J.A.B. Bulao & Associates

CASE 2011-0240: JAIME ABALOS AND SPOUSES FELIX SALAZAR AND CONSUELO SALAZAR, GLICERIO ABALOS, HEIRS OF AQUILINO ABALOS, NAMELY: SEGUNDA BAUTISTA, ROGELIO ABALOS, DOLORES A. ROSARIO, FELICIDAD ABALOS, ROBERTO ABALOS, JUANITO ABALOS, TITA ABALOS, LITA A. DELA CRUZ AND HEIRS OF AQUILINA ABALOS, NAMELY: ARTURO BRAVO, PURITA B. MENDOZA, LOURDES B. AGANON, CONSUELO B. SALAZAR, PRIMA B. DELOS SANTOS, THELMA APOSTOL AND GLECERIO ABALOS VS. HEIRS OF VICENTE TORIO, NAMELY: PUBLIO TORIO, LIBORIO TORIO, VICTORINA TORIO, ANGEL TORIO, LADISLAO TORIO, PRIMO TORIO AND NORBERTO TORIO (G.R. NO. 175444, 14 DECEMBER 2011, PERALTA, J.) SUBJECT/S: ORDINARY AND EXTRAORDINARY ACQUISITIVE PRESCRIPTION; EFFECT OF NOTARIZATION; WHEN SC CAN REVIEW FINDINGS OF FACT. (BRIEF TITLE: ABALOS VS. HEIRS OF TORIO).

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DISPOSITIVE:

WHEREFORE, the petition is DENIED. The assailed Decision and Resolution of the Court of Appeals in CA-G.R. SP No. 91887 are AFFIRMED.

SO ORDERED.

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SUBJECT/DOCTRINE/DIGEST:

WHAT ARE THE 2 KINDS OF ACQUISITIVE PRESCRIPTION?

ORDINARY AND EXTRAORDINARY.

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WHAT IS ORDINARY ACQUISITIVE PRESCRIPTION?

ORDINARY  ACQUISITIVE PRESCRIPTION REQUIRES;

1. 1.     POSSESSION IN GOOD FAITH AND

1. 2.     WITH JUST TITLE FOR TEN (10) YEARS.¹⁷

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WHAT IS EXTRAORDINARY ACQUISITIVE PRESCRIPTION?

IT REQUIRES:

1. 1.               WITHOUT GOOD FAITH;

1. 2.               WITHOUT JUST TITLE;

1. 3.               UNINTERRUPTED ADVERSE POSSESSION FOR 30 YEARS.

Acquisitive prescription of dominion and other real rights may be ordinary or extraordinary.¹⁶ Ordinary acquisitive prescription requires possession in good faith and with just title for ten (10) years.¹⁷ Without good faith and just title, acquisitive prescription can only be extraordinary in character which requires uninterrupted adverse possession for thirty (30) years.¹⁸

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WHAT IS POSSESSION IN GOOD FAITH?

IT CONSISTS IN THE REASONABLE BELIEF THAT THE PERSON FROM WHOM THE THING IS RECEIVED HAS BEEN THE OWNER THEREOF, AND COULD TRANSMIT HIS OWNERSHIP.¹⁹

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WHEN IS THERE JUST TITLE?

WHEN AN ADVERSE CLAIMANT CAME INTO POSSESSION OF THE PROPERTY THROUGH ONE OF THE MODES RECOGNIZED BY LAW FOR THE ACQUISITION OF OWNERSHIP OR OTHER REAL RIGHTS, BUT THE GRANTOR WAS NOT THE OWNER OR COULD NOT TRANSMIT ANY RIGHT.²⁰

Possession “in good faith” consists in the reasonable belief that the person from whom the thing is received has been the owner thereof, and could transmit his ownership.¹⁹ There is “just title” when the adverse claimant came into possession of the property through one of the modes recognized by law for the acquisition of ownership or other real rights, but the grantor was not the owner or could not transmit any right.²⁰

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IS PETITIONER THE OWNER OF SUBJECT LAND BY ORDINARY ACQUISITIVE PRESCRIPTION?

NO, BECAUSE HE ACKNOWLEDGED THAT THE OWNER WAS ANOTHER PERSON WHO MERELY TOLERATED HIS OCCUPATION OF THE THE PROPERTY.

ACTS OF POSSESSORY CHARACTER EXECUTED DUE TO LICENSE OR BY MERE TOLERANCE OF THE OWNER ARE INADEQUATE FOR PURPOSES OF ACQUISITIVE PRESCRIPTION.²²

POSSESSION, TO CONSTITUTE THE FOUNDATION OF A PRESCRIPTIVE RIGHT, MUST BE EN CONCEPTO DE DUEÑO, OR, TO USE THE COMMON LAW EQUIVALENT OF THE TERM, THAT POSSESSION SHOULD BE ADVERSE, IF NOT, SUCH POSSESSORY ACTS, NO MATTER HOW LONG, DO NOT START THE RUNNING OF THE PERIOD OF PRESCRIPTION.²³

In the instant case, it is clear that during their possession of the property in question, petitioners acknowledged ownership thereof by the immediate predecessor-in-interest of respondents. This is clearly shown by the Tax Declaration in the name of Jaime for the year 1984 wherein it contains a statement admitting that Jaime’s house was built on the landof Vicente, respondents’ immediate predecessor-in-interest.²¹ Petitioners never disputed such an acknowledgment. Thus, having knowledge that they nor their predecessors-in-interest are not the owners of the disputed lot, petitioners’ possession could not be deemed as possession in good faith as to enable them to acquire the subject land by ordinary prescription. In this respect, the Court agrees with the CA that petitioners’ possession of the lot in question was by mere tolerance of respondents and their predecessors-in-interest. Acts of possessory character executed due to license or by mere tolerance of the owner are inadequate for purposes of acquisitive prescription.²² Possession, to constitute the foundation of a prescriptive right, must be en concepto de dueño, or, to use the common law equivalent of the term, that possession should be adverse, if not, such possessory acts, no matter how long, do not start the running of the period of prescription.²³

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CAN PETITIONERS’ POSSESSION OF  SUBJECT PROPERTY BE CONSIDERED EXTRAORDINARY ACQUISITIVE PRESCRIPTION?

