GOVERNMENT SERVICE INSURANCE SYSTEM, petitioner,

vs.
LEO L. CADIZ, respondent.

FACTS:
Respondent Leo L. Cadiz was appointed as a Provincial Guard of Negros Oriental on
July 1, 1968. On March 16, 1974, he entered the police service and was promoted to
several ranks until he became a Police Major. In 1991, he was absorbed by the
Philippine National Police (PNP), with a rank of Police Chief Inspector. On July 17,
1992, respondents rank was adjusted to Police Chief Superintendent, the position he
held until his retirement on March 19, 1999 at the age of 55.
The medical records of respondent revealed that on October 11, 1996, he suffered a
heart attack and was hospitalized at the San Carlos Planters Hospital, San Carlos City.
He was transferred to the Siliman University Medical Center where he was diagnosed
to be suffering from AF with CHF Class 1-E T/A Sec. to Cardio embolic Sec. to AF,
Chronic CAD,[4] a heart ailment.
Consequently, he applied for early retirement due to an ailment causing [paralysis of
the] left hand and [slurred] speech rendering him unfit to discharge further his duties
and responsibilities as a police officer.
Dr. Silahis Rosario, a cardiologist and attending physician of respondent, testified
before the National Police Commission. After its own examination of respondent, the
Medical and Dental Service, PNP, declared him UNFIT FOR POLICE SERVICE.
Hence, on March 19, 1999, he was retired from service and granted permanent total
disability benefits.
Subsequently, respondent filed a disability claim with the GSIS, attaching to his
application his service record and PNP General Order No. 641, stating that
respondent retired from the PNP due to a permanent total disability.
GSIS, Dumaguete City, approved the claim and granted respondent permanent total
disability benefits starting March 19, 1999, and temporary total disability benefits
from October 12, 1996 to November 22, 1996.
The Medical Service Group of GSIS, Pasay City, however, directed Dr. Estrada to
revise her recommendation, thus [k]indly revise your medical recommendation.
On January 29, 2000, Dr. Estrada modified her recommendation by retaining
respondents temporary total disability benefits from October 12, 1996 to November
22, 1996, but downgrading the permanent total disability benefits to
compensation equivalent to 8 months permanent partial disability benefits from
March 19, 1999.
Respondent moved for reconsideration of the evaluation but the same was denied.
Employees Compensation Commission (ECC) affirmed the findings of the GSIS.
Hence, respondent filed a petition with the Court of Appeals which, on June 21, 2002,
rendered a decision setting aside the decision of the ECC and granting respondents

claim for permanent total disability.

ISSUE:
WON respondent is entitled to permanent total disability benefits?
HELD:
SC ruled in the affirmative.
Based on the ECC Schedule of Compensation, appellant was already awarded the
maximum benefits commensurate to the degree of his disability. Moreover, the
primary criterion set for permanent total disability in this case was not met, that is:
permanent paralysis of two limbs; complete loss of sight of both eyes; brain injury
resulting in incurable imbecility; and loss of two limbs at or above the ankle or wrist.
Clearly, the ECC did not state its reason for declaring that the benefits awarded by
the GSIS to respondent are those that are commensurate to the degree of his
disability. The fact that the latter did not lose the use of any part of his body does not
justify the denial of his claim for permanent total disability.
Permanent total disability does not mean a state of absolute helplessness, but means
disablement of an employee to earn wages in the same kind of work, or work of
similar nature, that he was trained for, or any work which a person of similar
mentality and attainment could do.
Most of all, the decision of the PNP to retire him at the age of 55 for being unfit for
police service is a clear indication that his heart ailment rendered him incapable of
effectively and competently performing his job as a Police Chief Superintendent
without serious discomfort or pain
and without material injury or danger to his life. WHEREFORE, in view of all the
foregoing, the Decision of the Court of Appeals in CA-G.R. SP No. 63521, declaring
respondent Leo L. Cadiz to be suffering from a permanent total disability and ordering
the Employees Compensation Commission to award him the full benefits
corresponding to his disability, is AFFIRMED in toto.

