Title
Supreme Court
Cruz vs. Sandiganbayan
Case
G.R. No. 134493
Decision Date
Aug 16, 2005
Former mayor Cruz convicted for double payments via signed vouchers, causing undue injury; refund didn’t negate liability; bad faith evident, Arias Doctrine inapplicable.

Case Summary (G.R. No. 134493)

Factual Background of the Case

During the audit investigation, the Special Audit Team discovered that there had been some irregularities in the municipality's financial dealings, particularly involving the duplicate payment of P54,542.56 made to Kelly Lumber and Construction Supply. The payments were made through two disbursement vouchers (DVs) signed by Cruz and subsequently encashed by him. The audit report, consisting of 336 pages, led to charges against Cruz for violating Section 3(e) of Republic Act No. 3019, known as the Anti-Graft and Corrupt Practices Act.

Legal Basis for the Charges

Section 3(e) of R.A. No. 3019 declares unlawful the acts of public officials that cause undue injury to any party, including the government, through bad faith, manifest partiality, or gross negligence. The Information filed against Cruz accused him of willfully paying Kelly Lumber twice despite prior payments having already been made.

Trial and Conviction

Cruz was arraigned and pleaded "Not Guilty." However, after a trial, the Sandiganbayan found him guilty of the charges on January 30, 1998. He was sentenced to imprisonment ranging from seven years and one month to ten years, alongside perpetual disqualification from holding public office. The court inferred bad faith from the circumstances of the payments, particularly noting that Cruz indeed encashed checks made payable to him rather than to Kelly Lumber, challenging the credibility of any defense asserting ignorance of wrongdoing.

Petitioner’s Defense and Arguments on Appeal

In his petition for review, Cruz advanced several arguments including the assertion that the Information was flawed for not specifying that he was an officer tasked with overseeing licenses or permits. The court rejected this, affirming that Section 3(e) applies broadly to all public officers irrespective of license-related duties. Additionally, Cruz contended that a previous court ruling granted him grounds for acquittal based on the reliance on subordinates, a defense that the court dismissed due to the specific facts of his case, which indicated that he had deviated from standard practices.

Analysis of Bad Faith and Credibility

The court emphasized that the allegation of bad faith could be substantiated without proving intent to defraud, as negligence may amount to a violation if it is gross and inexcusable. The court found Cruz’s actions—and the payment process—indicative of gross negligence. The systematic irregularities in payment practices should have prompted Cruz to exercise due diligence, undermining his claims of reliance on others.

Refund Argument and Its Implications

Cruz’s defense highlighted that Kelly Lumber reimbursed the municipality, suggesting that this n

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