SEC. 4. Powers and Duties of the Commission and SSS. - (a) The Commission.

- For the attainment

of its main objectives as set forth in Section 2 hereof, the Commission shall have the following
powers and duties:

"(1) To adopt, amend and rescind, subject to the approval of the President of the Philippines,
such rules and regulations as may be necessary to carry out the provisions and purposes of
this Act;

"(2) To establish a provident fund for the members which will consist of voluntary
contributions of employers and/or employees, self-employed and voluntary members and
their earnings, for the payment of benefits to such members or their beneficiaries, subject to
such rules and regulations as it may promulgate and approved by the President of the
Philippines;

"(3) To maintain a provident fund which consists of contributions made by both the SSS and
its officials and employees and their earnings, for the payment of benefits to such officials
and employees or their heirs under such terms and conditions as it may prescribe;

"(4) To approve restructuring proposals for the payment of due but unremitted contributions
and unpaid loan amortizations under such terms and conditions as it may prescribe;

"(5) To authorize cooperatives registered with the cooperative development authority or

associations registered with the appropriate government agency to act as collecting agents
of the SSS with respect to their members: Provided, That the SSS shall accredit the
cooperative or association: Provided, further, That the persons authorized to collect are
bonded;

"(6) To compromise or release, in whole or in part, any interest, penalty or any civil liability to
SSS in connection with the investments authorized under Section 26 hereof, under such
terms and conditions as it may prescribe and approved by the President of the Philippines;
and

"(7) To approve, confirm, pass upon or review any and all actions of the SSS in the proper
and necessary exercise of its powers and duties hereinafter enumerated.

"(b) The Social Security System. - Subject to the provision of Section four (4), paragraph seven (7)
hereof, the SSS shall have the following powers and duties:

"(1) To submit annually not later than April 30, a public report to the President of the
Philippines and to the Congress of the Philippines covering its activities in the administration
and enforcement of this Act during the preceding year including information and
recommendations on broad policies for the development and perfection of the program of the
SSS;

"(2) To require the actuary to submit a valuation report on the SSS benefit program every
four (4) years, or more frequently as may be necessary, to undertake the necessary actuarial
studies and calculations concerning increases in benefits taking into account inflation and the
financial stability of the SSS, and to provide for feasible increases in benefits every four (4)
years, including the addition of new ones, under such rules and regulations as the
Commission may adopt, subject to the approval of the President of the Philippines: Provided,
That the actuarial soundness of the reserve fund shall be guaranteed: Provided, further, That
such increases in benefits shall not require any increase in the rate of contribution;
 "(3) To establish offices of the SSS to cover as many provinces, cities and congressional
districts, whenever and wherever it may be expedient, necessary and feasible, and to inspect
or cause to be inspected periodically such offices;

"(4) To enter into agreements or contracts for such service and aid, as may be needed for
the proper, efficient and stable administration of the SSS;

"(5) To adopt, from time to time, a budget of expenditures including salaries of personnel,
against all funds available to the SSS under this Act;

"(6) To set up its accounting system and provide the necessary personnel therefor;

"(7) To require reports, compilations and analyses of statistical and economic data and to
make investigation as may be needed for the proper administration and development of the
SSS;

"(8) To acquire and dispose of property, real or personal, which may be necessary or
expedient for the attainment of the purposes of this Act;

"(9) To acquire, receive, or hold, by way of purchase, expropriation or otherwise, public or

private property for the purpose of undertaking housing projects preferably for the benefit of
low-income members and for the maintenance of hospitals and institutions for the sick, aged
and disabled, as well as schools for the members and their immediate families;

"(10) To sue and be sued in court; and

"(11) To perform such other corporate acts as it may deem appropriate for the proper
enforcement of this Act.

"SEC. 5. Settlement of Disputes. - (a) Any dispute arising under this Act with respect to coverage,
benefits, contributions and penalties thereon or any other matter related thereto, shall be cognizable
by the Commission, and any case filed with respect thereto shall be heard by the Commission, or
any of its members, or by hearing officers duly authorized by the Commission and decided within
twenty (20) days after the submission of the evidence. The filing, determination and settlement of
disputes shall be governed by the rules and regulations promulgated by the Commission.

"(b) Appeal to Courts. - Any decision of the Commission, in the absence of an appeal therefrom as
herein Provided, shall become final and executory fifteen (15) days after the date of notification, and
judicial review thereof shall be permitted only after any party claiming to be aggrieved thereby has
exhausted his remedies before the Commission. The Commission shall be deemed to be a party to
any judicial action involving any such decision, and may be represented by an attorney employed by
the Commission, or when requested by the Commission, by the Solicitor General or any public
prosecutors.

"(c) Court Review. - The decision of the Commission upon any disputed matter may be reviewed
both upon the law and the facts by the Court of Appeals. For the purpose of such review, the
procedure concerning appeals from the Regional Trial Court shall be followed as far as practicable
and consistent with the purposes of this Act. Appeal from a decision of the Commission must be
taken within fifteen (15) days from notification of such decision. If the decision of the Commission
involves only questions of law, the same shall be reviewed by the Supreme Court. No appeal bond
shall be required. The case shall be heard in a summary manner, and shall take precedence over all
cases, except that in the Supreme Court, criminal cases wherein life imprisonment or death has
been imposed by the trial court shall take precedence. No appeal shall act as a supersedeas or a
stay of the order of the Commission unless the Commission itself, or the Court of Appeals or the
Supreme Court, shall so order.

"(d) Execution of Decisions. - The Commission may, motu proprio or on motion of any interested
party, issue a writ of execution to enforce any of its decisions or awards, after it has become final
and executory, in the same manner as the decision of the Regional Trial Court by directing the city
or provincial sheriff or the sheriff whom it may appoint to enforce such final decision or execute such
writ; and any person who shall fail or refuse to comply with such decision, award or writ, after being
required to do so shall, upon application by the Commission pursuant to Rule 71 of the Rules of
Court, be punished for contempt.

SEC. 8. Terms Defined. - For purposes of this Act, the following terms shall, unless the context
indicates otherwise, have the following meanings:

"(a) SSS - The Social Security System created by this Act.

