[G.R. No. 127195.

August 25, 1999]

MARSAMAN MANNING AGENCY, INC. and DIAMANTIDES MARITIME, INC.,

petitioners, vs. NATIONAL LABOR RELATIONS COMMISSION and
WILFREDO T. CAJERAS, respondents.
DECISION
BELLOSILLO, J.:
MARSAMAN MANNING AGENCY, INC. (MARSAMAN) and its foreign
principal DIAMANTIDES MARITIME, INC. (DIAMANTIDES) assail the Decision of
public respondent National Labor Relations Commission dated 16 September 1996 as
well as its Resolution dated 12 November 1996 affirming the Labor Arbiter's decision
finding them guilty of illegal dismissal and ordering them to pay respondent Wilfredo T.
Cajeras salaries corresponding to the unexpired portion of his employment contract, plus
attorney's fees.
Private respondent Wilfredo T. Cajeras was hired by petitioner MARSAMAN, the
local manning agent of petitioner DIAMANTIDES, as Chief Cook Steward on the MV
Prigipos, owned and operated by DIAMANTIDES, for a contract period of ten (10)
months with a monthly salary of US$600.00, evidenced by a contract between the parties
dated 15 June 1995. Cajeras started work on 8 August 1995 but less than two (2) months
later, or on 28 September 1995, he was repatriated to the Philippines allegedly by mutual
consent.
On 17 November 1995 private respondent Cajeras filed a complaint for illegal
dismissal against petitioners with the NLRC National Capital Region Arbitration Branch
alleging that he was dismissed illegally, denying that his repatriation was by mutual
consent, and asking for his unpaid wages, overtime pay, damages, and attorneys fees.[1]
Cajeras alleged that he was assigned not only as Chief Cook Steward but also as assistant
cook and messman in addition to performing various inventory and requisition jobs.
Because of his additional assignments he began to feel sick just a little over a month on
the job constraining him to request for medical attention. He was refused at first by Capt.
Kouvakas Alekos, master of the MV Prigipos, who just ordered him to continue working.
However a day after the ships arrival at the port of Rotterdam, Holland, on 26 September
1995 Capt. Alekos relented and had him examined at the Medical Center for Seamen.
However, the examining physician, Dr. Wden Hoed, neither apprised private respondent
about the diagnosis nor issued the requested medical certificate allegedly because he
himself would forward the results to private respondents superiors. Upon returning to the
vessel, private respondent was unceremoniously ordered to prepare for immediate
repatriation the following day as he was said to be suffering from a disease of unknown
origin.

On 28 September 1995 he was handed his Seaman's Service Record Book with the
following entry: "Cause of discharge - Mutual Consent."[2] Private respondent promptly
objected to the entry but was not able to do anything more as he was immediately ushered
to a waiting taxi which transported him to the Amsterdam Airport for the return flight to
Manila. After his arrival in Manila on 29 September 1995 Cajeras complained to
MARSAMAN but to no avail.[3]
MARSAMAN and DIAMANTIDES, on the other hand, denied the imputation of
illegal dismissal. They alleged that Cajeras approached Capt. Alekos on 26 September
1995 and informed the latter that he could not sleep at night because he felt something
crawling over his body. Furthermore, Cajeras reportedly declared that he could no longer
perform his duties and requested for repatriation. The following paragraph in the vessel's
Deck Log was allegedly entered by Capt. Alekos, to wit:
Cajeras approached me and he told me that he cannot sleep at night and that he feels
something crawling on his body and he declared that he can no longer perform his duties
and he must be repatriated.[4]
Private respondent was then sent to the Medical Center for Seamen at Rotterdam where
he was examined by Dr. Wden Hoed whose diagnosis appeared in a Medical Report as
paranoia and other mental problems.[5] Consequently, upon Dr. Hoeds recommendation,
Cajeras was repatriated to the Philippines on 28 September 1995.
On 29 January 1996 Labor Arbiter Ernesto S. Dinopol resolved the dispute in favor
of private respondent Cajeras ruling that the latter's discharge from the MV Prigipos
allegedly by mutual consent was not proved by convincing evidence. The entry made by
Capt. Alekos in the Deck Log was dismissed as of little probative value because it was a
mere unilateral act unsupported by any document showing mutual consent of Capt.
Alekos, as master of the MV Prigipos, and Cajeras to the premature termination of the
overseas employment contract as required by Sec. H of the Standard Employment
Contract Governing the Employment of all Filipino Seamen on Board Ocean-Going
Vessels. Dr. Hoeds diagnosis that private respondent was suffering from paranoia and
other mental problems was likewise dismissed as being of little evidentiary value because
it was not supported by evidence on how the paranoia was contracted, in what stage it
was, and how it affected respondent's functions as Chief Cook Steward which, on the
contrary, was even rated Very Good in respondent's Service Record Book. Thus, the
Labor Arbiter disposed of the case as follows:
WHEREFORE, judgment is hereby rendered declaring the repatriation and dismissal of
complaint Wilfredo T. Cajeras as illegal and ordering respondents Marsaman Manning
Agency, Inc. and Diamantides Maritime, Inc. to jointly and severally pay complainant the
sum of USD 5,100.00 or its peso equivalent at the time of payment plus USD 510.00 as
10% attorneys fees it appearing that complainant had to engage the service of counsel to
protect his interest in the prosecution of this case.
The claims for nonpayment of wages and overtime pay are dismissed for having been
withdrawn (Minutes, December 18, 1995). The claims for damages are likewise

