WINSTON F. GARCIA; DEPARTMENT OF EDUCATION represented by ___________, in his official capacity as Department Secretary; DEPARTMENT OF BUDGET AND MANAGEMENT (DBM), represented By ROLANDO D. ANDAYA JR., in his official capacity as Department Secretary,
COMPLAINANTS, by counsel, to this Honorable Court, respectfully
1.1. Complainant MANILA PUBLIC SCHOOL TEACHERS INC. (“MPSTA”), represented by its President ARSENIO JALLORINA, is a corporation duly organized and existing in accordance with the laws of the Republic of the Philippines, with address at #933 G.M. Tolentino St., Sampaloc, Manila where it may be served summons and other processes of this Honorable Court.
1.2. ComplainantPARENTS TEACHERS COALITION FOR ADVANCEMENT (“PTCA”), represented byits founding incorporator MIGUEL C. MIRAM, is a corporation duly organized and existing in accordance with the laws of the Republic of the Philippines, with address at #750 Bohol St., Sampaloc, Manila where it may be served summons and other processes of this Honorable Court.
1.3. Defendant GOVERNMENT SERVICE INSURANCE SYSTEM (GSIS), represented by its President and General Manager WINSTONF. GARCIA, is a government owned and controlled corporation duly organized and existing under the laws of the Republic of the Philippines and may be served with summons and other processes of this Honorable Court at the 7th floor, GSIS Building, Financial Center, CCP Complex, Roxas Blvd., Pasay City.
1.4. Defendant DEPARTMENT OF EDUCATION (DEPED), is represented by ______________________, in his official capacity as Department Secretary, and may be served with summons and other processes of this Honorable Court at ______________________.
1.5. Defendant DEPARTMENT OF BUDGET AND MANAGEMENT (DBM), is represented by ROLANDO D. ANDAYA JR., in his official capacity as Department Secretary, and may be served with notices and processes of this Honorable Court at the DBM, Malacañang, Manila.
II.NATURE OF THE PETITION
2.1. This is a complaint for violation of trust relationship between the complainants as Trustor and the defendant GSIS as Trustee, with prayer for and for Prohibition and Mandamus under Rule 65 of the Rules of Civil Procedure and for the issuance of preliminary injunction to prohibit defendants DEPED and DBM from remitting premium payments to GSIS; to compel defendant GSIS to recognize the right of complainants, and all others similarly situated, to benefits and services mandated by Republic Act No. 8291, otherwise known as the GSIS Act of 1997, and with urgent application for the issuance of a Writ of Preliminary Injunction against defendants DEPED and the DBM, and all others under the supervision and control of said defendants,from further remitting premium payments to defendant GSIS so as not to render this case moot and academic, while the same is still under litigation and pending final decision, on the ground that defendant GSIS is in violation of the Trustor-Trustee relationship, and its continuing remittance of premium payments to defendant GSIS shall result in grave and irreparable damage to complainants unless immediately restrained.
2.2. Defendants DEPED and DBM are being sued as necessary parties in order that complete relief may be accorded the complainants.
III. STATEMENT OF FACTS
AND THE CASE
3.1.In the leading case of RICARDO VALMONTE, ET AL. vs. FELICIANO BELMONTE, JR., G.R. No. 74930 February 13, 1989, the Honorable Supreme Court elucidated on the nature and purpose of defendant GSIS, to wit:
“The GSIS is a trustee of contributions from the government and its employees and the administrator of various insurance programs for the benefit of the latter. Undeniably, its funds assume a public character. More particularly, Secs. 5(b) and 46 of P.D. 1146, as amended (the Revised Government Service Insurance Act of 1977), provide for annual appropriations to pay the contributions, premiums, interest and other amounts payable to GSIS by the government, as employer, as well as the obligations which the Republic of the Philippines assumes or guarantees to pay. Considering the nature of its funds, the GSIS is expected to manage its resources with utmost prudence and in strict compliance with the pertinent laws or rules and regulations. . . It is therefore the legitimate concern of the public to ensure that these funds are managed properly with the end in view of maximizing the benefits that accrue to the insured government employees. . ..”
