2nd LT. SALVADOR PARRENO represented by his daughter Myrna P.

Caintic, Petitioner, versus COMMISSION ON AUDIT

and CHIEF OF STAFF, ARMED FORCES OF THE PHILIPPINES, Respondents.

GR NO. 162224 | 2007-06-07

Facts: Salvador Parreno served in the AFP for 32 years. When he retired, he availed of a lump sum pension equivalent to
three years pay. After three years, in 1985, he started to receive his monthly pension. He migrated to Hawaii and then
become a naturalized American citizen. Since Section 27 of PD 1638 provides that a retiree who loses his Filipino
citizenship shall be removed from the retired list and his retirement benefits will also be terminated, the AFP stopped
giving Parreno his monthly pension. Parreno requested for a reconsideration but was denied by the Judge of Advocate
General of the AFP. Parreno, then, filed a claim in COA for the continuance of his monthly pension. However, COA
dismissed the claim for lack of jurisdiction. The petitioner filed a motion for reconsideration in COA by arguing that COA
has the jurisdiction to decide the constitutionality of PD 1638, direct recourse to the court would be dismissed for not
exhausting administrative remedies, and since his pension is part of the government funds, it is subject to COA’s
authority and jurisdiction. However, COA still denied the motion for lack of jurisdiction.

Issues:

(1) Whether or not COA has jurisdiction to rule on the constitutionality of Section 27 of PD 1638
(2) Whether or not Section 27 of PD 1638 should apply prospectively
(3) Whether or not Section 27 of PD 1638 is constitutional

Held:

(1) NO. COA has the jurisdiction over money claims against the government but this jurisdiction does not include
the power to rule on the constitutionality of laws. The power for judicial review on constitutionality of laws is
vested in the Supreme Court as provided by the 1987 Constitution. The petitioner further argues that COA has
the authority to order the restoration of his pension without ruling for the constitutionality of Section 27 of
1638. The Supreme Court pointed out that COA already ruled that his pension cannot be restored due to his loss
of Filipino Citizenship.
(2) NO. The petitioner and the Office of Solicitor General argues that PD1638 should only be applicable
prospectively that it should only apply to those who joined the military service after its effectivity. SC finds that
PD 1638 is a new system of retirement and so those who are in military service during its approval should be
affected. Furthermore, section 2 of PD 1638 clearly stated that it will apply to all military personnel in service of
the AFP. Lastly, PD 1638 was approved in 1979 which is long before the retirement of the petitioner on 1982.
(3) YES. The petitioner argues that the removal of his name on the retired list upon loss of his Filipino citizenship is
discriminatory and against public policy and welfare. The Court provided that the requisites for equal protection
of the laws to be reasonable are (1) must be based on substantial distinctions which make real differences, (2)
must be germane to the purpose of the law, (3) must not be limited to existing conditions only and (4) must
apply to each member of the class. PD 1638 has complied with these four requisites. It must be pointed out that
there is a difference between a retiree who lost his Filipino citizenship and a retiree who retained his Filipino
Citizenship. One of the constitutional right of the state is to require every citizen to render personal and military
services. A retiree who lost his Filipino citizenship already renounced his allegiance to the state and therefore,
could not render said services. Thus, his loss of citizenship provides a substantial distinction among retirees who
retained their citizenship. If there is substantial distinction, one class may be treated differently. Lastly, a retiree
is still part of the Citizen Armed Forces that is necessary for national defense. Therefore, PD 1638 is not against
public policy.