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069 Abosta Ship MGT V Hilario
069 Abosta Ship MGT V Hilario
~upreme
QCourt
~anila
FIRST DIVISION
ABOSTA SHIP MANAGEMENT
and/or ARTEMIO CORBILLA,
Petitioners,
- versus -
WILHILM M. HILARIO,
Respondent.
Promulgated:
.NOV Lt 2014
:x - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - ~...
DECISION
SERENO, CJ:
Abosta Ship Management Corporation (petitioner) filed a Petition for
Review on Certiorari 1 under Rule 45 of the 1997 Rules of Civil Procedure
assailing the Court of Appeals (CA) Decision2 dated 3 December 2010 and
Resolution3 dated 11February2011 in CA-G.R. SP No. 110745.
The antecedents of this case are as follows:
On 24 October 2002, an employment contract was executed by
petitioner, on behalf of its foreign principal Panstar Shipping Co., Ltd., and
respondent. In this contract, the latter was hired as a bosun (boatswain) of
the foreign vessel Grand Mark for a period of nine months, with a monthly
Designated additional member in lieu of Associate Justice Estela M. Perlas-Bernabe per S.O. No. 1885
dated 24 November 2014.
I
Rollo, pp. 10-31.
2
Id. at 36-48; penned by Associate Justice Antonio L. Villamor and concurred in by Associate Justices Jose
C. Reyes, Jr. and Samuel H. Gaerlan.
3
Id. at 34-35.
Decision
Decision
After the parties submitted their respective Position Papers, the Labor
Arbiter ordered petitioner to pay respondent his salary for nine months in the
amount of USD 10,071. The Labor Arbiter found that the contract executed
between the parties and the non-fulfillment thereof entitled respondent to his
salary for the whole duration of the contract. However, the arbiter did not
find bad faith, which would have merited the award of moral damages.10
This Decision prompted petitioner to appeal to the NLRC. On 11
March 2009, it held that respondents non-deployment was due to a valid
exercise of the foreign principals management prerogative, which should be
given due respect. Thus, the NLRC dismissed the Complaint, but ordered
petitioner to comply with our directive to deploy respondent as soon as
possible or face the inevitable consequences.11
Dissatisfied with the NLRCs ruling, respondent filed a Petition for
Certiorari with the CA. On 3 December 2010, it granted the Petition and
held that the NLRC committed grave abuse of discretion by holding that the
able seamans promotion was a valid management prerogative. The CA
further ruled that since respondent had already been hired for the same
position, then there was no longer any vacant position to which to promote
the able seaman. Moreover, under the POEA Rules, petitioner assumed joint
and solidary liability with its foreign principal, and was thus liable to
respondent. It thus found the NLRCs Decision to be contrary to law and
prevailing jurisprudence. Finally, the CA ruled that NLRCs Order for
petitioner to deploy respondent as soon as possible or face inevitable
consequences was nonsensical considering that the controversy arose
from way back in 2002, and that the assailed Order was issued in 2009.12
The CA likewise denied the Motion for Reconsideration filed by
petitioner. Hence, this Petition.
ASSIGNMENT OF ERRORS
Petitioner raises the following errors allegedly committed by the CA:
The Honorable Court of Appeals committed grave reversible error when it
ruled that complainant is entitled to actual damages in the light of Paul v.
Santiago case, the doctrine of stare decis [sic] being inapplicable in the
instant case as to the issue of award of actual damages.
The Honorable NLRC did not commit grave abuse of discretion when it
ruled differently from Santiago case [on] the issue of actual damages
contrary to erroneous decision of the Court of Appeals that NLRC
committed grave abuse of discretion in disregarding Santiago case on the
10
Id. at 100-106.
Id. at 141-150.
12
CA Decision, rollo, pp. 45-47.
11
Decision
13
14
Decision
that the foreign principal approved a different candidate for the position of
BSN.15 Thus, petitioner did not deploy respondent.
There was an apparent violation of the contract at the time that the
foreign principal decided to promote another person as expressed in its
communications dated 10 November 2002 and 14 November 2002. The
vacancy for the position of boatswain ceased to exist upon the execution of
the contract between petitioner and respondent on 24 October 2002, a
contract subsequently approved by the POEA on 25 October 2002. Clearly,
there was no vacancy when the foreign principal changed its mind, since the
position of boatswain had already been filled up by respondent.
The contract was already perfected on the date of its execution, which
occurred when petitioner and respondent agreed on the object and the cause,
as well as on the rest of the terms and conditions therein. Naturally,
contemporaneous with the perfection of the employment contract was the
birth of certain rights and obligations, a breach of which may give rise to a
cause of action against the erring party.16 Also, the POEA Standard Contract
must be recognized and respected. Thus, neither the manning agent nor the
employer can simply prevent a seafarer from being deployed without a valid
reason.17
True, the promotion and choice of personnel is an exercise of
management prerogative. In fact, this Court has upheld management
prerogatives, so long as they are exercised in good faith for the advancement
of the employers interest, and not for the purpose of defeating or
circumventing the rights of the employees under special laws or under valid
agreements.18 However, there are limitations on the exercise of management
prerogatives, such as existing laws and the principle of equity and
substantial justice.19
Under the principle of equity and substantial justice, change of mind
was not a valid reason for the non-deployment of respondent. He lost the
opportunity to apply for other positions in other agencies when he signed the
contract of employment with petitioner. Simply put, that contract was
binding on the parties and may not later be disowned simply because of a
change of mind of either one of them.
The unilateral and unreasonable failure to deploy respondent
constitutes breach of contract, which gives rise to a liability to pay actual
damages. The sanctions provided for non-deployment do not end with the
suspension or cancellation of license or the imposition of a fine and the
15
Id. at 60-61.
Santiago v. CF Sharp Crew Management, Inc., 554 Phil. 63 (2007).
17
Id.
18
San Miguel Corporation v. Ubaldo, G.R. No. 92859, 1 Feburary 1993, 218 SCRA 293, 301.
19
Peckson v. Robinsons Supermarket Corporation, G.R. No. 198534, 3 July 2013, 700 SCRA 668.
16
Decision
WHEREFORE,
DENIED.
premises
considered,
the
instant Petition
is
SO ORDERED.
xx xx
f. A verified undertaking stating that the applicant:
xx xx
(3) Shall assume joint and solidary liability with the employer for all claims and
liabilities which may arise in connection with the implementation of the contract; including
but not limited to payment of wages, death and disability compensation and repatriation.
22
Datuman v. First Cosmopolitan Power, 591 Phil. 662 (2008) citing Hellenic Philippine Shipping, Inc. v.
Siete, G.R. No. 84082, 13March 1991, 195 SCRA 179, 186; Empire Insurance Company v. NLRC, 355 Phil.
694 (1998).
23
Id. citing P.I. Manpower Placements, Inc. v. NLRC (Second Division), 342 Phil. 414 (1997).
Decision
WE CONCUR:
JlAAA:JA1
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CERTIFICATION