NO. BECAUSE THEIR EARLIEST TAX DECLARATION WAS IN 1974. FROM SUCH DATE THE 30 YEAR PERIOD ENDS IN 2004. BUT THE CASE WAS FILED IN 1996.

Moreover, the CA correctly held that even if the character of petitioners’ possession of the subject property had become adverse, as evidenced by their declaration of the same for tax purposes under the names of their predecessors-in-interest, their possession still falls short of the required period of thirty (30) years in cases of extraordinary acquisitive prescription. Records show that the earliest Tax Declaration in the name of petitioners was in 1974. Reckoned from such date, the thirty-year period was completed in 2004. However, herein respondents’ complaint was filed in 1996, effectively interrupting petitioners’ possession upon service of summons on them.²⁴ Thus, petitioners’ possession also did not ripen into ownership, because they failed to meet the required statutory period of extraordinary prescription.

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WHAT EVIDENCE IS REQUIRED IN ESTABLISHING PRESCRIPTION?

CLEAR, COMPLETE AND CONCLUSIVE.

This Court has held that the evidence relative to the possession upon which the alleged prescription is based, must be clear, complete and conclusive in order to establish the prescription.²⁵ In the present case, the Court finds no error on the part of the CA in holding that petitioners failed to present competent evidence to prove their alleged good faith in neither possessing the subject lot nor their adverse claim thereon. Instead, the records would show that petitioners’ possession was by mere tolerance of respondents and their predecessors-in-interest.

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PETITIONERS ATTACKED THE DUE EXECUTION AND AUTHENTICITY OF THE DEED OF SALE OF RESPONDENTS IN THEIR COMMENT TO RESPONDENTS’ PETITION FOR REVIEW FILED AT CA. IS THIS PROPER.

NO. POINTS OF LAW, THEORIES, ISSUES, AND ARGUMENTS NOT ADEQUATELY BROUGHT TO THE ATTENTION OF THE TRIAL COURT NEED NOT BE, AND ORDINARILY WILL NOT BE, CONSIDERED BY A REVIEWING COURT.²⁶ THEY CANNOT BE RAISED FOR THE FIRST TIME ON APPEAL.

Finally, as to the issue of whether the due execution and authenticity of the deed of sale upon which respondents anchor their ownership were not proven, the Court notes that petitioners did not raise this matter in their Answer as well as in their Pre-Trial Brief. It was only in their Comment to respondents’ Petition for Review filed with the CA that they raised this issue. Settled is the rule that points of law, theories, issues, and arguments not adequately brought to the attention of the trial court need not be, and ordinarily will not be, considered by a reviewing court.²⁶ They cannot be raised for the first time on appeal. To allow this would be offensive to the basic rules of fair play, justice and due process.²⁷

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SUPPOSE THE ISSUE OF DUE EXECUTION AND AUTHENTICITY OF THE SUBJECT DEED OF SALE WAS PROPERLY RAISED, WILL THE FINDINGS OF THE C.A. BE REVERSED?

NO. BECAUSE THE DEED OF SALE WAS NOTARIZED.

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WHAT IS THE EFFECT OF THE NOTARIZATION OF THE DEED OF SALE?

A NOTARIZED DOCUMENT HAS IN ITS FAVOR THE PRESUMPTION OF REGULARITY, AND TO OVERCOME THE SAME, THERE MUST BE EVIDENCE THAT IS CLEAR, CONVINCING AND MORE THAN MERELY PREPONDERANT; OTHERWISE, THE DOCUMENT SHOULD BE UPHELD.²⁹

Even granting that the issue of due execution and authenticity was properly raised, the Court finds no cogent reason to depart from the findings of the CA, to wit:

x x x x

Based on the foregoing, respondents [Jaime Abalos and the Spouses Felix and Consuelo Salazar] have not inherited the disputed land because the same was shown to have already been validly sold to Marcos Torio, who, thereupon, assigned the same to his son Vicente, the father of petitioners [herein respondents]. A valid sale was amply established and the said validity subsists because the deed evidencing the same was duly notarized.

There is no doubt that the deed of sale was duly acknowledged before a notary public. As a notarized document, it has in its favor the presumption of regularity and it carries the evidentiary weight conferred upon it with respect to its due execution. It is admissible in evidence without further proof of its authenticity and is entitled to full faith and credit upon its face.²⁸

Indeed, settled is the rule in our jurisdiction that a notarized document has in its favor the presumption of regularity, and to overcome the same, there must be evidence that is clear, convincing and more than merely preponderant; otherwise, the document should be upheld.²⁹ In the instant case, petitioners’ bare denials will not suffice to overcome the presumption of regularity of the assailed deed of sale.

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THE  THE ISSUE OF WHETHER PETITIONERS POSSESS THE SUBJECT PROPERTY AS OWNERS, OR WHETHER THEY OCCUPY THE SAME BY MERE TOLERANCE OF RESPONDENTS, IS A QUESTION OF FACT. IS CA RULING ON THIS REVIEWABLE BY THE SUPREME COURT?

