G.R. No.

L-21642

July 30, 1966

SOCIAL SECURITY SYSTEM, petitioner-appellee, vs. CANDELARIA D. DAVAC, ET AL., respondents; LOURDES Tuplano, respondent-appellant. J. Ma. Francisco and N. G. Bravo for respondentappellant. Office of the Solicitor General Arturo A. Alafriz, Solicitor Camilo D. Quiason and E. T. Duran for petitionerappellee. BARRERA, J.: This is an appeal from the resolution of the Social Security Commission declaring respondent Candelaria Davac as the person entitled to receive the death benefits payable for the death of Petronilo Davac. The facts of the case as found by the Social Security Commission, briefly are: The late Petronilo Davac, a former employee of Lianga Bay Logging Co., Inc. became a member of the Social Security System (SSS for short) on September 1, 1957. As such member, he was assigned SS I.D. No. 08-007137. In SSS form E-1 (Member's Record) which he accomplished and filed with the SSS on November 21, 1957, he designated respondent Candelaria Davac as his beneficiary and indicated his relationship to her as that of "wife". He died on April 5, 1959 and, thereupon, each of the respondents (Candelaria Davac and Lourdes Tuplano) filed their claims for death benefit with the SSS. It appears from their respective claims and the documents submitted in support thereof, that the deceased contracted two marriages, the first, with claimant Lourdes Tuplano on August 29, 1946, who bore him a child, Romeo Davac, and the second, with Candelaria Davac on January 18, 1949, with whom he had a minor daughter Elizabeth Davac. Due to their conflicting claims, the processing thereof was held in abeyance, whereupon the SSS filed this petition praying that respondents be required to interpose and litigate between themselves their conflicting claims over the death benefits in question.1wph1.t On February 25, 1963, the Social Security Commission issued the resolution referred to above, Not satisfied with the said resolution, respondent Lourdes Tuplano brought to us the present appeal. The only question to be determined herein is whether or not the Social Security Commission acted correctly in declaring respondent Candelaria Davac as the person entitled to receive the death benefits in question. Section 13, Republic Act No. 1161, as amended by Republic Act No. 1792, in force at the time Petronilo Davac's death on April 5, 1959, provides: 1. SEC. 13. Upon the covered employee's death or total and permanent disability under such conditions as the Commission may define, before becoming eligible for retirement and if

either such death or disability is not compensable under the Workmen's Compensation Act, he or, in case of his death, his beneficiaries, as recorded by his employer shall be entitled to the following benefit: ... . (emphasis supplied.) Under this provision, the beneficiary "as recorded" by the employee's employer is the one entitled to the death benefits. In the case of Tecson vs. Social Security System, (L-15798, December 28, 1961), this Court, construing said Section 13, said: It may be true that the purpose of the coverage under the Social Security System is protection of the employee as well as of his family, but this purpose or intention of the law cannot be enforced to the extent of contradicting the very provisions of said law as contained in Section 13, thereof, ... . When the provision of a law are clear and explicit, the courts can do nothing but apply its clear and explicit provisions (Velasco vs. Lopez, 1 Phil, 270; Caminetti vs. U.S., 242 U.S. 470, 61 L. ed. 442). But appellant contends that the designation herein made in the person of the second and, therefore, bigamous wife is null and void, because (1) it contravenes the provisions of the Civil Code, and (2) it deprives the lawful wife of her share in the conjugal property as well as of her own and her child's legitime in the inheritance. As to the first point, appellant argues that a beneficiary under the Social Security System partakes of the nature of a beneficiary in life insurance policy and, therefore, the same qualifications and disqualifications should be applied. Article 2012 of the New Civil Code provides: ART. 2012. Any person who is forbidden from receiving any donation under Article 739 cannot be named beneficiary of a life insurance policy by the person who cannot make any donation to him according to said article. And Article 739 of the same Code prescribes: ART. 739. The following donations shall be void: (1) Those made between persons who were guilty of adultery or concubinage at the time of the donation; xxx xxx xxx

