G.R. No. L-26197. August 30, 1968
ADELO C. RIVERA, PLAINTIFF-APPELLANT, VS. SAN MIGUEL BREWERY CORPORATION, DEFENDANT-APPELLEE.
CASTRO, J.:
Subject of this Resolution is
the appellant’s motion dated August 12, 1968 for reconsideration of our decision promulgated on July 20, 1968. It
raises several points which we shall discuss
in seriatim.
1. The appellant initially argues that the entire amount of P1,261.75 corresponding to his retirement benefit,
partakes of the nature of a regular
compensation for his loyalty and efficiency, citing NWSA vs. NWSA Consolidated
Unions et al. (G.R. No. L-18938, Aug. 31, 1964), and NDC vs. Unlicensed Crew Members of Three Doña Vessels (PMIU)
and the CIR (G.R. No. L-25390, June
27, 1968).
Worthy of note is the fact
that the cited cases involved the matter of gratuity or bonus, whereas the case
at bar concerns a private benefit
plan by virtue of which the employer (appellee) provides sickness, disability, death and old age benefits for its
employees (including the
appellant). But even assuming
that the appellant’ a
position is correct, that is, that his retirement benefit is in the nature of a compensation, still this will
not preclude the appellee from effecting the corresponding deduction. It is not denied that the amount of P1,261.75 is the whole
contribution of the appellee company for appellant’s benefit to its private
plan. In deducting from the said amount
its (employer’s) contribution to the Social Security System in behalf of the said employee,
the appellee company was merely exercising the right
granted to it by section
9 of the Social Security Act.
Equally
off-tangent is PLDT Co. vs. Geturian et al. (G.R. No. L–7756, July 30, 1955) because
involved therein is the question of whether a company can disregard at will the
pension plan which it has
unilaterally set up. In the case at bar,
the appellee company does not seek to
disregard or discontinue its private plan.
It merely asserts its
right to deduct from the
benefits accruing to the appellant under
the said plan what the law says it may deduct– i.e., its contributions to the System in behalf of the said employee
(appellant).
2. The appellant next argues
that the appellee company’s pension plan is a
unilateral contract which bestowed on him a vested right to the entire amount of P1, 261.75 as retirement
benefit. This is not quite correct. Upon the happening of any contingency (sickness,
disability, death or old age) provided
for in the plan, what vests in an
employee is merely the right to receive a retirement benefit, not in a specified sum, but in an amount
computed in accord with the provisions and conditions of the whole contract.[1]
Precisely, article XV of the private plan provides that:
“The benefits provided in these Rules shall be reduced by such
amounts as would be sufficient to compensate the company for its (i.e., employer’s) contribution for the account of each
employee to the Social Security System.
* * *”
Thus, his retirement benefit was accordingly reduced by
P331.40 which
is the sum total of the appellee company’s
contributions for his account to
the System.
Besides,
granting that the private plan assumed the proportions of a unilateral contract, then it is elementary that the pertinent
provisions of the law should be read into it.
One such provision is section 9 of the Social Security Act which
commands the integration of private plans – existing and in force at the time
of compulsory coverage – with the plan of
the System “in such a way that where the employer’s contributions to his
private plan is [sic] more than
that required of him in this Act, he shall pay to the System only the contribution required of him and he shall continue his contributions to
such private plan less his contribution to the System so that the employer’s total contribution to
his private benefit plan and to the
Social Security System shall be the same as
his contribution to his
private plan before the compulsory coverage; * * *”[2]
3. The appellant next contends that section 9 of the Social Security Act does not authorize the reduction of
the retirement benefit upon
retirement or at any time, but only and immediately
upon the integration of the private
plan with the System, because it mentions the word contribution no less
than seven times.
A
searching scrutiny of the aforementioned section fails to elicit any support for
the appellant’s contention. The section
merely
commands, inter alia, (1) the
integration of private plans with the System’s plan, and, (2) in case the
employer’s contributions to his private plan are more than those required of him under the Social
Security Act, the payment by him to the System of the contributions required of
him, and the continuation of the payment of his contributions to the private plan less
his contributions to the System. There is no express or implied mention of the
need to make an immediate deduction
of his contribution to the System from his contributions to the private
plan. It would seem that this right to
effect deduction, granted by law to the employer, can be exercised by the latter at his leisure but before
payment to the employee of What is due to the latter under the private
plan.
