Pan-Fil Co., Inc. v. Agujar
REITERATIONFacts
The Antecedents: Complainant Gabriel Agujar filed a complaint for payment of salaries for the unexpired portion of two employment contracts and separation pay for ten years of service with respondent Pan-Fil Co., Inc., a shipping agency. Agujar was hired as Able Seaman from August 14, 1973, to June 21, 1983. He claimed he was made to disembark before the completion of his contracts in November 1981 and November 1982, leaving unexpired portions. He also claimed separation pay due to the remoteness of re-boarding vessels of Sanko Kisen through Pan-Fil Co., Inc. Respondent argued prescription for the claim related to the MT "Virginia Lily" contract, as Agujar was allegedly made to disembark on April 27, 1982. Respondent also stated that Agujar was paid a completion contract bonus for his service on M/T "Moorfield Monarch" and denied entitlement to separation pay, asserting his contracts were for definite periods. Procedural History: The National Labor Relations Commission (NLRC) affirmed the decision of the Philippine Overseas Employment Administration (POEA). The NLRC directed Pan-Fil Co., Inc. to pay Agujar the unexpired portion of his contract on board M/T "Virginia Lily" and the unexpired portion of his contract on board M/T "Moorfield Monarch" equivalent to US$994.00 plus 10% attorney's fees. The decision was affirmed in all other aspects. The Petition: Petitioner Pan-Fil Co., Inc. sought to reverse the NLRC decision, assigning as errors the application of Article 1144 of the Civil Code and the holding of petitioner liable for the unexpired portion of the contract while on board M/T "Moorfield Monarch."
Issue(s)
Whether the money claims of private respondent have prescribed. Whether petitioner is liable for the unexpired portion of the contract while on board M/T "Moorfield Monarch."
Ruling
The petition is DISMISSED. The NLRC decision is affirmed in all other aspects.
Ratio Decidendi
On the issue of prescription: The Court ruled that the money claims of private respondent have not prescribed. The Court agreed with the Solicitor General that Article 1146 of the Civil Code, which provides a four-year prescriptive period for actions based on injury to the rights of the plaintiff, applies to this case. This is because the complaint essentially involves an "injury to rights" arising from forced disembarkation, with the monetary claims being incidental. The Court distinguished this from purely money claims, which are governed by the three-year prescriptive period under Article 292 of the Labor Code. Since the claim was filed on August 5, 1985, less than four years from April 27, 1982, when private respondent was off-loaded, it was filed on time. The Court reiterated the ruling in Callanta vs. Carnation Philippines, Inc. and Santos vs. Court of Appeals that actions for injury to rights prescribe in four years under the Civil Code, not three years under the Labor Code. On the liability for the unexpired portion of the contract: The Court found no merit in the petitioner's contention regarding the amount awarded for the unexpired portion of the contract on board M/T "Moorfield Monarch." The petitioner argued that only $340.00 should have been awarded based on POEA rules. However, the Court deferred to the findings of the NLRC regarding the factual determination of the amount due. The Court noted that POEA standards refer to indemnity to repatriated seamen and do not pertain to backpay, which was what private respondent was asking for and what the NLRC granted. Furthermore, the Court stated that to consider POEA rules as setting the maximum compensation would impair the contract between the parties. Therefore, the award of backpay equivalent to two months was affirmed.
Main Doctrine
Actions for injury to rights arising from employer-employee relations, where monetary claims are incidental, are governed by the four-year prescriptive period under Article 1146 of the Civil Code, not the three-year period under Article 292 of the Labor Code.