Orion Water District v. Government Service Insurance System
REITERATIONFacts
The Antecedents: The Government Service Insurance System (GSIS) filed a Complaint for Collection of Sum of Money and Damages against Orion Water District (OWD) and its officers for failure to remit employees' personal share in premiums for life and retirement policies covering July 1993 to July 31, 2000, amounting to ₱551,407.16. GSIS alleged repeated demands for payment were made, with the last demand letter received by OWD on November 21, 2002, but OWD failed to remit the arrearages. Procedural History: OWD filed a Motion to Dismiss, asserting that the Regional Trial Court (RTC) lacked jurisdiction because both GSIS and OWD are government-owned and controlled corporations (GOCCs), and disputes between them should be settled by the Secretary of Justice under Sections 66-70, Chapter 14, Book IV of Executive Order (E.O.) No. 292. The RTC denied the motion, finding it unmeritorious and stating that OWD failed to allege a dispute arising from the interpretation or application of statutes, contracts, or agreements. OWD's Motion for Reconsideration was also denied. Subsequently, OWD filed a petition for certiorari with the Court of Appeals (CA), imputing grave abuse of discretion to the RTC for maintaining jurisdiction. The CA affirmed the RTC's orders, ruling that E.O. No. 292 was inapplicable as the dispute was not solely between GOCCs, and that Republic Act (R.A.) No. 8291, specifically Section 41(w), sanctioned the filing of the complaint with the RTC. The Petition: OWD filed a petition for review on certiorari with the Supreme Court, contending that the CA erred in upholding the RTC's orders despite the clear provisions of law granting jurisdiction to the Secretary of Justice for disputes between government offices.
Issue(s)
Whether the Regional Trial Court has jurisdiction over a complaint for collection of sum of money filed by the GSIS against OWD for unremitted premium contributions. Whether Sections 66 to 70, Chapter 14, Book IV of Executive Order No. 292 apply to the dispute between GSIS and OWD.
Ruling
The Supreme Court denied the petition and affirmed the Decision and Resolution of the Court of Appeals.
Ratio Decidendi
On the jurisdiction of the Regional Trial Court: The Court held that jurisdiction over the subject matter is conferred by law and determined by the allegations in the complaint. The complaint filed by GSIS was for the recovery of premium arrearages owed by OWD on its employees' life and retirement policies. Membership in the GSIS is compulsory for all employees, and employers have a legal duty under Section 6(b) of R.A. No. 8291 to deduct and remit contributions. Section 7 of the same law imposes interest on delayed remittances, and Section 41(w) empowers the GSIS to initiate legal actions to recover unpaid contributions. The RTC has jurisdiction over civil cases involving sums of money exceeding certain thresholds, as amended by R.A. No. 7691. Therefore, the RTC properly exercised its jurisdiction in this collection case. On the applicability of Executive Order No. 292: The Court disagreed with OWD's contention that the case should be settled administratively under E.O. No. 292. It reiterated the CA's ruling that these provisions are inapplicable because the dispute is not solely between GOCCs and, more importantly, does not involve the interpretation and application of statutes, contracts, or agreements. The Court emphasized that E.O. No. 292, derived from Presidential Decree (P.D.) No. 242, applies only to specific instances of disputes among government offices, particularly those arising from the interpretation and application of statutes, contracts, or agreements. The present case is a straightforward collection of unremitted premium contributions, where the law clearly mandates OWD's obligation to remit. Furthermore, Section 66 of E.O. No. 292 explicitly states that disputes must be "solely" between government entities for administrative settlement. The inclusion of OWD officials in the complaint, even if not the primary focus, further removes it from the exclusive administrative settlement provision. The Court cited Philippine National Oil Company v. CA to support the principle that the "solely" requirement is critical.
Main Doctrine
The Regional Trial Court has jurisdiction over a complaint for collection of sum of money filed by the Government Service Insurance System (GSIS) against a local water district for unremitted premium contributions, as such a case does not fall under the exclusive administrative settlement provisions of Executive Order No. 292, Chapter 14, Book IV, which are limited to disputes arising from the interpretation and application of statutes, contracts, or agreements, and must be solely between government entities.