Title
Doldol vs. People
Case
G.R. No. 164481
Decision Date
Sep 20, 2005
Municipal Treasurer Doldol convicted of malversation after audits revealed shortages; partial restitution deemed admission of guilt.
malversation of public funds
state audit
cash shortages

Case Summary (G.R. No. 164481)

Factual Background

The petitioner served as the Municipal Treasurer of Urbiztondo, Pangasinan. A team of State Auditors led by State Auditor Emilie S. Ritua audited the petty cash and cash accounts in his custody for the General Fund, Special Education Fund and Trust Fund. The first audit covered November 30, 1994 to June 8, 1995 and was conducted in the presence of the petitioner and the Municipal Accountant. The auditors initially found a cash shortage of P801,933.26, noted an unrecorded Land Bank of the Philippines withdrawal of P360,000.59 on June 5, 1995, and observed that on June 8, 1995 the petitioner made adjustments in the General Fund Cashbook that increased the total shortage to P1,134,421.54.

Further Audits and Demands

The audit team, by Letter dated July 5, 1995, demanded immediate restitution of the discovered shortage and required the petitioner to submit a written explanation within seventy-two hours. The petitioner failed to respond and was relieved of his duties and directed on July 20, 1995 to transfer the accounts to the Assistant Municipal Treasurer. A subsequent audit for the period June 8, 1995 to July 19, 1995 disclosed an additional shortage of P149,905.92. The auditors, by Letter dated July 27, 1995, again demanded restitution and a written explanation within seventy-two hours. The petitioner again failed to reply.

Administrative Correspondence and Partial Restitution

The State Auditors transmitted their Memorandum and Consolidated Report to the Provincial Auditor on August 3, 1995. On that same date the petitioner wrote the Provincial Treasurer requesting a re-audit and contesting the auditors’ findings. Instead of pursuing re-audit relief, the petitioner paid P200,000.00 to the Acting Municipal Treasurer on September 15, 1995 (Official Receipt No. 436756) and promised further installments of P200,000.00 on October 31, 1995 and P884,139.66 on or before November 30, 1995, but failed to remit the balance.

Referral for Criminal Prosecution and Ombudsman Proceedings

On February 6, 1996, the Provincial Auditor transmitted the auditors’ memorandum and consolidated report to the Ombudsman and requested that the petitioner be charged with malversation of public funds. The petitioner sought extensions to file a counter-affidavit but did not submit one. The Ombudsman thereafter endorsed criminal informations to the Regional Trial Court.

Informations Filed

Two informations for malversation were filed against the petitioner. Criminal Case No. SCC-2760 charged that on or about June 8, 1995 the petitioner wilfully and unlawfully used and benefited P1,134,421.54 of public funds entrusted to him, contrary to law. Criminal Case No. SCC-2763 charged that sometime between June 8, 1995 and July 19, 1995 he wilfully misappropriated and converted to his own use P149,905.92 of public funds, contrary to law.

Trial Court Proceedings and Conviction

At trial the petitioner testified that the alleged shortages represented cash advances availed of by municipal employees and denied personal use of the funds. The trial court rejected the defenses and convicted the petitioner in a joint decision of both malversation charges under Art. 217, Revised Penal Code. Because the amounts exceeded P22,000.00, the trial court imposed penalties in the range of reclusion temporal to reclusion perpetua, and, applying the Indeterminate Sentence Law, sentenced the petitioner to suffer an indeterminate penalty of ten years, one day of prision mayor as minimum to eighteen years, eight months of reclusion temporal as maximum in each case. The court ordered restitution of P1,134,421.54 and P149,905.92 respectively, less the advance payment of P200,187.80, and imposed accessory penalties including perpetual absolute disqualification under Art. 41, Rev. Penal Code, and costs.

Appeal to the Court of Appeals

The petitioner appealed to the Court of Appeals. He argued that the audits were incomplete when the demand letters were issued, that he was denied opportunity to further verify records, that the missing funds were employee cash advances, and that the prosecution failed to prove personal use. The CA, by decision dated February 11, 2001, affirmed the trial court. The CA found that the auditors completed their examinations, that the petitioner had been given opportunities to explain and to verify records but failed to do so, and that bank records confirmed the auditors’ findings. The CA treated the petitioner’s partial payment and his promise to pay the balance as an implied admission of guilt under Section 27, Rule 130, Rules on Evidence. The CA distinguished Dumagat v. Sandiganbayan (G.R. No. 96915, 3 July 1992, 211 SCRA 171), finding Dumagat’s facts inapposite because in that case the audit was haphazard and incomplete, whereas in the present case the auditors had substantially complied with the Manual of Instructions and completed their examinations.

Petition for Review to the Supreme Court

The petitioner filed a petition for review on certiorari under Rule 45, Rules of Court, contending that the CA erred in affirming conviction based on an erroneous and incomplete audit and that dismissal was warranted because he was not afforded opportunity to explain or produce records. He relied on Dumagat v. Sandiganbayan and Section 560 of the Manual of Instructions to Treasurers and Auditors to argue that an incomplete audit cannot furnish criminal liability. The Office of the Solicitor General responded that the issues were factual and that the trial court’s findings, affirmed by the CA, were conclusive absent a showing that cogent facts were ignored or misconstrued. The OSG noted the petitioner’s failure to produce documentary evidence of employee cash advances and the petitioner’s partial restitution.

The Supreme Court’s Analysis

The Court reviewed the audit chronology, the demand letters dated July 5 and July 27, 1995, and the petitioner’s failure to respond within the prescribed periods. The Court observed that the petitioner was present during the in

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