Philippine Supreme Court Resolutions

G.R. No. 186560 (Government Service Insurance System v. Fernando P. de Leon). - Petitioner Government Service Insurance System (GSIS) is seeking reconsideration of this Court's Decision dated November 17, 2010 in the above-captioned case. The Court had affirmed with modification the Decision of the Court of Appeals (CA), upholding the right of respondent Fernando P. de Leon to receive retirement benefits from the government.

Respondent retired as Chief State Prosecutor of the Department of Justice (DOJ) in 1992, after 44 years of service to the government. Pie applied for retirement under Republic Act (R.A.) No. 910, invoking R.A. No. 3783, as amended by R.A. No. 4140, which provides that chief state prosecutors hold the same rank as judges. The application was approved by the GSIS. Thereafter, and for more than nine years, respondent continually received his retirement benefits from the GSIS until 2001, when he failed to receive his monthly pension. Respondent learned that the GSIS cancelled the payment of his pension because the Department of Budget and Management (DBM) informed the GSIS that respondent was not qualified to retire under R.A. No. 930; that the law was meant to apply only to justices and judges; and that having the same rank and qualification as a judge did not entitle respondent to the retirement benefits provided thereunder. Thus, the GSIS stopped the payment of respondent's monthly pension.

Respondent then filed a petition for mandamus before the CA, praying that petitioner be compelled to continue paying his monthly pension and to pay his unpaid monthly benefits from 2001. He also asked that the GSIS and the DBM be ordered to pay him damages. In a Decision dated October 28, 2008, the CA resolved to grant the petition. It found that GSIS allowed respondent to retire under R.A. No. 910, following precedents which allowed non-judges to retire under the said law. Since the error in the award of retirement benefits under R.A. 910 was not attributable to respondent, it was incumbent upon the GSIS to continue defraying his pension in accordance with the appropriate law which may apply to him.

Within the reglementary period, the GSIS filed the present Omnibus Motion^[1] seeking, first, the reconsideration of the Court's November 17, 2010 Decision, and second, to require the DOJ, the DBM, and the Commission on Audit to comment on its motion.^[2]  In its Omnibus Motion, petitioner argues that the Court's order for it to pay respondent's retirement benefits is contrary to existing laws. Petitioner insists that respondent has no clear and legal right to retirement benefits, raising anew the arguments .that the resumption of its payment would constitute unjust enrichment of respondent at the expense of the 1.5 million GS1S members who own the pension fund.^[3]

Petitioner points out that it dispenses benefits based on premium payments. Thus, when it refunded respondent's premium payments, the nexus between them was severed and respondent can no longer claim benefits under Presidential Decree (P.D.) No. 1146.

Petitioner also asserts that R.A. No. 8291, which took effect on June 24, 1997, mandates the GSIS to discontinue the processing and adjudication of retirement claims under R.A. No. 910. After the law took effect, the agencies concerned were given the task to process and pay the gratuities of their employees.^[4] Further, the source of funds for benefits under R.A. No. 910 is the National Government, through the DBM. Likewise, retirement benefits under R.A. No. 1 0071 come from the annual budget of the DOJ.^[5]

Petitioner also calls this Court's attention to the June 28, 2010 decision of the Office of the President (OP) in OP Case No. 09-I-439,^[6] the facts of which bear some similarities to respondent's case.

OP Case No. 09-I-439 was an appeal by Leticia T. Ancajas-Molina, who retired as Chief State Counsel of the DOJ on April 12, 1989, after 36 years of service. Retiring under R.A. No. 910, she received her monthly pension from April 13, 1994 until May 2008. When the DOJ sought clearance from the DBM to release the funds for Ancajas-Molina's pension from June to December 2008, the latter agency denied the request on the ground that she was not qualified to receive benefits under R.A. No. 910.^[7] The DBM also cited the Memorandum of then Chief Presidential Legal Counsel (CPLC) Avelino J. Cruz, Jr., which denied therein respondent's claim for retirement benefits under R.A. No. 910. In her appeal to the OP, Ancajas-Molina claimed that the DBM erred in declaring she was not entitled to the retirement benefits under R.A. No. 910, arguing that the CPLC's Memorandum specifically stated that it applied only to the Chief State Prosecutor, a position totally distinct from that of Chief State Counsel and governed by a different law.