ORDINARILY NO. BUT THERE ARE EXCEPTIONS AS FOLLOWS:

(a) When the findings are grounded entirely on speculation, surmises, or conjectures;

(b) When the inference made is manifestly mistaken, absurd, or impossible;

(c) When there is grave abuse of discretion;

(d) When the judgment is based on a misapprehension of facts;

(e) When the findings of facts are conflicting;

(f) When in making its findings the CA went beyond the issues of the case, or its findings are contrary to the admissions of both the appellant and the appellee;

(g) When the CA’s findings are contrary to those by the trial court;

(h) When the findings are conclusions without citation of specific evidence on which they are based;

(i) When the facts set forth in the petition as well as in the petitioner’s main and reply briefs are not disputed by the respondent;

(j) When the findings of fact are premised on the supposed absence of evidence and contradicted by the evidence on record; or

(k) When the CA manifestly overlooked certain relevant facts not disputed by the parties, which, if properly considered, would justify a different conclusion.¹⁵

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Republic of thePhilippines

Supreme Court

Manila

THIRD DIVISION

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D E C I S I O N

PERALTA, J.:

Before the Court is a petition for review on certiorari seeking to set aside the Decision¹ dated June 30, 2006 and Resolution² dated November 13, 2006 by the Court of Appeals (CA) in CA-G.R. SP No. 91887. The assailed Decision reversed and set aside the Decision³ dated June 14, 2005 of the Regional Trial Court (RTC) of Lingayen, Pangasinan, Branch 69, while the questioned Resolution denied petitioners’ Motion for Reconsideration.

The factual and procedural antecedents of the case are as follows:

On July 24, 1996, herein respondents filed a Complaint for Recovery of Possession and Damages with the Municipal Trial Court (MTC) of Binmaley, Pangasinan against Jaime Abalos (Jaime) and the spouses Felix and Consuelo Salazar. Respondents contended that: they are the children and heirs of one Vicente Torio (Vicente) who died intestate on September 11, 1973; at the time of the death of Vicente, he left behind a parcel of land measuring 2,950 square meters, more or less, which is located at San Isidro Norte, Binmaley, Pangasinan; during the lifetime of Vicente and through his tolerance, Jaime and the Spouses Salazar were allowed to stay and build their respective houses on the subject parcel of land; even after the death of Vicente, herein respondents allowed Jaime and the Spouses Salazar to remain on the disputed lot; however, in 1985, respondents asked Jaime and the Spouses Salazar to vacate the subject lot, but they refused to heed the demand of respondents forcing respondents to file the complaint.⁴

Jaime and the Spouses Salazar filed their Answer with Counterclaim, denying the material allegations in the Complaint and asserting in their Special and Affirmative Defenses that: respondents’ cause of action is barred by acquisitive prescription; the court a quo has no jurisdiction over the nature of the action and the persons of the defendants; the absolute and exclusive owners and possessors of the disputed lot are the deceased predecessors of defendants; defendants and their predecessors-in-interest had been in actual, continuous and peaceful possession of the subject lot as owners since time immemorial; defendants are faithfully and religiously paying real property taxes on the disputed lot as evidenced by Real Property Tax Receipts; they have continuously introduced improvements on the said land, such as houses, trees and other kinds of ornamental plants which are in existence up to the time of the filing of their Answer.⁵

On the same date as the filing of defendants’ Answer with Counterclaim, herein petitioners filed their Answer in Intervention with Counterclaim. Like the defendants, herein petitioners claimed that their predecessors-in-interest were the absolute and exclusive owners of the land in question; that petitioners and their predecessors had been in possession of the subject lot since time immemorial up to the present; they have paid real property taxes and introduced improvements thereon.⁶

After the issues were joined, trial ensued.

On December 10, 2003, the MTC issued a Decision, the dispositive portion of which reads as follows:

WHEREFORE, in view of the foregoing consideration[s], the Court adjudged the case in favor of the plaintiffs and against the defendants and defendants-intervenors are ordered to turn over the land in question to the plaintiffs (Lot Nos. 869 and 870, Cad. 467-D. Binmaley Cadastre located in Brgy. San Isidro Norte, Binmaley, Pangasinan with an area of 2,950 sq. m., more or less, bounded and described in paragraph 3 of the Complaint[)]; ordering the defendants and defendants-intervenors to remove their respective houses standing on the land in dispute; further ordering the defendants and defendants-intervenors, either singly or jointly to pay the plaintiffs land rent in the amount of P12,000.00 per year to be reckoned starting the year 1996 until defendants and defendants-intervenors will finally vacate the premises; furthermore, defendants and defendants-intervenors are also ordered to pay, either singly or jointly, the amount of P10,000.00 as and by way of attorney’s fees and costs of suit.

SO ORDERED.⁷

Jaime and the Spouses Salazar appealed the Decision of the MTC with the RTC of Lingayen, Pangasinan.⁸ Herein petitioners, who were intervenors, did not file an appeal.

In its Decision dated June 14, 2005, the RTC ruled in favor of Jaime and the Spouses Salazar, holding that they have acquired the subject property through prescription. Accordingly, the RTC dismissed herein respondents’ complaint.

Aggrieved, herein respondents filed a petition for review with the CA assailing the Decision of the RTC.

On June 30, 2006, the CA promulgated its questioned Decision, the dispositive portion of which reads, thus:

WHEREFORE, the petition is GRANTED. The Decision dated June 14, 2005 of the Regional Trial Court, Branch 69, Lingayen, Pangasinan is hereby REVERSED and SET ASIDE. In its stead, a new one is entered reinstating the Decision dated December 10, 2003 of the Municipal Trial Court of Binmaley, Pangasinan.

SO ORDERED.⁹

Jaime and the Spouses Salazar filed a Motion for Reconsideration, but the same was denied by the CA in its Resolution dated November 13, 2006.

Hence, the instant petition based on a sole assignment of error, to wit:

THE COURT OF APPEALS ERRED IN NOT APPRECIATING THAT THE PETITIONERS HEREIN ARE NOW THE ABSOLUTE AND EXCLUSIVE OWNERS OF THE LAND IN QUESTION BY VIRTUE OF ACQUISITIVE PRESCRIPTION.¹⁰

The main issue raised by petitioners is whether they and their predecessors-in-interest possessed the disputed lot in the concept of an owner, or whether their possession is by mere tolerance of respondents and their predecessors-in-interest. Corollarily, petitioners claim that the due execution and authenticity of the deed of sale upon which respondents’ predecessors-in-interest derived their ownership were not proven during trial.

