THE SOCIAL SECURITY COMMISSION, PETITIONER, VS. THE HON. JUDGE FROILAN BAYONA, ET AL., RESPONDENTS.

On August 30, 1957, the Faculty Club of the University of Santo
Tomas, Inc. and San Beda College Lay Faculty Club, Inc. filed a
petition for declaratory relief with preliminary injunction before the
Court of First Instance of Manila alleging in substance that they have
existing agreements with their respective employers– the University of
Santo Tomas and San Beda College– for the establishment of gratuity and retirement funds which have
been in operation prior to September 1, 1957; that the Social Security
Commission tried to compel them to integrate their private systems into
the Social Security System on said date; that inasmuch as their private
systems grant more benefits to the members than the Social Security
System the integration of their private systems would deprive their
members of property without due process of law, as well as would impair
the obligation of their contract to the detriment of the members.
Hence, they prayed for the issuance of preliminary injunction ex parte
commanding the Social Security Commission to desist from compelling
them to integrate during the pendency of the case on the ground that,
unless said Commission is enjoined, it might enforce the penal
provisions of the Social Security Act.

On August 30, 1957, the court a quo, Judge Froilan Bayona, presiding, issued ex parte a writ of preliminary injunction enjoining the Social Security Commission from compelling the integration sought for.

On September 7, 1957, the Social Security Commission moved to
dissolve the preliminary injunction on the following grounds: (1) a
statute is presumed constitutional; (2) there is no irreparable injury
shown to justify the issuance of injunction; (3) injunction does not
lie against laws for public welfare; (4) injunction does not lie
against enforcement of penal laws; (5) injunction does not lie to stop
the collection of contributions under the Social Security Law; and (6)
the preliminary injunction was barred by laches.

The motion to dissolve was denied. A motion for reconsideration of
the order having likewise been denied, the Social Security Commission
filed the present petition for certiorari with preliminary injunction.

In charging respondent judge with having acted with grave abuse of discretion in issuing the writ of preliminary injunction ex parte, petitioner advances the following reasons:

1. Respondent judge enjoined the enforcement of the Social
   Security Law for the benefit of an insignificant few who had manifested
   their defiance against its implementation. It is his sworn duty to
   enforce the law and not to tamper with it. The task of suspending the
   operation of a social legislation is a matter of extreme delicacy
   because it is an interference with the official acts not only of the
   duly elected representatives of the people but also of the highest
   magistrate of the land.

2. The order of
   respondent judge in effect enjoined the enforcement of a penal statute
   which he has no power to do. The rule is that equity will not intervene
   for the purpose of enjoining the enforcement of a penal statute even if
   the same is alleged to be unconstitutional since such invalidity should
   be interposed as a defense in a prosecution based on such statute.

3. Respondent
   judge cannot enjoin the collection of contributions under the Social
   Security Law for the same have the category of taxes which are
   collectible under the National Internal Revenue Code.

4. A
   writ of preliminary injunction should be issued only to prevent great
   and irreparable injury. The injury must be actual, positive,
   substantial and irremediable at law. Respondent corporations have not
   shown that they would suffer such injury if the injunction were not
   issued.

5. The order of respondent judge
   places the government in a worse position than a private litigant for
   the latter may secure the lifting pf an injunction by filing a
   counterbond. Such right cannot be exercised by the government for the
   latter is not by law required to file a bond.

Respondent corporations, on the other hand, advance the following arguments in refutation of those adduced by petitioner:

1. It is erroneous to state that the writ of preliminary
   injunction has the effect of suspending the operation of the Social
   Security Law. That law, regardless of any injunction, continues to be
   in force except only with respect to those who have private plans of
   their own in existence at the time of the effectivity of the law.

2. It
   is not also correct to state that courts have no power to enjoin the
   enforcement of penal statutes even if they are alleged to be
   unconstitutional, for there are cases in this jurisdiction which hold
   that, under penal statutes affecting persons and property rights, where
   their constitutionality is doubtful, courts may grant preliminary
   injunction.

3. While under the law the
   contributions to the system shall be collected in the same manner as
   taxes under the National Revenue Code, the same may be enjoined if
   special circumstances exist having relation to the existence of
   irreparable injury.

4. Petitioner is also
   in error when it states that respondent corporations have not shown
   that the non-issuance of the injunction would cause them irreparable
   injury. This injury consists of the following:

(a) To lift the injunction would mean to take away the availability
of the funds of respondent corporation from their members who may
borrow them in case of necessity;

(b) To dissolve the injunction would be to take away respondents’
funds which they may never be able to get back taking note of Section
31 of the Social Security Act, as amended, which says that no person
shall be deemed to be vested with any property or right by virtue of
the enactment of said Act;

(c) If respondent corporations refuse to join the Social Security
System, criminal prosecution would ensue against their officers and
members.