In its decision, the OP noted that the Chief State Counsel has the same rank and salary as those of an Assistant Solicitor General (ASG), who, in turn, has the same rank and qualifications for appointment, salary, and privileges as those of a judge of the Regional Trial Court. Further, pursuant to a subsequent law, R.A. No. 9417, an ASG has the same qualifications for appointment, rank, prerogatives, salaries, allowances, benefits, and privileges as those of an Associate Justice of the CA.^[8] The OP further averred that the pertinent laws do not have any specific provision on whether the same parity in rank and privileges also apply to retirement benefits. However, the OP said that the same laws do not proscribe parity of retirement benefits between the Chief State Counsel and the ASGs.^[9] Thus, the OP resolved that the laws should be construed in a way that would resolve doubts in favor of granting Ancajas-Molina's retirement benefits.

Petitioner, in the case at bar, argues that, following the OP's ruling in the abovementioned case, respondent is entitled to resume his retirement benefits under R.A. No. 910 with funds coming from the DBN4 and not from the GSIS.^[10]

In his Comment, respondent points out that the arguments on unjust enrichment, one retirement scheme, refund of premium payments, and the absence of clear legal right have all been thoroughly discussed and rejected by the Court in its November 17, 2010 Decision. As matters stand, petitioner's obligation to pay respondent's retirement benefits under P.D. No. 1146 is finally settled, respondent posits.^[11]

Respondent further avers that he had made a personal query with the DOJ to clarify whether said agency is now implementing the provisions of R.A. No. 10071, insofar as his retirement as Chief State Prosecutor is concerned. However, to this date, after the lapse of two months, the DOJ has not given a categorical reply.^[12]  Thus, respondent prays for the Court, in its sound discretion, to determine which agency is responsible for paying his retirement benefits and to order the joinder of such indispensable parties to the case.

Further, respondent prays that the GSIS be sanctioned for its failure to abide by the Court's Decision.

The motion for reconsideration is denied.

The Court, in its assailed Decision, extensively and exhaustively discussed the ratio for its ruling. The Court found � and the same is fully supported by the facts and the applicable laws � that respondent indubitably has a clear and legal right to the resumption of his monthly pension from the government. There is no longer any controversy on that matter.

Underscoring this fact is the clear mandate of Section 25 of R.A. No. 10071, to wit: 

Section 25. Applicability. - All benefits heretofore extended under Republic Act No. 910, as amended, and all other benefits that may be extended by the way of amendment thereto shall likewise be given to the prosecutors covered by this Act.

Petitioner points out that, under R.A. No. 8291, it can no longer process payments of retirement benefits under R.A. No. 910. Indeed, Section 49(b) of R.A. No. 8291 provides: 

SEC. 49. Dispensation of Social Insurance Benefits. - x x x. 

(b) The GSIS shall discontinue the processing and adjudication of retirement claims under R.A. No. 1616 except refund of retirement premium and R.A. No. 910. Instead, all agencies concerned shall process and pay the gratuities of their employees. The Board shall adopt the proper rules and procedures for the implementation of this provision.

Following these provisions, it will be the DOJ that would process and pay the gratuities due respondent under R.A. No. 910 from April 8, 2010, the date of effectivity of R.A. No. 10071. Inversely, the GSIS continues to be responsible for paying respondent's retirement benefits, in accordance with P.O. No. 1146. from the time the same were withheld until April 7, 2010.

WHEREFORE, the foregoing premises considered, the Motion for Reconsideration is DENIED. The Court REITERATES  the directive in its November 17, 2010 Decision, for the Government Service Insurance System to pay respondent's retirement benefits in accordance with P.D. No. 1 146, subject to deductions, if any, computed from the time the same were withheld until April 7, 2010. From April 8, 2010 onwards, respondent is entitled to receive benefits under R.A. No. 910, in relation to R.A. No. 10071, from the Department of Justice The GSIS is further DIRECTED to comply with this Resolution forthwith and without any further delay. Mendoza, J., no part due to prior action in the Court of Appeals; Villarama, Jr., J., designated additional member per Raffle dated 11 January 2010.

SO ORDERED. 

  Very truly yours,

MA. LUISA L. LAUREA
  Clerk of Court

By:

(Sgd.) TERESITA AQUINO TUAZON
Asst. Clerk of Court

Endnotes:

---

^[1] Rollo, pp. 126-141.

^[2] Id. at 139-140. 

^[3] Id. at 133. 

^[4] Id. at 137-138. 

^[5] Id. at 138. 

^[6] In Re: Appeal from the Letter-Decision dated July 22. 2008 of the Department of Budget and Management (DBM). Leticia T. Ancajas-Molina, Former Chief State Counsel, Department of Justice (DOJ), Appellant; id. at 143-146. 

^[7] Id. at 143. 

^[8] Id. at 145. 

^[9] Id. at 145-146. 

^[10] Id. at 135. 

^[11] Id. at 149-150. 

^[12] Id. at 152.