Conditional settlement of judgment award

In Career Philippines Ship Management, Inc. v. Madjus,[1] it was enunciated that the conditional settlement of the judgment award operates as a final satisfaction thereof which renders the case moot and academic.[2] This pronouncement was later clarified in Philippine Transmarine Carriers, Inc. v. Legaspi,[3] where the Supreme Court explained that it ruled against the employer in Madjus because of the prejudice that the terms accompanying the conditional settlement of judgment would cause the employee, viz.:

[T]he Court ruled against the employer because the conditional satisfaction of judgment signed by the parties was highly prejudicial to the employee. The agreement stated that the payment of the monetary award was without prejudice to the right of the employer to file a petition for certiorari and appeal, while the employee agreed that she would no longer file any complaint or prosecute any suit of action against the employer after receiving the payment.[4]

In the Legaspi case, the High Court allowed the return of the excess payment of the award to the employer, because the Receipt of the Judgment Award with Undertaking was fair to both the employer and the employee. The said agreement stipulated that the employee should return the amount to the employer if the petition for certiorari (filed by the employer) would be granted but without prejudice to the employee's right to appeal. The agreement, thus, provided available remedies to both parties. These principles were echoed in Seacrest Maritime Management, Inc. v. Picar, Jr.;[5] Philippine Transmarine Carriers, Inc. v. Pelagio;[6] and Juan B. Hernandez v. Crossworld Marine Services, Inc., Mykonos Shipping Co., Ltd., and Eleazar Diaz.[7]

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[1] 650 Phil. 157 (2010).

[2] Id. at 163.

[3] 710 Phil. 838 (2013).

[4] Id. at 847-848.

[5] G.R. No. 209383, March 11, 2015, 753 SCRA 207.

[6] G.R. No. 211302, August 12, 2015, 766 SCRA 447.

[7] G.R. No. 209098, November 14, 2016.