"(b) Commission - The Social Security Commission as herein created.

"(c) Employer- Any person, natural or juridical, domestic or foreign, who carries on in the Philippines
any trade, business, industry, undertaking, or activity of any kind and uses the services of another
person who is under his orders as regards the employment, except the Government and any of its
political subdivisions, branches or instrumentalities, including corporations owned or controlled by
the Government: Provided, That a self-employed person shall be both employee and employer at
the same time.

"(d) Employee - Any person who performs services for an employer in which either or both mental or
physical efforts are used and who receives compensation for such services, where there is an
employer-employee relationship: Provided, That a self-employed person shall be both employee and
employer at the same time.

"(e) Dependents - The dependents shall be the following:

"(1) The legal spouse entitled by law to receive support from the member;

"(2) The legitimate, legitimated or legally adopted, and illegitimate child who is unmarried, not
gainfully employed, and has not reached twenty-one (21) years of age, or if over twenty-one
(21) years of age, he is congenitally or while still a minor has been permanently
incapacitated and incapable of self-support, physically or mentally; and

"(3) The parent who is receiving regular support from the member.

"(f) Compensation - All actual remuneration for employment, including the mandated cost-of-living
allowance, as well as the cash value of any remuneration paid in any medium other than cash
except that part of the remuneration in excess of the maximum salary credit as Provided under
Section Eighteen of this Act.

"(g) Monthly salary credit - The compensation base for contributions and benefits as indicated in the
schedule in Section Eighteen of this Act.
"(h) Monthly - The period from one end of the last payroll period of the preceding month to the end of
the last payroll period of the current month if compensation is on hourly, daily or weekly basis; if on
any other basis, 'monthly' shall mean a period of one (1) month.

"(i) Contribution - The amount paid to the SSS by and on behalf of the members in accordance with
Section Eighteen of this Act.

"(j) Employment - Any service performed by an employee for his employer except:

"(1) Employment purely casual and not for the purpose of occupation or business of the
employer;

"(2) Service performed on or in connection with an alien vessel by an employee if he is

employed when such vessel is outside the Philippines;

"(3) Service performed in the employ of the Philippine Government or instrumentality or

agency thereof;

"(4) Service performed in the employ of a foreign government or international organization,

or their wholly-owned instrumentality: Provided, however, That this exemption
notwithstanding, any foreign government, international organization or their wholly-owned
instrumentality employing workers in the Philippines or employing Filipinos outside of the
Philippines, may enter into an agreement with the Philippine Government for the inclusion of
such employees in the SSS except those already covered by their respective civil service
retirement systems: Provided, further, That the terms of such agreement shall conform with
the provisions of this Act on coverage and amount of payment of contributions and
benefits: Provided, finally, That the provisions of this Act shall be supplementary to any such
agreement; and

"(5) Such other services performed by temporary and other employees which may be
excluded by regulation of the Commission. Employees of bona fide independent contractors
shall not be deemed employees of the employer engaging the service of said contractors.

"(k) Beneficiaries - The dependent spouse until he or she remarries, the dependent legitimate,
legitimated or legally adopted, and illegitimate children, who shall be the primary beneficiaries of the
member: Provided, That the dependent illegitimate children shall be entitled to fifty percent (50%) of
the share of the legitimate, legitimated or legally adopted children: Provided, further, That in the
absence of the dependent legitimate, legitimated children of the member, his/her dependent
illegitimate children shall be entitled to one hundred percent (100%) of the benefits. In their absence,
the dependent parents who shall be the secondary beneficiaries of the member. In the absence of all
the foregoing, any other person designated by the member as his/her secondary beneficiary.

"(l) Contingency - The retirement, death, disability, injury or sickness and maternity of the member.

"(m) Average monthly salary credit - The result obtained by dividing the sum of the last sixty (60)
monthly salary credits immediately preceding the semester of contingency by sixty (60), or the result
obtained by dividing the sum of all the monthly salary credits paid prior to the semester of
contingency by the number of monthly contributions paid in the same period, whichever is
greater: Provided, That the injury or sickness which caused the disability shall be deemed as the
permanent disability for the purpose of computing the average monthly salary credit.
"(n) Average daily salary credit- The result obtained by dividing the sum of the six (6) highest
monthly salary credits in the twelve-month period immediately preceding the semester of
contingency by one hundred eighty (180).

"(o) Semester - A period of two (2) consecutive quarters ending in the quarter of contingency.

"(p) Quarter - A period of three (3) consecutive calendar months ending on the last day of March,
June, September and December.

"(q) Credited years of service - For a member covered prior to January nineteen hundred and eighty
five (1985) minus the calendar year of coverage plus the number of calendar years in which six (6)
or more contributions have been paid from January nineteen hundred and eighty five (1985) up to
the calendar year containing the semester prior to the contingency. For a member covered in or after
January nineteen hundred and eighty five (1985), the number of calendar years in which six (6) or
more contributions have been paid from the year of coverage up to the calendar year containing the
semester prior to the contingency: Provided, That the Commission may provide for a different
number of contributions in a calendar year for it to be considered as a credited year of service.

"(r) Member - The worker who is covered under Section Nine and Section Nine-A of this Act.

"(s) Self-employed - Any person whose income is not derived from employment, as defined under
this Act, as well as those workers enumerated in Section Nine-A hereof.

"(t) Net earnings - Net income before income taxes plus non-cash charges such as depreciation and
depletion appearing in the regular financial statement of the issuing or assuming institution.

"(u) Fixed charges - Recurring expense such as amortization of debt discount or rentals for leased
properties, including interest on funded and unfunded debt.

