G.R. No. 188716 - Ocampo vs. Commission on Audit

Melinda L. Ocampo retired from the National Electrification Administration on March 1, 1996, after more than 17 years of service, availing a lump sum payment (net gratuity of P358,917.01) under Commonwealth Act No. 186 as amended by Republic Act No. 1616.
Three days later, on March 4, 1996, she assumed office as Board Member of the Energy Regulatory Board (ERB) under a Letter of Appointment dated February 16, 1996.
On June 30, 1998, upon the expiration of her term as Board Member, she retired pursuant to Executive Order No. 172, which provided retirement benefits similar to those granted to members of the Commission on Elections.
After her first retirement from the ERB, Ocampo received a lump sum gratuity benefit computed based on 60 months (five years) of advance salary and began receiving a corresponding monthly pension.

On August 25, 1998, Ocampo was re-appointed to the ERB, this time as Chairman, with an intended term of four years.
On August 15, 2001, pursuant to the abolition of the ERB and its replacement by the Energy Regulatory Commission (ERC) via Republic Act No. 9136, she retired a second time.
For her second retirement, she sought to claim retirement gratuity benefits similar to those granted under Executive Order No. 172, claiming a lump sum computed on a pro-rata basis (for a period of two years, eleven months, and twenty days) equivalent to the benefits she would have received as ERB Chairman.

Following her second retirement application, the transaction involving the payment of her benefits was subjected to a post-audit by the State Auditor, resulting in State Auditor IV, Nelda R. Monterde, issuing Notice of Suspension (NS) No. 2002-002-101 on July 10, 2002.

The NS suspended the payment of P1,452,613.71 computed as Ocampo’s second retirement gratuity and demanded legal justification for receiving two retirement gratuities under the same law (EO 172).

Correspondence between Ocampo and Chairperson Fe C. Barin of the ERC, as well as endorsements to the Department of Budget and Management (DBM), reveal contested interpretations regarding the entitlement and computation of her benefits.
The COA’s Legal and Adjudication Office-National (LAO-N) reaffirmed the disallowance via LAO-N-2003-132 (June 12, 2003) by emphasizing that the statutory scheme under EO 172 and RA 3595 does not permit a qualified official to receive double gratuity or a double monthly pension.

Ocampo contended that, as she retired twice from the ERB (first as Board Member and then as Chairman), she is entitled to two distinct sets of retirement benefits—a lump sum gratuity and a monthly pension for each instance.
She argued that the explicit language in Executive Order No. 172 and Republic Act No. 3595 does not expressly prohibit receiving retirement benefits twice and that a liberal construction of these laws is warranted to acknowledge her separate services in different capacities.
In contrast, the COA, supported by the Office of the Solicitor General (OSG), maintained that such a separation would result in double compensation, which is constitutionally and jurisprudentially impermissible.

Executive Order No. 172, which sets forth the conditions under which Board Members and the Chairman of the ERB are entitled to retirement benefits upon completion of their terms or upon becoming eligible under existing laws.
Republic Act No. 3595 (as amended), which provides for retirement benefits in the form of a lump sum gratuity (computed as one year’s salary multiplied by the number of years of service, not to exceed five years) and a life annuity based on the last monthly salary.
Administrative Order No. 444 and provisions in the Constitution (Article IX-B, Section 8) which prohibit additional or double compensation, underpinning the principle that a retiree cannot claim two full sets of benefits for services rendered within the same agency.

In its Decision No. 2008-017 dated February 15, 2008, and Decision No. 2009-038 dated June 1, 2009, the COA partially affirmed the disallowance by:

Allowing only a pro-rata retirement gratuity based on her service as ERB Board Member and as Chairman, thereby effectively reducing the total allowable benefit to P2,688,636.23.
Ordering an adjustment of the agency’s books to reflect that Ocampo had already received benefits amounting to P4,138,086.71, with a disallowance of P1,449,450.48.

The petition for certiorari was filed challenging the COA’s ruling, arguing grave abuse of discretion in not granting full benefits for each retirement instance.

Is Ocampo entitled to claim a second lump sum retirement benefit as ERB Chairperson under EO 172, despite having already received the maximum lump sum gratuity during her first retirement as a Board Member?
Does the statutory framework in EO 172 and RA 3595 permit the payment of two separate lump sum gratuities for distinct retirement events from the same agency?

Should Ocampo receive two sets of monthly pensions corresponding to her two retirements, one as a Board Member and the other as Chairman, or should the monthly pension be computed solely on the basis of her final retirement benefit?
How does the prohibition against double compensation as contained in both constitutional and jurisprudential principles affect her claim for double monthly pensions?

Did the COA properly exercise its authority in auditing and reviewing government expenditures pertaining to retirement benefits already disbursed, in light of Ocampo’s subsequent claim for additional benefits?
Was the subsequent remand directing the recomputation of retirement benefits appropriate given the statutory limitations on multiple payments?