G.R. No. 232168 - Civil Service Commission vs. Jejomar Erwin S. Binay, Jr. and Gerardo Kangleon San Gabriel

Since 2001, the Employees' Compensation Commission (ECC) planned to renovate its building on Sen. Gil J. Puyat Avenue, Makati City, including an additional floor, installation of equipment, wall partitions, and modular work stations. Budget constraints delayed the project until 2004 when the Government Service Insurance System (GSIS) released the operating budget.
In March 2004, the ECC conducted a public bidding for the renovation project, excluding the modular work stations, which were to be procured via other means. Executive Director Elmor Juridico preferred contemporary, state-of-the-art modular work stations and directed Engr. Nelson Buenaflor to prepare technical specifications.
Only UB Office Systems HK Ltd. met the required specifications; this company had exclusive distributorship rights with Accent Systems Inc., servicing government agencies such as Land Bank, BIR, and Pag-Ibig Fund.

On November 25, 2004, the ECC Bids and Awards Committee (BAC), chaired by Deputy Executive Director Evelyn Tablang, with members including petitioner Irene S. Rosario, convened to select the procurement mode for modular work stations. They consulted with the Technical Working Group and Engr. Buenaflor due to limited expertise on modular office systems.
On December 1, 2004, the BAC recommended direct contracting with Accent Systems as a practical alternative to competitive bidding under Section 50 of RA 9184 and its IRR, as Accent Systems was the exclusive distributor whose products had no suitable substitute.
Executive Director Juridico approved the recommendation and began negotiations with Accent Systems. The contract amounted to P3,834,262.72 for the supply and installation of modular work stations for various ECC offices.

The modular work stations were delivered and installed on March 2, 2005.
On June 14, 2005, State Auditor IV Teodulfo L. La Torre issued an Audit Observation Memorandum directing Executive Director Juridico to explain several issues, including:

ECC’s funds used for procurement came from rental income, authorized only for maintenance and upkeep of the building, excluding capital outlay.
The modular work stations were deleted from the 2004 proposed special budget and were not itemized in the 2005 approved Corporate Operating Budget, despite capital outlay appropriations.
The actual cost exceeded initial cost estimates reflected in the architect’s April 2003 bills.

Executive Director Juridico acknowledged the errors but insisted no favoritism was involved and immediate acquisition was needed for ECC's upcoming 30th anniversary.

On October 31, 2006, COA issued Notice of Disallowance No. ECC-2006-001 disallowing payment of the full amount to Accent Systems citing:

Procurement exceeded architect’s estimates, violating COA Circular No. 85-55A against excessive expenditures.
Failure to conduct public bidding as prescribed under Section 10 of RA 9184.
Granting unauthorized advance payment violating P.D. 1445.
Failure to require performance security from the supplier.
Lack of appropriation for contract expenditure contrary to P.D. 1445.

Liability was jointly imposed on Executive Director Juridico, certifying officers Milagros Balteza and Ma. Teresa Urbano, members of the BAC including petitioner Rosario, and Accent Systems.
Petitioner and BAC members filed motions for reconsideration. On August 5, 2008, LAO-Corporate issued Decision No. 2008-046 which modified the notice of disallowance by exonerating petitioner, Ma. Teresa Urbano, and all BAC members from liability but affirmed liability of Juridico and Balteza. Petitioner did not appeal the decision.

Balteza appealed LAO-Corporate Decision No. 2008-046 to the COA Proper.
On November 11, 2014, COA Proper issued Decision No. 2014-334 reinstating liability of all persons originally liable, including petitioner, but reduced the disallowed amount to P1,642,262.72, representing the difference between the architect's estimate and actual cost.
COA Proper found that BAC failed to justify their recommendation for direct contracting, and technical specifications favored a specific brand, violating RA 9184.
Petitioner filed a motion for reconsideration, arguing the prior decision of exoneration was final and that BAC’s role was merely recommendatory under the law.
On January 28, 2020, COA Proper issued Resolution No. 2020-151 denying petitioner’s motion but exonerating Urbano; petitioner and other BAC members remained liable for the full amount of P3,834,262.72.
COA Proper held that LAO-Corporate decisions are subject to automatic review, thus earlier exoneration had not become final; also, BAC members are expected to be knowledgeable and comply with procurement laws even if their function is recommendatory.

Petitioner Irene S. Rosario filed the present petition to annul COA Proper’s Decision No. 2014-334 and Resolution No. 2020-151, praying for her exclusion from liability.
Main arguments:

Violation of right to speedy disposition given the 14-year protracted proceedings characterized by oppressive delay.
The doctrine of finality of judgments was ignored as she was exonerated in 2008 and did not appeal.
BAC’s participation was limited to recommendatory duties and complied with procurement law.
Petitioner acted in good faith and in the regular course of her duties.

COA, through the Office of the Solicitor General, argued that delay was justified by the need to consider Balteza’s appeal, that LAO-Corporate decision was not final due to automatic review, and that BAC’s recommendation was improper because competitive bidding is public policy and requirements for direct contracting were not met.

Did the Commission on Audit Proper violate petitioner Irene S. Rosario’s constitutional right to speedy disposition of her case?
Whether the exoneration of petitioner by the COA Legal and Adjudication Office-Corporate branch (LAO-Corporate) in 2008 became final and executory.
Whether the BAC members, including petitioner, are solidarily liable for the disallowed amount under the Notice of Disallowance for failure to comply with procurement laws despite their merely recommendatory role.
Whether the recommendation for direct contracting with Accent Systems conformed with the requirements under RA 9184 and its IRR.