Without deciding whether the naming of a beneficiary of the benefits accruing from membership in the Social Security System is a donation, or that it creates a situation analogous to the relation of an insured and the beneficiary under a life insurance policy, it is

enough, for the purpose of the instant case, to state that the disqualification mentioned in Article 739 is not applicable to herein appellee Candelaria Davac because she was not guilty of concubinage, there being no proof that she had knowledge of the previous marriage of her husband Petronilo.1 Regarding the second point raised by appellant, the benefits accruing from membership in the Social Security System do not form part of the properties of the conjugal partnership of the covered member. They are disbursed from a public special fund created by Congress in pursuance to the declared policy of the Republic "to develop, establish gradually and perfect a social security system which ... shall provide protection against the hazards of disability, sickness, old age and death."2 The sources of this special fund are the covered employee's contribution (equal to 2- per cent of the employee's monthly compensation);3 the employer's contribution (equivalent to 3- per cent of the monthly compensation of the covered employee);4 and the Government contribution which consists in yearly appropriation of public funds to assure the maintenance of an adequate working balance of the funds of the System.5 Additionally, Section 21 of the Social Security Act, as amended by Republic Act 1792, provides: SEC. 21. Government Guarantee. The benefits prescribed in this Act shall not be diminished and to guarantee said benefits the Government of the Republic of the Philippines accepts general responsibility for the solvency of the System. From the foregoing provisions, it appears that the benefit receivable under the Act is in the nature of a special privilege or an arrangement secured by the law, pursuant to the policy of the State to provide social security to the workingmen. The amounts that may thus be received cannot be considered as property earned by the member during his lifetime. His contribution to the fund, it may be noted, constitutes only an insignificant portion thereof. Then, the benefits are specifically declared not transferable,6 and exempted from tax legal processes, and lien.7Furthermore, in the settlement of claims thereunder the procedure to be observed is governed not by the general provisions of law, but by rules and regulations promulgated by the Commission. Thus, if the money is payable to the estate of a deceased member, it is the Commission, not the probate or regular court that determines the person or persons to whom it is payable.8 that the benefits under the Social Security Act are not intended by the lawmaking body to form part of the estate of the covered members may be gathered from the subsequent amendment made to Section 15 thereof, as follows: SEC. 15. Non-transferability of benefit. The system shall pay the benefits provided for in this Act to such persons as may be entitled thereto in accordance with the provisions of this Act. Such benefits are not transferable,

and no power of attorney or other document executed by those entitled thereto in favor of any agent, attorney, or any other individual for the collection thereof in their behalf shall be recognized except when they are physically and legally unable to collect personally such benefits: Provided, however, That in the case of death benefits, if no beneficiary has been designated or the designation there of is void, said benefits shall be paid to the legal heirs in accordance with the laws of succession. (Rep. Act 2658, amending Rep. Act 1161.) In short, if there is a named beneficiary and the designation is not invalid (as it is not so in this case), it is not the heirs of the employee who are entitled to receive the benefits (unless they are the designated beneficiaries themselves). It is only when there is no designated beneficiaries or when the designation is void, that the laws of succession are applicable. And we have already held that the Social Security Act is not a law of succession.9 Wherefore, in view of the foregoing considerations, the resolution of the Social Security Commission appealed from is hereby affirmed, with costs against the appellant. So ordered. Concepcion, C.J., Reyes, J.B.L., Dizon, Makalintal, Bengzon, J.P., Zaldivar and Sanchez, concur. Footnotes
1

For a woman to be guilty of concubinage, she must know the man to be married (Viada y Vilaseca, Vol. 5, p. 217).
2

Sec. 1, Rep. Act 1792, in force at the time of death of herein covered member.

GOVERNMENT SERVICE INSURANCE SYSTEM, Cebu City Branch, petitioner, vs. MILAGROS O. MONTESCLAROS, respondent. G.R. No. 146494. July 14, 2004 Sangguniang Bayan member Nicolas Montesclaros (Nicolas) married Milagros Orbiso (Milagros) on 10 July 1983.[3] Nicolas was a 72- year old widower when he married Milagros who was then 43 years old. On 4 January 1985, Nicolas filed with the Government Service Insurance System (GSIS) an application for retirement benefits effective 18 February 1985 under Presidential Decree No. 1146 or the Revised Government Service Insurance Act of 1977 (PD 1146). In his retirement application, Nicolas designated his wife Milagros as his sole beneficiary. [4] Nicolas last day of actual service was on 17 February 1985.[5] On 31 January 1986, GSIS approved Nicolas application for retirement effective 17 February 1984, granting a lump sum payment of annuity for the first five years and a monthly annuity

