no unlawful withholding because Montierro's complaint was premature.

Teresita J. Leonardo-De Castro, Lucas P. Bersamin, Jose Portugal Perez, and Estela M. Perlas-Bernabe concurred.