The petition lacks merit.

Preliminarily, the Court agrees with the observation of respondents that some of the petitioners in the instant petition were the intervenors¹¹ when the case was filed with the MTC. Records would show that they did not appeal the Decision of the MTC.¹² The settled rule is that failure to perfect an appeal renders the judgment final and executory.¹³ Hence, insofar as the intervenors in the MTC are concerned, the judgment of the MTC had already become final and executory.

It also bears to point out that the main issue raised in the instant petition, which is the character or nature of petitioners’ possession of the subject parcel of land, is factual in nature.

Settled is the rule that questions of fact are not reviewable in petitions for review on certiorari under Rule 45 of the Rules of Court.¹⁴ Section 1 of Rule 45 states that petitions for review on certiorari “shall raise only questions of law which must be distinctly set forth.”

Doubtless, the issue of whether petitioners possess the subject property as owners, or whether they occupy the same by mere tolerance of respondents, is a question of fact. Thus, it is not reviewable.

Nonetheless, the Court has, at times, allowed exceptions from the abovementioned restriction. Among the recognized exceptions are the following:

(a) When the findings are grounded entirely on speculation, surmises, or conjectures;

(b) When the inference made is manifestly mistaken, absurd, or impossible;

(c) When there is grave abuse of discretion;

(d) When the judgment is based on a misapprehension of facts;

(e) When the findings of facts are conflicting;

(f) When in making its findings the CA went beyond the issues of the case, or its findings are contrary to the admissions of both the appellant and the appellee;

(g) When the CA’s findings are contrary to those by the trial court;

(h) When the findings are conclusions without citation of specific evidence on which they are based;

(i) When the facts set forth in the petition as well as in the petitioner’s main and reply briefs are not disputed by the respondent;

(j) When the findings of fact are premised on the supposed absence of evidence and contradicted by the evidence on record; or

(k) When the CA manifestly overlooked certain relevant facts not disputed by the parties, which, if properly considered, would justify a different conclusion.¹⁵

In the present case, the findings of fact of the MTC and the CA are in conflict with those of the RTC.

After a review of the records, however, the Court finds that the petition must fail as it finds no error in the findings of fact and conclusions of law of the CA and the MTC.

Petitioners claim that they have acquired ownership over the disputed lot through ordinary acquisitive prescription.

Acquisitive prescription of dominion and other real rights may be ordinary or extraordinary.¹⁶ Ordinary acquisitive prescription requires possession in good faith and with just title for ten (10) years.¹⁷ Without good faith and just title, acquisitive prescription can only be extraordinary in character which requires uninterrupted adverse possession for thirty (30) years.¹⁸

Possession “in good faith” consists in the reasonable belief that the person from whom the thing is received has been the owner thereof, and could transmit his ownership.¹⁹ There is “just title” when the adverse claimant came into possession of the property through one of the modes recognized by law for the acquisition of ownership or other real rights, but the grantor was not the owner or could not transmit any right.²⁰

In the instant case, it is clear that during their possession of the property in question, petitioners acknowledged ownership thereof by the immediate predecessor-in-interest of respondents. This is clearly shown by the Tax Declaration in the name of Jaime for the year 1984 wherein it contains a statement admitting that Jaime’s house was built on the landof Vicente, respondents’ immediate predecessor-in-interest.²¹ Petitioners never disputed such an acknowledgment. Thus, having knowledge that they nor their predecessors-in-interest are not the owners of the disputed lot, petitioners’ possession could not be deemed as possession in good faith as to enable them to acquire the subject land by ordinary prescription. In this respect, the Court agrees with the CA that petitioners’ possession of the lot in question was by mere tolerance of respondents and their predecessors-in-interest. Acts of possessory character executed due to license or by mere tolerance of the owner are inadequate for purposes of acquisitive prescription.²² Possession, to constitute the foundation of a prescriptive right, must be en concepto de dueño, or, to use the common law equivalent of the term, that possession should be adverse, if not, such possessory acts, no matter how long, do not start the running of the period of prescription.²³

Moreover, the CA correctly held that even if the character of petitioners’ possession of the subject property had become adverse, as evidenced by their declaration of the same for tax purposes under the names of their predecessors-in-interest, their possession still falls short of the required period of thirty (30) years in cases of extraordinary acquisitive prescription. Records show that the earliest Tax Declaration in the name of petitioners was in 1974. Reckoned from such date, the thirty-year period was completed in 2004. However, herein respondents’ complaint was filed in 1996, effectively interrupting petitioners’ possession upon service of summons on them.²⁴ Thus, petitioners’ possession also did not ripen into ownership, because they failed to meet the required statutory period of extraordinary prescription.

This Court has held that the evidence relative to the possession upon which the alleged prescription is based, must be clear, complete and conclusive in order to establish the prescription.²⁵ In the present case, the Court finds no error on the part of the CA in holding that petitioners failed to present competent evidence to prove their alleged good faith in neither possessing the subject lot nor their adverse claim thereon. Instead, the records would show that petitioners’ possession was by mere tolerance of respondents and their predecessors-in-interest.

Finally, as to the issue of whether the due execution and authenticity of the deed of sale upon which respondents anchor their ownership were not proven, the Court notes that petitioners did not raise this matter in their Answer as well as in their Pre-Trial Brief. It was only in their Comment to respondents’ Petition for Review filed with the CA that they raised this issue. Settled is the rule that points of law, theories, issues, and arguments not adequately brought to the attention of the trial court need not be, and ordinarily will not be, considered by a reviewing court.²⁶ They cannot be raised for the first time on appeal. To allow this would be offensive to the basic rules of fair play, justice and due process.²⁷

Even granting that the issue of due execution and authenticity was properly raised, the Court finds no cogent reason to depart from the findings of the CA, to wit:

x x x x

Based on the foregoing, respondents [Jaime Abalos and the Spouses Felix and Consuelo Salazar] have not inherited the disputed land because the same was shown to have already been validly sold to Marcos Torio, who, thereupon, assigned the same to his son Vicente, the father of petitioners [herein respondents]. A valid sale was amply established and the said validity subsists because the deed evidencing the same was duly notarized.