thereafter.[6] Nicolas died on 22 April 1992. Milagros filed with GSIS a claim for survivorship pension under PD 1146. On 8 June 1992, GSIS denied the claim because under Section 18 of PD 1146, the surviving spouse has no right to survivorship pension if the surviving spouse contracted the marriage with the pensioner within three years before the pensioner qualified for the pension.[7] According to GSIS, Nicolas wed Milagros on 10 July 1983, less than one year from his date of retirement on 17 February 1984. On 2 October 1992, Milagros filed with the trial court a special civil action for declaratory relief questioning the validity of Section 18 of PD 1146 disqualifying her from receiving survivorship pension. On 9 November 1994, the trial court rendered judgment declaring Milagros eligible for survivorship pension. The trial court ordered GSIS to pay Milagros the benefits due including interest. Citing Articles 115[8] and 117[9] of the Family Code, the trial court held that retirement benefits, which the pensioner has earned for services rendered and for which the pensioner has contributed through monthly salary deductions, are onerous acquisitions. Since retirement benefits are property the pensioner acquired through labor, such benefits are conjugal property. The trial court held that the prohibition in Section 18 of PD 1146 is deemed repealed for being inconsistent with the Family Code, a later law. The Family Code has retroactive effect if it does not prejudice or impair vested rights.

SEC. 17. Death of a Member. (a) Upon the death of a member, the primary beneficiaries shall be entitled to: (1) the basic monthly pension which is guaranteed for five years; Provided, That, at the option of the beneficiaries, it may be paid in lump sum as defined in this Act: Provided, further, That, the member is entitled to old-age pension at the time of his death; or (2) the basic survivorship pension which is guaranteed for thirty months and the dependents pension; Provided, That, the deceased had paid at least thirty-six monthly contributions within the fiveyear period immediately preceding his death, or a total of at least one hundred eighty monthly contributions prior to his death. (b) At the end of the guaranteed periods mentioned in the preceding sub-section (a), the survivorship pension shall be paid as follows: (1) when the dependent spouse is the only survivor, he shall receive the basic survivorship pension for life or until he remarries; (2) when only dependent children are the survivors, they shall be entitled to the survivorship pension for as long as they are qualified; (3) when the survivors are the dependent spouse and the dependent children, they shall be entitled to the survivorship pension so long as there are dependent children and, thereafter, the surviving spouse shall receive the basic survivorship pension for life or until he remarries. (c) In the absence of primary beneficiaries, the secondary beneficiaries designated by the deceased and recorded in the System, shall be entitled to: (1) a cash payment equivalent to thirty times the basic survivorship pension when the member is qualified for old-age pension; or (2) a cash payment equivalent to fifty percent of the average monthly compensation for each year he paid contributions, but not less than five hundred pesos; Provided, That, the member paid at least thirty-six monthly contributions within the five-year period immediately preceding his death or paid a total of at least one hundred eighty monthly contributions prior to his death. (d) When the primary beneficiaries are not entitled to the benefits mentioned in paragraph (a) of this section, they shall receive a cash payment equivalent to one hundred percent of the average monthly compensation for each year the member paid contributions, but not less than five hundred pesos. In the absence of primary beneficiaries, the amount shall revert to the funds of the System. SEC. 18. Death of a Pensioner. Upon the death of a pensioner, the primary beneficiaries shall receive the

The Issues GSIS raises the following issues: 1. Whether Section 16 of PD 1146 entitles Milagros to survivorship pension; 2. Whether retirement benefits form part of conjugal property; 3. Whether Articles 254 and 256 of the Family Code repealed Section 18 of PD 1146.[12]

The Courts Ruling The pertinent provisions survivorship benefits read: of PD 1146 on

SEC. 16. Survivorship Benefits. When a member or pensioner dies, the beneficiary shall be entitled to survivorship benefits provided for in sections seventeen and eighteen hereunder. The survivorship pension shall consist of: (1) basic survivorship pension which is fifty percent of the basic monthly pension; and (2) dependents pension not exceeding fifty percent of the basic monthly pension payable in accordance with the rules and regulations prescribed by the System.

