Case Summary (A.M. No. 11-7-10-SC)
In-House Recommendation
In her August 10, 2010 memorandum, Atty. Candelaria urged the Court to advise COA to respect the CFAG-based computation on the grounds that:
• The Court’s use of CFAG guidelines had previously been upheld by COA in similar cases.
• The Constitution grants the Judiciary fiscal autonomy, including full flexibility in allocating and utilizing its resources.
• Allowing COA to dictate the appraisal method would encroach on the Judiciary’s administrative and fiscal prerogatives.
COA’s Post-Audit Authority and Judicial Autonomy
Under Article IX-D, Section 2(1) of the 1987 Constitution, COA may conduct post-audit examinations of all government funds and property, including those of constitutional bodies granted fiscal autonomy. This power, however, must be balanced against the Judiciary’s constitutional guarantee of fiscal autonomy (Article VIII, Section 3), its independence, and the separation of powers.
Separation of Powers and Judicial Independence
The Supreme Court reaffirmed that separation of powers ensures each branch’s supremacy within its own sphere, subject to checks and balances (Angara v. Electoral Commission). Judicial independence consists of:
• Decisional independence – judges decide free of external influence.
• Institutional independence – the Judiciary, as a branch, operates free from executive or legislative interference.
Constitutional safeguards (security of tenure, protection of salaries, administrative supervision) reinforce these principles.
Fiscal Autonomy Defined
Article VIII, Section 3 guarantees that Judiciary appropriations may not be reduced below the previous year’s level and shall be automatically released. In Bengzon v. Drilon, the Court held that fiscal autonomy entails “freedom from outside control,” including authority to allocate, disburse, and utilize appropriations and assets without external veto or micromanagement.
Supreme Court Practice and Authority to Dispose of Property
By En Banc Resolution (March 23, 2004), the Court recognized a longstanding practice of selling official property to retiring justices as an additional retirement benefit. Exercising administrative supervision, the Supreme Court determines the terms, conditions, and valuation method for these transactions. The Government Accounting and Auditing Manual (Section 501, Title 7) confirms that heads of agencies have “full and sole authority” to dives
...continue readingCase Syllabus (A.M. No. 11-7-10-SC)
Factual Antecedents
- Two memoranda dated July 14, 2011 and August 10, 2010 were submitted by Atty. Eden T. Candelaria, Deputy Clerk of Court and Chief Administrative Officer, Office of Administrative Services, to the Chief Justice.
- The memoranda sought guidance on the proper formula for computing the appraisal value that retiring Supreme Court justices must pay to purchase government properties used during their tenure.
- On June 8, 2010, the Legal Services Sector of the COA issued Opinion No. 2010-035, finding an aggregate underpayment of ₱221,021.50 by five retired justices when acquiring assigned vehicles and equipment.
- The COA’s computation compared values under the CFAG Joint Resolution No. 35 (April 23, 1997) against COA Memorandum No. 98-569-A (August 5, 1998), revealing discrepancies for models of Toyota Camry, Toyota Grandia, a Sony TV set, and an unspecified item.
- COA attributed the underpayment to the Supreme Court Property Division’s reliance on the CFAG formula instead of the COA’s revised guidelines.
Recommendations of the Office of Administrative Services
- Atty. Candelaria recommended that the Supreme Court advise COA to respect the in-house appraisal based on the CFAG formula, noting longstanding Court practice since 1997.
- Two prior cases involving retired Court of Appeals justices (Agcaoili and Guerrero) saw COA uphold CFAG-based appraisals.
- Emphasized that the 1987 Constitution grants the Judiciary fiscal autonomy, encompassing full flexibility in resource allocation and utilization.
- Allowing COA to override the Court’s chosen policy on property disposal would encroach on the judiciary’s constitutional prerogative.
Issue
- Which appraisal formula must govern the computation of the purchase price for government properties acquired by retiring Supreme Court justices: the CFAG Joint Resolution No. 35