There is no doubt that the deed of sale was duly acknowledged before a notary public. As a notarized document, it has in its favor the presumption of regularity and it carries the evidentiary weight conferred upon it with respect to its due execution. It is admissible in evidence without further proof of its authenticity and is entitled to full faith and credit upon its face.²⁸

Indeed, settled is the rule in our jurisdiction that a notarized document has in its favor the presumption of regularity, and to overcome the same, there must be evidence that is clear, convincing and more than merely preponderant; otherwise, the document should be upheld.²⁹ In the instant case, petitioners’ bare denials will not suffice to overcome the presumption of regularity of the assailed deed of sale.

WHEREFORE, the petition is DENIED. The assailed Decision and Resolution of the Court of Appeals in CA-G.R. SP No. 91887 are AFFIRMED.

SO ORDERED.

DIOSDADO M. PERALTA

Associate Justice

WE CONCUR:

PRESBITERO J. VELASCO, JR.

Associate Justice

Chairperson

ROBERTO A. ABAD JOSE CATRAL MENDOZA

Associate Justice Associate Justice

ESTELA M. PERLAS-BERNABE

Associate Justice

ATTESTATION

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 Court’s Division.

PRESBITERO J. VELASCO, JR.

Associate Justice

Third Division, Chairperson

CERTIFICATION

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 Court’s Division.

RENATO C. CORONA

Chief Justice

1Penned by Associate Justice Magdangal M. de Leon, with Associate Justices Godardo A. Jacinto and Rosalinda Asuncion-Vicente, concurring ; Annex “J” to Petition, rollo, pp. 87-98.

2Penned by Associate Justice Magdangal M. de Leon, with Associate Justices Asuncion-Vicente and Vicente S.E. Veloso, concurring; Annex “L” to Petition, id. at 107-109.

3Records, pp. 316-324.

4Id. at 1-3.

5Id. at 34-39.

6Id. at 10-16.

7Id. at 273.

8See Notice of Appeal, id. at 274.

9CA rollo, p. 94

10Rollo, p. 8.

11Except for Jaime Abalos and the spouses Felix and Consuelo Salazar, all petitioners in the instant petition were intervenors in the case filed with the MTC.

12See Notice of Appeal, records, p. 274.

13Province of Camarines Sur v. Heirs of Agustin Pato, G.R. No. 151084, July 2, 2010, 622 SCRA 644, 652, citing M.A. Santander Construction, Inc. v. Villanueva, G.R. No. 136477, November 10, 2004, 441 SCRA 525, 530.

14Heirs of Felicidad Vda. de Dela Cruz v. Heirs of Pedro T. Fajardo, G.R. No. 184966, May 30, 2011, 649 SCRA 463, 470.

15Spouses. Andrada v. Pilhino Sales Corporation, G.R. No. 156448, February 23, 2011, 644 SCRA 1, 10.

16Civil Code, Art. 1117.

17Civil Code, Art. 1134.

18Civil Code, Art. 1137; Tan v. Ramirez, G.R. No. 158929, August 3, 2010, 626 SCRA 327, 336; Aguirre v. Heirs of Lucas Villanueva, G.R. No. 169898, October 27, 2006, 505 SCRA 855, 860.

19Villanueva v. Branoco, G.R. No. 172804, January 24, 2011, 640 SCRA 308, 320; Imuan v. Cereno, G.R. No. 167995, September 11, 2009, 599 SCRA 423, 433.

20Id.

21Exhibit “K,” records, p. 264.

22Lamsis v. Donge-e, G.R. No. 173021, October 20, 2010, 634 SCRA 154, 172.

23Esguerra v. Manantan, G.R. No. 158328, February 23, 2007, 516 SCRA 561, 573; Marcelo v. Court of Appeals, G.R. No. 131803, April 14, 1999, 305 SCRA 800, 807-808.

24Article 1120 of the Civil Code provides that “[p]ossession is interrupted for the purposes of prescription, naturally or civilly.” Article 1123 of the same Code further provides that “[c]ivil interruption is produced by judicial summons to the possessor.”

25Heirs of Juanita Padilla v. Magdua, G.R. No. 176858, September 15, 2010, 630 SCRA 573, 584.

26American Home Insurance Co. of New York v. F.F. Cruz & Co., Inc., G.R. No. 174926, August 10, 2011.

27Id.

28CA rollo, pp. 91-92.

29Spouses Palada v. Solidbank Corporation, G.R. No. 172227, June 29, 2011; Emilio v. Rapal, G.R. No. 181855, March 30, 2010, 617 SCRA 199, 202-203; Heirs of the Deceased Spouses Vicente S. Arcilla and Josefa Asuncion Arcilla v. Teodoro, G.R. No. 162886, August 11, 2008, 561 SCRA 545, 564.

CASE 2011-0239:  JEBSENS MARITIME INC., represented by MS. ARLENE ASUNCION and/or ALLIANCE MARINE SERVICES, LTD. VS. ENRIQUE UNDAG (G.R. NO. 191491, 14 DECEMBER 2011, MENDOZA, J.) SUBJECT: DISABILITY BENEFITS TO SEAMEN. (BRIEF TITLE: JEBSENS VS. UNDAG).

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DISPOSITIVE:

WHEREFORE, the petition is GRANTED. The September 16, 2009 Decision of the Court of Appeals and its March 3, 2010 Resolution are hereby REVERSED and SET ASIDE, and the October 17, 2005 and January 24, 2006 Resolutions of the National Labor Relations Commission are REINSTATED.

SO ORDERED.