dismissed for lack of merit, since no evidence was presented to show that bad faith
characterized the dismissal.[6]
Petitioners appealed to the NLRC.[7] On 16 September 1996 the NLRC affirmed
the appealed findings and conclusions of the Labor Arbiter.[8] The NLRC subscribed to
the view that Cajeras repatriation by alleged mutual consent was not proved by
petitioners, especially after noting that private respondent did not actually sign his
Seamans Service Record Book to signify his assent to the repatriation as alleged by
petitioners. The entry made by Capt. Alekos in the Deck Log was not considered reliable
proof that private respondent agreed to his repatriation because no opportunity was given
the latter to contest the entry which was against his interest. Similarly, the Medical Report
issued by Dr. Hoed of Holland was dismissed as being of dubious value since it contained
only a sweeping statement of the supposed ailment of Cajeras without any elaboration on
the factual basis thereof.
Petitioners' motion for reconsideration was denied by the NLRC in its Resolution
dated 12 November 1996.[9] Hence, this petition contending that the NLRC committed
grave abuse of discretion: (a) in not according full faith and credit to the official entry by
Capt. Alekos in the vessels Deck Log conformably with the rulings in Haverton Shipping
Ltd. v. NLRC[10] and Wallem Maritime Services, Inc. v. NLRC;[11] (b) in not
appreciating the Medical Report issued by Dr. Wden Hoed as conclusive evidence that
respondent Cajeras was suffering from paranoia and other mental problems; (c) in
affirming the award of attorneys fees despite the fact that Cajeras' claim for exemplary
damages was denied for lack of merit; and, (d) in ordering a monetary award beyond the
maximum of three (3) months salary for every year of service set by RA 8042.
We deny the petition. In the Contract of Employment[12] entered into with private
respondent, petitioners convenanted strict and faithful compliance with the terms and
conditions of the Standard Employment Contract approved by the POEA/DOLE[13]
which provides:
1. The employment of the seaman shall cease upon expiration of the contract period
indicated in the Crew Contract unless the Master and the Seaman, by mutual consent, in
writing, agree to an early termination x x x x (underscoring ours).
Clearly, under the foregoing, the employment of a Filipino seaman may be terminated
prior to the expiration of the stipulated period provided that the master and the seaman (a)
mutually consent thereto and (b) reduce their consent in writing.
In the instant case, petitioners do not deny the fact that they have fallen short of the
requirement. No document exists whereby Capt. Alekos and private respondent reduced
to writing their alleged mutual consent to the termination of their employment contract.
Instead, petitioners presented the vessel's Deck Log wherein an entry unilaterally made
by Capt. Alekos purported to show that private respondent himself asked for his
repatriation. However, the NLRC correctly dismissed its evidentiary value. For one thing,
it is a unilateral act which is vehemently denied by private respondent. Secondly, the
entry in no way satisfies the requirement of a bilateral documentation to prove early
termination of an overseas employment contract by mutual consent required by the

