SSS
v. COA
G.R.
No. 224182
March
2, 2021
FACTS:
Social Security System Central
Visayas Division (hereinafter referred to as SSS-Central Visayas) granted
Collective Negotiation Agreement Incentives to its employees. The incentives
were granted pursuant Social Security Commission Resolution. However the
SSS-Central Visayas received a Notice of Disallowance issued by the Commission
on Audit Central Visayas Division which was upheld by the Commission on Audit
Proper. On appeal to the Supreme Court the issues to be resolved was whether
the Commission on Audit (COA) properly disallowed the grant of the Collective
Negotiation Agreement and is upheld to be proper, whether the amount received
as incentives should be returned.
ISSUE:
Whether or not the amount received
as incentives under the Collective Negotiation Agreement should be returned.
HELD:
The Court held that COA properly
disallowed the grant because it was done in violation of the Budget Circular,
thus lacking legal basis. Consequently, this would require the return of the
disallowed amounts. The responsibility to return is a civil obligation to which
fundamental civil law principles, such as unjust enrichment and solutio
indebiti apply regardless of the good faith of passive recipients. Solutio
indebiti is an equitable principle applicable to cases involving disallowed
benefits which prevents undue fiscal leakage that may take place if the
government is unable to recover from passive recipients amounts corresponding
to a properly disallowed transaction. Nevertheless, while the principle of solution
indebiti is consistently applied in the liability of payees to return, the
admits of exceptions, such as when the amounts received by the payees
constitutes as disallowed benefits that were genuinely given in consideration
of services rendered negating the application of unjust enrichment, and also in
cases of social justice. However in this case, the grant of the Collective
Negotiation Agreement incentive has no basis for failing to comply with the
requirements of the applicable laws. Thus, since it is devoid of legal basis,
the recipient employees have no valid claim to the benefits they received, and
accordingly, they have no claim to receive the benefits at the expense of the
government. Therefore, the approving and certifying officers of SSSCentral Visayas
are jointly and severally liable for the disallowed amounts received by the
individual employees, while the recipient employees are liable to return the
amounts they received respectively.