applicable pension mentioned under paragraph (b) of section seventeen of this Act: Provided,That, the dependent spouse shall not be entitled to said pension if his marriage with the pensioner is contracted within three years before the pensioner qualified for the pension. When the pensioner dies within the period covered by the lump sum, the survivorship pension shall be paid only after the expiration of the said period. This shall also apply to the pensioners living as of the effectivity of this Act, but the survivorship benefit shall be based on the monthly pension being received at the time of death. (Emphasis supplied) Under PD 1146, the primary beneficiaries are (1) the dependent spouse until such spouse remarries, and (2) the dependent children.[13] The secondary beneficiaries are the dependent parents and legitimate descendants except dependent children. [14] The law defines dependent as the legitimate, legitimated, legally adopted, acknowledged natural or illegitimate child who is unmarried, not gainfully employed, and not over twenty-one years of age or is over twenty-one years of age but physically or mentally incapacitated and incapable of self-support. The term also includes the legitimate spouse dependent for support on the member, and the legitimate parent wholly dependent on the member for support.[15] The main question for resolution is the validity of the proviso in Section 18 of PD 1146, which proviso prohibits the dependent spouse from receiving survivorship pension if such dependent spouse married the pensioner within three years before the pensioner qualified for the pension (the proviso). We hold that the proviso, which was the sole basis for the rejection by GSIS of Milagros claim, is unconstitutional because it violates the due process clause. The proviso is also discriminatory and denies equal protection of the law.

In a pension plan where employee participation is mandatory, the prevailing view is that employees have contractual or vested rights in the pension where the pension is part of the terms of employment. [18] The reason for providing retirement benefits is to compensate service to the government. Retirement benefits to government employees are part of emolument to encourage and retain qualified employees in the government service. Retirement benefits to government employees reward them for giving the best years of their lives in the service of their country.[19] Thus, where the employee retires and meets the eligibility requirements, he acquires a vested right to benefits that is protected by the due process clause. [20] Retirees enjoy a protected property interest whenever they acquire a right to immediate payment under pre-existing law.[21] Thus, a pensioner acquires a vested right to benefits that have become due as provided under the terms of the public employees pension statute.[22] No law can deprive such person of his pension rights without due process of law, that is, without notice and opportunity to be heard.[23] In addition to retirement and disability benefits, PD 1146 also provides for benefits to survivors of deceased government employees and pensioners. Under PD 1146, the dependent spouse is one of the beneficiaries of survivorship benefits. A widows right to receive pension following the demise of her husband is also part of the husbands contractual compensation.[24]

Denial of Due Process The proviso is contrary to Section 1, Article III of the Constitution, which provides that [n]o person shall be deprived of life, liberty, or property without due process of law, nor shall any person be denied the equal protection of the laws. The proviso is unduly oppressive in outrightly denying a dependent spouses claim for survivorship pension if the dependent spouse contracted marriage to the pensioner within the threeyear prohibited period. There is outright confiscation of benefits due the surviving spouse without giving the surviving spouse an opportunity to be heard. The proviso undermines the purpose of PD 1146, which is to assure comprehensive and integrated social security and insurance benefits to government employees and their dependents in the event of sickness, disability, death, and retirement of the government employees. The whereas clauses of PD 1146 state: WHEREAS, the Government Service Insurance System in promoting the efficiency and welfare of the employees of the Government of the Philippines, administers the laws that grant to its members social security and insurance benefits; WHEREAS, it is necessary to preserve at all times the actuarial solvency of the funds administered by the System; to guarantee to the government employee all the benefits due him; and to expand and increase the

Retirement Benefits as Property Interest Under Section 5 of PD 1146, it is mandatory for the government employee to pay monthly contributions. PD 1146 mandates the government to include in its annual appropriation the necessary amounts for its share of the contributions. It is compulsory on the government employer to take off and withhold from the employees monthly salaries their contributions and to remit the same to GSIS. [16] The government employer must also remit its corresponding share to GSIS.[17] Considering the mandatory salary deductions from the government employee, the government pensions do not constitute mere gratuity but form part of compensation.

benefits made available to him and his dependents to the extent permitted by available resources; WHEREAS, provisions of existing laws have impeded the efficient and effective discharge by the System of its functions and have unduly hampered the System from being more responsive to the dramatic changes of the times and from meeting the increasing needs and expectations of the Filipino public servant; Xxxx The law extends survivorship benefits to the surviving and qualified beneficiaries of the deceased member or pensioner to cushion the beneficiaries against the adverse economic effects resulting from the death of the wage earner or pensioner.[26]

