The Supreme Court (SC) has ordered the Government Service Insurance System (GSIS) to stop enforcing a rule that excluded secondary beneficiaries from receiving survivorship benefits of deceased members who had paid premiums for at least three years but less than 15 years.

In a recent decision, the SC ruled that the GSIS exceeded its authority when it issued a rule under Section 24.2.2 of the Revised Implementing Rules and Regulations of Republic Act No. 8291, the Government Service Insurance Act of 1997.

It pointed out that under the GSIS law, a secondary beneficiary is entitled to survivorship benefits if there is no primary beneficiary; the secondary beneficiary meets the dependency requisites under the law; the member was in government service at the time of death; and the member had rendered at least three years of service.

But it said that under Section 24.2.2 of the Revised IRR, the GSIS added a new rule that limits survivorship benefits for secondary beneficiaries only to cases where the deceased member served at least 15 years.

In a decision written by Associate Justice Henri Jean Paul B. Inting, the SC declared ultra vires (beyond the powers) on the part of the GSIS in issuing Section 24.2.2 of the Revised IRR.

Since the new rule in Revised IRR is ultra vires, the GSIS is barred from enforcing the provision to the extent that it conflicts with Section 21(c) of the GSIS law under RA 8291.

The SC’s Office of the Spokesperson said that the ruling was issued on the petition filed by Petronilo B. Laroco who sought from the GSIS survivorship benefits following the death of his daughter, Cristie C. Laroco.

Cristie was a teacher at the Camp Crame Elementary School in Quezon City with 13 years of government service and had paid GSIS premiums for 12 years. She died single in 2017 and had no children.

In 2018, the GSIS’ committee on claims denied Petronilo’s application.

The committee ruled that Petronilo was not entitled to receive survivorship benefits and that he may only receive the benefits if the deceased member had rendered at least 15 years of service in government. It pointed out that Cristie had only 13 years of service.

Petronilo appealed before the GSIS Board of Trustees which denied his appeal on July 31, 2019. The board cited the Revised IRR of RA 8291.

On appeal before the Court of Appeals (CA), Petronilo’s plea was denied on Jan. 25, 2023. The CA agreed that the GSIS has the power to adopt the Revised IRR.

Petronilo elevated the case to the SC.

In resolving the petition, the SC ruled that the GSIS exceeded its authority in promulgating the Revised IRR that removed the right of secondary beneficiaries to receive survivorship benefits under the conditions expressly recognized by the law.

The SC said:

“There is no question that under Section 53 of Republic Act No. 8291, the GSIS was granted the power to promulgate rules and regulations to implement the said law. However, it is well-established that when an administrative agency is statutorily conferred with the authority to issue subordinate legislation, such power must be exercised within the confines of the enabling statute and the Constitution.

“The power does not grant the administrative agency the authority to abridge, enlarge, supplant, or modify the enabling statute, for such is the sole function of the Legislature.

“Thus, rules promulgated by an administrative agency must always be consistent with the law they intend to carry out. A regulation that modifies an existing law by abridging, impairing, or enlarging its terms, or by imposing additional requirements that are not contemplated by the statute, is void not only for being ultra vires but also for being unreasonable and must be struck down by the courts.

“Evidently, the Revised IRR of Republic Act No. 8291 impaired Section 21 (c) of the law by failing to recognize the entitlement to survivorship benefits of secondary beneficiaries of GSIS members who died in active service with at least three years of creditable service.

“That is, while Section 21 (c) of Republic Act No. 8291 grants survivorship benefits to secondary beneficiaries under such conditions, Section 24.2.2 of the Revised IRR imposes an additional requirement of least 15 years of creditable service.

“Indubitably, Section 24.2.2 of the Revised IRR of Republic Act No. 8291 is inconsistent with and unduly restricts Section 21 (c) of Republic Act No. 8291.

“Rather than faithfully implementing the enabling statute, it imposes additional requirements on secondary beneficiaries to qualify for survivorship benefits that are not required by law. Accordingly, Section 24.2.2 of the Revised IRR of Republic Act No. 8291 must be struck down for being ultra vires, insofar as it is inconsistent with the enabling statute.

“It must be emphasized that in a social insurance fund where employee participation is mandated by law, the benefits provided thereby that have accrued are considered as property within the contemplation of the Due Process Clause. The benefits are considered as part of the compensation of the member-employee.

“Given that Petronilo's status as the sole legal heir of Cristie is not disputed by the GSIS, he may receive survivorship benefits under Section 21 (c) (2) of Republic Act No. 8291.

“The case should therefore be remanded to the GSIS Committee on Claims to compute the survivorship benefits due to Petronilo in accordance with the applicable law and regulation.

“Accordingly, the Petition for Review on Certiorari is granted. The Decision dated January 25, 2023, and the Resolution dated May 24, 2023, of the Court of Appeals in CA-G.R. SP No. 163916 are set aside. Section 24.2.2 of the Implementing Rules and Regulations of Republic Act No. 8291 is declared ultra vires and the Government Service Insurance System is enjoined from implementing it insofar as it contradicts Section 2l (c) of Republic Act No. 8291. Petitioner Petronilo B. Laroco may claim survivorship benefits under Section 2l (c) (2) of Republic Act No. 8291.”