3.2. It is settled law that the relationship between complainants and defendant GSIS is one of Trustor-Trustee. A fiduciary relationship exists between Trustor and Trustee. (Pacheco vs. Arro, 85 Phil. 505). As Trustee, defendant GSIS is obliged to comply with its legal obligation as enunciated and mandated under Republic Act No. 8291, otherwise known as the GSIS Act of 1997. Said Republic Act No. 8291 is the law governing the Trustor-Trustee relationship existing between the herein parties.
3.3. Defendant GSIS has wantonly, brazenly, and shamelessly abused its power as Trustor, violating and corrupting in the process the services and benefits of GSIS members clearly outlined in Republic Act No. 8291, and prejudicing the rights and interest of the complainants as Trustees.
3.4. The travails and hardship of complainants began in the January 2001 when Atty. Winston Garcia was appointed President and General Manager of defendant GSIS. Though his qualifications was questioned by his own Cebuano provincemate, then Senator Sergio Osmeña, he was able to weather criticisms by projecting himself as a reformist determined to improve benefits and services to GSIS members. As things turned out, it was simply just that- projection in media.
3.5. Defendant GSIS, thru Atty. Winston F. Garcia, did not take long to conjure and implement the so-called “reform”:
3.5.1. Premium-based policy;
3.5.2. Survivorship policy;
3.5.3. Cross-default policy;
3.5.4. Compulsory insurance revision;
3.5.5. Investment policy; and
3.5.6. Housing policy.
3.6. All of these policies had the effect of reducing benefits of the complainants and GSIS members. Benefits enunciated and mandated by law- Republic Act No. 8291. These policies also had the effect of causing the deterioration of services to complainant and GSIS members as a whole.
(discussion follows on each policy)
The Civil Service Commission, thru then Chairperson Karina David, issued a strongly-worded demand letter directing defendant GSIS to cease and desist from implementing its premium-based policy. CSC stated:
The Office of the Solicitor General, thru then Solicitor General and now Justice of the Supreme Court, categorically stated that the premium-based policy has no basis in law and is prejudicial to GSIS members.
The Commission on Audit issued Notices of Disallowances for misguided investments of defendant GSIS in paintings, in GSIS Properties Inc., and also issued a report on the illegality of the Ecard project, the transfer of GSIS funds from Landbank to Unionbank, the cash advances of GSIS officials, and the immorality of the compensation package of GSIS officials.
Because of the abuse and perceived corruption, a slew of resolutions calling for the investigation of GSIS policies and practices were issued by different Senators and members of the House of Representatives.
(Cite each resolutions)
Different organized groups of GSIS members and government employees issued formal statements calling for the removal of Atty. Winston F. Garcia.
(Cite the organized groups)
Media commentators, especially those not under the payroll of GSIS, criticized GSIS PGM and also called for the ouster of Atty. Winston F. Garcia.
Complaints before the Ombudsman filed against GSIS officials.
Complaints before the regular courts were also filed by individual GSIS members.
Undeniable proof of the deterioration of benefits is the number of GSIS members who received zero proceeds in their retirement pay and when they surrendered their insurance policy, a sampling of which is hereto attached.
The continuing abuse by defendant GSIS in the utilization of GSIS funds and properties, deterioration of services, and baseless reduction of GSIS members’ benefits must be stopped, as it had wrought havoc on the rights and interest of complainant, and all GSIS members. Complainants and GSIS members, as Trustors, have suffered enough under the so-called “reform” agenda of Atty. Winston Garcia.
4.1. Notwithstanding defendant GSIS’ use of the nomenclature “reform”, there is no dispute that its policies are violative of R.A. No. 8291, violative of the vested rights of complainants and GSIS members, and violative of the Trustor-Trustee fiduciary relationship between complainants and defendant GSIS. There is a clear breach of trust on the part of defendant GSIS.
4.2. As held in Government vs. Padilla, 46 Phil rep. 642:
“As the law of trusts has been much more frequently applied in England and in the United States than it has in Spain, we may draw freely upon American precedents ….”
