EN BANC

[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.

RESOLUTION

NACHURA , J : p

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 Decision footx 1 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. Cesar's wife, Carmelita,
had led 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 Cesar's 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
bene ts 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.
IASEca

SO ORDERED. footx 2

In a letter footx 3 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 Cesar's
abandonment had been painful enough; and to lose their home of 26 years would be
even more painful and traumatic for the children.
The Court directed the OCA to comment. The OCA recommended that the
Court's December 21, 1998 Decision be reconsidered insofar as the forfeiture of
Cesar's leave credits was concerned, underscoring, however, that said bene ts would
only be released to Carmelita and her children. footx 4
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 In a Resolution dated August 3, 1999, footx 5 the Court resolved to deny the
motion for reconsideration for lack of merit.
On April 3, 2006, Cesar L. Lledo, Jr., Cesar's son, wrote a letter footx 6 to then
Chief Justice Artemio V. Panganiban. He related that his father had been bedridden
after suffering a severe stroke and acute renal failure. He had been abandoned by his
mistress and had been under Cesar Jr.'s care since 2001. The latter appealed to the
Court to reconsider its December 21, 1998 Decision, speci cally the forfeiture of leave
credits, which money would be used to pay for his father's medical expenses. Cesar Jr.
asked the Court for retroactive application of the Court's ruling subsequent to his
father's dismissal, wherein the Court ruled that despite being dismissed from the
service, government employees are entitled to the monetary equivalent of their leave
credits since these were earned prior to dismissal.
Treating the letter as a motion for reconsideration, the Court, on May 3, 2006,
granted the same, specifically on the forfeiture of accrued leave credits. footx 7
Cesar Jr. wrote the Court again on November 27, 2006, expressing his gratitude
for the Court's consideration of his request for his father's leave credits. He again
asked for judicial clemency in connection with his father's claim for refund of the
latter's personal contributions to GSIS. footx 8
The Court directed the GSIS to comment, within 10 days from notice, on Cesar
Jr.'s letter. footx 9 For failing to le the required Comment, the Court, in a Resolution
dated December 11, 2007, footx 10 required the GSIS to show cause why it should not
be held in contempt for failure to comply with the Resolution directing it to le its
Comment. The Court reiterated its December 11, 2007 Resolution on June 17, 2008,
and directed compliance.
In a letter footx 11 dated April 16, 2009, Jason C. Teng, Regional Manager of the
GSIS Quezon City Regional Of ce, explained that a request for a refund of retirement
premiums is disallowed. He explained:
The rate of contribution for both government and personal shares of retirement
premiums was actuarially computed to allow the GSIS to generate enough
investment returns to be able to pay off future claims. During actuarial
computation, the expected demographics considered the percentages of different
types of future claims (and non-claims). As such, if those that were expected to
have no future claim (e.g., those with forfeited retirement bene ts) were suddenly
allowed to receive claims for payment of bene ts, this would have a negative
impact on the financial viability of the GSIS.
cCaDSA

Even as the Court noted the letter in its June 30, 2009 Resolution, footx 12 it
further required the Board of Directors of the GSIS (GSIS Board) to le a separate
Comment within 10 days from notice.
In its Comment, footx 13 the GSIS Board said that Cesar is not entitled to the
refund of his personal contributions of the retirement premiums because "it is the
policy of the GSIS that an employee/member who had been dismissed from the service
with forfeiture of retirement bene ts cannot recover the retirement premiums he has
paid unless the dismissal provides otherwise." The GSIS Board pointed out that the
Court's Decision did not provide that Cesar is entitled to a refund of his retirement
premiums.
There is no gainsaying that dismissal from the service carries with it the
forfeiture of retirement bene ts. Under the Uniform Rules in Administrative Cases in the
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 Civil Service, it is provided that: footx 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 bene ts, and the perpetual disquali cation 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 father's
personal contributions to the GSIS. He is not claiming any of the bene ts 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 ef ciency and welfare of the employees of the Government of the
Philippines" and to replace the pension systems in existence at that time. footx 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 bene ts 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 bene ciary . 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. footx 16 AHCaED

