Philippine Health Insurance Corporation v. Commission on Audit
REITERATIONFacts
The Antecedents: During the first half of 2010, the Philippine Health Insurance Corporation (Philhealth) Regional Office No. VI - Iloilo City disbursed P1,190,000.00 for an Anniversary Gift to its officials and employees, pursuant to Philhealth Board Resolution No. 382, S. 2001, as amended by Resolution No. 445, S. 2002. Additionally, P187,122.73 was paid as transportation allowances to job order contractors, as per Resolution No. 938, S. 2006. The Commission on Audit (COA) Auditor subsequently issued Notices of Disallowance (ND) 2010-001 and 2010-002. ND 2010-001 disallowed P833,000.00 of the Anniversary Gift payments for being irregular and excessive, citing issuances limiting such grants to P3,000.00 per employee. ND 2010-002 disallowed the transportation allowances for job order contractors, deeming it illegal due to a violation of contractor agreements and lack of presidential authorization. Procedural History: Philhealth, through its officers and employees, appealed the disallowances to the COA Regional Director. In Decision No. 2012-031 dated December 26, 2012, the Regional Director denied the appeal for being filed out of time, although the merits were also addressed, affirming the disallowances. Aggrieved, Philhealth elevated the case to the COA Commission Proper (COA Proper). The COA Proper, in Decision No. 2014-440 dated December 29, 2014, dismissed Philhealth's petition for review for being filed out of time, thereby declaring the Regional Director's decision final and executory. A subsequent motion for reconsideration was also denied. Consequently, Philhealth filed the present petition for Certiorari before the Supreme Court. The Petition: Philhealth filed a Petition for Certiorari under Rule 64 in relation to Rule 65 of the Rules of Court, assailing the COA Proper's Decision No. 2014-440 and Resolution dated August 18, 2015. The core issue presented to the Supreme Court is whether the subject disallowances had become final and executory due to Philhealth's failure to appeal within the reglementary periods prescribed by the COA Rules. Philhealth argued that its appeal to the Regional Director was timely and that it sought an extension for its appeal to the COA Proper. The petition also contended that the COA Proper committed grave abuse of discretion in dismissing its petition outright. The Supreme Court noted that Philhealth's appeal to the Regional Director was filed 204 days late, and its petition for review to the COA Proper was filed 41 days late, rendering the disallowances final and executory.
Issue(s)
Whether the subject disallowances had become final and executory due to Philhealth's failure to appeal within the reglementary period. Whether the COA Proper committed grave abuse of discretion in dismissing Philhealth's petition for review for being filed out of time.
Ruling
The petition is dismissed. The assailed Decision No. 2014-440 dated December 29, 2014 and Resolution dated August 18, 2015 of the Commission on Audit Commission Proper in COA CP Case No. 2013-071 are affirmed.
Ratio Decidendi
On the issue of finality of disallowances due to failure to appeal within the reglementary period: The Court affirmed the COA Proper's finding that Philhealth's appeal to the Regional Director and its subsequent Petition for Review before the COA Proper were filed beyond the six-month reglementary period. Under the COA Rules, a notice of disallowance must be appealed to the Director within six months from receipt, and a review of the Director's ruling must be filed with the COA Proper within the time remaining of the original six-month period. Philhealth's claim of filing its appeal to the Regional Director on the last day of the period and then moving for an extension to file with the COA Proper was deemed insufficient. The Court emphasized that procedural rules prescribing definite reglementary periods are indispensable and must be strictly complied with, and cannot be suspended or relaxed absent compelling reasons. The excuses provided by Philhealth were considered flimsy and lacking prudence. The Court noted that similar issues regarding Philhealth's belated appeals had been previously upheld as final and executory by the Supreme Court. On the issue of grave abuse of discretion: The COA Proper did not commit grave abuse of discretion when it dismissed Philhealth's petition outright for being filed out of time. The dismissal was a consequence of Philhealth's failure to comply with the procedural rules governing appeals within the COA. Consequently, the subject Notices of Disallowance became final and executory, and the COA Proper could no longer take cognizance of Philhealth's Petition for Review after it was filed belatedly. The Court reiterated that procedural rules are designed to prevent needless delays and ensure the orderly and speedy discharge of business, and strict adherence is required. The Court's decision to uphold the COA's procedural ruling was based on the established principle that final and executory decisions are immutable and unassailable.
Main Doctrine
The Commission on Audit (COA) Proper did not commit grave abuse of discretion in dismissing a petition for review for being filed out of time, as procedural rules prescribing definite reglementary periods must be strictly complied with. Furthermore, disbursements for anniversary gifts exceeding the prescribed limit and transportation allowances granted to job order contractors not considered employees are illegal and irregular.