OSM Shipping vs. NLRC

OSM SHIPPING PHILIPPINES, INC. VS. NLRC1 (Panganiban, 2003) Petition for review on certiorari of the decisions of the CA Facts: • A complaint for illegal dismissal and non-payment of salaries, overtime pay and vacation pay was filed by Fermin Guerrero against OSM Shipping Phils. Guerrero was hired by petitioner, in behalf of its principal Phil. Carrier Shipping Agency (PS-SLC) to board its vessel MV Princess Hoa as Master Mariner for a contract of 10 months. • He boarded the ship on July 21, 1994. Almost 7 months later, he was forced to disembark the ship because he was never paid any compensation for his work since he boarded the ship and as such, he could not even buy his basic necessities.

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OSM story:

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Concorde Pacific, the American company which owns the MV Princess Hoa, appointed Phil. Carrier Shipping Agency Services Co. (PC-SASCO) as ship manager, one of whose responsibilities was the selection or determination of qualifications of Filipino Seamen. o On the same date, OSM entered into a Crew Agreement with PC -SASCO for the purpose of processing the documents of crew members of the vessel. o The initial plan was to use the vessel for overseas trade. But Concorde changed its plans for the vessel and decided to use it instead for coastwide trade, thus the vessel never left the Philippines. It had the vessel converted to Philippine registry by way of bareboat chartering it out to another entity named PS-SLC. o To do this, Concorde, through its representative had to terminate is crew agreement with PS-SASCO. Consequently, the latter terminated its crew agreement with OSM. o PS-SLC, the bareboat charterer, is now the disponent owner/employer of the crew and is thus responsible for the payment of the complainant’s wages. Labor Arbiter rendered its decision in favor of Guerrero, ordering OSM and PS-SASCO to jointly and severally pay Guerrero’s claims. NLRC affirmed with modification. OSM filed with the CA a petition to set aside the NLRC judgment. This was dismissed because petitioner did not comply with the requirements of Sec. 3 Rule 46 of the ROC by failing to attach a duplicate original or certified true copy of the LA’s decision. They only attached a mere machine copy. Hence this petition.

Issue: 1) Procedural – WON CA was correct in dismissing the petition for failure to comply with the said requirement? – NO 2) Substantive – WON OSM is jointly liable with PC-SASCO, as its agent. - YES Held: 1) Sec. 3 rule 46 of the ROC requires that a duplicate original or certified true copy of only the questioned decision should be attached to the petition and not all supporting papers. Since the LA’s decision was not questioned ruling, a machine copy of it would suffice. The duplicate original of the questioned decision of the NLRC should be attached, and this was complied with. However, even if petitioner’s procedural contention was correct, this Court still ruled for Guerrero on the merits. To remand this case to the CA would further delay the recovery of wages. 2) On behalf of its principal, OSM does not deny hiring Guerrero as master mariner. Petitioner was the legitimate manning agent of PS-SASCO and it was allowed to recruit, hire and deploy seamen on board the vessel. a. It argues that since Guerrero was never deployed overseas, his employment contract became ineffective because its object was allegedly absent. – Employment contract like any contract is perfected upon the concurrence of essential elements such as consent of the parties, object certain (subject 1

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matter of the contract) and the cause of the obligation. Contrary to petitioner’s contention, the object of the contract was the rendition of service by Guerrero on board the vessel. The non-deployment overseas of the ship did not affect the validity of the perfected employment contract. b. OSM also contends that there was a novation of the contract when Concorde decided to use the ship for coastwide trade. – A contract cannot be novated solely by the will of one party. 3) Joint and solidary liability is meant to assure aggrieved workers of immediate and sufficient payment of what is due them. Decision of NLRC affirmed.