Standard Employment Contract. Hence, since the latter sets the minimum terms and
conditions of employment for the protection of Filipino seamen subject only to the
adoption of better terms and conditions over and above the minimum standards,[14] the
NLRC could not be accused of grave abuse of discretion in not accepting anything less.
However petitioners contend that the entry should be considered prima facie
evidence that respondent himself requested his repatriation conformably with the rulings
in Haverton Shipping Ltd. v. NLRC[15] and Abacast Shipping and Management
Agency, Inc. v. NLRC.[16] Indeed, Haverton says that a vessels log book is prima facie
evidence of the facts stated therein as they are official entries made by a person in the
performance of a duty required by law. However, this jurisprudential principle does not
apply to win the case for petitioners. In Wallem Maritime Services, Inc. v. NLRC[17]
the Haverton ruling was not given unqualified application because the log book presented
therein was a mere typewritten collation of excerpts from what could be the log book.[18]
The Court reasoned that since the log book was the only piece of evidence presented to
prove just cause for the termination of respondent therein, the log book had to be duly
identified and authenticated lest an injustice would result from a blind adoption of its
contents which were but prima facie evidence of the incidents stated therein.
In the instant case, the disputed entry in the Deck Log was neither authenticated nor
supported by credible evidence. Although petitioners claim that Cajeras signed his
Seamans Service Record Book to signify his conformity to the repatriation, the NLRC
found the allegation to be actually untrue since no signature of private respondent
appeared in the Record Book.
Neither could the Medical Report prepared by Dr. Hoed be considered corroborative
and conclusive evidence that private respondent was suffering from paranoia and other
mental problems, supposedly just causes for his repatriation. Firstly, absolutely no
evidence, not even an allegation, was offered to enlighten the NLRC or this Court as to
Dr. Hoed's qualifications to diagnose mental illnesses. It is a matter of judicial notice that
there are various specializations in medical science and that a general practitioner is not
competent to diagnose any and all kinds of illnesses and diseases. Hence, the findings of
doctors who are not proven experts are not binding on this Court.[19] Secondly, the
Medical Report prepared by Dr. Hoed contained only a general statement that private
respondent was suffering from paranoia and other mental problems without providing the
details on how the diagnosis was arrived at or in what stage the illness was. If Dr. Hoed
indeed competently examined private respondent then he would have been able to discuss
at length the circumstances and precedents of his diagnosis. Petitioners cannot rely on the
presumption of regularity in the performance of official duties to make the Medical
Report acceptable because the presumption applies only to public officers from the
highest to the lowest in the service of the Government, departments, bureaus, offices,
and/or its political subdivisions,[20] which Dr. Wden Hoed was not shown to be.
Furthermore, neither did petitioners prove that private respondent was incompetent or
continuously incapacitated for the duties for which he was employed by reason of his
alleged mental state. On the contrary his ability as Chief Cook Steward, up to the very
moment of his repatriation, was rated Very Good in his Seamans Service Record Book as
correctly observed by public respondent.