"SEC. 9. Coverage. - (a) Coverage in the SSS shall be compulsory upon all employees not over
sixty (60) years of age and their employers: Provided, That in the case of domestic helpers, their
monthly income shall not be less than One thousand pesos (P1,000.00) a month: Provided, further,
That any benefit already earned by the employees under private benefit plans existing at the time of
the approval of this Act shall not be discontinued, reduced or otherwise impaired: Provided, further,
That private plans which are existing and in force at the time of compulsory coverage shall be
integrated with the plan of the SSS in such a way where the employer's contribution to his private
plan is more than that required of him in this Act, he shall pay to the SSS only the contribution
required of him and he shall continue his contribution to such private plan less his contribution to the
SSS so that the employer's total contribution to his benefit plan and to the SSS shall be the same as
his contribution to his private benefit plan before the compulsory coverage: Provided, further, That
any changes, adjustments, modifications, eliminations or improvements in the benefits to be
available under the remaining private plan, which may be necessary to adopt by reason of the
reduced contributions thereto as a result of the integration, shall be subject to agreements between
the employers and employees concerned: Provided, further, That the private benefit plan which the
employer shall continue for his employees shall remain under the employer's management and
control unless there is an existing agreement to the contrary: Provided, finally, That nothing in this
Act shall be construed as a limitation on the right of employers and employees to agree on and
adopt benefits which are over and above those Provided under this Act.

"(b) Spouses who devote full time to managing the household and family affairs, unless they are also
engaged in other vocation or employment which is subject to mandatory coverage, may be covered
by the SSS on a voluntary basis.
"(c) Filipinos recruited by foreign-based employers for employment abroad may be covered by the
SSS on a voluntary basis.

"SEC. 9-A. Compulsory Coverage of the Self-Employed. - Coverage in the SSS shall also be
compulsory upon such self-employed persons as may be determined by the Commission under such
rules and regulations as it may prescribe, including but not limited to the following:

"1. All self-employed professionals;

"2. Partners and single proprietors of businesses;

"3. Actors and actresses, directors, scriptwriters and news correspondents who do not fall
within the definition of the term "employee" in Section 8 (d) of this Act;

"4. Professional athletes, coaches, trainers and jockeys; and

"5. Individual farmers and fishermen.

"Unless otherwise specified herein, all provisions of this Act applicable to covered employees shall
also be applicable to the covered self-employed persons.

"SEC. 10. Effective Date of Coverage. - Compulsory coverage of the employer shall take effect on
the first day of his operation and that of the employee on the day of his employment: Provided, That
the compulsory coverage of the self-employed person shall take effect upon his registration with the
SSS.

"SEC. 11. Effect of Separation from Employment. - When an employee under compulsory coverage
is separated from employment, his employer's contribution on his account and his obligation to pay
contributions arising from that employment shall cease at the end of the month of separation, but
said employee shall be credited with all contributions paid on his behalf and entitled to benefits
according to the provisions of this Act. He may, however, continue to pay the total contributions to
maintain his right to full benefit.

"SEC. 11-A. Effect of Interruption of Business or Professional Income. - If the self-employed realizes
no income in any given month, he shall not be required to pay contributions for that month. He may,
however, be allowed to continue paying contributions under the same rules and regulations
applicable to a separated employee member: Provided, That no retroactive payment of contributions
shall be allowed other than as prescribed under Section Twenty-two-A hereof.

"SEC. 12. Monthly Pension. - (a) The monthly pension shall be the highest of the following amounts:

"(1) The sum of the following:

"(i) Three hundred pesos (P300.00; plus

"(ii) Twenty percent (20%) of the average monthly salary credit; plus

"(iii) Two percent (2%) of the average monthly salary credit for each credited year of
service in excess of ten (10) years; or

"(2) Forth percent (40%) of the average monthly salary credit; or

 "(3) One thousand pesos (P1,000.00): Provided, That the monthly pension shall in no case
be paid for an aggregate amount of less than sixty (60) months.

"(b) Notwithstanding the preceding paragraph, the minimum pension shall be One thousand two
hundred pesos (P1,200.00) for members with at least ten (10) credited years of service and Two
thousand four hundred pesos (P2,400.00) for those with twenty (20) credited years of service.

"SEC. 12-A. Dependents' Pension. - Where monthly pension is payable on account of death,
permanent total disability or retirement, dependents' pension equivalent to ten percent (10%) of the
monthly pension or Two hundred fifty pesos (P250.00), whichever is higher, shall also be paid for
each dependent child conceived on or before the date of the contingency but not exceeding five (5),
beginning with the youngest and without substitution: Provided, That where there are legitimate or
illegitimate children, the former shall be preferred.

SEC. 12-B. Retirement Benefits. - (a) A member who has paid at least one hundred twenty (120)
monthly contributions prior to the semester of retirement and who: (1) has reached the age of sixty
(60) years and is already separated from employment or has ceased to be self-employed; or (2) has
reached the age of sixty-five (65) years, shall be entitled for as long as he lives to the monthly
pension: Provided, That he shall have the option to receive his first eighteen (18) monthly pensions
in lump sum discounted at a preferential rate of interest to be determined by the SSS.

"(b) A covered member who is sixty (60) years old at retirement and who does not qualify for pension
benefits under paragraph (a) above, shall be entitled to a lump sum benefit equal to the total
contributions paid by him and on his behalf: Provided, That he is separated from employment and is
not continuing payment of contributions to the SSS on his own.

"(c) The monthly pension shall be suspended upon the reemployment or resumption of self-
employment of a retired member who is less than sixty-five (65) years old. He shall again be subject
to Section Eighteen and his employer to Section Nineteen of this Act.

"(d) Upon the death of the retired member, his primary beneficiaries as of the date of his retirement
shall be entitled to receive the monthly pension: Provided, That if he has no primary beneficiaries
and he dies within sixty (60) months from the start of his monthly pension, his secondary
beneficiaries shall be entitled to a lump sum benefit equivalent to the total monthly pensions
corresponding to the balance of the five-year guaranteed period, excluding the dependents' pension.

"(e) The monthly pension of a member who retires after reaching age sixty (60) shall be the higher of
either: (1) the monthly pension computed at the earliest time he could have retired had he been
separated from employment or ceased to be self-employed plus all adjustments thereto; or (2) the
monthly pension computed at the time when he actually retires.

