J. Phil Marine Inc.

v NLRC (2008)
Petitioners: J-PHIL Marine, Inc. and/or Jesus Candava and Norman Shipping Services
Respondents: NLRC and Warlito E. Dumalaog
Topic: Elements of Agency

SUMMARY: Dumalaog filed a claim for unpaid money claims and damages against J-Phil.
During the pendency of the case, Dumalaog and J-Phil (against the advice of Dumalaog’s
counsel) entered into a compromise agreement. Dumalaog’s counsel questioned the
compromise agreement but the SC said that counsel is only acting as Dumalaog’s agent, and
that Dumalaog is free to enter into compromise agreements without the intervention of his
counsel.

 Warlito E. Dumalaog: served as cook aboard vessels plying overseas

 J-Phil Marine, Inc: Manning agency
 Jesus Candava: President of J-Phil
 Norman Shipping Services: J-Phil’s foreign principal

FACTS:
 Dumalaog filed before the NLRC a pro-forma complaint against petitioners for unpaid
money claims, moral and exemplary damages, and attorneys fees.
o He also filed 2 amended pro forma complaints praying for the award of overtime
pay, vacation leave pay, sick leave pay, and disability/medical benefits (because
he contracted enlargement of the heart and severe thyroid enlargement)
o Total claim: P864,343.30 p+ P117,557.60 (interest) + P195,928.66 (attorneys
fees)
 Labor Arbiter dismissed complaint for lack of merit.
 Dumalaog appealed and the NLRC reversed the Labor Arbiter’s decision & awarded
US$50,000.00/P450,000 disability benefit to Dumalaog.
 Petitioners filed a petition for review before the CA.
 CA dismissed for failure to attach to the petition all material documents, and for defective
verification and certification.
 Hence this Petition for Review on Certiorari.
 Petitioners filed a Manifestation informing the SC that they had an amicable settlement
with Dumalaog.
o Apparently, during the pendency of the case before this Court, Dumalaog
entered into a compromise agreement with petitioners.
 He signed a Quitclaim and Release subscribed and sworn to before the
Labor Arbiter
 Dumalaog’s counsel filed a Comment & Opposition
o Said Dumalaog should be paid more than the P450,000 because this was
“unconscionably low and un-Christian”
 Dumalaog’s counsel also filed a Comment on the present petition (PURPORTEDLY on
behalf of the respondent)
 SC dismissed the petition.
o Because the parties forged a compromise agreement and executed a Quitclaim
and Release
o Article 227 of the Labor Code: Any compromise settlement, including those
involving labor standard laws, voluntarily agreed upon by the parties with the
assistance of the Department of Labor, shall be final and binding upon the
parties. The National Labor Relations Commission or any court shall not assume
 jurisdiction over issues involved therein except in case of non-compliance thereof
or if there is prima facie evidence that the settlement was obtained
through fraud, misrepresentation, or coercion.
 The fact that Dumalaog was not assisted by his counsel when he entered into the
compromise does not render it null and void.
o Eurotech Hair Systems, Inc. v. Go: A compromise agreement is valid as long as
the consideration is reasonable and the employee signed the waiver voluntarily,
with a full understanding of what he was entering into. All that is required for the
compromise to be deemed voluntarily entered into is personal and specific
individual consent. Thus, contrary to respondents contention, the employees
counsel need not be present at the time of the signing of the compromise
agreement.
 The relation of attorney and client is in many respects one of agency, and the
general rules of agency apply to such relation. The acts of an agent are deemed
the acts of the principal only if the agent acts within the scope of his authority.
 Here, Dumalaog’s counsel is acting beyond the scope of his authority in questioning the
compromise agreement.
 A client has the right to compromise a suit without the intervention of his lawyer.
o The only qualification is that if such compromise is entered into with the intent of
defrauding the lawyer of the fees justly due him, the compromise must be subject
to the said fees
 Here, there is no showing that respondent intended to defraud his counsel of his fees. In
fact, the Quitclaim and Release, the execution of which was witnessed by petitioner J-
Phils president Eulalio C. Candava and one Antonio C. Casim, notes that the 20%
attorneys fees would be paid 12 April 2007 P90,000.

WHEREFORE, the petition is, in light of all the foregoing discussion, DISMISSED.