Ampatuan v. Commission on Audit
REITERATIONFacts
The Antecedents: The Commission on Audit (COA), through its Special Audit Office (SAO), conducted a special audit of the Office of the Regional Governor (ORG) in the Autonomous Region in Muslim Mindanao (ARMM) for the period of January 2008 to September 2009. Petitioner Zaldy Uy Ampatuan was then the Regional Governor. The audit resulted in Notice of Disallowance (ND) No. ORG-12-002-MDS/LF (08 & 09), disallowing P79,162,435.00 paid to a supermarket named 'Superama' for office supplies and relief goods. The disbursements, made via cash advances by Adham G. Patadon (Chief-Supply Division), were found illegal due to lack of public bidding, violation of cash payment limits, and the use of spurious documents, with the supplier denying the transactions entirely. Procedural History: Petitioner was held liable for failing to monitor his subordinates and ensure the proper management of government resources. Petitioner's subsequent appeals to the SAO Director and the COA Proper were denied for being filed out of time and for lack of merit. Petitioner then filed a Supplemental Motion for Reconsideration (MR) and a Petition for Relief from Judgment, arguing that his former counsel was grossly negligent, that he never received the ND, and that his signatures on previous pleadings were either obtained without explanation or were electronic signatures used without consent. The COA Proper dismissed these filings as prohibited or unsubstantiated, declaring the ND final and executory. The Petition: Petitioner filed a Petition for Certiorari under Rule 65 before the Supreme Court, despite Rule 64 being the correct procedural vehicle. He argued that his constitutional right to due process was violated because he was incarcerated for the 'Maguindanao Massacre' during the proceedings and relied entirely on counsel who failed to raise his defense of non-participation. He maintained that no evidence linked him to the approval or authorization of the disallowed disbursements and that the COA committed grave abuse of discretion in sustaining his liability based solely on his position as Regional Governor.
Issue(s)
Whether the doctrine of immutability of judgment precludes the Supreme Court from reviewing the COA's final and executory decision, considering potential grave abuse of discretion and the interest of substantial justice. Whether the Petitioner, as head of the agency, may be held solidarily liable for the disallowed amounts, and under what conditions such liability arises, considering the absence of direct participation, bad faith, or gross negligence.
Ruling
The Supreme Court GRANTED the petition, SET ASIDE the COA Resolution dated August 15, 2019, and MODIFIED the Notice of Disallowance by DELETING Petitioner Zaldy Uy Ampatuan's solidary liability.
Ratio Decidendi
On Issue 1: The Court ruled that while the doctrine of immutability of judgment is vital for the finality of litigation, it is not an absolute bar to judicial review. A judgment rendered with grave abuse of discretion, such as when it is not based on law or evidence, is void and cannot be perpetuated by the principle of immutability. Although the Petitioner erroneously filed under Rule 65 and the petition was technically late under Rule 64, the Court relaxed procedural rules in the interest of substantial justice. The Court emphasized that it is not powerless to set aside a final and executory judgment when the public respondent is guilty of an evasion of a positive duty. Consequently, the merits of the case regarding the lack of evidentiary basis for liability justified the Court's intervention despite the procedural lapses. On Issue 2: The Court held that the COA erred in imputing liability to the Petitioner based solely on his position as the head of the agency under Section 2 of Presidential Decree (PD) No. 1445. Governing laws, specifically Section 103 of PD No. 1445 and Section 38, Book I of the Administrative Code of 1987, clarify that a superior officer is not civilly liable for the wrongful acts of subordinates unless they authorized the act in writing or acted with bad faith, malice, or gross negligence. Applying the ruling in Madera v. COA, the Court noted that public officers enjoy a presumption of good faith and regularity in the performance of official duties. In this case, the records showed that the Petitioner had no knowledge of, nor did he participate in, the approval or authorization of the disallowed disbursements, which were carried out by the Special Disbursing Officer. Since there was no evidence of confederation, conspiracy, or flagrant breach of duty on the Petitioner's part, there was no legal or evidentiary basis to hold him personally liable for the return of the disallowed amount.
Main Doctrine
The Supreme Court emphasizes that the principle of immutability of judgment must yield to the higher interest of substantial justice when a decision is void due to grave abuse of discretion. Specifically, in Commission on Audit (COA) disallowances, the head of an agency cannot be held solidarily liable solely based on their administrative position. Liability is personal and depends on the individual's direct participation in the disallowed transaction and a finding of bad faith, malice, or gross negligence. The presumption of good faith and regularity in the performance of official duties prevails unless overcome by evidence of a flagrant and palpable breach of duty.