National Housing Corporation v. Workmen's Compensation Commission
REITERATIONFacts
The Antecedents: The National Housing Corporation (NHC) undertook the construction of a plant complex. Serafin Niones was a laborer in this construction. He died on April 18, 1971, of "acute cardiac failure clue to gastric carcinoma." His widow, Nicasia Vda. de Niones, filed a claim for death benefits with the Workmen's Compensation Commission (WCC) against NHC. NHC filed an answer, asserting that Serafin Niones was an employee of an independent contractor, Marsteel Corporation, and that gastric carcinoma is not an occupational disease. Procedural History: The acting Chief Referee issued an award in favor of the claimants. A motion for reconsideration was denied. The WCC en banc affirmed the award, ordering NHC to pay compensation, burial expenses, and attorney's fees. NHC's motion for reconsideration of this award was also denied, prompting NHC to elevate the case to the Supreme Court for review. The Petition: NHC submits two issues for resolution: (1) the absence of an employer-employee relationship between NHC and Serafin Niones, and (2) the non-compensability of gastric carcinoma as an occupational disease under the Workmen's Compensation Act.
Issue(s)
Whether an employer-employee relationship existed between the petitioner (National Housing Corporation) and the deceased worker (Serafin Niones). Whether gastric carcinoma, which caused the death of the worker, is an occupational and compensable disease under the Workmen's Compensation Act.
Ruling
The Supreme Court affirmed the decision of the respondent Workmen's Compensation Commission. The National Housing Corporation was held liable for compensation benefits. The award of the WCC was affirmed in its entirety.
Ratio Decidendi
On the issue of employer-employee relationship: The Court held that even if Serafin Niones was technically employed by Marsteel Corporation, an alleged independent contractor, NHC was still liable as the "statutory employer." This is based on Section 39(a) of the Workmen's Compensation Act, which defines "employer" broadly to include those who are virtually the owner or manager of the business even if not the direct employer. Evidence showed NHC issued a gate pass to Niones, remitted his SSS contributions, kept office records of his employment for at least three months, and exercised control and supervision over his work. The construction of the plant complex was integral to NHC's objective of manufacturing low-cost housing. Citing jurisprudence, the Court emphasized that when an owner of an establishment lets another do work necessarily connected with its business and exercises supervision, the owner becomes the statutory employer. NHC's failure to controvert the claim within the reglementary period also resulted in the loss of non-jurisdictional defenses and an admission of compensability. On the issue of compensability of gastric carcinoma: The Court reiterated that the Workmen's Compensation Act is a social legislation designed to give relief to the working man, and recent decisions have broadened the scope of compensable diseases under the presumption of compensability provided in Section 44 of the Act. This presumption applies in the absence of substantial evidence to the contrary, and even if the cause of death is unknown. The Court noted that the Physician's Report of Sickness expressly stated that Niones' illness was aggravated by the nature of his work, which involved strenuous manual labor, unusual exertions, and deficient meals. The Court dismissed the petitioner's argument regarding Niones being a leper, stating there was no finding of leprosy in the records, and even if it existed, there was no showing that it caused or aggravated the gastric carcinoma. The Court stressed that probability, not the ultimate degree of certainty, is the test of proof in compensation proceedings. Furthermore, NHC's failure to controvert the claim within the prescribed period led to an outright award, as failure to controvert results in the loss of defenses and an admission of compensability.
Main Doctrine
An owner of an industrial or business establishment who lets another do a piece of work directly or necessarily connected with its usual business, and exercises direct supervision and control over the workers of the contractor, becomes the statutory employer of those workers and is liable for compensation benefits. Furthermore, under the presumption of compensability, claims for compensation are presumed to be compensable in the absence of substantial evidence to the contrary, and this presumption applies even if the cause of death is unknown or the illness is not directly work-related but is aggravated by the nature of employment.