4.3. The remedies available to the Trustor, as stated in 72 Del. Laws, c. 388, § 7; 73Del. Laws, c. 409, § 4, include:
4.4.1. Appointing a special fiduciary; and
4.4.2. Suspending the trustee.
Appointing a special fiduciary
4.4. While this complaint is pending resolution, it is necessary that this Honorable Court appoint a special fiduciary for purposes of preserving the assets of the defendant GSIS. It is recommended that the Landbank of the Philippines be appointed special fiduciary for this purpose.
Suspending the trustee
4.5. Defendant GSIS as trustee should be suspended as such. In the meantime, premium payments should be deposited with this Honorable Court while defendant GSIS continues to violate of R.A. No. 8291, violate the vested rights of complainants and GSIS members, and violate the Trustor-Trustee fiduciary relationship between complainants and defendant GSIS.
4.6. The premium payments deposited with this Honorable Court should be under the joint custody of this Honorable Court and the appointed special fiduciary.
V. AVERMENTS IN SUPPORT OF
5.1.The foregoing averments are herein repleaded.
5.2. Inasmuch as it has been demonstrated beyond doubt that defendant GSIS has acted and are acting without or in excess of jurisdiction and/or grave abuse of discretion amounting to lack of jurisdiction, in adopting and implementing legally baseless policies discussed above, said actions are undoubtedly improper, illegal and void ab initio. Defendant GSISis bereft of any legal authority to enforce these policies, and may be enjoined from doing so through the instant complaint. Defendant GSIS are bent on proceeding with the implementation and enforcement of the challenged action and, unless it is enjoined and prohibited from doing so pending the resolution of the herein complaint, complainants will not only suffer injustice and injury which may not be susceptible of reparation but whatever judgment that may be rendered therein may likewise be ineffective. Complainants have exhausted all administrative remedies.
5.3. Complainants respectfully and urgently apply for the issuance of a writ of preliminary injunction to enjoin defendant GSIS from enforcing and implementing herein questioned policies, specifically….(state them). Specifically, petitioners’ pray that defendants DEPED and DBM, and all others under their control and/or supervision, be ordered to cease and desist from remitting to defendant GSIS all collected premium payments of complainants, and those similarly situated, pending final resolution of the instant petition.
5.4. If respondents’ acts of oppression and abuse of discretion are not restrained, grave and irreparable damage will be incurred by the complainants, as they face loss of property rights (i.e. their benefits mandated under R.A. No. 8291) without due process of law.
5.5. The aforementioned sinequanon requirements for the issuance of writ of preliminary injunction having been satisfied by complainants, it is incontrovertible that complainants, and all those similarly situated, are therefore entitled to the issuance of the said reliefs prayed for.
5.6. Complainants are ready, willing and able to post a bond in an amount and under any terms and conditions that may be set by this Honorable Court.
5.7.The complainants are entitled to the relief demanded in whole or part of such relief which consists in restraining the commission of the act complained of, specifically, implementing GSIS policies in violation of the due process and property rights of the complainants. Unless proceedings are stopped by an injunction order, complainants shall suffer grave and irreparable injury incapable of monetary estimation and unless restrained immediately, the judgment to be rendered in this case will become moot and academic.
Wherefore, it is respectfully prayed that upon filing of this suit and after due proceedings:
1. A writ of preliminary injunction be immediately issued against defendant DEPED and DBM, and all others under their control and/or supervision, directing them to cease and desist from further remitting premium payments to defendant GSIS and to remit the same to this Honorable Court, to be held under joint custody of this Honorable Court and the duly-appointed special fiduciary; and issue an order appointing a special fiduciary to preserve the assets of defendant GSIS, preferably, the Landbank of the Philippines; and suspending defendant GSIS as trustee.
After due proceedings, Decision be rendered as follows:
1. A Writ of Mandamus and Prohibition be issued against defendant GSIS directing it to comply and adhere to the clear provisions of R.A. No. 8291 insofar as benefits and services due the complainants and GSIS members are concerned, and that defendant GSIS be prohibited from making and implementing amendments to R.A. No. 8291 prejudicial to the interests of complainants and GSIS members.
Other reliefs just and equitable under the premises are likewise prayed for.