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Republic of thePhilippines

Supreme Court

Manila

THIRD DIVISION

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D E C I S I O N

MENDOZA, J.:

This petition for review assails the September 16, 2009 Decision^[1][1] and the March 3, 2010 Resolution^[2][2] of the Court of Appeals (CA), which set aside the October 17, 2005 and January 24, 2006 Resolutions of the National Labor Relations Commission (NLRC), dismissing the complaint of respondent Enrique Undag (respondent) for disability benefits.

Records bear out that respondent was hired as Lead Operator on board the vessel FPSO Jamestown owned by Alliance Marine Services, Ltd. and managed by its local agent, Jebsens Maritime, Inc. (petitioners). Respondent’s contract with petitioners was for a period of four (4) months with a basic salary of US$806.00 a month. He was deployed on March 24, 2003 and eventually repatriated to thePhilippines on July 18, 2003 after his contract with the petitioners had expired.

On September 24, 2003, about two months after repatriation, he went to see a physician, Dr. Efren Vicaldo (Dr. Vicaldo), for a physical check-up and was diagnosed to have “Hypertensive cardiovascular disease, Atrial Fibrillation, Diabetes Mellitus II, Impediment Grade X (20.15%).” According to Dr. Vicaldo, respondent had a history of hypertension and diabetes and was at risk of developing a stroke, coronary artery disease and congestive heart failure. He likewise stated that respondent’s ailment was aggravated by his work as a seaman and that he was no longer fit for work. For said reason, respondent requested for financial assistance from petitioners but the latter denied his request.

Constrained, he filed a complaint for sickness benefits against petitioners before the NLRC, alleging that he had been suffering from chest pains and difficulty of breathing since July 2003 when he was on board petitioners’ vessel. Despite knowing his bad physical condition upon repatriation, the petitioners did not give him any financial assistance. Thus,  he prayed that petitioners be ordered to reimburse him for his medical expenses and pay him sickness allowance amounting to US$3,224.00, including damages and attorney’s fees.

Petitioners countered that respondent was not entitled to disability benefits because his repatriation was not due to medical reasons but due to the expiration of his employment contract. Petitioners basically argued that, under the POEA Standard Employment Contract (POEA-SEC), a seafarer was entitled to disability benefits only if he had suffered a work-related illness during the term of his contract.

On June 30, 2005, after due hearing, the Labor Arbiter (LA) rendered a decision ordering petitioners to pay, jointly and severally, respondent the Philippine peso equivalent of US$60,000.00 representing total permanent disability compensation benefits for US$3,224.00 sickness allowance, and 10% attorney’s fees.

On appeal, however, the NLRC reversed the LA decision and denied respondent’s claim for disability benefits. The NLRC reasoned out that respondent failed to present substantial evidence proving that he had suffered any illness while on board or after disembarking from petitioners’ vessel. Respondent’s motion for reconsideration was later denied.

Not satisfied with the NLRC decision, respondent appealed before the CA. On September 16, 2009, the CA rendered a decision setting aside the ruling of the NLRC. The appellate court stated that respondent was able to prove by substantial evidence that his work as a seafarer caused his hypertensive cardiovascular disease or, at least, was a relevant factor in contracting his illness. The CA explained that as Lead Operator, respondent performed multi-tasking functions which required excessive physical and mental effort.  Moreover, he was also exposed to the perils of the sea and was made to endure unpredictable and extreme climate changes in the daily performance of his job. The CA also took judicial notice of the fact that overseas workers suffer a great degree of emotional strain while on duty on board vessels because of their being separated from their families for the duration of their contract. The CA was of the strong view that the inherent difficulties in respondent’s job definitely caused his illness. The CA added that because of the nature of his work, the illness suffered by respondent contributed to the aggravation of his injury which was pre-existing at the time of his employment. Finally, the CA ruled that respondent is entitled to claim total and permanent disability benefits because of the undisputed doctor’s findings that he “is now unfit to resume work as a seaman in any capacity,” which clearly constitutes a permanent and total disability as defined by law.

Not in conformity with the CA decision, petitioners filed this petition for review praying for its reversal raising this lone

ISSUE

WHETHER OR NOT THE COURT OF APPEALS ERRED IN AWARDING FULL DISABILITY BENEFITS TO THE PRIVATE RESPONDENT.

In advocacy of their position, petitioners argue that the CA committed a reversible error in awarding respondent disability benefits on the principal ground that there are numerous substantial and competent evidence on record which clearly establish the fact that respondent was guilty of fraudulent misrepresentation, hence, forfeiting his right to any benefits under the POEA contract. For one, respondent intentionally lied when he declared that he was not suffering from a previous medical condition in his pre-employment medical examination (PEME). Specifically, he failed to disclose the fact that he was suffering from diabetes and heart problem, which is a clear case of concealment.

Secondly, respondent’s illnesses were not acquired during the term of his contract with petitioners. He had no evidence showing that he acquired the heart problem and hypertension while he was on board the vessel. The fact that respondent passed his PEME does not automatically mean that he suffered his illness on board the vessel or that the same was not pre-existing.

Third, the Labor Code provision on permanent disability is not applicable in a claim for disability benefits under the POEA contract.

Respondent’s Position

          Respondent counters that petitioners never raised the issue of fraudulent misrepresentation before the labor tribunals despite being given the opportunity to do so. Hence, they are estopped from raising it for the first time on appeal. At any rate, he claims that he did not commit any fraud or misrepresentation because he underwent a stringent PEME, which included a blood and urine examination, conducted by the company-designated physician. His illness, therefore, was not pre-existing.  In any case, the pre-existence of an illness is not a bar for the compensability of a seafarer’s illness. His non-compliance with the mandatory 3-day reporting upon signoff is irrelevant because it only applies to a seafarer who has signed off from the vessel for medical reasons.

          Moreover, respondent argues that a repatriation due to a finished contract does not preclude a seafarer from recovery of benefits, as the only requirement is that the disease must be a consequence or a result of the work performed.  He has shown by substantial evidence that his cardiovascular disease was work-related. The strenuous work conditions that he experienced while on sea duty coupled with his usual encounter with the unfriendly forces of nature increased the risk of contracting his heart ailment.