Considering all the foregoing we cannot ascribe grave abuse of discretion on the part
of the NLRC in ruling that petitioners failed to prove just cause for the termination of
private respondent's overseas employment. Grave abuse of discretion is committed only
when the judgment is rendered in a capricious, whimsical, arbitrary or despotic manner,
which is not true in the present case.[21]
With respect to attorneys fees, suffice it to say that in actions for recovery of wages
or where an employee was forced to litigate and thus incurred expenses to protect his
rights and interests, a maximum award of ten percent (10%) of the monetary award by
way of attorneys fees is legally and morally justifiable under Art. 111 of the Labor Code,
[22] Sec. 8, Rule VIII, Book III of its Implementing Rules,[23] and par. 7, Art.
2208[24] of the Civil Code.[25] The case of Albenson Enterprises Corporation v. Court
of Appeals[26] cited by petitioners in arguing against the award of attorneys fees is
clearly not applicable, being a civil action for damages which deals with only one of the
eleven (11) instances when attorneys fees could be recovered under Art. 2208 of the Civil
Code.
Lastly, on the amount of salaries due private respondent, the rule has always been
that an illegally dismissed worker whose employment is for a fixed period is entitled to
payment of his salaries corresponding to the unexpired portion of his employment.[27]
However on 15 July 1995, RA 8042 otherwise known as the Migrant Workers and
Overseas Filipinos Act of 1995 took effect, Sec. 10 of which provides:
Sec. 10. In case of termination of overseas employment without just, valid or authorized
cause as defined by law or contract, the worker shall be entitled to the full reimbursement
of his placement fee with interest at twelve percent (12%) per annum, plus his salaries for
the unexpired portion of the employment contract or for three (3) months for every year
of the unexpired term whichever is less (underscoring ours).
The Labor Arbiter, rationalizing that the aforesaid law did not apply since it became
effective only one (1) month after respondent's overseas employment contract was
entered into on 15 June 1995, simply awarded private respondent his salaries
corresponding to the unexpired portion of his employment contract, i.e., for 8.6 months.
The NLRC affirmed the award and the Office of the Solicitor General (OSG) fully
agreed. But petitioners now insist that Sec. 10, RA 8042 is applicable because although
private respondents contract of employment was entered into before the law became
effective his alleged cause of action, i.e., his repatriation on 28 September 1995 without
just, valid or authorized cause, occurred when the law was already in effect. Petitioners'
purpose in so arguing is to invoke the law in justifying a lesser monetary award to private
respondent, i.e., salaries for three (3) months only pursuant to the last portion of Sec. 10
as opposed to the salaries for 8.6 months awarded by the Labor Arbiter and affirmed by
the NLRC.
We agree with petitioners that Sec. 10, RA 8042, applies in the case of private
respondent and to all overseas contract workers dismissed on or after its effectivity on 15
July 1995 in the same way that Sec. 34,[28] RA 6715,[29] is made applicable to locally
employed workers dismissed on or after 21 March 1989.[30] However, we cannot
subscribe to the view that private respondent is entitled to three (3) months salary only. A

plain reading of Sec. 10 clearly reveals that the choice of which amount to award an
illegally dismissed overseas contract worker, i.e., whether his salaries for the unexpired
portion of his employment contract or three (3) months salary for every year of the
unexpired term, whichever is less, comes into play only when the employment contract
concerned has a term of at least one (1) year or more. This is evident from the words for
every year of the unexpired term which follows the words salaries x x x for three months.
To follow petitioners thinking that private respondent is entitled to three (3) months
salary only simply because it is the lesser amount is to completely disregard and overlook
some words used in the statute while giving effect to some. This is contrary to the wellestablished rule in legal hermeneutics that in interpreting a statute, care should be taken
that every part or word thereof be given effect[31] since the law-making body is
presumed to know the meaning of the words employed in the statue and to have used
them advisedly.[32] Ut res magis valeat quam pereat.[33]
WHEREFORE, the questioned Decision and Resolution dated 16 September 1996
and 12 November 1996, respectively, of public respondent National Labor Relations
Commission are AFFIRMED.Petitioners MARSAMAN MANNING AGENCY, INC.,
and DIAMANTIDES MARITIME, INC., are ordered, jointly and severally, to pay
private respondent WILFREDO T. CAJERAS his salaries for the unexpired portion of his
employment contract or USD$5,100.00, reimburse the latter's placement fee with twelve
percent (12%) interest per annum conformably with Sec. 10 of RA 8042, as well as
attorney's fees of ten percent (10%) of the total monetary award. Costs against
petitioners.
SO ORDERED.
G.R. No. L-50734-37 February 20, 1981
WALLEM PHILIPPINES SHIPPING, INC., petitioner,
vs.
THE HON. MINISTER OF LABOR, in his capacity as Chairman of the National Seamen
Board Proper, JAIME CAUNCA, ANTONIO CABRERA, EFREN GARCIA, JOSE
OJEDA and RODOLFO PAGWAGAN,respondents.