And
this is as it should be — for to compel the employer to make the deduction every time he pays the required premiums to the System, would be to constrain him to adopt
and maintain a cumbersome accounting procedure. Surely, our lawmakers did not intend nor envision
this possible inconvenience to the employer.
Indeed, where a right is granted, whatever is necessary for the proper and effective exercise of said right is
presumed to have been granted likewise.
Else, the right becomes inutile.
Nor
can we consider as a waiver the appellee’s omission to effect immediate deduction. Waivers are not presumed, but must clearly and convincingly be shown, either by
express stipulation or by acts admitting no other reasonable
interpretation.[3]
4. The appellant insists nevertheless that there was no need for
the appellee company to adopt and incorporate article
XV into its private plan because there was
no reduction of the monthly
contribution or amortization for the private benefit plan – considering that
exhibit A which is the statement of account of the retirement benefits of the appellant duly rendered by the appellee, does not show any such reduction, whereas
section 9 of the Social Security Act provides, inter alia,
“* * * 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 contribution
thereto as a result reduced of the integration,
shall be subject to agreements between
the employers and employees concerned. *
* *” (emphasis supplied)
If the
appellant had taken a long look, he would have noted that exhibit A mentioned the following:
“Less: Employer’s
Contribution to the
Social Security System ……… P331.40.”
The above amount of P331.40 is
the sum total of the deductions effected by the appellee from its contributions to the private benefit plan. But the appellant tries to salvage his
untenable position by saying that the
reduction was made too late. We have
shown the emptiness of this argument in our discussion in no. 3 above.
5. The appellant’s argument
that, not being a party to the collective bargaining agreement, he
cannot be bound by article XV of the Health, Welfare and Retirement Plan, was
sufficiently refuted in our decision of July
20, 1968.
6. The appellant differs with our view that he would be enriched at the expense of the appellee
company if he were allowed “to
enjoy the full amount of retirement pay under the private plan and all
the benefits due to him under the Social Security Act without spending any
single centavo,” and, conversely, if we were “to prohibit the Company from making the corresponding
deduction from such benefits of its
contributions to the Social Security System, in behalf of the appellant.”
Does not the appellant stand
to gain two benefits — his retirement,
benefit under the
company plan and that accruing to him
under the System? Did not the appellee company make possible his enjoyment of these
two benefits – the first, by setting up unilaterally and maintaining single handedly its health, welfare
and retirement Plan, and the second,
by paying its employer’s contributions to the System in behalf of the appellant?
The deduction of the amount of
P331.40 in this case merely represents a
writing-off of a superadded
liability, inasmuch as payment of the
System premiums would otherwise impose upon the appellee company a greater economic burden than that which
it voluntarily assumed when it
adopted the private plan. Otherwise stated, the Social Security Act grants the
employer the right to deduct its contributions to the System in
behalf of the employee in order to
preclude the employer from shouldering a double burden.
7. The appellant tries another
approach, and cites the fact that the appellee
has provided in article XV of
the private plan that –
“* * * However, beginning with the Company’s contributions corresponding
to the month of April, 1963 the Company’s contribution to the Social Security System shall no longer be deducted from
the benefits provided in these Rules,”
in support of his argument that the appellee
included this provision because
it realized the unfairness of the situation.
We disagree. That the appellee
introduced this proviso in article XV is no admission, much less proof,
that the arrangement before April 1963 was unfair. The appellant here commits the fallacy
of non sequitur.
Besides, the law (Social Security
Act, section 9) grants to the appellee the right to make the corresponding
deduction. Whether or not the appellee exercises said right is entirely up to it. That it decided to waive said right after
April 1963 is a
matter we cannot inquire into.
8. The appellant notes the
“harsh discrimination where he now finds himself after all his years of loyalty, dedication and efficiency,
to the very end of his good health.” He has not, however, offered proof that no deduction of the employer’s
contributions has been mad from the retirement benefits of other
retirees similarly situated.
9. The appellant resorts to
less than fair argument when he states that “Exhibit ‘A’ also shows
that the amount of P331.40 includes even the
period of April 1, 1963 to September 15, 1963, and that deduction was still made on September I, 1963, despite Article
XV of the Health and Welfare Plan.”
