VOL.

17, JULY 30, 1966 863

Social Security System vs. Davac, et al.

No. L-21642. July 30, 1966.

SOCIAL SECURITY SYSTEM, petitioner-appellee, vs.

CANDELARIA D. DAVAC, ET AL., respondents; LOURDES
TuPLANO, respondent-appellant.

Social Security Act; Non-transferability of benefits.—Construing

Section 15, Republic Act No. 2658, amending Republic Act No. 1161, if
there is a named beneficiary and the designation is not invalid (as it is not so
in this case, notwithstanding the fact that the beneficiary designated appears
to be the bigamous wife of the deceased), it is not the heirs of the employee
who are entitled to receive the benefits (unless they are the designated
beneficiaries themselves). It is only when there are no designated
beneficiaries or when the designation is void, that the laws of succession are
applicable. And we have already held that the Social Security Act is not a
law of succession. (Tecson vs. Social Security System, L-13798, Dec. 28,
1961).
Concubinage; Donation; Where donation was not made to a
concubine.—Article 739 of the New Civil Code does not apply to a case
where the concubine did not know that.the man was married, To be guilty of
concubinage, the woman must know the man to be married (5 Viada,
Codigo. Penal, 217).
Social Security System; Nature of benefit.—The benefit receivable
under the Social Security Act is in the nature of a special privilege or an
arrangement secured by the law pursuant to the policy of the State to
provide social security to working-

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Social Security System vs. Davac, et al.

men. The amount received by the members cannot be considered property

earned by him. It is not his conjugal property.

PETITION for review by certiorari of a resolution of the Social

Security Commission.
The facts are stated in the opinion of the Court.
     J. Ma. Francisco and N.G. Bravo for respondent-appellant.
          Solicitor General Arturo A. Alafriz, Solicitor Camilo D.
Quiason and E.T. Duran for petitioner-appellee.

BARRERA, J.:

This is an appeal from the resolution of the Social Security

Commission declaring respondent Candelaria Davac as the person
entitled to receive the death benefits payable for the death of
Petronilo Davac.
The facts of the case as found by the Social Security
Commission, briefly are: The late Petronilo Davac, a former
employee of Lianga Bay Logging Co., Inc. became a member of the
Social Security System (SSS for short) on September 1, 1957, As
such member, he was assigned SS I.D. No. 08–007137. In SSS form
E-1 (Member’s Record) which he accomplished and filed with the
SSS on November 21, 1957, he designated respondent Candelaria
Davac as his beneficiary and indicated his relationship to her as that
of “wife”. He died on April 5, 1959 and, thereupon, each of the
respondents (Candelaria Davac and Lourdes Tuplano) filed their
claims for death benefit with the SSS. It appears from their
respective claims and the documents submitted in support thereof,
that the deceased contracted two marriages, the first, with claimant
Lourdes Tuplano on August 29, 1946, who bore him a child, Romeo
Davac, and the second, with Candelaria Davac on January 18, 1949,
with whom he had a minor daughter Elizabeth Davac. Due to their
conflicting claims, the processing thereof was held in abeyance,
whereupon the SSS filed this petition praying that respondents be
required to interpose and litigate between themselves their
conflicting claims over the death benefits in question.
On February 25, 1963, the Social Security Commission issued
the resolution referred to above. Not satisfied

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Social Security System vs. Davac, et al.

with the said resolution, respondent Lourdes Tuplano brought to us

the present appeal.
The only question to be determined herein is whether or not the
Social Security Commission acted correctly in declaring respondent
Candelaria Davac as the person entitled to receive the death benefits
in question.
Section 13, Republic Act No. 1161, as amended by Republic Act
No. 1792, in force at the time Petronilo Davac’s death on April 5,
1959, provides:

“SEC. 13. Upon the covered employee’s death or total and permanent
disability under such conditions as the Commission may define, before
becoming eligible for retirement and if either such death or disability is not
compensable under the Workmen’s Compensation Act, he or, in case of his
death, his beneficiaries, as recorded by his employer shall be entitled to the
following benefit: x x x.” (italics supplied.)

Under this provision, the beneficiary “as recorded” by the

employee’s employer is the one entitled to the death benefits. In the
case of Tecson vs. Social Security System, (L-15798, December 28,
1961), this Court, construing said Section 13, said:

“It may be true that the purpose of the coverage under the Social Security
System is protection of the employee as well as of his family, but this
purpose or intention of the law cannot be enforced to the extent of
contradicting the very provisions of said law as contained in Section 13,
thereof, x x x. When the provision of a law are clear and explicit, the courts
can do nothing but apply its clear and explicit provisions (Velasco vs.
Lopez, 1 Phil. 270; Caminetti vs, U.S., 242 U.S. 470, 61 L. ed. 442)."