DE CASTRO, J.:
Petition for certiorari with preliminary injunction with prayer that the Orders dated
December 19, 1977 and April 3, 1979 of the National Seamen Board (NSB) be declared
null and void. Private respondents were hired by petitioner sometime in May 1975 to
work as seamen for a period of ten months on board the M/V Woermann Sanaga, a Dutch
vessel owned and operated by petitioner's European principals. While their employment
contracts were still in force, private respondents were dismissed by their employer,
petitioner herein, and were discharged from the ship on charges that they instigated the
International Transport Federation (ITF) to demand the application of worldwide ITF
seamen's rates to their crew.

Private respondents were repatriated to the Philippines on October 27, 1975 and upon
their arrival in Manila, they instituted a complaint against petitioner for illegal dismissal
and recovery of wages and other benefits corresponding to the five months' unexpired
period of their shipboard employment contract.
In support of their complaint, private respondents submitted a Joint Affidavit 1 stating the
circumstances surrounding their employment and subsequent repatriation to the
Philippines, material averments of which are herein below reproduced:
J O I N TAF F I D AV I T
xxx xxx xxx
5. That aside from our basic monthly salary we are entitled to two (2) months
vacation leave, daily subsistence allowance of US$8.14 each, daily food
allowance of US$2.50. as well as overtime pay which we failed to receive
because our Shipboard Employment Contract was illegally terminated;
6. That while we were in Rotterdam, on or about July 9, 1975, representative of
the ITF boarded our vessel and talked with the Ship's Captain;
7. That the following day, the representatives of the ITF returned and was
followed by Mr. M.S.K. Ogle who is the Company's Administrative Manager,
again went to see the Captain;
8. That at around 7:00 in the evening all the crew members were called in the
Mess Hall where the ITF representatives informed us that they have just entered
into a "Special Agreement" with the Wallem Shipping Management, Ltd.,
represented by Mr. M.S.K. Ogle, Administrative Manager, wherein new salary
rates was agreed upon and that we were going to be paid our salary differentials
in view of the new rates;
9. That in the same meeting, Mr. M.S.K. Ogle also spoke where he told that a
Special Agreement has been signed and that we will be receiving new pay rate
and enjoined us to work hard and be good boys;
10. That the same evening we received our salary differentials based on the new
rates negotiated for us by the ITF.
11. That while we were in the Port Dubai, Saudi Arabia, we were not receiving
our pay, since the Ship's Captain refused to implement the world-wide rates and
insisted on paying us the Far East Rate;
12. That the Port Dubai is one that is within the Worldwide rates sphere.
13. That on October 22, 1975, Mr. Greg Nacional Operation Manager of

respondent corporation, arrived in Dubai Saudi Arabia and boarded our ship;
14. That on October 23, 1975, Mr. Nacional called all the crew members,
including us to a meeting at the Mess Hall and there he explained that the
Company cannot accept the worldwide rate. The Special Agreement signed by
Mr. Ogle in behalf of the Company is nothing but a scrap of paper. Mr. Jaime
Caunca then asked Mr. Nacional, in view of what he was saying, whether the
Company will honor the Special Agreement and Mr. Nacional answered "Yes".
That we must accept the Far East Rates which was put to a vote. Only two voted
for accepting the Far East Rates;
15. That immediately thereafter Mr. Nacional left us;
16. That same evening, Mr. Nacional returned and threatened that he has
received a cable from the Home Office that if we do not accept the Far East
Rate, our services will be terminated and there will be a change in crew;
17. That when Mr. Nacional left, we talked amongst ourselves and decided to
accept the Far East Rates;
18. That in the meeting that evening because of the threat we informed Mr.
Nacional we were accepting the Far East Rate and he made us sign a document
to that effect;
19. That we the complainants with the exception of Leopoldo Mamaril and Efren
Garcia, were not able to sign as we were at the time on work schedules, and Mr.
Nacional did not bother anymore if we signed or not;
20. That after the meeting Mr. Nacional cabled the Home Office, informing them
that we the complainants with the exception of Messrs. Mamaril and Garcia were
not accepting the Far East Rates;
21. That in the meeting of October 25, 1975, Mr. Nacional signed a document
whereby he promised to give no priority of first preference in "boarding a vessel
and that we are not blacklisted";
22. That in spite of our having accepted the Far East Rate, our services were
terminated and advised us that there was a change in crew;
23. That on October 27, 1975, which was our scheduled flight home, nobody
attended us, not even our clearance for our group travel and consequently we
were not able to board the plane, forcing us to sleep on the floor at the airport in
the evening of October 27, 1975;
24. That the following day we went back to the hotel in Dubai which was a two
hours ride from the airport, where we were to await another flight for home via

