G.R. No. 102918 - Nessia vs. Fermin

Petitioner Jose V. Nessia filed a complaint against respondents Jesus M. Fermin (Mayor of Victorias, Negros Occidental) and Municipality of Victorias, Negros Occidental for recovery of damages and reimbursement of expenses.
Petitioner alleged that he incurred the claimed expenses in the performance of his official duties as the then Deputy Municipal Assessor of Victorias.
Respondent Municipality of Victorias concurred with Mayor Fermin’s position and added defenses.
The municipality was declared in default for non-appearance at the pre-trial conference.

Petitioner alleged that Mayor Fermin deliberately ignored and caused the non-payment of petitioner’s vouchers covering his claim for reimbursement of travel expense allowances.
Petitioner’s theory of motive was that Mayor Fermin disregarded the vouchers because petitioner defied the mayor’s request for all municipal officials to register and vote in Victorias in the 1980 local elections.
In his answer with counterclaim, Mayor Fermin disputed petitioner’s allegations.
Mayor Fermin asserted that the claims could not be approved because they exceeded the budgetary appropriations.
The Municipality of Victorias adopted the position of Mayor Fermin.
The municipality further claimed that petitioner was blamable because he did not provide the mayor justification for drawing funds in excess of budgetary appropriations and did not amend the vouchers to conform thereto.

The parties joined issues and presented their evidence.
The Municipality of Victorias did not participate in the pre-trial conference and was declared in default.

The Regional Trial Court of Kabankalan, Branch LXI, Negros Occidental, rendered judgment on 24 April 1987 in favor of petitioner.
The trial court found that Mayor Fermin maliciously refused to act on petitioner’s vouchers.
The finding was supported by Mayor Fermin’s inaction on petitioner’s follow-up letters inquiring into the status of the vouchers.
The trial court ruled that the vouchers were received by the secretary of Mayor Fermin, thereby negating Mayor Fermin’s contention that the vouchers were not received by him.
The trial court alternatively held that even if the vouchers never reached Mayor Fermin, he remained answerable because he should have inquired into their whereabouts upon receipt of petitioner’s follow-up letters.
Based on evidence and Mayor Fermin’s admission that he did nothing on the vouchers, the trial court awarded damages, though less than the amounts prayed for by petitioner.
The trial court ordered:

Joint and several payment of P1,424.75 for reimbursement of traveling and food expenses, with 12% per annum interest from the filing of the complaint until fully paid.
Mayor Jesus Fermin to pay P10,000.00 as moral damages and P2,000.00 as exemplary damages.
Joint and several payment of P3,000.00 as attorney’s fees.
Payment of costs.

Petitioner Nessia and Mayor Fermin elevated the case to the Court of Appeals.
Petitioner prayed for an increase in moral and exemplary damages.
Mayor Fermin sought exoneration from liability.
The Municipality of Victorias did not appeal the trial court’s decision.
On 19 July 1991, the Court of Appeals dismissed petitioner’s complaint on the ground of lack of cause of action.
The Court of Appeals ruled that the complaint and petitioner’s evidence did not establish unjust inaction.
The Court of Appeals held that the “situation before us” involved allegations that petitioner accused Fermin of failing to act on vouchers not shown to have been received, and that even if received, they could not be approved because they were submitted late and were not supported by an appropriation.

Whether the petition should have been dismissed for lack of a certified true copy of the Court of Appeals decision, pursuant to Circular 1-88, par. 3.

Whether the Court of Appeals could reverse the trial court’s decision as to the Municipality of Victorias, considering that it did not appeal and the decision allegedly became final and executory.
Whether the Court of Appeals could grant affirmative relief to the Municipality of Victorias, which did not appeal.

Whether the Court of Appeals erred in exonerating Mayor Fermin from malicious refusal to act on petitioner’s vouchers.
Whether petitioner could claim relief under Art. 27, despite the complaint allegations that the mayor “refused and continued to refuse” payment, and whether such allegations were incompatible with the theory of unjust inaction.

Budgetary appropriation defense and relation to damages for official inaction

Whether the absence or insufficiency of budgetary appropriation precluded...(Subscriber-Only)