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 ve years and
thereafter as long as he live. (sic) The amount of the monthly annuity at the age
of fty-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 ve 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 two-tenths per centum of said average monthly salary:
Provided, That this amount shall be adjusted actuarially if retirement be at an age
other than fty-seven years: Provided, further, That the maximum amount of
monthly annuity at age fty-seven shall not in any case exceed two-thirds of said
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 average monthly salary or ve hundred pesos, whichever is the smaller amount:
And provided, nally, That retirement bene t 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 bene ciary, 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- ve years of age, lump sum payment of
present value of annuity for rst ve years and future annuity to be paid monthly;
or

"(4) Such other benefit as may be approved by the System.

"(b) Survivors bene t. — Upon death before he becomes eligible for
retirement, his bene ciaries as recorded in the application of retirement annuity
led 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 bene t. — 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 ve years; if he has served at least ve years but less
than fteen years, he shall be paid also the corresponding employer's premiums,
without interest, described in subsection (a) of section ve hereof; and if he has
served at least fteen years he shall be retired and be entitled to the bene t
provided under subsection (a) of this section. IEAacS

"(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 ." footx 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 Bene ts 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
bene ts 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 speci cally 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:
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 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:

xxx xxx xxx

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
bene ts he has quali ed 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. footx 18 CTIDcA

The repealing clause of P.D. No. 1146 reads:

Section 48. Repealing Clause. — All laws or parts of law speci cally
inconsistent herewith shall be considered amended or repealed accordingly.

On the other hand R.A. No. 8291's repealing clause states:

SEC. 3. Repealing Clause. — All laws and any other law or parts of law
speci cally inconsistent herewith are hereby repealed or modi ed 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 con ict must be found in
existing and prior acts. The failure to add a speci c 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." footx 19

There are two accepted instances of implied repeal. The rst 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 con ict, 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
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 repeal the earlier law. footx 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." footx 21 Thus,
as the above-quoted repealing clause indicates, only the laws or parts of law
speci cally inconsistent with P.D. No. 1146 were considered amended or repealed.
footx 22 aEHTSc

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 rst 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. footx 23
We now examine the effect of the later statutes on the provision speci cally
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
bene ts 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 Cesar's 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
bene ts he has quali ed to in the event of any contingency compensable under
this Act. AEScHa

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 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 bene ts 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. footx 24
As mentioned earlier, neither P.D. No. 1146 nor R.A. No. 8291 contains any
provision speci cally 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. footx 25
The money subject of the instant request consists of personal contributions made by
the employee, premiums paid in anticipation of bene ts 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 .
Puno, C.J., Carpio, Corona, Carpio Morales, Velasco, Jr., Leonardo-de Castro,
Brion, Peralta, Bersamin, Del Castillo, Abad, Villarama, Jr., Perez and Mendoza, JJ.,
concur.
Footnotes
1. Rollo, pp. 267-278.
2. Id. at 276.
3. Id. at 283.
4. Id. at 288-289.
5. Id. at 290.
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 6. Id. at 293.
7. Id. at 304-305.
8. Id. at 307.
9. Id. at 310.
10. Id. at 316.
11. Id. at 327.
12. Id. at 328.
13. Id. at 329-332.
14. Civil Service Commission Memorandum Circular No. 19-99.
15. Commonwealth Act No. 186, Sec. 3.
16. Emphasis supplied.

17. Emphasis supplied.

18. Intia, Jr. v. COA, 366 Phil. 273, 291-292 (1999).
19. Id. at 290.
20. Id.
21. P.D. No. 1146, Sixth Whereas clause.

22. P.D. No. 1146, Sec. 48.

23. Agujetas v. CA, 329 Phil. 721, 745-746 (1996), citing Iloilo Palay and Corn Planters
Association, Inc. v. Feliciano, 13 SCRA 377.
24. Id. at 746, citing Villegas v. Subido, 41 SCRA 190.
25. Profeta v. Drilon, G.R. No. 104139, December 22, 1992, 216 SCRA 777, 783.

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