Air France;
25. That we were finally able to leave for home on November 2, 1975 arriving
here on the 3rd of November;
26. That we paid for all excess baggages;
27. That Mr. Nacional left us stranded, since he went ahead on October 27, 1975;
28. That immediately upon arriving in Manila, we went to respondent Company
and saw Mr. Nacional, who informed us that we were not blacklisted, however,
Mr. Mckenzie, Administrative Manager did inform us that we were all
blacklisted;
29. That we were asking from the respondent Company our leave pay, which
they refused to give, if we did not agree to a US$100.00 deduction;
30. That with the exception of Messrs. Jaime Caunca Amado Manansala and
Antonio Cabrera, we received our leave pay with the US$100.00 deduction;
31. That in view of the written promise of Mr. Nacional in Dubai last October
23, 1975 to give us priority and preference in boarding a vessel and that we were
not blacklisted we have on several occasions approached him regarding his
promise, which up to the present he has refused to honor.
xxx xxx xxx
Answering the complaint, petitioner countered that when the vessel was in London,
private respondents together with the other crew insisted on worldwide ITF rate as per
special agreement; that said employees threatened the ship authorities that unless they
agreed to the increased wages the vessel would not be able to leave port or would have
been picketed and/or boycotted and declared a hot ship by the ITF; that the Master of the
ship was left with no alternative but to agree; that upon the vessel's arrival at the Asian
port of Dubai on October 22, 1975, a representative of petitioner went on board the ship
and requested the crew together with private respondents to desist from insisting
worldwide ITF rate and instead accept the Far East rate; that said respondents refused to
accept Far East ITF rates while the rest of the Filipino crew members accepted the Far
East rates; that private respondents were replaced at the expense of petitioner and it was
prayed that respondents be required to comply with their obligations under the contract
by requiring them to pay their repatriation expenses and all other incidental expenses
incurred by the master and crew of the vessel.
After the hearing on the merits, the hearing Officer of the Secretariat rendered a decision
2 on March 14, 1977 finding private respondents to have violated their contract of
employment when they accepted salary rates different from their contract verified and
approved by the National Seamen Board. As to the issue raised by private respondents

that the original contract has been novated, it was held that:
xxx xxx xxx
For novation to be a valid defense, it is a legal requirement that all parties to the
contract should give their consent. In the instant case only the complainants and
respondents gave their consent. The National Seamen Board had no participation
in the alleged novation of the previously approved employment contract. It
would have been different if the consent of the National Seamen Board was first
secured before the alleged novation of the approved contract was undertaken,
hence, the defense of novation is not in order.
xxx xxx xxx
The Hearing Officer likewise rules that petitioner violated the contract when its
representative signed the Special Agreement and he signed the same at his own risk and
must bear the consequence of such act, and since both parties are in paridelicto,
complaint and counterclaim were dismissed for lack of merit but petitioner was ordered
to pay respondents Caunca and Cabrera their respective leave pay for the period that they
have served M/V Woermann Sanaga plus attorney's fees.
Private respondents filed a motion for reconsideration with the Board which modified the
decision of the Secretariat in an Order 3 of December 19, 1977 and ruled that petitioner is
liable for breach of contract when it ordered the dismissal of private respondents and their
subsequent repatriation before the expiration of their respective employment contracts.
The Chairman of the Board stressed that "where the contract is for a definite period, the
captain and the crew members may not be discharged until after the contract shall have
been performed" citing the case of Madrigal Shipping Co., Inc. vs. Ogilvie, et al. (104
Phil. 748). He directed petitioner to pay private respondents the unexpired portion of their
contracts and their leave pay, less the amount they received as differentials by virtue of
the special agreements entered in Rotterdam, and ten percent of the total amounts
recovered as attorney's fees.
Petitioner sought clarification and reconsideration of the said order and asked for a
confrontation with private respondents to determine the specific adjudications to be
made. A series of conferences were conducted by the Board. It was claimed by petitioner
that it did not have in its possession the records necessary to determine the exact amount
of the judgment since the records were in the sole custody of the captain of the ship and
demanded that private respondents produce the needed records. On this score, counsel for
respondents manifested that to require the master of the ship to produce the records
would result to undue delay in the disposition of the case to the detriment of his clients,
some of whom are still unemployed.
Under the circumstances, the Board was left with no alternative but to issue an Order
dated April 3, 1979 4 fixing the amount due private respondents at their three (3) months'
salary equivalent without qualifications or deduction. Hence,the instant petition before Us