But appellant contends that the designation herein made in the

person of the second and, therefore, bigamous wife is null and void,
because (1) it contravenes the provisions of the Civil Code, and (2)
it deprives the lawful wife of her share in the conjugal property as
well as of her own and her child’s legitime in the inheritance.
As to the first point, appellant argues that a beneficiary under the
Social Security System partakes of the nature of a beneficiary in life
insurance policy and, therefore, the same qualifications and
disqualifications should be applied.

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Social Security System vs. Davac, et al.

Article 2012 of the New Civil Code provides:

“ART. 2012. Any person who is forbidden from receiving any donation
under Article 739 cannot be named beneficiary of a life insurance policy by
the person who cannot make any donation to him according to said article.”

And Article 739 of the same Code prescribes:

“ART. 739. The following donations shall be void:

"(1) Those made between persons who were guilty of adultery or
concubinage at the time of the donation;

x      x      x

Without deciding whether the naming of a beneficiary of the benefits

accruing from membership in the Social Security System is a
donation, or that it creates a situation analogous to the relation of an
insured and the beneficiary under a life insurance policy, it is
enough, for the purpose of the instant case, to state that the
disqualification mentioned in Article 739 is not applicable to herein
appellee Candelaria Davac because she was not guilty of
concubinage, there being no proof that she1 had knowledge of the
previous marriage of her husband Petronilo.
Regarding the second point raised by appellant, the benefits
accruing from membership in the Social Security System do not
form part of the properties of the conjugal partnership of the covered
member. They are disbursed from a public special fund created by
Congress in pursuance to the declared policy of the Republic “to
develop, establish gradually and perfect a social security system
which. x x x shall provide protection against the hazards of
2
disability, sickness, old age and death."
The sources of this special fund are the covered employee’s
contribution (equal to 2–1/2 per cent of the employee’s monthly
3
compensation) ; the employer’s contribution (equivalent to 3–1/24
per cent of the monthly compensation of the covered employee) ;
and the Government contribution which consists in yearly
appropriation of public

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1 For a woman to be guilty of concubinage, she must know the man to be married
(Viada y Vilaseca, Vol. 5, p. 217).
2 Sec, 1, Rep. Act 1792, in force at the time of death herein covered member.
3 Sec. 18, id.
4 Sec. 19, id.

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Social Security System vs. Davac, et al.

funds to assure the maintenance of an adequate working balance of

5
the funds of the System, Additionally, Section 21 of the Social
Security Act, as amended by Republic Act 1792, provides:

“SEC. 21. Government Guarantee.—The benefits prescribed in this Act

shall not be diminished and to guarantee said benefits the Government of the
Republic of the Philippines accepts general responsibility for the solvency
of the System.”

From the foregoing provisions, it appears that the benefit receivable

under the Act is in the nature of a special privilege or an
arrangement secured by the law, pursuant to the policy of the State
to provide social security to the workingmen. The amounts that may
thus be received cannot be considered as property earned by the
member during his lifetime. His contribution to the fund, it may be
noted, constitutes only an insignificant portion thereof.
6
Then, the
benef its are specif ically declared7 not transferable, and exempted
from tax, legal processes, and lien. Furthermore, in the settlement of
claims thereunder the procedure to be observed is governed not by
the general provisions of law, but by rules and regulations
promulgated by the Commission. Thus, if the money is payable to
the estate of a deceased member, it is the Commission, not the
probate or regular 8court that determines the person or persons to
whom it is payable. That the benefits under the Social Security Act
are not intended by the lawmaking body to form part of the estate of
the covered members may be gathered from the subsequent
amendment made to Section 15 thereof, as follows:

“SEC. 15. Non-transferability of benefit.—The system shall pay the benefits

provided for in this Act to such persons as may be entitled thereto in
accordance with the provisions of this Act. Such benefits are not
transferable, and no power of attorney or other document executed by those
entitled thereto in favor of any agent, attorney, or any other individual for
the collection thereof in their behalf shall be recognized except when they
are physically and legally unable to collect personally such benefits:
Provided, however, That in the case of death benefits, if no beneficiary has
been designated or the designation there-

_______________

5 Sec. 20, id.

6 Sec. 15, id.
7 Sec. 16, id.
8 Sec. 5, id.

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868 SUPREME COURT REPORTS ANNOTATED

Festejo vs. Crisologo, et al.

of is void, said benefits shall be paid to the legal heirs in accordance with
the laws of succession.” (Rep. Act 2658, amending Rep. Act 1161.)

In short, if there is a named beneficiary and the designation is not

invalid (as it is not so in this case), it is not the heirs of the employee
who are entitled to receive the benefits (unless they are the
designated beneficiaries themselves). It is only when there is no
designated beneficiaries or when the designation is void, that the
laws of succession are applicable. And we have 9
already held that the
Social Security Act is not a law of succession.
Wherefore, in view of the foregoing considerations, the
resolution of the Social Security Commission appealed from is
hereby affirmed, with costs against the appellant. So ordered.

Chief Justice Concepcion and Justices J.B.L. Reyes, Dizon,

Makalintal, J.P. Bengzon, Zaldivar and Sanchez, concur.

Resolution affirmed.

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