G.R. No. 152058 - Social Security Commission vs. Court of Appeals

Respondent Jose Rago worked as an electrician for Legend Engineering in Basak, Pardo, Cebu City.
On 1 December 1993 at about 6:15 p.m., while working on the ceiling of a building, he stepped on a weak ceiling joist causing him to fall approximately twelve feet.
X-ray examinations on the day of the accident revealed a marked compression fracture of the L1 vertebra and a slight kyphosis, with an initially normal spinal alignment.
Rago was hospitalized at the Perpetual Succour Hospital in Cebu City from 1 December 1993 to 24 December 1993 and confined at home from 25 December 1993 to 25 August 1994.

On 20 May 1994, Rago filed a claim for permanent partial disability benefits with the SSS, which due to his 35 monthly contributions resulted in only a lump sum award.
After making additional contributions in November 1995, he sought an adjustment from lump sum to monthly payments, which was resolved in his favor on 18 October 1995.
Rago also secured an Employee’s Compensation (EC) sickness benefit for 120 days (from 1 December 1993 to 30 March 1994), approved following an x-ray report and later filed and obtained benefits for converting the SSS disability to EC disability.

On 16 June 1998, Rago claimed for extension of his EC partial disability and was granted a 50% OB rating per the Manual on Ratings of Physical Impairment.
Multiple requests subsequently filed by Rago to convert his permanent partial disability to permanent total disability were denied by the Cebu City SSS office in a series of letters between 11 April 1999 and 17 April 2000.
The denials were based on medical findings that Rago was not entirely prevented from engaging in any gainful occupation.

On 3 April 2000, Rago petitioned the Social Security Commission (SSC) to convert his status to permanent total disability, citing:

A lengthy convalescence period (268 days) surpassing the qualifying period of 240 days.
Progressive deterioration evidenced by x-ray results.
Loss of capacity to work as an electrician, having been unemployed since the accident.

The petition was docketed as SSC Case No. 4-15009-2000.
The SSC’s position paper (dated 24 August 2000) and subsequent Resolution (dated 20 December 2000) denied the conversion request on the grounds that Rago had already been awarded the maximum benefit as a partial disability.

Rago appealed to the Court of Appeals without filing a motion for reconsideration with the SSC, filing his petition for review in CA-G.R. SP No. 63389.
The Court of Appeals, on 18 October 2001, reversed the SSC’s resolution and granted the conversion from permanent partial to permanent total disability, directing the appropriate computation of benefits.
The SSC later filed a motion for reconsideration based on issues including:

The assertion that Rago’s failure to file a motion for reconsideration was mandatory.
Tabulated contributions allegedly numbering 35 (later disputed as 57), affecting his claims.

In its resolution dated 30 January 2002, the Court of Appeals denied the SSC’s motion for reconsideration, emphasizing that once the appeal was perfected, the lower tribunal had lost jurisdiction.

On 20 March 2003, Rago communicated difficulties in securing counsel and submitted additional pleadings addressing the interpretation of the filing of a motion for reconsideration, arguing that the underlying rule was permissive rather than mandatory.
Throughout the proceedings, additional evidence such as multiple x-ray reports and affidavits was presented to attest to the progressive and disabling nature of Rago’s condition.

Whether Rago’s failure to file a motion for reconsideration with the SSC before resorting to a petition for review constituted a fatal procedural defect.
Whether the permissive character of the term “may” (amaya) in the SSC’s rules renders the motion for reconsideration optional or mandatory as a prerequisite to judicial review.

Whether Rago’s condition, initially classified as permanent partial disability, had in fact deteriorated into a permanent total disability based on:

The prolonged period of incapacity (exceeding 120 days continuously).
The cumulative period, including adjustments, of partial disability benefits amounting to recognition of permanent total disability.

Whether the medical evidence, including radiologic reports and corroborating affidavits, sufficiently supported the conversion request despite contrary opinions from some SSS personnel.

Whether the SSC’s issuance of a clarificatory order after the appeal was perfected constituted an impermissible alteration of its original ruling.
Whether judicial interference was proper given the doctrine of exhaustion of administrative remedies and the procedural posture of the case.