before the pensioner qualified for pension. The object of the prohibition is vague. There is no reasonable connection between the means employed and the purpose intended. The law itself does not provide any reason or purpose for such a prohibition. If the purpose of the proviso is to prevent deathbed marriages, then we do not see why the proviso reckons the three-year prohibition from the date the pensioner qualified for pension and not from the date the pensioner died. The classification does not rest on substantial distinctions. Worse, the classification lumps all those marriages contracted within three years before the pensioner qualified for pension as having been contracted primarily for financial convenience to avail of pension benefits. Indeed, the classification is discriminatory and arbitrary. This is probably the reason Congress deleted the proviso in Republic Act No. 8291 (RA 8291), [32] otherwise known as the Government Service Insurance Act of 1997, the law revising the old charter of GSIS (PD 1146). Under the implementing rules of RA 8291, the surviving spouse who married the member immediately before the members death is still qualified to receive survivorship pension unless the GSIS proves that the surviving spouse contracted the marriage solely to receive the benefit.[33] Thus, the present GSIS law does not presume that marriages contracted within three years before retirement or death of a member are sham marriages contracted to avail of survivorship benefits. The present GSIS law does not automatically forfeit the survivorship pension of the surviving spouse who contracted marriage to a GSIS member within three years before the members retirement or death. The law acknowledges that whether the surviving spouse contracted the marriage mainly to receive survivorship benefits is a matter of evidence. The law no longer prescribes a sweeping classification that unduly prejudices the legitimate surviving spouse and defeats the purpose for which Congress enacted the social legislation. WHEREFORE, the petition is DENIED for want of merit. We declare VOID for being violative of the constitutional guarantees of due process and equal protection of the law the proviso in Section 18 of Presidential Decree No. 1146, which proviso states that the dependent spouse shall not be entitled to said pension if his marriage with the pensioner is contracted within three years before the pensioner qualified for the pension. The Government Service Insurance System cannot deny the claim of Milagros O. Montesclaros for survivorship benefits based on this invalid proviso. No pronouncement as to costs.

Violation of the Equal Protection Clause The surviving spouse of a government employee is entitled to receive survivors benefits under a pension system. However, statutes sometimes require that the spouse should have married the employee for a certain period before the employees death to prevent sham marriages contracted for monetary gain. One example is the Illinois Pension Code which restricts survivors annuity benefits to a surviving spouse who was married to a state employee for at least one year before the employees death. The Illinois pension system classifies spouses into those married less than one year before a members death and those married one year or more. The classification seeks to prevent conscious adverse risk selection of deathbed marriages where a terminally ill member of the pension system marries another so that person becomes eligible for benefits. In Sneddon v. The State Employees Retirement System of Illinois,[27] the Appellate Court of Illinois held that such classification was based on difference in situation and circumstance, bore a rational relation to the purpose of the statute, and was therefore not in violation of constitutional guarantees of due process and equal protection. A statute based on reasonable classification does not violate the constitutional guaranty of the equal protection of the law.[28] The requirements for a valid and reasonable classification are: (1) it must rest on substantial distinctions; (2) it must be germane to the purpose of the law; (3) it must not be limited to existing conditions only; and (4) it must apply equally to all members of the same class.[29] Thus, the law may treat and regulate one class differently from another class provided there are real and substantial differences to distinguish one class from another.[30] The proviso in question does not satisfy these requirements. The proviso discriminates against the dependent spouse who contracts marriage to the pensioner within three years before the pensioner qualified for the pension.[31] Under the proviso, even if the dependent spouse married the pensioner more than three years before the pensioners death, the dependent spouse would still not receive survivorship pension if the marriage took place within three years

A.M. No. P-95-1167

February 9, 2010

CARMELITA LLEDO, Complainant, vs. ATTY. CESAR V. LLEDO, Branch Clerk of Court, Regional Trial Court, Branch 94, Quezon City,Respondent.

