GR L 13493; (April, 1960) (Digest)
G.R. No. L-13493; April 30, 1960
LUCIANO DE LA ROSA, petitioner-appellee, vs. THE GOVERNMENT SERVICE INSURANCE SYSTEM, respondent-appellant.
FACTS
Petitioner Luciano de la Rosa was Chief of Section in the Legal Aid Office of the Department of Justice. His position was abolished due to a reorganization under Republic Act No. 422 , and he was laid off on January 1, 1951. He received a gratuity of P3,045 pursuant to Executive Order No. 392 and Republic Act No. 422 . On December 14, 1951, he applied for retirement under Republic Act No. 660 , which was granted on June 20, 1952. Under this retirement, he was entitled to a lump sum payment of P6,787.80 for the first five years. However, respondent GSIS deducted the previously received gratuity of P3,045, paying only the balance of P2,864.40, citing Section 26, paragraph 2 of Republic Act No. 660 . Petitioner filed an action for mandamus to compel GSIS to pay the deducted amount, arguing that the gratuity under Executive Order No. 392 and Republic Act No. 422 required refund only if the recipient was reinstated, which did not occur in his case.
ISSUE
Whether the gratuity received by petitioner under Executive Order No. 392 and Republic Act No. 422 should be deducted from his retirement benefits under Republic Act No. 660 , as mandated by Section 26, paragraph 2 of Republic Act No. 660 .
RULING
The Supreme Court reversed the lower court’s decision and dismissed the petition. The Court held that Section 26, paragraph 2 of Republic Act No. 660 explicitly requires that any gratuity or retirement benefit already received by an officer or employee separated due to the reorganization under Republic Act No. 422 must be refunded to the GSIS if they opt to retire under Republic Act No. 660 . This provision indicates that Congress did not intend for such individuals to receive both the gratuity and the retirement benefits; instead, the gratuity is to be offset against the retirement benefits. The Court cited its prior ruling in Gabriel vs. GSIS (103 Phil., 651), which established that by applying for benefits under Republic Act No. 660 , the petitioner voluntarily accepted the condition of refunding any prior gratuity. The Court also addressed petitioner’s reliance on an amendment by Republic Act No. 1123 , noting that it took effect only upon approval on June 16, 1954, and had no retroactive effect on petitioner’s case, which was finalized in 1952. Thus, the deduction by GSIS was lawful, and petitioner was not entitled to recover the deducted amount. Costs were imposed on the petitioner.