GOVERNMENT SERVICE INSURANCE SYSTEM (GSIS), petitioner, vs. THE HON.

COURT OF APPEALS and ROSA BALAIS, respondents.

FACTS:
Private respondent started working as an emergency employee of the National
Housing Authority (NHA) in 1952. She then rose from the ranks until she was
promoted to Chief Paying Cashier in 1984.
Medical records disclose that on December 17, 1989, private respondent suddenly
experienced chills, followed by loss of consciousness. She was brought to the Capitol
Medical Center where she was sedated but allowed to go home after three hours.
Later, on the same day, however, she vomited several times and suffered from parieoccipital pains. She was again rushed to U.E.R.M. Medical Center where she
underwent a thorough medical examination. She was diagnosed to be suffering from
Subarachnoid Hemorrhage Secondary to Ruptured Aneurysm.
Despite her operation, private respondent could not perform her duties as efficiently
as she had done prior to her illness. This forced her to retire early from the
government service on March 1, 1990 at the age of sixty-two (62) years.
Private respondent filed a claim for disability benefits with the GSIS.
Accordingly, the GSIS granted her temporary total disability (TTD) benefits for the
period starting from December 17, 1989 to January 31, 1990 and subsequently,
permanent partial disability (PPD) benefits for nine months starting on March 2, 1990.
In a letter dated November 17, 1992, private respondent requested the GSIS for the
conversion of the classification of her disability benefits from permanent partial
disability (PPD) to permanent total disability (PTD).
However, it was denied by GSIS which evaluated her claim found no basis to alter its
findings.
A request for reconsideration, explaining that since the time of her operation she
continued to suffer from dizziness, headaches, loss of memory and inability to
properly sleep. Moreover, she contended that there were instances when she felt
extremely weak and could not walk without support. She further stated that she was
required to take medication for life.
The GSIS, however, denied reconsideration which denial was later affirmed on appeal
by the ECC.
Private respondent filed a petition for review with the Court of Appeals. Wherefore,
petition for review was granted and ECC decision was reversed.
GSIS now comes to this Court by way of a petition for review on certiorari alleging

that the Court of Appeals erred:

1. In reversing and setting aside the decision of the Employees Compensation
Commission which affirmed the decision of herein petitioner GSIS.
2. In considering the ailment of Subarachnoid Hemorrhage Secondary to Ruptured
Aneurysm as permanent total disability.
ISSUE:
Whether private respondent is entitled to conversion of her benefits from permanent
partial disability to permanent total disability.
HELD:
Both petitioner and the Solicitor General argue against private respondents request
for the conversion of her disability benefits on the ground that she had already been
awarded the benefits commensurate to the degree of her physical condition at the
time of her retirement.
Furthermore, they aver that private respondents request for conversion cannot be
granted because other than alleging abnormalities and non-improvement of memory
she failed to show sufficient medical basis that would warrant said conversion.
A persons disability may not manifest fully at one precise moment in time but rather
over a period of time. It is possible that an injury which at first was considered to be
temporary may later on become permanent or one who suffers a partial disability
becomes totally and permanently disabled from the same cause.
It does not mean state of absolute helplessness, but inability to do substantially all
material acts necessary to prosecution of an occupation for remuneration or profit in
substantially customary and usual manner.
It is also important to note that private respondent was constrained to retire at the
age of 62 years because of her impaired physical condition. This, again, is another
indication that her disability is permanent and total.
In the case at bar, the denial of the claim for permanent total disability benefit of
private respondent who, for 38 long years during her prime had rendered her best
service with an unblemished record and who was compelled to retire on account of
her worsening condition, would indeed subvert the salutary intentions of the law in
favor of the worker.
Petition DENIED. CA decision affirmed.