May a government employee, dismissed from the service for cause, be allowed to recover the personal contributions he paid to the Government Service Insurance System (GSIS)? This is the question that confronts this Court in the instant case, the factual antecedents of which are as follows: On December 21, 1998, this Court promulgated a Decision1 in the above-captioned case, dismissing from the service Atty. Cesar V. Lledo, former branch clerk of court of the Regional Trial Court of Quezon City, Branch 94. Cesars wife, Carmelita, had filed an administrative case against him, charging the latter with immorality, abandonment, and conduct unbecoming a public official. During the investigation, it was established that Cesar had left his family to live with another woman with whom he also begot children. He failed to provide support for his family. The investigating judge recommended Cesars dismissal from the service. The Office of the Court Administrator (OCA) adopted the recommendation. The Court, in its December 21, 1998 Decision, disposed of the case in this wise: WHEREFORE, Cesar V. Lledo, branch clerk of court of RTC, Branch 94, Quezon City, is hereby DISMISSED from the service, with forfeiture of all retirement benefits and leave credits and with prejudice to reemployment in any branch or instrumentality of the government, including any government-owned or controlled corporation. This case is REFERRED to the IBP Board of Governors pursuant to Section 1 of Rule 139-B of the Rules of Court. SO ORDERED.2 In a letter3 dated January 15, 1999, Carmelita and her children wrote to then Chief Justice Hilario G. Davide, Jr., begging for humane consideration and asking that part of the money due Cesar be applied to the payment of the arrearages of their amortized house and lot then facing foreclosure by the GSIS. They averred that Cesars abandonment had been painful enough; and to lose their home of 26 years would be even more painful and traumatic for the children. RULING: There is no gainsaying that dismissal from the service carries with it the forfeiture of retirement benefits. Under the Uniform Rules in Administrative Cases in the Civil Service, it is provided that:14 Section 58. Administrative Disabilities Inherent in Certain Penalties. a. The penalty of dismissal shall carry with it that of cancellation of eligibility, forfeiture of retirement benefits, and the perpetual disqualification for

reemployment in the government service, unless otherwise provided in the decision. However, in the instant case, Cesar Jr. seeks only the return of his fathers personal contributions to the GSIS. He is not claiming any of the benefits that Cesar would have been entitled to had he not been dismissed from the service, such as retirement benefits. To determine the propriety of Cesar Jr.s request, a reexamination of the laws governing the GSIS is in order. The GSIS was created in 1936 by Commonwealth Act No. 186. It was intended to "promote the efficiency and welfare of the employees of the Government of the Philippines" and to replace the pension systems in existence at that time.15

Section 9 of Commonwealth Act No. 186 states: Section 9. Effect of dismissal or separation from service. Upon dismissal for cause of a member of the System, the benefits under his membership policy shall be automatically forfeited to the System, except one-half of the cash or surrender value, which amount shall be paid to such member, or in case of death, to his beneficiary. In other cases of separation before maturity of a policy, the Government contributions shall cease, and the insured member shall have the following options: (a) to collect the cash surrender value of the policy; or (b) to continue the policy by paying the full premiums thereof; or (c) to obtain a paid up or extended term insurance in such amount or period, respectively, as the paid premiums may warrant, in accordance with the conditions contained in said policy; o[r] (d) to avail himself of such other options as may be provided in the policy.16 In 1951, Commonwealth Act No. 186 was amended by Republic Act (R.A.) No. 660. R.A. No. 660 amended Sections 2(a), (d), and (f); 4; 5; 6; 7; 8; 10; 11; 12; 13; 14; 15; and 16 of Commonwealth Act No. 186. R.A. No. 660 likewise added new provisions to the earlier law, one of which reads: Section 8. The following new sections are hereby inserted in Commonwealth Act Numbered One hundred and eighty-six: II. Retirement Insurance Benefit "Section 11. (a) Amount of annuity. Upon retirement a member shall be automatically entitled to a life annuity payable monthly for at least five years and thereafter as long as he live. (sic) The amount of the monthly annuity at the age of fifty-seven years shall be twenty pesos, plus, for each year of service rendered after the approval of this Act, one and six-tenths per centum of the average monthly salary received by him during the last five years of service, plus, for each year of service rendered prior to the approval of this Act, if