This statement is clearly false because the
stipulation of facts entered into by the parties states
“* * * That the amount of P311.40 representing the Defendant’s [appellee company] contribution to the Social Security System during the
period from September 1957 to March
1963 was deducted from Plaintiff’s [appellant] retirement benefits in accordance with Article 15 * * * of the Defendant’s [appellee]
Health, Welfare and Retirement Plan * * *.” (emphasis supplied)
Well-settled
is the rule that where parties to an action submit a case upon stipulated
facts, and there is no other evidence introduced, they
are bound by the facts so stipulated.[4] The facts agreed upon cannot be
contradicted, unless it is shown
that the admission was made through a palpable
mistake.[5] Here, the appellant
does not
allege – much less prove – that a palpable mistake has led him into agreeing to the
stipulation of facts. He may not
therefore repudiate the stipulation of facts without the consent
of the appellee or without leave of court on justifiable
reasons.[6]
10. The appellant finally rehashes his argument that deduction of the amount of P331.40 from his retirement
benefit is a violation of section 19 of the Social Security Act which
provides, in part, that –
“* * * Notwithstanding any contract to the contrary, an employer shall not deduct, directly or indirectly, from the compensation of his employees
covered by the System or otherwise recover from them the employer’s
contribution with respect to such employees,”
because – he maintains – the
word “otherwise” in this particular section should be
interpreted in its broadest sense.
Meaning, stated elsewise, that any recovery from
the employees of the employer’s contribution to the System with respect to such employees, would be illegal.
The
appellant’s interpretation of the abovequoted
provision of section 19 would create a conflict between said section and section 9 of the same Act, which states, inter
alia, that
“* * * [W]here the employer’s contributions to his private plan is [sic] more than
that required of him in this Act, he shall pay to the System only the contribution
required of him and he shall
continue his contributions to such private
plan less his contribution
to the System so that the
employer’s total contribution to his private benefit plan and to the Social
Security System shall be the same as his
contribution to his private plan before the compulsory coverage. * * *”(emphasis supplied)
For, whereas section 9 allows the employer to deduct his contributions to the System
with respect to his employees from his contributions to his private plan, section 19 – according to the appellant’s
interpretation – prohibits this deduction because it would “otherwise” be
a recovery from the employees of the
employer’s contributions to the System.
We
cannot subscribe to appellant’s
interpretation because it
will create – where there is clearly
none- a conflict between section 19 and section 9. It is not the function of courts to impute conflicting intentions to the
legislature, unless such conflicting intentions
are shown by, clear and positive contradictory language.[7] Hence, where two
constructions of a statute are possible, one of which harmonizes the provisions of the entire act, the other creating discord between different provisions, the former should be adopted.[8]
In
fine, we still hold that section 19 prohibits
any employer’s scheme to make his employees shoulder his
burden of paying to the System the employer’s contributions required by the Social Security Act,
but it does not prohibit the employer from effecting the proper deduction from
his contributions to his private benefit plan.
ACCORDINGLY, the appellant’s motion for
reconsideration dated August 12, 1968 is hereby denied.
Concepcion, C.J., Reyes, Dizon, Makalintal, Zaldivar, Sanchez, Angeles and Fernando, JJ., concur.
[1]
Hurd vs. Illinois
Bell Tel. Co., 136 F. Supp. l25. affirmed 234 F. 2d 942, certiorari denied; Seybold vs.
Western Elec. Co., 77 S.Ct. 216, 352 U.S. 918, 1 L. Ed,
2d 124, rehearing denied 77 S.Ct. 352, 352 U.S. 977,
1 L. Ed. 2d 329.
[2]
See p. 4, Decision.
[3]
Ramirez vs. CA, 52 O.G. 779; Arrieta vs.
National Rice and Corn Corp., G.R. No. L-15645, Jan. 31, 1964; Jocson vs.
Capitol Subdivision, Inc., G.R. No. L-6573, Feb. 28, 1963; Fernandez vs. Subido, et al., 70 Phil. 151, 159; Toledo vs.
Saulog Transit Corp., 59 O.G. No. 52, 8941,
8946.
[4]
Steveson & Co. vs. Collector of Internal
Revenue, 51 Phil. 178-183.
[5]
Irlanda vs. Pitargue,
22 Phil. 383.
[6]
Ortua vs. Rodriguez, 63 Phil. 809.
[7]
Medeiros vs. Soares,
61 P. 2d., p. 501.
[8]
People vs.
Rapini, 134
A. L. R., p. 545.