GOVERNMENT SERVICE INSURANCE SYSTEM, Petitioner,

vs.
FERNANDO P. DE LEON, Respondent.
FACTS:
Respondent Fernando P. de Leon retired as Chief State Prosecutor of the Department
of Justice (DOJ) in 1992, after 44 years of service to the government. He applied for
retirement under Republic Act (R.A.) No. 910, invoking R.A. No. 3783, as amended by
R.A. No. 4140, which provides that chief state prosecutors hold the same rank as
judges. Thereafter, and for more than nine years, respondent continuously received
his retirement benefits, until 2001, when he failed to receive his monthly pension.
Respondent learned that GSIS cancelled the payment of his pension because the
Department of Budget and Management (DBM) informed GSIS that respondent was
not qualified to retire under R.A. No. 910; that the law was meant to apply only to
justices and judges; and that having the same rank and qualification as a judge did
not entitle respondent to the retirement benefits provided thereunder.
Respondent then filed a petition for mandamus before the CA, praying that petitioner
be compelled to continue paying his monthly pension and to pay his unpaid monthly
benefits from 2001. The CA granted the petition. Petitioner GSIS is now before this
Court, assailing the Decision of the CA and the Resolution denying its motion for
reconsideration. GSIS argues that the writ of mandamus issued by the CA is not
proper because it compels petitioner to perform an act that is contrary to law.
ISSUE:
Whether or not the CA erred in granting the petition for mandamus
HELD:
This case involves a former government official who, after honorably serving office for
44 years, was comfortably enjoying his retirement in the relative security of a regular
monthly pension, but found himself abruptly denied the benefit and left without
means of sustenance. This is a situation that obviously cries out for the proper
application of retirement laws, which are in the class of social legislation. Indeed,
retirement laws are liberally construed and administered in favor of the persons
intended to be benefited, and all doubts are resolved in favor of the retiree to achieve
their humanitarian purpose.

In this case, respondent was able to establish that he has a clear legal right to the
reinstatement of his retirement benefits. In stopping the payment of respondents
monthly pension, GSIS relied on the memorandum of the DBM, which, in turn, was
based on the Chief Presidential Legal Counsels opinion that respondent, not being a
judge, was not entitled to retire under R.A. No. 910. And because respondent had
been mistakenly allowed to receive retirement benefits under R.A. No. 910, GSIS
erroneously concluded that respondent was not entitled to any retirement benefits at
all, not even under any other extant retirement law. This is flawed logic.
Respondents disqualification from receiving retirement benefits under R.A. No. 910
does not mean that he is disqualified from receiving any retirement benefit under any
other existing retirement law.
Prior to the effectivity of R.A. No. 8291, retiring government employees who were not
entitled to the benefits under R.A. No. 910 had the option to retire under either of two
laws: Commonwealth Act No. 186, as amended by R.A. No. 660, or P.D. No. 1146.
In his Comment, respondent implicitly indicated his preference to retire under P.D. No.
1146, since this law provides for higher benefits, and because the same was the
latest law at the time of his retirement in 1992.
Under P.D. No. 1146, to be eligible for retirement benefits, one must satisfy the
following requisites: Section 11. Conditions for Old-Age Pension.(a) Old-age pension
shall be paid to a member who:(1) has at least fifteen years of service;
(2) is at least sixty years of age; and(3) is separated from the service.Respondent
had complied with these requirements at the time of his retirement. GSIS does not
dispute this. Accordingly, respondent is entitled to receive the benefits provided
under Section 12 of the same law. To grant respondent these benefits does not
equate to double retirement, as GSIS mistakenly claims. Since respondent has been
declared ineligible to retire under R.A. No. 910, GSIS should simply apply the proper
retirement law to respondents claim, in substitution of R.A. No. 910.
It must also be underscored that GSIS itself allowed respondent to retire under R.A.
No. 910, following jurisprudence laid down by this Court.
One could hardly fault respondent, though a seasoned lawyer, for relying on
petitioners interpretation of the pertinent retirement laws, considering that the latter
is tasked to administer the governments retirement system. He had the right to
assume that GSIS personnel knew what they were doing. Since the change in
circumstances was through no fault of respondent, he cannot be prejudiced by the
same.
DENIED

MONICO K. IMPERIAL, JR.

vs.
GOVERNMENT SERVICE INSURANCE SYSTEM.

