A.M. No. 02-12-01-SC - Re: Automatic Permanent Total Disability Benefits to Heirs of Justices and Judges

Two separate cases involved claims for permanent total disability benefits under Republic Act No. 910, as amended, pertaining to Justices and Judges who died while in actual service.
The cases involved were those of the late Judge Melvyn U. Calvan and the late Judge Emmanuel R. Real.

Judge Calvan was the Presiding Judge of the Municipal Circuit Trial Court in Bangui, Ilocos Norte.
He died on November 16, 2003, due to cardio-respiratory arrest while still in active service.
His record showed a total government service of 21 years, 2 months, and 1 day, which included 16 years, 3 months, and 6 days in the Judiciary.
On February 12, 2004, his widow, Dr. Susana B. Calvan, filed a claim for benefits under Republic Act No. 910, referencing the Court’s prior Resolution dated September 30, 2003 (A.M. No. 02-12-01-SC).
The application for benefits was subsequently approved on March 17, 2004 in Resolution A.M. No. 11445-Ret.
The Supreme Court’s Fiscal Management and Budget Office (FMBO) forwarded a request to the Department of Budget and Management (DBM) for the release of funds that included an additional 5-year lump sum gratuity, which was designed to complete the total benefit package.

Judge Real was the Presiding Judge of the Regional Trial Court in Ligao, Albay, Branch II.
He died on February 25, 2002, due to cardiac arrest and complications from multiple myeloma while still in active service.
His service record comprised 32 years, 7 months, and 23 days, with 10 years and 28 days in the Judiciary.
On March 11, 2002, his widow, Mrs. Elena N. Real, together with their four children, filed a claim for permanent total disability benefits.
Initially, the claim was denied on June 3, 2002 (Resolution A.M. No. 10821-Ret.) due to non-filing of the application during his incumbency for medical evaluation, but the denial was qualified by approving the claim as a claim for retirement/gratuity benefits under Republic Act No. 910.
Subsequently, Mrs. Real sought reconsideration under the same resolution (A.M. No. 02-12-01-SC) and, on March 22, 2004, the claim was approved with an order to pay the additional 5-year lump sum benefits.

The DBM, through letters issued by Undersecretary Mario L. Relampagos, disallowed the additional 5-year lump sum gratuity benefits in both cases.
The rationale given by DBM was that under Section 2 of Republic Act No. 910, a judge or justice who dies while in actual service is entitled only to a 5-year lump sum gratuity, which is distinct from the 10-year benefit applicable to a retirement due to permanent physical disability.
The DBM maintained that treating death in actual service as equivalent to retirement due to physical disability would exceed the clear provisions of the law.

The Supreme Court, through its Resolution dated September 30, 2003 in A.M. No. 02-12-01-SC, had interpreted that the benefits provided under Republic Act No. 910 should extend to cover both situations: death while in actual service and retirement due to permanent physical disability.
The Court emphasized its constitutional mandate in fiscal autonomy and administrative supervision over the judiciary, asserting its exclusive prerogative to interpret the law.
The Court critiqued the DBM for overstepping its statutory bounds by reinterpreting the law and effectively usurping the judicial function of legal interpretation.

Whether the DBM was justified in disallowing the FMBO’s request for releasing funds for the additional 5-year lump sum benefits based on its interpretation of Republic Act No. 910.
Whether the DBM's intervention in interpreting the law contravened the separation of powers as prescribed by the Constitution.

Whether the term “permanent physical disability” under Republic Act No. 910, as interpreted in the Court’s Resolution dated September 30, 2003, encompasses the situation of a judge or justice who dies while in active service.
Whether the resolution should be considered part of the law itself, thereby binding the DBM in its execution of disbursements.

Whether the DBM's act of disallowing the funds amounts to an improper review and substitution of the judicial interpretation provided in the Resolution.
Whether the executive branch agency (DBM) exceeded its mandate by reviewing and interpreting the judicial issuance rather than merely executing it.