G.R. No. 175045-46 - Santillano vs. People

The case is an appeal from the Sandiganbayan’s decision dated October 13, 2006, in criminal cases Nos. 24467-24469 involving irregular disbursement of funds for public projects in San Jose, Surigao del Norte.
The accused include public officers—Ruben B. Ecleo, Jr., Arsenia N. Orejas, and Anadelia N. Navarra—and the petitioner, Engr. Ricardo L. Santillano, a private contractor and proprietor of PBMA Builders.

Criminal Case No. 24467: Concerning the construction of a public market wherein funds amounting to P4,008,005.00 were released to Santillano despite an insufficiency in the actual project accomplishment, resulting in an overpayment of P444,575.17.
Criminal Case No. 24468: Involving the construction of a municipal building with approved payments of P3,849,664.00 exceeding the contract price of P3,684,575.00 and an overpayment of P2,412,639.70 based on a mere 37.38% project accomplishment.
Criminal Case No. 24469: Relating to the repair and rehabilitation of a municipal guest house wherein funds amounting to P300,000.00 were disbursed for work on a private building owned by PBMA, although the municipality did not possess such a guest house.

The common charge across the cases was violation of Section 3(e) of Republic Act No. 3019 (the Anti-Graft and Corrupt Practices Act) for causing undue injury to the government and granting unwarranted benefits through manifest partiality, evident bad faith, or gross inexcusable negligence.

At the arraignment, only Ecleo, Jr. and Navarra appeared, pleading not guilty; Santillano surrendered and was arraigned later, filing a plea of not guilty.
A joint trial was ordered with State Auditors from the Commission on Audit (COA) presenting audit reports and evidence demonstrating the discrepancies in project costs and execution.
Witness testimonies and documentary evidence showed approval and disbursement of funds by the public officials despite irregularities in the actual work completed.
Testimonies revealed that Santillano issued receipts for overpayments and attempted to justify these overages invoking PD 1594, notwithstanding the lack of corresponding written orders for additional work.

For the public market project, discrepancies were found between the approved billing, actual work completed, and a computed overpricing of P444,575.17.
In the municipal building project, while an agreement was reached for a certain contract price, the actual inspection revealed only 37.33% completion and an overpayment of P2,412,639.70.
The municipal guest house funds were misappropriated since the project was diverted to a private building of PBMA, with no actual municipal guest house present.

Santillano claimed that he was justified by additional work done and invoked PD 1594 for adjustments, despite his authority being solely based on verbal instructions rather than written agreements.
Public officials, particularly Ecleo, Jr. and Navarra, contended they signed documents in good faith relying on each other’s certifications.
Santillano later challenged the decision on the ground that, as a private individual, he should not be held liable for acts committed in conspiracy with public officers under RA 3019.

Santillano’s appeal was largely based on alleged procedural defects – specifically his failure to comply with Rule 45 requirements, including the submission of a statement of material dates and proof of service of the petition on the lower court.
The People, via its Special Prosecutor, contended that the petition was fatally deficient since it did not comply with the mandatory requirements, notably not serving the petition on the Sandiganbayan.

Whether Santillano’s petition under Rule 45 was fatally defective due to failure to supply a statement of material dates and proof of service on the lower court as mandated by the Rules of Court and relevant Supreme Court Circular No. 19-91.

Whether the inclusion of private persons acting in conspiracy with public officers under Section 3(e) of RA 3019 is legally tenable, given that Santillano is a private individual.
Whether the evidence sufficiently established a conspiracy between Santillano and the public officials in causing the wrongful disbursement of government funds.
Whether oral or verbal justification of additional work is adequate to excuse the excess disbursement of funds without written orders or proper approval as required by PD 1594 and the contract.