G.R. No. 258182 - People vs. Romeo Chan Reales

In 2001, then-Governor Milagrosa T. Tan of the Province of Samar designated Romeo Chan Reales as the Officer-in-Charge (OIC) of the Office of the Provincial Administrator in addition to his role as Provincial Accountant.
His authority was expressly limited to signing or approving certain documents such as the payroll for salaries and wages, disbursement vouchers for utilities and subscriptions, and remittances to GSIS, PhilHealth, BIR, PAG-IBIG, Land Bank, and Philippine National Bank. Documents outside these functions were to be forwarded to the Governor’s office.

Reales allegedly created and enrolled 25 fictitious job order workers in the payroll, thereby facilitating the release of public funds amounting to PHP 76,500.00 for salaries that were never duly earned.
He approved key documents—including the Summary of Payrolls, the Daily Time Records (DTRs), and the Time Book and Payroll—for the periods covering October 1–31, 2005 and November 1–30, 2005. His signatures appeared on these documents in various capacities, allegedly certifying the alleged work rendered by non-existent or ghost employees.

The anomaly in the payroll system caused financial damage to the government, with the Province of Samar particularly affected by the misdirection of public funds.
An affidavit/complaint was filed by Aurelio A. Bardaje, Jr. alleging “illegal transactions of disbursing public money” via contracts of services purportedly executed for employees who did not render any service.

The investigation by the Field Investigation Group of the Office of the Ombudsman-Visayas led to the filing of two separate Informations:

Criminal Case No. SB-17-CRM-2197 for violation of Section 3(e) of Republic Act No. 3019, which penalizes public officers for causing undue injury through manifest partiality, evident bad faith, or gross inexcusable negligence.
Criminal Case No. SB-17-CRM-2198 for malversation through falsification of public documents under Article 217 (in relation to Articles 48 and 171 of the Revised Penal Code).

The inculpatory averments in both Informations focused on Reales’ role in approving the payrolls and DTRs, highlighting his signature as the central element linking him to the fraudulent disbursement of funds.

The prosecution presented six witnesses whose testimonies centered on the inability to locate relevant documents—often attributed to damage or loss—for the employment of the 25 job order workers.
Witness testimony highlighted that the documents, including the Daily Time Records and the Summary of Payrolls, lacked the signatures of the alleged employees, and the verification process was allegedly manipulated by Reales through his own signatures.
Reales, for his part, attributed his actions to reliance on routine administrative processes and maintained that the documents had been duly scrutinized by the appropriate officers despite the overwhelming irregularities pointed out by the prosecution.

Based on the evidence presented, the Sandiganbayan convicted Reales on both counts:

Violation of Section 3(e) of RA 3019, with findings anchored on his willful approval of payments to ghost employees, demonstrating evident bad faith.
Malversation through falsification of public documents, based primarily on his signatures which allegedly rendered the payrolls and DTRs fraudulent.

The court imposed imprisonment (with ranges set by the Indeterminate Sentence Law), perpetual disqualification from public office, fines, and civil liabilities to the Provincial Government of Samar.

Reales filed a motion for reconsideration of his conviction, contending that there was no conclusive evidence proving that the job order workers were non-existent or that they failed to render work. His defense maintained that his approvals were purely administrative and that no direct proof of falsification was established.
After the motion was denied, Reales elevated the matter on appeal seeking reversal and acquittal of the conviction on both charges.

The majority opinion at the Sandiganbayan emphasized that the negative averment—that the job order workers did not render work—was sufficiently proven by the documents and witness testimonies, thereby meeting the burden to demonstrate evident bad faith.
A dissenting opinion, however, argued that the evidence presented was circumstantial and that Reales’ reliance on his administrative role and the regularity of the payroll process should have precluded a finding of criminal intent.

Whether the prosecution established beyond reasonable doubt that the 25 job order workers did not actually render any service.
Whether the absence of the workers’ signatures on the Daily Time Records and related documents conclusively proves their non-participation.

Whether Reales’ act of signing the payroll documents amounts to manifest partiality, evident bad faith, or gross inexcusable negligence.
Whether his conduct created an undue injury to the government by facilitating the disbursement of public funds to ghost employees.

Whether the prosecution sufficiently proved that Reales falsified public documents to misappropriate public funds for his personal benefit.
Whether his signatures, in themselves, serve as conclusive evidence of involvement in a fraud scheme to disburse salaries to non-existent employees.

Whether the burden to prove the non-existence or non-performance of work by the alleged employees was correctly shifted to or remained with the prosecution.
How the rule on negative averments applies in the context of payroll fraud involving ghost employees.

Whether the reliance on documentary evidence (which in some instances was damaged, missing, or treated as hearsay) is sufficient to render a conviction.
The extent to which contradictory witness testimonies and gaps in the chain of evidence affected the overall credibility of the prosecution’s case.