Dadole v. Commission on Audit
REITERATIONFacts
1. The Antecedents: Judges of the Regional Trial Court (RTC) and Municipal Trial Court (MTC) in Mandaue City had been receiving monthly additional allowances, initially P1,260 and later increased to P1,500, funded through annual appropriation ordinances enacted by the Sangguniang Panlungsod. These allowances were provided to supplement their salaries and were considered a benefit for judges stationed in the city. 2. Procedural History: The Department of Budget and Management (DBM) issued Local Budget Circular No. 55 (LBC 55) in March 1994, setting a maximum allowance of P1,000 for judges in cities. Acting on this circular, the Mandaue City Auditor issued notices of disallowance, reducing the judges' allowances to P1,000 and demanding reimbursement for the excess received from April to September 1994. The judges protested, but their motion for reconsideration was denied by the City Auditor and subsequently by the Commission on Audit (COA) in a decision dated September 21, 1995, and a resolution dated May 28, 1996. This led to the filing of the present petition for certiorari. 3. The Petition: The petitioner judges filed a petition for certiorari under Rule 64 of the Rules of Court, assailing the COA's decision and resolution. They argue that Local Budget Circular No. 55 is void for exceeding the supervisory powers of the President, as it infringes upon the local autonomy of Mandaue City by imposing a uniform limit on allowances not explicitly provided by law. They also contend that the circular is void for lack of publication, violating the principle that administrative issuances implementing laws must be published to be effective. Furthermore, they question whether the COA correctly interpreted LBC 55 and whether the city's appropriation ordinances contravene annual appropriation laws, particularly concerning the use of Internal Revenue Allotment (IRA).
Issue(s)
Whether LBC 55 is void for exceeding the President's power of general supervision and for lack of publication. Whether the Mandaue City appropriation ordinance providing for judges' allowances is valid despite the DBM's subsequent circular.
Ruling
The petition is GRANTED. The decision and resolution of the Commission on Audit are SET ASIDE.
Ratio Decidendi
On Issue 1: The Court ruled that LBC 55 is null and void because it overstepped the President's power of general supervision. Under the Constitution, the President exercises general supervision over local governments, which is distinct from the power of control; supervision means overseeing that subordinates perform their duties, while control allows an officer to alter or nullify acts. Section 458 of RA 7160 allows LGUs to provide additional allowances 'when the finances of the city government allow,' without setting a specific maximum limit. By imposing a uniform P1,000 cap, the DBM substituted its judgment for that of the LGU, violating the principle of local autonomy. Furthermore, LBC 55 is void for lack of publication, as it is an implementing regulation that affects the income and rights of government employees, thus requiring publication in the Official Gazette or a newspaper of general circulation per Tañada v. Tuvera. On Issue 2: The Court held that the Mandaue City appropriation ordinance remains valid and in full force. The COA failed to provide evidence that the allowances were sourced from the Internal Revenue Allotment (IRA) rather than locally generated revenues; a general deficit in local revenue does not prove that the IRA specifically funded the judges' allowances. Moreover, under Sections 326 and 327 of RA 7160, the DBM has a 90-day period to review and take action on local appropriation ordinances. Since the DBM failed to formally disapprove the ordinance within the 90-day window, the ordinance was deemed reviewed and remained effective by operation of law. Consequently, the DBM and COA could no longer question the legality of the allowances provided in the ordinance after the lapse of the review period.
Main Doctrine
The President or any of his or her alter egos cannot interfere in local affairs as long as the concerned local government unit acts within the parameters of the law and the Constitution. Any directive seeking to alter the wisdom of a law-conforming judgment on local affairs is a patent nullity because it violates the principle of local autonomy and the separation of powers. Administrative rules and regulations must also be published if their purpose is to enforce or implement existing law pursuant to a valid delegation, especially when they tend to deprive government workers of allowances.