SEC. 22. Remittance of Contributions. -- (a) The contributions imposed in the preceding Section
shall be remitted to the SSS within the first ten (10) days of each calendar month following the month
for which they are applicable or within such time as the Commission may prescribe. Every employer
required to deduct and to remit such contributions shall be liable for their payment and if any
contribution is not paid to the SSS as herein prescribed, he shall pay besides the contribution a
penalty thereon of three percent (3%) per month from the date the contribution falls due until paid. If
deemed expedient and advisable by the Commission, the collection and remittance of contributions
shall be made quarterly or semi-annually in advance, the contributions payable by the employees to
be advanced by their respective employers: Provided, That upon separation of an employee, any
contribution so paid in advance but not due shall be credited or refunded to his employer.
"(b) The contributions payable under this Act in cases where an employer refuses or neglects to pay
the same shall be collected by the SSS in the same manner as taxes are made collectible under the
National Internal Revenue Code, as amended. Failure or refusal of the employer to pay or remit the
contributions herein prescribed shall not prejudice the right of the covered employee to the benefits
of the coverage.

"The right to institute the necessary action against the employer may be commenced within twenty
(20) years from the time the delinquency is known or the assessment is made by the SSS, or from
the time the benefit accrues, as the case may be.

"(c) Should any person, natural or juridical, default in any payment of contributions, the Commission
may also collect the same in either of the following ways:

"1. By an action in court, which shall hear and dispose of the case in preference to any other
civil action; or

"2. By issuing a warrant to the Sheriff of any province or city commanding him to levy upon
and sell any real and personal property of the debtor. The Sheriff's sale by virtue of said
warrant shall be governed by the same procedure prescribed for executions against property
upon judgments by a court of record.

"(d) The last complete record of monthly contributions paid by the employer or the average of the
monthly contributions paid during the past three (3) years as of the date of filing of the action for
collection shall be presumed to be the monthly contributions payable by and due from the employer
to the SSS for each of the unpaid month, unless contradicted and overcome by other
evidence: Provided, That the SSS shall not be barred from determining and collecting the true and
correct contributions due the SSS even after full payment pursuant to this paragraph, nor shall the
employer be relieved of his liability under Section Twenty-eight of this Act.

"SEC. 22-A. Remittance of Contributions of Self-Employed Member. - Self-employed members shall

remit their monthly contributions quarterly on such dates and schedules as the Commission may
specify through rules and regulations: Provided, That no retroactive payment of contributions shall
be allowed, except as Provided in this Section.

Facts:
In 1994, Edgardo submitted his SSS Form E-4 with his wife Edna and their children as
beneficiaries. When he died in 2005, Edna tried to claim the death benefits as the wife of a
deceased member but it was denied. It appears from the SSS records that Edgardo had another set
of SSS Form E-4 in 1982 where his former wife Rosemarie and their child were designated as
beneficiaries. Edna did not know that Edgardo was previously married to another woman. She then
filed for a petition before the SSS, and notice was sent to Rosemarie but she made no answer. The
SSC dismissed Ednas petition because the SSS Form E-4 designating Rosemarie and her child
was not revoked by Edgardo, and that she was still presumed to be the legal wife as Edna could not
proved that Edgardos previous marriage was annulled or divorced.

Issue: W/N Edna is entitled to the SSS benefits as the wife of a deceased member
Held:
No. The law in force at the time of Edgardos death was RA 8282. Applying Section 8(e) and (k)
thereof, only the legal spouse of the deceased-member is qualified to be the beneficiary of the
latters SS benefits. Here, there is a concrete proof that Edgardo contracted an earlier marriage with
another individual as evidenced by their marriage contract.

Since the second marriage of Edgardo with Edna was celebrated when the Family Code was
already in force. Edna, pursuant to Art 41 of the Family Code, failed to establish that there was no
impediment or that the impediment was already removed at the time of the celebration of her
marriage to Edgardo. Edna could not adduce evidence to prove that the earlier marriage of Edgardo
was either annulled or dissolved or whether there was a declaration of Rosemaries presumptive
death before her marriage to Edgardo. What is apparent is that Edna was the second wife of
Edgardo. Considering that Edna was not able to show that she was the legal spouse of a deceased-
member, she would not qualify under the law to be the beneficiary of the death benefits of Edgardo.

Although the SSC is not intrinsically empowered to determine the validity of marriages, it is required
by Section 4(b) (7) of R.A. No. 828229 to examine available statistical and economic data to ensure
that the benefits fall into the rightful beneficiaries

ELENA P. DYCAICO, G.R. No. 161357

Petitioner,
versus
SOCIAL SECURITY SYSTEM CHICO-NAZARIO and
and SOCIAL SECURITY GARCIA, JJ.
COMMISSION,
Respondents. Promulgated:

November 30, 2005

Bonifacio S. Dycaico became a member of the SSS on January 24, 1980. In

his self-employed data record (SSS Form RS-1), he named the petitioner,
Elena P. Dycaico, and their eight children as his beneficiaries. At that time,
Bonifacio and Elena lived together as husband and wife without the benefit
of marriage.
In June 1989, Bonifacio was considered retired and began receiving his
monthly pension from the SSS. He continued to receive the monthly pension
until he passed away on June 19, 1997. A few months prior to his death,
however, Bonifacio married the petitioner on January 6, 1997.
 Shortly after Bonifacios death, the petitioner filed with the SSS an
application for survivors pension. Her application, however, was denied on
the ground that under Section 12-B(d) of Republic Act (Rep. Act) No. 8282
or the Social Security Law[2] she could not be considered a primary
beneficiary of Bonifacio as of the date of his retirement. The said proviso
reads:
Sec. 12-B. Retirement Benefits.

