GR L 46362; (January, 1982) (Digest)
G.R. No. L-46362 January 30, 1982
PEDRITA S. MARTE, petitioner, vs. EMPLOYEES’ COMPENSATION COMMISSION, respondent.
FACTS
The Court previously rendered a decision on March 31, 1980, granting petitioner Pedrita Marte’s claim for permanent total disability benefits. The Court ordered the Government Service Insurance System (GSIS) to pay her disability benefits, reimburse medical expenses, and pay attorney’s fees equivalent to 10% of the award. The GSIS filed a motion for partial reconsideration, seeking to delete the award for attorney’s fees. It argued that such an award was improper under the law. The GSIS also raised concerns about encountering numerous spurious claims, justifying its cautious approach in evaluating medical certificates, and contended it had no strict duty to conduct yearly examinations of claimants.
Petitioner filed her comment, praying for the denial of the GSIS motion regarding the deletion of attorney’s fees. The core dispute centered on the propriety of charging attorney’s fees against the GSIS when a claimant is forced to litigate to secure rightful compensation benefits.
ISSUE
Whether the GSIS can be held liable for the payment of attorney’s fees to the claimant’s counsel.
RULING
Yes, the GSIS can be held liable for attorney’s fees. The Court rejected the GSIS’s arguments. The prohibition against charging attorney’s fees under the Labor Code is intended to protect the claimant’s award from diminution, not to absolve the defaulting government agency from liability. When the GSIS unjustly refuses a valid claim, compelling the employee to engage counsel and pursue judicial action, fairness and equity demand that the GSIS bear the cost of such legal fees. The Court cited Luz G. Cristobal vs. ECC & GSIS, which clarified that the claimant is exempt from liability for attorney’s fees, but the defaulting agency remains liable. This principle ensures claimants, who are often not legally trained, can obtain competent legal representation without being deprived of their full award.
The Court further noted that the GSIS’s internal problems with spurious claims are not a valid basis to challenge a court decision or deny a legitimate claimant like Marte. The proper remedy for the GSIS is to improve its claims processing system and pursue legal actions against fraudulent claimants and physicians, not to penalize valid claimants. However, considering that the Labor Code had subsequently increased the maximum disability benefits, the Court modified the award, reducing the attorney’s fees from 10% to 5% of the total award granted to the petitioner. The dispositive portion of the prior decision was amended accordingly.