G.R. No. 143190; October 17, 2001
ANTONIO P. BELICENA, petitioner, vs. SECRETARY OF FINANCE, respondent.

FACTS

Petitioner Antonio P. Belicena was the Acting Undersecretary of Finance. On May 20, 1997, the President designated him as Acting Secretary of Finance from May 22 to 27, 1997, while the incumbent Secretary was abroad on official business. Belicena took his oath and received one day’s salary for this acting capacity. He compulsorily retired on October 8, 1997, but his service was extended until June 30, 1998. Upon retirement, a dispute arose regarding the computation of his terminal leave pay.
The Department of Finance, through Assistant Secretary Ma. Eleanor dela Cruz, initially refused to base the computation on his one-day salary as Acting Secretary, insisting it should be based on his salary as Acting Undersecretary. This resulted in a difference of P418,243.50. The Civil Service Commission (CSC) initially ruled in favor of using the higher salary but later reversed itself upon reconsideration, stating that since the incumbent Secretary was still receiving his salary, there was no legal fund source for Belicena’s salary differential. The Court of Appeals affirmed the CSC’s reconsidered ruling.

ISSUE

Whether the highest monthly salary received by Belicena, for the purpose of computing his terminal leave pay, is the rate corresponding to the position of Acting Secretary of Finance, notwithstanding his brief one-day service in that capacity.

RULING

Yes. The Supreme Court reversed the Court of Appeals and reinstated the CSC’s original ruling. The legal basis for computing terminal leave pay is the retiree’s “highest monthly salary” received. The Court held that Belicena’s valid designation as Acting Secretary of Finance pursuant to Section 17, Chapter 5, Title I, Book III of the Administrative Code of 1987 entitled him to the salary differential for that period. The fact that he served for only one day is immaterial; what is controlling is that he lawfully received the higher salary attached to that position.
The Court rejected the argument that there was no appropriation to pay the differential because the incumbent Secretary was still being paid. The designation was made by presidential authority, and Belicena performed the functions and received the corresponding compensation for that day. Therefore, the salary he received as Acting Secretary constitutes his “highest monthly salary” for terminal leave computation. However, following precedent in Borromeo v. Civil Service Commission, the Court excluded COLA and RATA from this base amount.