Case Summary (G.R. No. 97898)
Background Facts
San Beda College is a duly organized domestic corporation and a recognized educational institution in the Philippines. On August 30, 1957, the lay faculty club of San Beda College and another faculty club sought declaratory relief in the Court of First Instance of Manila to assess the applicability of the Social Security Act concerning their benefits plan. The court issued a preliminary injunction preventing the SSS from requiring the integration of San Beda's private benefits plan into the Social Security System.
Legal Proceedings
The SSS filed for certiorari against the injunction, which was later dissolved in a judgment rendered on May 30, 1962. Subsequently, San Beda College paid the outstanding premiums amounting to P121,111.07 in installments. However, the SSC demanded payment of penalties for late contributions, which San Beda College contested, leading to SSC Case No. 475 and the present petition for review.
Applicable Law
The relevant legislation includes Section 22 of Republic Act 1161, which mandates the collection and remittance of contributions, imposing a penalty of three percent per month on delayed payments. Furthermore, Section 5 of the Social Security Act lays out the Commission's authority regarding claims and penalties.
Jurisdiction and Penalties
San Beda College contested the SSC's jurisdiction and the constitutionality of the penalties imposed, arguing it had not been liable for delayed payments due to the injunction. The court, acknowledging the previous restraining order, found that the college could not be penalized for delays that were outside its control. The SSS's argument that the obligation to remit contributions continued despite the injunction was rejected because it failed to acknowledge the necessity of mutual consent for any payment.
Court's Rationale
The court held that the penalties were unjustified due to the injunction that prevented SSS from enforcing its collection. It clarified that San Beda's non-remittance of contributions was not due to negligence but rather the result of legal constraints. The court further indicated that any penalties resulting from the injunction should have been sought from the bond associated with the court's order, which the SSS neg
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Case Overview
- The case is a petition filed by San Beda College for a review of the resolution by the Social Security Commission dated December 1, 1966.
- The resolution found San Beda College liable for penalties due to late remittance of premium contributions from September 1957 to August 1962, ordering the college to pay a total of P120,785.45.
- The Social Security System (SSS) is a government agency established under Republic Act 1161, while San Beda College operates as a domestic corporation.
Background of the Case
- On August 30, 1957, the lay faculty club of San Beda College, alongside the University of Sto. Tomas faculty club, sought a declaratory relief from the Court of First Instance of Manila (Civil Case No. 33578) regarding the applicability of the Social Security Act to their members.
- The court issued a preliminary injunction against the Social Security Commission, preventing them from enforcing the integration of the San Beda College's private benefits plan into the Social Security System.
- Following a series of legal proceedings, on May 30, 1962, the Supreme Court ruled in favor of the Social Security Commission, dissolving the injunction and remanding the case for further proceedings.
Payment of Premiums
- After the dissolution of the injunction, San Beda College paid the overdue premiums amounting to P121,111.07 in installments across different dates in 1962 and 1963.
- The case originally filed by the faculty clubs was dismissed on November 2, 1964, due to lack of initiative in prosecution.
Demands and Legal Proceedings
- The Social Security System issued demands for penalties on August 13, 1964, and January 18, 1965, totaling P120,785.45 for the late remittance of contributions.
- Upon refusal from San Beda College to comply, the Social Security System filed a collection petition (Case No. 475) against the college.
- San Beda College contested the petition, asse