(d) Upon the death of the retired member, his primary beneficiaries as of
the date of his retirement shall be entitled to receive the monthly pension.

the SSC promulgated its Resolution affirming the denial of the

petitioners claim. The SSC refuted the petitioners contention that
primary beneficiaries need not be legitimate family members by citing
the definitions of primary beneficiaries and dependents in Section 8 of
Rep. Act No. 8282. Under paragraph (k) of the said provision,
primary beneficiaries are [t]he dependent spouse until he or she
remarries, the dependent legitimate, legitimated or legally adopted,
and illegitimate children Paragraph (e) of the same provision, on the
other hand, defines dependents as the following: (1) [t]he legal spouse
entitled by law to receive support from the member; (2) [t]he
legitimate, legitimated or legally adopted, and illegitimate child who
is unmarried, not gainfully employed and has not reached twenty-one
(21) years of age, or if over twenty-one (21) years of age, he is
congenitally or while still a minor has been permanently incapacitated
and incapable of self-support, physically or mentally; and (3) [t]he
parent who is receiving regular support from the member.
Based on the foregoing, according to the SSC, it has consistently ruled that
entitlement to the survivors pension in ones capacity as primary beneficiary
is premised on the legitimacy of relationship with and dependency for
support upon the deceased SSS member during his lifetime.
Under Section 12-B(d) of Rep. Act No. 8282, the primary
beneficiaries who are entitled to survivors pension are those who
qualify as such as of the date of retirement of the deceased member.
Hence, the petitioner, who was not then the legitimate spouse of
Bonifacio as of the date of his retirement, could not be considered his
primary beneficiary.
Aggrieved, the petitioner filed with the CA a petition for review. the
appellate court dismissed the petition
 The petitioner maintains that when she and Bonifacio got married in January
1997, a few months before he passed away, they merely intended to legalize
their relationship and had no intention to commit any fraud. Further, since
Rep. Act No. 8282 is a social legislation, it should be construed liberally in
favor of claimants like the petitioner. She cites the Courts pronouncement
that the sympathy of the law on social security is toward its beneficiaries,
and the law, by its own terms, requires a construction of utmost liberality in
their favor.[5]
The SSS posits that the statutes intent is to give survivorship pension
only to primary beneficiaries at the time of the retirement of the
deceased member. Rep. Act No. 8282 itself ordains the persons
entitled thereto and cannot be subject of change by the SSS.

Issue: won petitioner wife, who was not then the legitimate spouse of
Bonifacio as of the date of his retirement, could be considered his
primary beneficiary.
Ruling:

The Court holds that the proviso as of the date of his retirement in Section
12-B(d) of Rep. Act No. 8282, which qualifies the term primary
beneficiaries, is unconstitutional for it violates the due process and equal
protection clauses of the Constitution.[7]

In an analogous case, Government Service Insurance System v. Montesclaros

The proviso, which denied a dependent spouses claim for survivorship
pension if the dependent spouse contracted marriage to the pensioner within
the three-year prohibited period, was declared offensive to the due process
clause. There was outright confiscation of benefits due the surviving spouse
without giving him or her an opportunity to be heard. The proviso was also
held to infringe the equal protection clause as it discriminated against
dependent spouses who contracted their respective marriages to pensioners
within three years before they qualified for their pension.

For reasons which shall be discussed shortly, the proviso as of the date of his
retirement in Section 12-B(d) of Rep. Act No. 8282 similarly violates the
due process and equal protection clauses of the Constitution.

The proviso infringes the equal protection clause

 the petitioner belongs to the second group of dependent spouses, i.e., her
marriage to Bonifacio was contracted after his retirement. She and those
similarly situated are undoubtedly discriminated against as the proviso as of
the date of his retirement disqualifies them from being considered primary
beneficiaries for the purpose of entitlement to survivors pension.
the proviso was apparently intended to prevent sham marriages or those
contracted by persons solely to enable one spouse to claim benefits upon the
anticipated death of the other spouse.
This concern is concededly valid. However, classifying dependent spouses
and determining their entitlement to survivors pension based on whether the
marriage was contracted before or after the retirement of the other spouse,
regardless of the duration of the said marriage, bears no relation to the
achievement of the policy objective of the law,i.e., provide meaningful
protection to members and their beneficiaries against the hazard of
disability, sickness, maternity, old age, death and other contingencies
 resulting in loss of income or financial burden."[14] Put differently, such
classification of dependent spouses is not germane to the aforesaid policy
objective.
Further, the classification of dependent spouses on the basis of whether their
respective marriages to the SSS member were contracted prior to or after the
latters retirement for the purpose of entitlement to survivors pension does
not rest on real and substantial distinctions. It is arbitrary and discriminatory.

The proviso infringes the due process clause

Thus, it was ruled that, where the employee retires and meets the eligibility
requirements, he acquires a vested right to benefits that is protected by the
due process clause and [r]etirees enjoy a protected property interest
whenever they acquire a right to immediate payment under pre-existing
law.[20] Further, since pursuant to the pertinent law therein, the dependent
spouse is entitled to survivorship pension, a widows right to receive pension
following the demise of her husband is also part of the husbands contractual
compensation.[21]
Even the retirement benefits of self-employed individuals, like Bonifacio,
who have been included in the compulsory coverage of Rep. Act No.
8282[25] are not mere gratuity because they are required to pay both the
employer and employee contributions.
under Rep. Act No. 8282, the surviving spouse is entitled to survivors
pension accruing on the death of the member; hence, the surviving spouses
right to receive such benefit following the demise of the wife or husband, as
the case may be, is also part of the latters contractual compensation.
The proviso as of the date of his retirement in Section 12-B(d) of Rep. Act
No. 8282 runs afoul of the due process clause as it outrightly deprives the
surviving spouses whose respective marriages to the retired SSS members
were contracted after the latters retirement of their survivors benefits. There
is outright confiscation of benefits due such surviving spouses without
giving them an opportunity to be heard.
In the petitioners case, for example, she asserted that when she and
Bonifacio got married in 1997, it was merely to legalize their relationship
and not to commit fraud. This claim is quite believable. After all, they had
been living together since 1980 and, in fact, during that time their eldest
child was already twenty-four (24) years old. However, the petitioner was
not given any opportunity to prove her claim that she was Bonifacios bona
 fide legal spouse as she was automatically disqualified from being
considered as his primary beneficiary.

Conclusion

Even as the proviso as of the date of his retirement in Section 12-B(d) is

nullified, the enumeration of primary beneficiaries for the purpose of entitlement to
survivors pension is not substantially affected since the following persons are
considered as such under Section 8(k) of Rep. Act No. 8282:
(1) The dependent spouse until he or she remarries; and

(2) The dependent legitimate, legitimated or legally adopted, and illegitimate

children.