          Lastly, he asserts that his disability is permanent and total because he has been declared to be unfit for sea duty for which he is entitled to recover attorney’s fees and litigation costs under Article 2208. 

THE COURT’S RULING

No substantial evidence that illness was work-related

Entitlement of seamen on overseas work to disability benefits is a matter governed, not only by medical findings, but by law and by contract. The material statutory provisions are Articles 191 to 193 under Chapter VI (Disability Benefits) of the Labor Code, in relation with Rule X of the Rules and Regulations Implementing Book IV of the Labor Code.  By contract, the POEA-SEC, as provided under Department Order No. 4, series of 2000 of the Department of Labor and Employment, and the parties’ Collective Bargaining Agreement (CBA) bind the seaman and his employer to each other.^[3][3]

Deemed incorporated in every Filipino seafarer’s contract of employment, denominated as POEA-SEC or the Philippine Overseas Employment Administration-Standard Employment Contract, is a set of standard provisions established and implemented by the POEA, called the Amended Standard Terms and Conditions Governing the Employment of Filipino Seafarers on Board Ocean-Going Vessels, which contain the minimum requirements prescribed by the government for the employment of Filipino seafarers. Section 20(B), paragraph 6, of the 2000 Amended Standard Terms and Conditions provides:

SECTION 20. COMPENSATION AND BENEFITS

x x x

B.         COMPENSATION AND BENEFITS FOR INJURY OR ILLNESS

The liabilities of the employer when the seafarer suffers work-related injury or illness during the term of his contract are as follows: 

X x x

6.         In case of permanent total or partial disability of the seafarer caused by either injury or illness the seafarer shall be compensated in accordance with the schedule of benefits enumerated in Section 32 of this Contract. Computation of his benefits arising from an illness or disease shall be governed by the rates and the rules of compensation applicable at the time the illness or disease was contracted. 

Pursuant to the aforequoted provision, two elements must concur for an injury or illness to be compensable.  First, that the injury or illness must be work-related; and second, that the work-related injury or illness must have existed during the term of the seafarer’s employment contract.

The 2000 POEA Amended Standard Terms and Conditions defines “work-related injury” as “injury(ies) resulting in disability or death arising out of and in the course of employment” and “work-related illness” as “any sickness resulting in disability or death as a result of an occupational disease listed under Section 32-A of this contract with the conditions set therein satisfied.” These are:

SECTION 32-A.       OCCUPATIONAL DISEASES

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

1) The seafarer’s work must involve the risks described herein;

2) The disease was contracted as a result of the seafarer’s exposure to the described risks;

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

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

Sec. 32-A(11) of the 2000 POEA Amended Standard Terms and Conditions explicitly considers a cardiovascular  disease as an occupational disease if the same was contracted under  working  conditions that  involve  any of  the  following risks –

a)   If the heart disease was known to have been present during employment, there must be proof that an acute exacerbation was clearly precipitated by the unusual strain by reasons of the nature of his work.

b)  The strain of the work that brings about an acute attack must be sufficient severity and must be followed within 24 hours by the clinical signs of cardiac insult to constitute causal relationship.

c)  If a person who was apparently asymptomatic before being subjected to strain at work showed signs and symptoms of cardiac injury during the performance of his work and such symptoms and signs persisted, it is reasonable to claim a causal relationship.

Consequently, for cardiovascular disease to constitute an occupational disease for which the seafarer may claim compensation, it is incumbent upon said seafarer to show that he developed the same under any of the three conditions identified above.^[4][4]

In labor cases as in other administrative proceedings, substantial evidence or such relevant evidence as a reasonable mind might accept as sufficient to support a conclusion is required. The oft-repeated rule is that whoever claims entitlement to the benefits provided by law should establish his or her right thereto by substantial evidence.^[5][5] Substantial evidence is more than a mere scintilla.  The evidence must be real and substantial, and not merely apparent; for the duty to prove work-causation or work-aggravation imposed by law is real and not merely apparent.^[6][6]

In this case, the Court is of the considered view that respondent failed to prove that his ailment was work-related and was acquired during his 4-month sea deployment. Respondent claims that sometime in July 2003, he showed manifestations of a heart disease when he suddenly felt chest pains, shortness of breath and fatigability.^[7][7]  He, however, never substantiated such claim. He never showed any written note, request or record about any medical check-up, consultation or treatment.  Similarly, he failed to substantiate his allegation that after his arrival in Manila on July 18, 2003, he reported to petitioners’ office on July 31, 2003 to seek medical consultation for the discomfort he was experiencing but petitioners ignored him.^[8][8]

He also alleged that onAugust 4, 2003, more or less sixteen (16) days after arriving inManila, he underwent a physical and laboratory examination at the Maritime Clinic for International Service, Inc. conducted by petitioners where he was declared to be unfit for sea duty. Again, there is no record of this except his self-serving claim. What is on record is that onSeptember 24, 2003, respondent surfaced demanding payment of disability benefits.

Respondent failed to comply with the mandatory 3-day rule

More importantly, respondent failed to comply with the mandatory 3-day medical examination deadline provided in Section 20(B), paragraph (3) of the 2000 Amended Standard Terms and Conditions Governing the Employment of Filipino Seafarers on Board Ocean-Going Vessels. As earlier stated, it was only on September 24, 2003, or more than two (2) months after his arrival in Manila, that he sought a medical opinion from Dr. Vicaldo who declared him unfit to work as a seaman due to “hypertensive cardiovascular disease, atrial fibrillation and diabetes mellitus II.”^[9][9]  Section 20(B), paragraph (3) of the 2000 Amended Standard Terms and Conditions Governing the Employment of Filipino Seafarers on Board Ocean-Going Vessels, reads:

Section 20(B), paragraph (3) thereof states:

X x x.

3. Upon sign off from the vessel for medical treatment, the seafarer is entitled to sickness allowance equivalent to his basic wage until he is declared fit to work or the degree of permanent disability has been assessed by the company-designated physician but in no case shall this period exceed one-hundred twenty (120) days.