FACTS:
Petitioner,thenBranchmanagerofGSISNagaFieldOfficewasadministrativelychargedwith
dishonesty, grave misconduct and conduct prejudicial to the best interest of the
service for approving salary loan requests of 8 employees who lacked contribution
requirements. In so doing, he allegedly gave unwarranted benefits through evident
bad faith, manifest partiality or gross negligence, and caused injury to the pension
fund.
He was preventively suspended for 90 days. The counsel of the petitioner explained
that his client granted the loan applications under the existing board resolution, with
the approval of GSIS Vice President; the loans were fully paid, without causing any
prejudice to the service. Atty. Molina filed a motion for reconsideration, pointing out that the GSIS
Rules of Procedure set the venue of pre-hearing conferences at the GSIS Main Office in Pasay City. The
Hearing Officer denied the motion for reconsideration.
Atty. Molina failed to appear. Atty. Molina likewise failed to submit the petitioners verification of the
answer and to submit a letter of authority to represent the petitioner in the case. On the prosecutions
motion, the Hearing Officer declared the petitioner to have waived his right to file his answer and to have a
formal investigation of his case, and expunged the unverified answer and other pleadings filed by Atty.
Molina from the records.
The GSIS president and manager Winston Garcia found him guilty of grave
misconduct and conduct prejudicial to the best interest of the service.
The petitioner appealed to the Civil Service Commission (CSC), reiterating his arguments of denial of due
process and the lack of evidence against him.

The CSC thus affirmed.

CA dismissed the petition, and denied the subsequent motion for reconsideration, finding no reversible
error in the challenged CSC Resolution
ISSUES:
(1) Whether the petitioner was denied due process, and
(2) Whether there was substantial evidence to support petitioners dismissal from the service.
HELD:
First Issue:
Procedural due process is the constitutional standard demanding that notice and an opportunity to be heard
be given before judgment is rendered. As long as a party is given the opportunity to defend his interests in
due course, he would have no reason to complain; the essence of due process is in the opportunity to be
heard. A formal or trial-type hearing is not always necessary. In this case, while the petitioner did not
participate in the August 17, 2006 pre-hearing conference because Atty. Molina failed to submit a letter of
authority to represent the petitioner.
Second issue:
Especially a government official has defined misconduct as an intentional wrongdoing or a deliberate
violation of a rule of law or standard of behavior. Misconduct is grave where the elements of corruption,
clear intent to violate the law or flagrant disregard of established rule are present. Otherwise, a misconduct
is only simple.
After a careful review of the records, however, we disagree with the findings of the GSIS, the CSC and the
CA that the petitioners acts constituted grave misconduct. While we accord great respect to the factual
findings of administrative agencies that misconduct was committed, we cannot characterize the offense
committed as grave.
No substantial evidence was adduced to support the elements of corruption, clear intent to violate the law
or flagrant disregard of established rule that must be present to characterize the misconduct as grave.
Under the circumstances of the present case, we do not see the type of open defiance and disregard of GSIS
rules that the CSC observed. In fact, the CSCs findings on the petitioners actions prior to the approval of
the loans negate the presence of any intent on the petitioners part to deliberately defy the policy of the
GSIS. First, GSIS branch managers have been granted in the past the authority to approve loan applications
beyond the prescribed requirements of GSIS; second, there was a customary lenient practice in the approval
of loans exercised by some branch managers notwithstanding the existing GSIS policy; and third, the
petitioner first sought the approval of his immediate supervisor before acting on the loan applications.
These circumstances run counter to the characteristic flagrant disregard of the rules that grave misconduct
requires.
Thus, the petitioners liability under the given facts only involves simple misconduct.