In relation thereto, Section 8(e) thereof qualifies the dependent spouse and
dependent children as follows:
(1) The legal spouse entitled by law to receive support from the member;
(2) The legitimate, legitimated or legally adopted, and illegitimate child who is
unmarried, not gainfully employed and has not reached twenty-one years (21)
of age, or if over twenty-one (21) years of age, he is congenitally or while still
a minor has been permanently incapacitated and incapable of self-support,
physically or mentally.

Finally, the Court concedes that the petitioner did not raise the issue of the
validity of the proviso as of the date of his retirement in Section 12-B(d) of Rep.
Act No. 8282. The rule is that the Court does not decide questions of a
constitutional nature unless absolutely necessary to a decision of the
case.[29] However, the question of the constitutionality of the proviso is absolutely
necessary for the proper resolution of the present case. Accordingly, the Court
required the parties to present their arguments on this issue and proceeded to pass
upon the same in the exercise of its equity jurisdiction and in order to render
substantial justice to the petitioner who, presumably in her advanced age by now,
deserves to receive forthwith the survivors pension accruing upon the death of her
husband.

SOCIAL SECURITY G.R. No. 167050

COMMISSION,
Petitioner,
Present:
 CORONA, C.J.,
Chairperson
VELASCO, JR.,
-versus- LEONARDO-DE CASTRO,
PERALTA,* and
PEREZ, JJ.

RIZAL POULTRY and

LIVESTOCK ASSOCIATION,
INC., BSD AGRO INDUSTRIAL
DEVELOPMENT Promulgated:
CORPORATION and BENJAMIN
SAN DIEGO, June 1, 2011
Respondents.
x ----------------------------------------------------------------------------------------x
DECISION

PEREZ, J.:

This petition for certiorari challenges the Decision[1] dated 20 September

2004 and Resolution[2] dated 9 February 2005 of the Court of Appeals. The instant
case stemmed from a petition filed by Alberto Angeles (Angeles) before the Social
Security Commission (SSC) to compel respondents Rizal Poultry and Livestock
Association, Inc. (Rizal Poultry) or BSD Agro Industrial Development Corporation
(BSD Agro) to remit to the Social Security System (SSS) all contributions due for
and in his behalf. Respondents countered with a Motion to Dismiss[3] citing rulings
of the National Labor Relations Commission (NLRC) and Court of Appeals
regarding the absence of employer-employee relationship between Angeles and the
respondents.

As a brief backgrounder, Angeles had earlier filed a complaint for illegal

dismissal against BSD Agro and/or its owner, Benjamin San Diego (San
Diego). The Labor Arbiter initially found that Angeles was an employee and that
he was illegally dismissed. On appeal, however, the NLRC reversed the Labor
Arbiters Decision and held that no employer-employee relationship existed
between Angeles and respondents. The ruling was anchored on the finding that the
duties performed by Angeles, such as carpentry, plumbing, painting and electrical
works, were not independent and integral steps in the essential operations of the
company, which is engaged in the poultry business.[4] Angeles elevated the case to
the Court of Appeals via petition for certiorari. The appellate court affirmed the
NLRC ruling and upheld the absence of employer-employee
[5]
relationship. Angeles moved for reconsideration but it was denied by the Court
of Appeals.[6] No further appeal was undertaken, hence, an entry of judgment was
made on 26 May 2001.[7]

At any rate, the SSC did not take into consideration the decision of the
NLRC. It denied respondents motion to dismiss in an Order dated 19 February
2002. The SSC ratiocinated, thus:

Decisions of the NLRC and other tribunals on the issue of existence of

employer-employee relationship between parties are not binding on the
Commission. At most, such finding has only a persuasive effect and does not
constitute res judicata as a ground for dismissal of an action pending before
Us. While it is true that the parties before the NLRC and in this case are the same,
the issues and subject matter are entirely different.The labor case is for illegal
dismissal with demand for backwages and other monetary claims, while the
present action is for remittance of unpaid SS[S] contributions. In other words,
although in both suits the respondents invoke lack of employer-employee
relationship, the same does not proceed from identical causes of action as one is
for violation of the Labor Code while the instant case is for violation of the SS[S]
Law.

Moreover, the respondents arguments raising the absence of employer-

employee relationship as a defense already traverse the very issues of the case at
bar, i.e., the petitioners fact of employment and entitlement to SS[S]
coverage. Generally, factual matters should not weigh in resolving a motion to
dismiss when it is based on the ground of failure to state a cause of action, but
rather, merely the sufficiency or insufficienciy of the allegations in the
complaint. x x x. In this respect, it must be observed that the petitioner very
categorically set forth in his Petition, that he was employed by the respondent(s)
from 1985 to 1997.[8]

A subsequent motion for reconsideration filed by respondents was likewise

denied on 11 June 2002. The SSC reiterated that the principle of res judicata does
not apply in this case because of the absence of the indispensable element of
identity of cause of action.[9]

Unfazed, respondents sought recourse before the Court of Appeals by way

of a petition for certiorari. The Court of Appeals reversed the rulings of the SSC
and held that there is a common issue between the cases before the SSC and in the
NLRC; and it is whether there existed an employer-employee relationship between
Angeles and respondents. Thus, the case falls squarely under the principle of res
judicata, particularly under the rule on conclusiveness of judgment, as enunciated
in Smith Bell and Co. v. Court of Appeals.[10]

The Court of Appeals disposed, thus:

WHEREFORE, the petition is GRANTED. The Order dated February

19, 2000 and the Resolution dated June 11, 2002 rendered by public respondent
Social Security Commissoin in SSC Case No. 9-15225-01 are
hereby REVERSED and SET ASIDE and the respondent commission is ordered
to DISMISS Social Security Commission Case No. 9-15225-01.[11]

After the denial of their motion for reconsideration in a Resolution [12] dated
9 February 2005, petitioner filed the instant petition.

