Case Digest (G.R. No. 127545)
Facts:
Andres Sanchez, Leonardo D. Regala, Rafael D. Barata, Norma Agbayani, and Cesar N. Sarino, G.R. No. 127545, April 23, 2008, the Supreme Court En Banc, Tinga, J., writing for the Court. The petitioners (all then officials of the Department of the Interior and Local Government — DILG) sought review of the Commission on Audit (COA) Decision No. 96-654 (21 November 1996) which affirmed a Notice of Disallowance dated 29 March 1993 and held them jointly and severally liable for ₱600,000 withdrawn from the DILG’s Capability Building Program Fund under R.A. No. 7180 (1992 General Appropriations Act).In 1991–1992 the 1992 GAA appropriated ₱75,000,000 for a Capability Building Program to be administered by the DILG through the Local Government Academy, subject to Special Provisions and a required work-and-financial plan. Atty. Hiram C. Mendoza proposed an ad hoc task force to design programs for implementing local autonomy; the Deputy Executive Secretary Dionisio de la Serna accepted the proposal and DILG Secretary Cesar N. Sarino authorized transfer(s) of two cash advances of ₱300,000 each (total ₱600,000) from the Fund to the Office of the President to finance operational expenses of the task force. The first cash advance was allegedly liquidated without supporting receipts; the second was not properly liquidated.
The DILG Department Auditor disallowed the amounts (3rd Indorsement, 25 May 1992) citing lack of legal basis for the task force, prior unliquidated advances, noncompliance with R.A. 7180 restrictions, and unspecified expense estimates. COA sustained the disallowance in Decision No. 96-654; Commissioner Sofronio B. Ursal signed the Decision but filed a separate dissent arguing the transfer fell within the President’s augmentation power under Sec. 25(5), Art. VI, 1987 Constitution and that audit of expenditures should be by the Auditor for the Office of the President.
Petitioners filed a petition for review (dated 10 February 1997). The Office of the Solicitor General (OSG) initially filed a manifestation (19 January 1998) but later reversed its position and, in a Memorandum dated 6 July 2005, agreed the transfer lacked legal basis and COA’s disallowance was valid, noting absence of a work-and-financial plan and incomplete liquidation and that Atty. Mendoza was not a DILG or OP employee. COA filed its Memorandum reaffirming its view; petitioners filed replies and memoranda; the Court held oral argument and framed ...(Pro-only)
Issues:
- Was there a legal basis for the transfer of funds from the DILG’s Capability Building Program Fund to the Office of the President?
- Were the conditions required for a lawful transfer/augmentation under Sec. 25(5), Art. VI, 1987 Constitution present in this case (i.e., actual savings and an item to be augmented)?
- Is the Capability Building Program Fund a trust fund, special fund, trust receipt, or a regular appropriation for purposes of audit and transfer?
- Was the COA’s disallowance of the ₱600,000 v...(Pro-only)
Ruling:
- (Pro-only)
Ratio:
- (Pro-only)
Doctrine:
- (Pro-only)