Basilia Vda de Consuegra vs GSIS, Commission of Public Highways, CSC and Rosario Diaz

30 January 1971
Zaldivar, J.

 During the lifetime of Jose Consuegra, he contracted 2 marriages. The first with respondent Rosario
Diaz in 1937; the second (which was contracted in good faith while the first marriage was subsisting)
with petitioner Basilia Berdin in 1957 with 7 children;
 Being a member of GSIS when Jose Consuegra died, the proceeds of his life insurance were given to
Basilia and her children who were the beneficiaries in the policy. Likewise, Consuegra was also entitled
to retirement insurance benefits, however he did not designate any beneficiary for it.
 Respondent Rosario, the first wife, filed a claim with GSIS asking that the retirement insurance
benefits be given to her as only legal heir considering that there was no designated beneficiary
 Petitioner Basilia filed a similar claim asserting that being the beneficiaries of the life insurance policy,
they are the only ones entitled to receive the retirement insurance benefits
 GSIS ruled that since the legal heir is Rosario, she is entitled to one-half or 8/16 of the retirement
benefits; while the same goes for Basilia and her children (1/16 each). Hence, this petition.

ISSUE + RULING: Whether the beneficiary named in the life insurance automatically becomes the
beneficiary in the retirement insurance

NO. The beneficiary named in the life insurance does not automatically become the beneficiary in the
retirement insurance. Petition DENIED.

Originally, CA 186 (the law creating GSIS in 1936) provided for life insurance only. Upon amendment by
RA 660 in 1951, aside from the life insurance, the retirement insurance was added. Thus, we note that life
insurance and retirement insurance are separate and distinct.

a. Beneficiaries in life insurance – The beneficiary in a life insurance may not necessarily be an heir
of the insured. The insured may designate any person as beneficiary unless disqualified to be
under the Civil Code. And in the absence of any beneficiary named, the proceeds of the insurance
will go to the estate of the insured.
b. Beneficiaries in retirement insurance – Retirement insurance is intended for the benefit of the
employee – to provide for his old age or incapacity after rendering service in the govt for a
required number of years. The beneficiary of a retirement insurance can only claim the proceeds
if the employee dies before retirement. If the employee failed or overlooked to state the
beneficiary of his retirement insurance, the retirement benefits will accrue to his estate and will
be given to his legal heirs

In this case, when the deceased designated his beneficiaries in his life insurance, he could not have
intended those beneficiaries of his life insurance as also the beneficiaries of his retirement insurance
because the provisions on retirement insurance under GSIS came about only when CA 186 was amended
by RA 660 in 1951. Further, RA 660 says that the employee needs to file an application for retirement
insurance benefits when he becomes a member of GSIS, and he should state in his application the
beneficiary. Hence, the beneficiary named in the life insurance does not automatically become the
beneficiary in the retirement insurance unless the same beneficiary in the life insurance is so designated
in the application for retirement insurance.

This Court uphold the ruling of GSIS. In construing the rights of 2 women who were married to the same
man, this Court hold that since the first marriage has not been dissolved or declared void, the conjugal
partnership established by that marriage has not ceased. Nor has the first wife lost or relinquished her
status as putative heir of her husband. Consequently, whether as conjugal partner in a still subsisting
marriage or as putative heir, she has an interest in the husband’s share in the property.

The right of the second wife, although it can be presumed to be void ab initio as it was celebrated while
the first marriage was still subsisting, still there is a need for judicial declaration of its nullity. And inasmuch
as the conjugal partnership formed by the 2nd marriage was dissolved before judicial declaration of its
nullity, the just and equitable solution would be to recognize the right of the 2nd wife to her share of ½ in
the property acquired by her husband, and consider the other half as pertaining to the conjugal
partnership of the 1st marriage.