For this purpose, the seafarer shall submit himself to a post-employment medical examination by a company-designated physician within three working days upon his return except when he is physically incapacitated to do so, in which case a written notice to the agency within the same period is deemed as compliance. Failure of the seafarer to comply with the mandatory reporting requirement shall result in his forfeiture of the right to claim the above benefits. [Emphases and underscoring supplied]

 While the rule is not absolute, there is no credible explanation from respondent why he failed to comply with the mandatory rule considering his claim that in July, 2003, he was suffering from chest pain, shortness of breath and fatigue. An award of disability benefit to a seaman in this case, despite non-compliance with strict mandatory requirements of the law, cannot be sustained.  The rationale behind the rule can easily be divined. Within three days from repatriation, it would be fairly easier for a physician to determine if the illness was work-related or not.  After that period, there would be difficulty in ascertaining the real cause of the illness. 

To ignore the rule would set a precedent with negative repercussions because it would open the floodgates to a limitless number of seafarers claiming disability benefits.  It would certainly be unfair to the employer who would have difficulty determining the cause of a claimant’s illness considering the passage of time. In such a case, the employers would have no protection against unrelated disability claims.

Respondent claims that the 3-day mandatory rule is not applicable as it is only for those who were repatriated for medical reasons. This could only mean that he had no medical reason then.  In his pleadings, he claimed that sometime in July 2003, he showed manifestations of a heart disease as he suddenly felt chest pains, shortness of breath and fatigability.^[10][10] He, however, failed to disclose when exactly in July 2003 that he felt those manifestations whether before or after his repatriation onJuly 18, 2003. If it was before the said date, he should have submitted himself to a medical examination three days after repatriation.

The Court’s ruling is not novel.  In the past, the Court repeatedly denied the payment of disability benefits to seamen who failed to comply with the mandatory reporting and examination requirement. Lately, in the recent case of Alex C. Cootauco v. MMS Phil. Maritime Services, Inc.,^[11][11] it was written:

For this purpose, the seafarer shall submit himself to a post-employment medical examination by a company-designated physician within three working days upon his return except when he is physically incapacitated to do so, in which case a written notice to the agency within the same period is deemed as compliance. Failure of the seafarer to comply with the mandatory reporting requirement shall result in his forfeiture of the right to claim the above benefits.

As these provisions operate, the seafarer, upon sign-off from his vessel, must report to the company-designated physician within three working days from arrival for diagnosis and treatment.

Applying the above provision of Section 20(B), paragraph (3), petitioner is required to undergo post-employment medical examination by a company-designated physician within three working days from arrival, except when he is physically incapacitated to do so, in which case, a written notice to the agency within the same period would suffice.

In Maunlad Transport, Inc. v. Manigo, Jr., this Court explicitly declared that it is mandatory for a claimant to be examined by a company-designated physician within three days from his repatriation. The unexplained omission of this requirement will bar the filing of a claim for disability benefits.

The NLRC and the Court of Appeals determined that petitioner did not observe the established procedure as there is no proof at all that he reported to the office of the respondents. We see no reason to depart from their findings. While petitioner remains firm that he reported to the office of the respondents for mandatory reporting, the records are bereft of any proof to fortify his claim. The onus probandi falls on petitioner to establish or substantiate such claim by the requisite quantum of evidence. There is absolutely no evidence on record to prove petitioner’s claim that he reported to respondents’ office for mandatory reportorial requirement. Petitioner therefore failed to adduce substantial evidence as basis for the grant of relief. [Emphasis and underscoring supplied]

The Court reiterated the same ruling in the case of Coastal Safeway Marine Services, Inc. vs. Elmer T. Esguerra,^[12][12] where it was written:

For this purpose, the seafarer shall submit himself to a post-employment medical examination by a company-designated physician within three working days upon his return except when he is physically incapacitated to do so, in which case, a written notice to the agency within the same period is deemed as compliance. Failure of the seafarer to comply with the mandatory reporting requirement shall result in his forfeiture of the right to claim the above benefits.

If a doctor appointed by the seafarer disagrees with the assessment, a third doctor may be agreed jointly between the employer and the seafarer. The third doctor’s decision shall be final and binding on both parties.

The foregoing provision has been interpreted to mean that it is the company-designated physician who is entrusted with the task of assessing the seaman’s disability, whether total or partial, due to either injury or illness, during the term of the latter’s employment. Concededly, this does not mean that the assessment of said physician is final, binding or conclusive on the claimant, the labor tribunal or the courts. Should he be so minded, the seafarer has the prerogative to request a second opinion and to consult a physician of his choice regarding his ailment or injury, in which case the medical report issued by the latter shall be evaluated by the labor tribunal and the court, based on its inherent merit. For the seaman’s claim to prosper, however, it is mandatory that he should be examined by a company-designated physician within three days from his repatriation. Failure to comply with this mandatory reporting requirement without justifiable cause shall result in forfeiture of the right to claim the compensation and disability benefits provided under the POEA-SEC. [Emphases and underscoring supplied]

WHEREFORE, the petition is GRANTED. The September 16, 2009 Decision of the Court of Appeals and its March 3, 2010 Resolution are hereby REVERSED and SET ASIDE, and the October 17, 2005 and January 24, 2006 Resolutions of the National Labor Relations Commission are REINSTATED.

SO ORDERED.

JOSE CATRAL MENDOZA

                                                                                    Associate Justice

WE CONCUR:

PRESBITERO J. VELASCO, JR.

Associate Justice

Chairperson

DIOSDADO M. PERALTA                      ROBERTO A. ABAD

            Associate Justice                                     Associate Justice

ESTELA M. PERLAS-BERNABE

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 Court’s Division.

          PRESBITERO J. VELASCO, JR.

                         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 Court’s Division.

                                                                      RENATO C. CORONA

                                                                               Chief Justice