alleging grave abuse of discretion on the part of the respondent official as Chairman of
the Board, in issuing said order which allegedly nullified the findings of the Secretariat
and premised adjudication on imaginary conditions which were never taken up with full
evidence in the course of hearing on the merits.
The whole controversy is centered around the liability of petitioner when it ordered the
dismissal of herein private respondents before the expiration of their respective
employment contracts.
In its Order of December 19, 1977 5 the Board, thru its Chairman, Minister Blas F. Ople,
held that there is no showing that the seamen conspired with the ITF in coercing the ship
authorities to grant salary increases, and the Special Agreement was signed only by
petitioner and the ITF without any participation from the respondents who, accordingly,
may not be charged as they were, by the Secretariat, with violation of their employment
contract. The Board likewise stressed that the crew members may not be discharged until
after the expiration of the contract which is for a definite period, and where the crew
members are discharged without just cause before the contract shall have been performed,
they shall be entitled to collect from the owner or agent of the vessel their unpaid salaries
for the period they were engaged to render the services, applying the case of Madrigal
Shipping Co., Inc. vs. Jesus Ogilivie et al. 6

The findings and conclusion of the Board should be sustained. As already intimated
above, there is no logic in the statement made by the Secretariat's Hearing Officer that the
private respondents are liable for breach of their employment contracts for accepting
salaries higher than their contracted rates. Said respondents are not signatories to the
Special Agreement, nor was there any showing that they instigated the execution thereof.
Respondents should not be blamed for accepting higher salaries since it is but human for
them to grab every opportunity which would improve their working conditions and
earning capacity. It is a basic right of all workingmen to seek greater benefits not only for
themselves but for their families as well, and this can be achieved through collective
bargaining or with the assistance of trade unions. The Constitution itself guarantees the
promotion of social welfare and protection to labor. It is therefore the Hearing Officer
that gravely erred in disallowing the payment of the unexpired portion of the seamen's
respective contracts of employment.
Petitioner claims that the dismissal of private respondents was justified because the latter
threatened the ship authorities in acceeding to their demands, and this constitutes serious
misconduct as contemplated by the Labor Code. This contention is not well-taken. The
records fail to establish clearly the commission of any threat. But even if there had been
such a threat, respondents' behavior should not be censured because it is but natural for
them to employ some means of pressing their demands for petitioner, who refused to
abide with the terms of the Special Agreement, to honor and respect the same. They were
only acting in the exercise of their rights, and to deprive them of their freedom of
expression is contrary to law and public policy. There is no serious misconduct to speak

of in the case at bar which would justify respondents' dismissal just because of their
firmness in their demand for the fulfillment by petitioner of its obligation it entered into
without any coercion, specially on the part of private respondents.
On the other hand, it is petitioner who is guilty of breach of contract when they dismissed
the respondents without just cause and prior to the expiration of the employment
contracts. As the records clearly show, petitioner voluntarily entered into the Special
Agreement with ITF and by virtue thereof the crew men were actually given their salary
differentials in view of the new rates. It cannot be said that it was because of respondents'
fault that petitioner made a sudden turn-about and refused to honor the special agreement.
In brief, We declare petitioner guilty of breach of contract and should therefore be made
to comply with the directives contained in the disputed Orders of December 19, 1977 and
April 3, 1979.
WHEREFORE, premises considered, the decision dated March 14, 1977 of the Hearing
Officer is SET ASIDE and the Orders dated December 19, 1977 and April 3, 1979 of the
National Seamen Board are AFFIRMED in toto. This decision is immediately executory.
Without costs.
SO ORDERED.