Villegas v. Auditor General
REITERATIONFacts
The Antecedents: The City of Manila appropriated P580,000.00 for the purchase of closed refuse collection trucks. A public bidding was held, but due to restrictive specifications, no award was made. A rebidding was scheduled with revised specifications. Several bidders, including CCH, Inc. (CCH), G.A. Machineries Inc. (GAMI), and Business & Industrial Suppliers, Inc. (BISI), submitted offers. The committee on awards, composed of the City Mayor, City Auditor, and City Treasurer, deliberated on the bids. After discussions and seeking further information, the committee, with technical advisers and end-user representatives present, unanimously awarded the contract to BISI on June 20, 1962, for 12 units of Ochsner w/ Thames Trader trucks at $12,064 CIF each, as funds allowed. A purchase order was issued and approved. Procedural History: CCH and GAMI protested the award. The committee on awards dismissed their protests. CCH and GAMI then protested to the Auditor General. The Auditor General formed a technical committee which opined that CCH's offered truck was superior to BISI's. Based on this report, the Deputy Auditor General directed the City Auditor to be guided accordingly, implying the award should have been to CCH. The City Mayor asserted the validity of the award to BISI and noted that CCH was under investigation for a previous unsatisfactory contract. The Auditor General reiterated his belief that CCH should have been awarded and warned that the purchase from BISI might not be allowed in audit. The City Auditor, following superior orders, refused to pre-audit a voucher for establishing a letter of credit for the purchase. Petitioners, the Mayor and BISI, filed a petition for mandamus to compel the respondents (Auditor General and City Auditor) to sign the voucher and perform necessary acts for the delivery of the trucks. The Petition: The Court of First Instance rendered judgment commanding the respondents to sign the voucher and perform all pertinent acts towards the delivery of the trucks. The case was appealed to the Supreme Court.
Issue(s)
Whether the Committee on Awards was legally constituted despite the Mayor's delegation of his role to a representative. Whether the Auditor General has the jurisdiction to revoke or veto an award made by a local Committee on Awards on the ground that another bid is technicality superior. Whether Mandamus is the proper remedy to compel the City Auditor to sign the voucher for payment.
Ruling
The Supreme Court affirmed the judgment of the Court of First Instance, commanding the respondents, Auditor General and City Auditor Jose Erestain, to sign the voucher dated July 24, 1962, and to perform all other pertinent acts leading to the delivery of the garbage trucks to the City of Manila. The Court ruled that the committee on awards was duly empowered to act, the award to BISI was legally authorized, and the Auditor General lacked the authority to revise or veto the award.
Ratio Decidendi
On Issue 1: While the Court agreed that discretionary powers, such as the Mayor's membership in the Committee on Awards, generally cannot be delegated to a representative, the action remained valid. Two members of the three-person committee—the City Treasurer and the City Auditor—were present, and these two constituted a legal quorum capable of transacting business. Furthermore, any defect in the representation was cured because the City Mayor subsequently ratified the Committee's action by approving the purchase order and filing the present Mandamus petition. The law (Section 3(c) of RA 2264) requires the committee to act, and action by a majority of a quorum is sufficient when all members were notified. Therefore, the award was legally made by the authorized body. On Issue 2: The Auditor General's authority under the Constitution is strictly limited to auditing expenditures to ensure they are legal and supported by law. Applying the doctrine in Guevara v. Gimenez, the Court ruled that the Auditor General does not have the power to substitute his judgment for that of the administrative officer regarding the wisdom or advantageousness of a contract. His duty is to determine if an appropriation exists and if the contract follows the appropriation law; once these are satisfied, his duty is ministerial. While he may bring 'irregular' or 'unnecessary' expenditures to the attention of administrative officers, this specifically implies he lacks the power to refuse payment on those grounds alone. He cannot act as a 'general veto power' over all city contracts based on a difference in technical opinion. On Issue 3: Mandamus is the proper remedy because the refusal to sign the voucher was based on an unauthorized exercise of discretion by the Auditor General. Since the contract with BISI was perfected and complied with all mandatory legal requirements including public bidding and appropriation, there was no legal ground for the City Auditor to withhold his signature. When a public officer refuses to perform a duty that the law requires him to perform—and where he possesses no discretion to refuse because the legal conditions have been met—the court may issue a writ of Mandamus to compel performance. The proposed expenditure of city funds was legal, and the contract was entered into by the Mayor within his scope of authority, thus the signing of the voucher was a purely ministerial act.
Main Doctrine
The Auditor General has no authority to revise, revoke, or veto a contract award made by a duly constituted committee on awards, provided the contract conforms to legal procedures and the award was not tainted by illegality, fraud, or grave abuse of discretion. The Auditor General's role is limited to bringing irregularities to the attention of administrative officers, not to disapprove payments on grounds of unwisdom or extravagance.