Fortune Life Insurance v. Commission on Audit
REITERATIONFacts
The Antecedents: The Provincial Government of Antique (LGU) entered into a memorandum of agreement with Fortune Life Insurance Company, Inc. for the life insurance coverage of qualified barangay officials. The LGU allocated P4,393,593.60 for premium payments and submitted a disbursement voucher for pre-audit to the Commission on Audit (COA)-Antique. The COA disallowed the payment, citing lack of legal basis under Republic Act No. 7160 (Local Government Code). The LGU's appeal was denied, and subsequently, Fortune Life Insurance Company, Inc. filed a petition for money claim with the COA. Procedural History: The COA denied Fortune Life Insurance Company, Inc.'s petition for money claim on November 15, 2012, holding that only municipal or city governments are expressly empowered to secure group insurance for barangay workers under the Local Government Code, and noting non-compliance with publication requirements under the Government Procurement Reform Act. Fortune Life received the decision on December 14, 2012, and filed a motion for reconsideration on January 14, 2013. The COA denied this motion, with Fortune Life receiving notice of the denial on July 14, 2014. Consequently, Fortune Life filed a petition for certiorari on August 12, 2014. The Petition: Fortune Life Insurance Company, Inc. sought reconsideration of the Supreme Court's resolution that dismissed its petition for certiorari under Rule 64 in relation to Rule 65 of the Rules of Court. The dismissal was based on late filing, non-submission of proof of service and verified declaration, and failure to demonstrate grave abuse of discretion by the respondents. Fortune Life argued that the fresh period rule from Neypes v. Court of Appeals should apply, that its affidavit of service was sufficient, and that it had attached a verified declaration. It also contended that the COA committed grave abuse of discretion through delays, a terse resolution, and misinterpretation of the Local Government Code.
Issue(s)
Whether the petition for certiorari was filed within the reglementary period. Whether the petitioner complied with the rule on proof of service. Whether the petitioner showed grave abuse of discretion on the part of the COA. Whether the petitioner and its counsel exhibited harshness and disrespect towards the Court and its Members.
Ruling
The Court DENIED the Motion for Reconsideration for lack of merit. It ordered the petitioner and its counsel, Atty. Eduardo S. Fortaleza, to show cause in writing why they should not be punished for indirect contempt of court and, in Atty. Fortaleza's case, why he should not be disbarred.
Ratio Decidendi
On the reglementary period: The Court held that the fresh period rule enunciated in Neypes v. Court of Appeals does not apply to petitions for certiorari under Rule 64 of the Rules of Court. Unlike Rule 42, Rule 64 provides a 30-day period to file the petition. A motion for reconsideration interrupts this period, and if denied, the petitioner has the remaining period, which shall not be less than five days, to file the petition. In this case, the petitioner received the denial of its motion for reconsideration on July 14, 2014, and had until July 19, 2014, to file the petition. However, the petition was filed on August 13, 2014, making it 25 days late. The Court reiterated that the belated filing of a Rule 64 petition based on a mistaken belief that the fresh period rule applies is fatal to the recourse, as in Pates v. Commission on Elections. On the compliance with the rule on proof of service: The Court found the petitioner's claim of compliance unwarranted, stating that Section 13, Rule 13 of the Rules of Court requires both an affidavit of service and the registry receipt when service is made by registered mail. The petition only contained cut print-outs of registry receipt numbers, not the actual registry receipts themselves, which did not substantially comply with the rule. The Court emphasized that compliance with this rule is mandatory, and the absence of either the affidavit or the registry receipt means there is no proof of service, as held in Cruz v. Court of Appeals. On whether grave abuse of discretion was shown: The Court found that the petition for certiorari did not sufficiently disclose how the COA committed grave abuse of discretion. The bases cited by the petitioner, such as the COA's decision-making time, the terseness of the denial of the motion for reconsideration, and the differing opinion of former Senator Pimentel, did not approximate grave abuse of discretion. The Court clarified that grave abuse of discretion implies a capricious and whimsical exercise of judgment equivalent to lack or excess of jurisdiction, which was not demonstrated. Furthermore, the COA's denial of the claim for lack of sufficient publication under the Government Procurement Act was well within its authority. On the harshness and disrespect towards the Court: The Court strongly condemned the petitioner and its counsel for their harsh and disrespectful language, accusing the Court and its Members of ignorance and recklessness. The Court found these accusations unfounded and undeserved, as the petition clearly lacked proper proof of service. The Court stated that it does not tolerate such language and considers it offensive, especially when the Court's resolutions are arrived at with care and caution. The Court ordered the petitioner and its counsel to show cause why they should not be punished for indirect contempt and, in the case of the counsel, for disbarment.
Main Doctrine
The fresh period rule enunciated in Neypes v. Court of Appeals does not apply to petitions for certiorari under Rule 64 of the Rules of Court. Strict compliance with procedural rules, including proof of service, is mandatory, and failure to comply may be fatal to the recourse.