A careful evaluation of the foregoing arguments provide us with some observations.

A law is presumed constitutional until otherwise declared by
judicial interpretation. The task of suspending the operation of a law
even if alleged to be unconstitutional is a matter of extreme delicacy
because it is an interference with the official acts not only of the
duly elected representatives of the people but also of the highest
magistrate of the land. This notwithstanding, respondent corporations
resisted the integration of their private systems into the system
established by the Social Security Act, and in order to avoid being
recreant to their duty which may result in their prosecution, they
filed the present petition seeking a judicial declaration on its
constitutionality. But pending such action, they sought the restraining
hand of the court on the plea that unless the enforcement of the law is
restrained, they would suffer an irreparable injury.

At this stage of the proceeding, it is not the task of the Court to
pass on the question of constitutionality of the law. This concerns the
merits of the case. We shall confine our inquiry into the propriety of
the issuance of the writ which is the main issue raised in this
petition. The foremost inquiry regarding this issue is the existence or
non-existence of irreparable injury which seems to be the main basis of
the issuance of the writ.

Damages are irreparable within the meaning of the rule relative to
the issuance of injunction where there is no standard by which their
amount can be measured with reasonable accuracy (Crouch vs. Central
Labor Council, 83 ALR, 193). “An irreparable injury which a court of
equity will enjoin includes that degree of wrong of a repeated and
continuing kind which produce hurt, inconvenience, or damage that can
be estimated only by conjecture, and not by any accurate standard of
measurement” Phipps vs. Rogue River Valley Canal Co., 7 ALR, 741). An
irreparable injury to authorize an injunction consists of “a serious
charge of, or is destructive to, the property it affects, either
physically or in the character in which it has been held and enjoined,
or when the property has some peculiar quality or use, so that its
pecuniary value will not fairly recompense the owner of the loss
thereof” (Dunker vs. Field and Tub Club, 92 P., 502).

Respondent corporations made a lengthy discourse. On the matter of
irreparable injury they may suffer if the injunction were not issued,
but the array of figures they have laid out merely succeeded in proving
that the damage, if any they may suffer, is susceptible of
mathematical computation. It is net then irreparable. As already
stat-ed, this term has a definite meaning in law. It does not have
reference to the amount of damages that may be caused but rather to the
difficulty of measuring the damages inflicted. If full compensation can
be obtained, by way of damages, equity will not apply the remedy of
injunction (28 Am. Jur., 244; 43 C.J.S., 427, 446).

Neither can respondent corporations contend that their integration
would mean the destruction of their existing private systems. The most
that can happen would be a diminution of benefits in proportion to the
reduction of the contributions to their private systems. But while they
may suffer such reduction in benefits they also stand to benefit under
the government system. Bear in mind that the integration does not mean
the discontinuance of the private system for under the law three
alternatives are open to respondents in effecting the integration.^[1]
In other words, respondents may continue with whatever private may
have at present as a complement to the benefits afforded to them under
the government system without prejudice to their integration into the
government security system.

It may be conceded that, if the injunction be lifted, the possible
damages respondents may suffer are their contributions and those of
their employers to the government security system. But restoration of
said contributions had been assured by petitioner should the provision
under consideration be declared unconstitutional and invalid. There can
always be an appropriate arrangement to provide for refund in the event
of such circumstance. Surely, the millions of pesos available to the
Social Security System would be more than sufficient to compensate
respondents for the contributions they have made.

The same thing may not be said if the enforcement of the law is
restrained, for then respondents would be more harrassed and prejudiced
in case the constitutionality of the law is upheld, since they will
have to pay all the back contributions from September, 1957, including
interests, up to the time the preliminary injunction is dissolved.
Restoration would then be much more difficult in view of the
contingencies that may arise with regard to the members of their
private systems. There are, to be sure, more weighty reasons favoring
the lifting of the injunction issued by respondent judge.

Premises considered, petition is granted. The writ of preliminary
injunction issued by respondent judge is hereby lifted. No costs.

Padilla, Reyes, J.B.L., Barrera, Paredes, and Dizon, JJ., concur.

^[1] (a) To abandon totally
their private systems and be integrated into the government system; (b)
to integrate into the government system so much of their contributions
as required by law and continue with thier systems with respect to the
excess of thier contributions; and (c) to be covered by the government
system and continue in full force thier private systems (Section 9,
Republic Act 1161).