Title
Araullo vs. Aquino III
Case
G.R. No. 209287
Decision Date
Jul 1, 2014
The Supreme Court ruled the Disbursement Acceleration Program (DAP) unconstitutional, citing violations of constitutional spending limits, improper reallocation of funds, and undermining checks and balances.

Case Digest (G.R. No. 209287)
Expanded Legal Reasoning Model

Facts:

  • Parties
    • Petitioners – Various citizens, taxpayers, civil society groups, party‐list representatives, and associations.
    • Respondents – Benigno S. Aquino III (President), Paquito N. Ochoa Jr. (Executive Secretary), Florencio B. Abad (Budget Secretary), and related officials.
  • Genesis of Controversy
    • In 2011–12 the Philippine economy slowed; government underspending in infrastructure was cited by the World Bank.
    • To accelerate growth, the Department of Budget and Management (DBM) created the Disbursement Acceleration Program (DAP) pooling “savings” and unprogrammed funds to finance priority projects.
    • Late 2013 Senate privilege speeches revealed extra releases to legislators; DBM officials publicly explained these were DAP disbursements.
  • Relevant Issuances
    • DBM memoranda (October 2011–September 2013) granting the President omnibus authority to consolidate savings and realign funds.
    • National Budget Circular No. 541 (July 18, 2012) – Withdraws unobligated allotments of agencies as of June 30, 2012, for reallocation to priority projects.
    • 2011–2013 General Appropriations Acts – Define “savings,” “augmentation,” availability of funds, unprogrammed fund conditions, and prohibition on impoundment.

Issues:

  • Procedural
    • Are certiorari, prohibition, and mandamus proper remedies?
    • Do petitioners have standing, and is there a ripe justiciable controversy?
  • Substantive
    • Does the DAP violate Art. VI, Sec. 29(1) (“no money paid out except by appropriation”)?
    • Does the DAP violate Art. VI, Sec. 25(5) (general prohibition on transfers and limited power to augment “from savings”)?
      • Were the funds truly “savings”?
      • Were items funded existed in the GAAs?
      • Were there cross‐border transfers of savings?
    • Were unprogrammed funds released contrary to GAA conditions?
    • Were the principles of equal protection, checks and balances, and public accountability breached by legislative requests?
    • Are the petitions in time to warrant a temporary restraining order?
    • Does the doctrine of operative fact preserve executed projects?

Ruling:

  • (Subscriber-Only)

Ratio:

  • (Subscriber-Only)

Doctrine:

  • (Subscriber-Only)

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