G.R. No. L-34676 April 30, 1974
BENJAMIN T. LIGOT, petitioner, vs. ISMAEL MATHAY, Auditor General and JOSE V. VELASCO, Auditor, Congress of the Philippines, respondents.

FACTS

Petitioner Benjamin T. Ligot served as a member of the House of Representatives from December 30, 1957, to December 30, 1969. During his second term, Republic Act No. 4134 was enacted, increasing the annual salary of members of Congress from P7,200 to P32,000, effective July 1, 1964. However, Section 14, Article VI of the 1935 Constitution prohibited such salary increases from taking effect until after the expiration of the full term of all members of Congress who approved the increase. In Philconsa vs. Mathay, the Supreme Court held that the increased compensation would only become operative on December 30, 1969, for incoming members. Consequently, Ligot received only P7,200 annually throughout his tenure, including his third term ending December 30, 1969.
Upon the expiration of his term, Ligot, having lost his reelection bid, filed for retirement under Commonwealth Act No. 186 , as amended. The law grants a gratuity to elected officials based on “the rates of pay as provided by law.” The House initially issued a treasury warrant computing his gratuity using the P32,000 salary. Respondent Congress Auditor Jose V. Velasco, however, withheld his signature, pending a ruling on a similar claim by another former congressman. The Auditor General subsequently disallowed the use of the P32,000 rate, ruling that Ligot was only entitled to a computation based on the P7,200 salary he actually received. Ligot’s request for reconsideration was denied, prompting this petition for review.

ISSUE

Whether a retiring member of Congress, whose term ended on December 30, 1969, is entitled to have his retirement gratuity computed based on the increased salary of P32,000 per annum under R.A. No. 4134 , which was constitutionally inoperative for him during his incumbency.

RULING

The Supreme Court dismissed the petition and affirmed the decision of the Auditor General. The legal logic is anchored on the constitutional prohibition and the nature of retirement benefits. The Court reiterated its ruling in Philconsa vs. Mathay that the salary increase under R.A. No. 4134 could only take effect for members of Congress commencing their terms on December 30, 1969. For outgoing members like Ligot, whose terms expired on that date, the operative “rate of pay as provided by law” during their entire service was P7,200. To compute his retirement gratuity on the P32,000 rate would be a subtle circumvention of the constitutional ban, as it would effectively grant him an increased compensation for his term of office indirectly through retirement benefits, which the Constitution expressly forbade directly.
The Court emphasized that retirement pay is considered deferred compensation for services actually rendered. Since Ligot rendered his congressional service at the constitutionally mandated rate of P7,200, his retirement gratuity must logically be based on that same rate. Adopting the higher salary for computation would equate his constitutionally prohibited compensation with the statutory rate prescribed for his successors, creating an absurd and illegal equivalence. Therefore, the Auditor General correctly computed the retirement gratuity based on the salary of P7,200 per annum that Ligot lawfully received.