said service was at least seven years, one and twotenths per centum of said average monthly salary: Provided, That this amount shall be adjusted actuarially if retirement be at an age other than fiftyseven years: Provided, further, That the maximum amount of monthly annuity at age fifty-seven shall not in any case exceed two-thirds of said average monthly salary or five hundred pesos, whichever is the smaller amount: And provided, finally, That retirement benefit shall be paid not earlier than one year after the approval of this Act. In lieu of this annuity, he may prior to his retirement elect one of the following equivalent benefits: "(1) Monthly annuity during his lifetime; "(2) Monthly annuity during the joint-lives of the employee and his wife or other designated beneficiary, which annuity, however, shall be reduced upon the death of either to one-half and be paid to the survivor; "(3) For those who are at least sixty-five years of age, lump sum payment of present value of annuity for first five years and future annuity to be paid monthly; or "(4) Such other benefit as may be approved by the System. "(b) Survivors benefit. Upon death before he becomes eligible for retirement, his beneficiaries as recorded in the application of retirement annuity filed with the System shall be paid his own premiums with interest of three per centum per annum, compounded monthly. If on his death he is eligible for retirement, then the automatic retirement annuity or the annuity chosen by him previously shall be paid accordingly. "(c) Disability benefit. If he becomes permanently and totally disabled and his services are no longer desirable, he shall be discharged and paid his own contributions with interest of three per centum per annum, compounded monthly, if he has served less than five years; if he has served at least five years but less than fifteen years, he shall be paid also the corresponding employer's premiums, without interest, described in subsection (a) of section five hereof; and if he has served at least fifteen years he shall be retired and be entitled to the benefit provided under subsection (a) of this section. "(d) Upon dismissal for cause or on voluntary separation, he shall be entitled only to his own premiums and voluntary deposits, if any, plus interest of three per centum per annum, compounded monthly."17 Thus, Section 11(d) of R.A. No. 660 should be deemed to have amended Commonwealth Act No. 186.

In 1977, then President Ferdinand Marcos issued Presidential Decree (P.D.) No. 1146, an act "Amending, Expanding, Increasing and Integrating the Social Security and Insurance Benefits of Government Employees and Facilitating the Payment thereof under Commonwealth Act No. 186, as amended, and for other purposes." Section 4 of P.D. No. 1146 reads: Section 4. Effect of Separation from the Service. A member shall continue to be a member, notwithstanding his separation from the service and, unless the terms of his separation provide otherwise, he shall be entitled to whatever benefits which shall have accrued or been earned at the time of his separation in the event of any contingency compensable under this Act. There is no provision in P.D. No. 1146 dealing specifically with GSIS members dismissed from the service for cause, or their entitlement to the premiums they have paid. Subsequently, R.A. No. 8291 was enacted in 1997, and it provides: Section 1. Presidential Decree No. 1146, as amended, otherwise known as the "Revised Government Service Insurance Act of 1977", is hereby amended to read as follows: xxxx SEC. 4. Effect of Separation from the Service. A member separated from the service shall continue to be a member, and shall be entitled to whatever benefits he has qualified to in the event of any contingency compensable under this Act. It is noteworthy that none of the subsequent laws expressly repealed Section 9 of Commonwealth Act No. 186, as amended. In fact, none of the subsequent laws expressly repealed the earlier laws. Be that as it may, we must still resolve the issue of whether the same has been impliedly repealed. We answer in the negative. As a general rule, repeals by implication are not favored. When statutes are in pari materia, they should be construed together. A law cannot be deemed repealed unless it is clearly manifested that the legislature so intended it.18 The repealing clause of P.D. No. 1146 reads: Section 48. Repealing Clause. All laws or parts of law specifically inconsistent herewith shall be considered amended or repealed accordingly. On the other hand R.A. No. 8291s repealing clause states:

SEC. 3. Repealing Clause. All laws and any other law or parts of law specifically inconsistent herewith are hereby repealed or modified accordingly: Provided, That the rights under existing laws, rules and regulations vested upon or acquired by an employee who is already in the service as of the effectivity of this Act shall remain in force and effect: Provided, further, That subsequent to the effectivity of this Act, a new employee or an employee who has previously retired or separated and is reemployed in the service shall be covered by the provisions of this Act. This Court has previously determined the nature of similarly-worded repealing clauses. Thus: The holding of this Court in Mecano vs. COA is instructive: "The question that should be asked is: What is the nature of this repealing clause? It is certainly not an express repealing clause because it fails to identify or designate the act or acts that are intended to be repealed. Rather, it is an example of a general repealing provision, as stated in Opinion No. 73, s. 1991. It is a clause which predicates the intended repeal under the condition that a substantial conflict must be found in existing and prior acts. The failure to add a specific repealing clause indicates that the intent was not to repeal any existing law, unless an irreconcilable inconsistency and repugnancy exist in the terms of the new and old laws. This latter situation falls under the category of an implied repeal."19 There are two accepted instances of implied repeal. The first takes place when the provisions in the two acts on the same subject matter are irreconcilably contradictory, in which case, the later act, to the extent of the conflict, constitutes an implied repeal of the earlier one. The second occurs when the later act covers the whole subject of the earlier one and is clearly intended as a substitute; thus, it will operate to repeal the earlier law.20 Addressing the second instance, we pose the question: were the later enactments intended to substitute the earlier ones? We hold that there was no such substitution. P.D. No. 1146 was not intended to replace Commonwealth Act No. 186, as amended by R.A. No. 660, but "to expand and improve the social security and insurance programs administered by the Government Service Insurance System."21 Thus, as the above-quoted repealing clause indicates, only the laws or parts of law specifically inconsistent with P.D. No. 1146 were considered amended or repealed.22 In fact, Section 34 of P.D. No. 1146 mandates that the GSIS, as created and established under Commonwealth Act No. 186, shall implement the provisions of that law. Moreover, Section 13 states: Section 13. Retirement Option. Employees who are in the government service upon the effectivity of this Act shall, at the time of their retirement, have the option to retire under this Act or under Commonwealth Act No. 186, as previously amended.