For our consideration are the issues raised by petitioner, to wit:

WHETHER OR NOT THE DECISION OF THE NLRC AND THE COURT OF

APPEALS, FINDING NO EMPLOYER-EMPLOYEE RELATIONSHIP,
CONSTITUTES RES JUDICATA AS A RULE ON CONCLUSIVENESS OF
JUDGMENT AS TO PRECLUDE THE RELITIGATION OF THE ISSUE OF
EMPLOYER-EMPLOYEE RELATIONSHIP IN A SUBSEQUENT CASE
FILED BEFORE THE PETITIONER.

WHETHER OR NOT RESPONDENT COURT OF APPEALS MAY ORDER

OUTRIGHT THE DISMISSAL OF THE SSC CASE IN THE CERTIORARI
PROCEEDINGS BEFORE IT.[13]
SSC maintains that the prior judgment rendered by the NLRC and Court of
Appeals, that no employer-employee relationship existed between the parties, does
not have the force of res judicataby prior judgment or as a rule on the
conclusiveness of judgment. It contends that the labor dispute and the SSC claim
do not proceed from the same cause of action in that the action before SSC is for
non-remittance of SSS contributions while the NLRC case was for illegal
dismissal. The element of identity of parties is likewise unavailing in this case,
according to SSC. Aside from SSS intervening, another employer, Rizal Poultry,
was added as respondent in the case lodged before the SSC. There is no showing
that BSD Agro and Rizal Poultry refer to the same juridical entity. Thus, the
finding of absence of employer-employee relationship between BSD Agro and
Angeles could not automatically extend to Rizal Poultry. Consequently, SSC
assails the order of dismissal of the case lodged before it.

SSC also claims that the evidence submitted in the SSC case is different
from that adduced in the NLRC case. Rather than ordering the dismissal of the
SSC case, the Court of Appeals should have allowed SSC to resolve the case on its
merits by applying the Social Security Act of 1997.

Respondents assert that the findings of the NLRC are conclusive upon the
SSC under the principle of res judicata and in line with the ruling in Smith Bell v.
Court of Appeals. Respondents argue that there is substantially an identity of
parties in the NLRC and SSC cases because Angeles himself, in his Petition,
treated Rizal Poultry, BSD Agro and San Diego as one and the same entity.

Respondents oppose the view proffered by SSC that the evidence to prove
the existence of employer-employee relationship obtaining before the NLRC and
SSS are entirely different.Respondents opine that the definition of an employee
always proceeds from the existence of an employer-employee relationship.

In essence, the main issue to be resolved is whether res judicata applies so

as to preclude the SSC from resolving anew the existence of employer-employee
relationship, which issue was previously determined in the NLRC case.

Res judicata embraces two concepts: (1) bar by prior judgment as enunciated
in Rule 39, Section 47(b) of the Rules of Civil Procedure; and (2) conclusiveness
of judgment in Rule 39, Section 47(c).[14]

There is bar by prior judgment when, as between the first case where the
judgment was rendered and the second case that is sought to be barred, there is
identity of parties, subject matter, and causes of action. In this instance, the
judgment in the first case constitutes an absolute bar to the second action.[15]

But where there is identity of parties in the first and second cases, but no
identity of causes of action, the first judgment is conclusive only as to those
matters actually and directly controverted and determined and not as to matters
merely involved therein. This is the concept of res judicata known as
conclusiveness of judgment. Stated differently, any right, fact or matter in issue
directly adjudicated or necessarily involved in the determination of an action
before a competent court in which judgment is rendered on the merits is
conclusively settled by the judgment therein and cannot again be litigated between
the parties and their privies, whether or not the claim, demand, purpose, or subject
matter of the two actions is the same.[16]

Thus, if a particular point or question is in issue in the second action, and the
judgment will depend on the determination of that particular point or question, a
former judgment between the same parties or their privies will be final and
conclusive in the second if that same point or question was in issue and adjudicated
in the first suit. Identity of cause of action is not required but merely identity of
issue.[17]

The elements of res judicata are: (1) the judgment sought to bar the new
action must be final; (2) the decision must have been rendered by a court having
jurisdiction over the subject matter and the parties; (3) the disposition of the case
must be a judgment on the merits; and (4) there must be as between the first and
second action, identity of parties, subject matter, and causes of action. Should
identity of parties, subject matter, and causes of action be shown in the two cases,
then res judicata in its aspect as a bar by prior judgment would apply. If as
between the two cases, only identity of parties can be shown, but not identical
causes of action, then res judicata as conclusiveness of judgment applies.[18]

Verily, the principle of res judicata in the mode of conclusiveness of

judgment applies in this case. The first element is present in this case. The NLRC
ruling was affirmed by the Court of Appeals. It was a judicial affirmation through a
decision duly promulgated and rendered final and executory when no appeal was
undertaken within the reglementary period. The jurisdiction of the NLRC, which is
a quasi-judicial body, was undisputed. Neither can the jurisdiction of the Court of
Appeals over the NLRC decision be the subject of a dispute. The NLRC case was
clearly decided on its merits; likewise on the merits was the affirmance of the
NLRC by the Court of Appeals.

With respect to the fourth element of identity of parties, we hold that there is
substantial compliance.
 The parties in SSC and NLRC cases are not strictly identical. Rizal Poultry
was impleaded as additional respondent in the SSC case. Jurisprudence however
does not dictate absolute identity but only substantial identity. [19] There is
substantial identity of parties when there is a community of interest between a
party in the first case and a party in the second case, even if the latter was not
impleaded in the first case.[20]

BSD Agro, Rizal Poultry and San Diego were litigating under one and the
same entity both before the NLRC and the SSC. Although Rizal Poultry is not a
party in the NLRC case, there are numerous indications that all the while, Rizal
Poultry was also an employer of Angeles together with BSD Agro and San
Diego. Angeles admitted before the NLRC that he was employed by BSD Agro
and San Diego from 1985 until 1997.[21] He made a similar claim in his Petition
before the SSC including as employer Rizal Poultry as respondent.[22] Angeles
presented as evidence before the SSC his Identification Card and a Job Order to
prove his employment in Rizal Poultry. He clarified in his Opposition to the
Motion to Dismiss[23] filed before SSC that he failed to adduce these as evidence
before the NLRC even if it would have proven his employment with BSD
Agro. Most significantly, the three respondents, BSD Agro, Rizal Poultry and San
Diego, litigated as one entity before the SSC. They were represented by one
counsel and they submitted their pleadings as such one entity. Certainly, and at the
very least, a community of interest exists among them. We therefore rule that there
is substantial if not actual identity of parties both in the NLRC and SSC cases.

