G.R. No. 178552 - Southern Hemisphere Engagement Network, Inc. vs. Anti-Terrorism Council

Formation of the Task Force and Establishment of the UP Technology Management Center (UP TMC)

On September 19, 1994, while serving as Chancellor of the University of the Philippines (UP) Diliman, Dr. Roger R. Posadas formed a Task Force on Science and Technology Assessment, Management and Policy.
The Task Force was charged with preparing curricula for masteral and doctoral programs in technology management, innovation studies, science and technology, and related areas.
On June 6, 1995, acting upon the Task Force’s proposal, UP established the UP Technology Management Center (UP TMC).
Although the members of the Task Force nominated Dr. Posadas for the position of Center Director, he declined the nomination, resulting in Professor Jose B. Tabbada being designated as acting UP TMC Director.
Subsequently, Dr. Posadas played a crucial role in securing funding for ten new graduate courses at UP TMC through collaborations with the Philippine Institute of Development Studies/Policy, Training and Technical Assistance Facility, the National Economic Development Authority, and the Canadian International Development Agency.

On October 5, 1995, Malacanang granted Dr. Posadas and fifteen other UP Diliman officials authority to attend the foundation day of the state university in Fujian, China, scheduled from October 30 to November 6, 1995.
Prior to leaving for China, Dr. Posadas formally designated Dr. Rolando P. Dayco, then UP Diliman Vice-Chancellor for Administration, as Officer-in-Charge (OIC) in his absence.
On November 7, 1995, which was Dr. Dayco’s last day as OIC Chancellor, he appointed Dr. Posadas as Project Director of the TMC Project, with the appointment retroactively effective from September 18, 1995, to September 17, 1996.
Additionally, in an undated letter, Dr. Dayco designated Dr. Posadas as a consultant to the project, with the appointment backdated to the project’s commencement.

On August 22, 1996, the COA Resident Auditor issued a Notice of Suspension of payments made to UP TMC personnel, including a P36,000.00 consultant fee for Dr. Posadas and a P30,000.00 monthly honorarium as Project Director, based on purported irregularities in the appointments.
The following day, the COA Resident Auditor further suspended the monthly honorarium for the period between September 18 and October 17, 1995.
On September 16, 1996, the UP Diliman Legal Office issued a memorandum to the COA Resident Auditor, asserting that the payments were legal in nature (as consultancy fees) and confirmed Dr. Dayco’s authority in making those appointments.
Accepting the explanation from the Legal Office, the COA Resident Auditor lifted the earlier suspension notices.

In response to the controversy, UP President Javier constituted an Administrative Disciplinary Tribunal to address charges of grave misconduct and abuse of authority against Dr. Posadas and Dr. Dayco.
On August 18, 1998, the Tribunal recommended dismissal of both officials; however, the UP Board of Regents modified the penalty to forced resignation with the opportunity to reapply after one year and provided that they issue a public apology.
Concurrently, the UP General-Counsel initiated criminal cases in the Sandiganbayan against both officials.
On June 28, 2005, the Sandiganbayan found Dr. Posadas and Dr. Dayco guilty of violating Section 3(e) of Republic Act 3019 and Section 7(b) of Republic Act 6713, imposing imprisonment (with a minimum of 9 years and one day and a maximum of 12 years for the former, and 5 years for the latter), perpetual disqualification from public office, and ordering them to indemnify the government in the sum of P336,000.00.

Whether the appointments of Dr. Posadas as Project Director and Consultant were executed in good faith or with a fraudulent intent characterized by bad faith.

The determination hinges on whether Dr. Dayco and Dr. Posadas acted with moral obliquity or dishonest purpose, traits which underpin the concept of fraud in the context of Section 3(e) of Republic Act 3019.

The legitimacy of appointing a superior (Dr. Posadas) by an OIC (Dr. Dayco) in light of the formalities and civil service rules regarding appointments.

The issue arises as to whether Dr. Dayco exceeded his authority by appointing his own superior in the absence of the Chancellor.

Whether the administrative misstep inherent in the appointments should be treated as a criminal offense.

This involves assessing if the irregularities merit criminal prosecution or if they fall under the purview of mere administrative lapse or error.

The adequacy of the prosecution’s evidence concerning undue injury to the government or the granting of unwarranted benefits to the petitioners.

The issue addresses whether the alleged payments and appointments resulted in actual damage to the government or provided a benefit that was not warranted by the circumstances.