Accordingly, Commonwealth Act No. 186, as amended, had not been abrogated by P.D. No. 1146. Meanwhile, R.A. No. 8291, although enacted to amend P.D. No. 1146, did not expressly repeal Commonwealth Act No. 186. Under the first instance of implied repeal, we are guided by the principle that in order to effect a repeal by implication, the later statute must be so irreconcilably inconsistent with and repugnant to the existing law that they cannot be reconciled and made to stand together. The clearest case of inconsistency must be made before the inference of implied repeal can be drawn, for inconsistency is never presumed.23 We now examine the effect of the later statutes on the provision specifically dealing with employees dismissed for cause. We again quote Section 11(d) of Commonwealth Act No. 186, as amended: (d) Upon dismissal for cause or on voluntary separation, he shall be entitled only to his own premiums and voluntary deposits, if any, plus interest of three per centum per annum, compounded monthly. Compare this with Section 4 of P.D. No. 1146, to wit: Section 4. Effect of Separation from the Service. A member shall continue to be a member, notwithstanding his separation from the service and, unless the terms of his separation provide otherwise, he shall be entitled to whatever benefits which shall have accrued or been earned at the time of his separation in the event of any contingency compensable under this Act. and Section 1 of R.A. No. 8291, which amended Section 4 of P.D. No. 1146 and the law in force at the time of Cesars dismissal from the service: SEC. 4. Effect of Separation from the Service. A member separated from the service shall continue to be a member, and shall be entitled to whatever benefits he has qualified to in the event of any contingency compensable under this Act. There is no manifest inconsistency between Section 11(d) of Commonwealth Act No. 186, as amended, and Section 4 of R.A. No. 8291. The latter provision is a general statement intended to cover members separated from the service whether the separation is voluntary or involuntary, and whether the same was for cause or not. Moreover, the same deals only with the benefits the member is entitled to at the time of separation. For the latter law to be deemed as having repealed the earlier law, it is necessary to show that the statutes or statutory provisions deal with the same subject matter and that the latter be inconsistent with the former. There must be a showing of repugnance, clear and

convincing in character. The language used in the later statute must be such as to render it irreconcilable with what had been formerly enacted. An inconsistency that falls short of that standard does not suffice.24 As mentioned earlier, neither P.D. No. 1146 nor R.A. No. 8291 contains any provision specifically dealing with employees dismissed for cause and the status of their personal contributions. Thus, there is no inconsistency between Section 11(d) of Commonwealth Act No. 186, as amended, and Section 4 of P.D. No. 1146, and, subsequently, R.A. No. 8291. The inevitable conclusion then is that Section 11(d) of Commonwealth Act No. 186, as amended, continues to govern cases of employees dismissed for cause and their claims for the return of their personal contributions. Finally, it should be remembered that the GSIS laws are in the nature of social legislation, to be liberally construed in favor of the government employees.25 The money subject of the instant request consists of personal contributions made by the employee, premiums paid in anticipation of benefits expected upon retirement. The occurrence of a contingency, i.e., his dismissal from the service prior to reaching retirement age, should not deprive him of the money that belongs to him from the outset. To allow forfeiture of these personal contributions in favor of the GSIS would condone undue enrichment. Pursuant to the foregoing discussion, Cesar is entitled to the return of his premiums and voluntary deposits, if any, with interest of three per centum per annum, compounded monthly. WHEREFORE, the foregoing premises considered, the Government Service Insurance System is hereby DIRECTED to return to Atty. Cesar Lledo his own premiums and voluntary deposits, if any, plus interest of three per centum per annum, compounded monthly. SO ORDERED.