As previously stated, an identity in the cause of action need not obtain in order to
apply res judicata by conclusiveness of judgment. An identity of issues would
suffice.

The remittance of SSS contributions is mandated by Section 22(a) of the

Social Security Act of 1997, viz:

SEC. 22. Remittance of Contributions. - (a) The contributions imposed in

the preceding Section shall be remitted to the SSS within the first ten (10) days of
each calendar month following the month for which they are applicable or within
such time as the Commission may prescribe. Every employer required to deduct
and to remit such contributions shall be liable for their payment and if any
contribution is not paid to the SSS as herein prescribed, he shall pay besides the
 contribution a penalty thereon of three percent (3%) per month from the date the
contribution falls due until paid. x x x.

The mandatory coverage under the Social Security Act is premised on the
existence of an employer-employee relationship.[24] This is evident from Section
9(a) which provides:

SEC. 9. Coverage. - (a) Coverage in the SSS shall be compulsory upon all
employees not over sixty (60) years of age and their employers: Provided, That in
the case of domestic helpers, their monthly income shall not be less than One
thousand pesos (P1,000.00) a month x x x.

Section 8(d) of the same law defines an employee as any person who
performs services for an employer in which either or both mental or physical
efforts are used and who receives compensation for such services, where there is
an employer-employee relationship. The illegal dismissal case before the NLRC
involved an inquiry into the existence or non-existence of an employer-employee
relationship. The very same inquiry is needed in the SSC case. And there was no
indication therein that there is an essential conceptual difference between the
definition of employee under the Labor Code and the Social Security Act.
In the instant case, therefore, res judicata in the concept of conclusiveness of
judgment applies. The judgment in the NLRC case pertaining to a finding of an
absence of employer-employee relationship between Angeles and respondents is
conclusive on the SSC case.

A case in point is Smith Bell and Co. v. Court of Appeals[25] which, contrary to
SSC, is apt and proper reference. Smith Bell availed of the services of private
respondents to transport cargoes from the pier to the company's warehouse. Cases
were filed against Smith Bell, one for illegal dismissal before the NLRC and the
other one with the SSC, to direct Smith Bell to report all private respondents to the
SSS for coverage. While the SSC case was pending before the Court of Appeals,
Smith Bell presented the resolution of the Supreme Court in G.R. No. L-44620,
which affirmed the NLRC, Secretary of Labor, and Court of Appeals finding that
no employer-employee relationship existed between the parties, to constitute as bar
to the SSC case. We granted the petition of Smith Bell and ordered the dismissal of
the case. We held that the controversy is squarely covered by the principle of res
judicata, particularly under the rule on conclusiveness of judgment. Therefore, the
judgment in G.R. No. L-44620 bars the SSC case, as the relief sought in the latter
case is inextricably related to the ruling in G.R. No. L-44620 to the effect that
private respondents are not employees of Smith Bell.

The fairly recent case of Co v. People,[26] likewise applies to the present case. An
information was filed against Co by private respondent spouses who claim to be
employees of the former for violation of the Social Security Act, specifically for
non-remittance of SSS contributions. Earlier, respondent spouses had filed a labor
case for illegal dismissal. The NLRC finally ruled that there was no employer-
employee relationship between her and respondent spouses. Co then filed a motion
to quash the information, arguing that the facts alleged in the Information did not
constitute an offense because respondent spouses were not her employees. In
support of her motion, she cited the NLRC ruling. This Court applied Smith
Bell and declared that the final and executory NLRC decision to the effect that
respondent spouses were not the employees of petitioner is a ruling binding in the
case for violation of the Social Security Act. The Court further stated that the
doctrine of conclusiveness of judgment also applies in criminal cases.[27]

Applying the rule on res judicata by conclusiveness of judgment in

conjunction with the aforecited cases, the Court of Appeals aptly ruled, thus:

In SSC Case No. 9-15225-01, private respondent Angeles is

seeking to compel herein petitioners to remit to the Social Security
System (SSS) all contributions due for and in his behalf, whereas in
NLRC NCR CA 018066-99 (NLRC RAB-IV-5-9028-97 RI) private
respondent prayed for the declaration of his dismissal illegal. In SSC No.
9-15225-01, private respondent, in seeking to enforce his alleged right to
compulsory SSS coverage, alleged that he had been an employee of
petitioners; whereas to support his position in the labor case that he was
illegally dismissed by petitioners BSD Agro and/or Benjamin San Diego,
he asserted that there was an employer-employee relationship existing
between him and petitioners at the time of his dismissal in 1997. Simply
stated, the issue common to both cases is whether there existed an
employer-employee relationship between private respondent and
petitioners at the time of the acts complaint of were committed both in
SSC Case No. 9-15225-01 and NLRC NCR CA 018066-99 (NLRC
RAB-IV-5-9028-977-RI).
 The issue of employer-employee relationship was laid to rest in
CA GR. SP. No. 55383, through this Courts Decision dated October 27,
2000 which has long attained finality. Our affirmation of the NLRC
decision of May 18, 1999 was an adjudication on the merits of the case.

Considering the foregoing circumstances, the instant case falls

squarely under the umbrage of res judicata, particularly, under the rule
on conclusiveness of judgment. Following this rule, as enunciated
in Smith Bell and Co. and Carriaga, Jr. cases, We hold that the relief
sought in SSC Case No. 9-15225-01 is inextricably related to Our ruling
in CA GR SP No. 55383 to the effect that private respondent was not an
employee of petitioners.[28]

The NLRC decision on the absence of employer-employee relationship

being binding in the SSC case, we affirm the dismissal by Court of Appeals of the
SSC case.

WHEREFORE, premises considered, the petition is DENIED. The Court

of Appeals Decision dated 20 September 2004, as well as its Resolution dated 9
February 2005, is AFFIRMED.