Abejo v. Commission on Audit
CLARIFICATIONFacts
The Antecedents: The Inter-Country Adoption Board (ICAB), established by Republic Act No. 8043, is the central authority for inter-country adoptions in the Philippines. Due to a high volume of applications from prospective adoptive parents (PAPs) between 2008 and 2010, ICAB members were requested to assist the Inter-Country Adoption Placement Committee (ICPC) in reviewing PAPs dossiers. To compensate for this additional workload, the ICAB members were granted additional remuneration, initially P250.00 per reviewed application, later increased to P500.00 per application, through internal memoranda. Procedural History: An audit of the ICAB's finances resulted in Notice of Disallowance (ND) No. 2011-009-101-(08-10), disallowing the total additional remuneration of P162,855.00 granted to ICAB members. The disallowance was based on the lack of legal basis, violation of DBM Budget Circular No. 2003-5 and Section 49 of RA 9970, a prior denial by the DSWD Legal Service, and the fact that ICAB members are only entitled to a P1,500.00 per diem per meeting as per Section 5 of RA 8043. The petitioner, as the Executive Director and approving officer, was identified as liable to return the disallowed amount. The petitioner appealed to the COA National Government Section (NGS) – Cluster 6, which affirmed the disallowance. Subsequently, a petition for review was filed before the Commission on Audit (COA) Proper, which also denied the petition, upholding the disallowance and finding the petitioner liable. The Petition: The petitioner filed a petition for certiorari under Rule 64 in relation to Rule 65 of the Rules of Court with the Supreme Court, assailing the COA Proper's decision. The petitioner argued that the additional remuneration had a legal basis, citing the ICAB Manual of Operation and considering the work as a special project under RA 9970. She also contended that she acted in good faith and should not be compelled to reimburse the disallowed amount. The Supreme Court, while acknowledging procedural defects in the petition (failure to file a motion for reconsideration), opted to resolve the case on the merits due to the involvement of substantial justice. The Court affirmed the disallowance of the additional remuneration but modified the decision by absolving the petitioner from liability to return the disallowed amount, citing the Madera Rules and the presumption of good faith.
Issue(s)
Whether the Commission on Audit (COA) correctly disallowed the additional remuneration given to Inter-Country Adoption Board (ICAB) members. Whether petitioner Bernadette Lourdes B. Abejo should be held liable for the disallowed amount.
Ruling
The petition is PARTIALLY GRANTED. Decision No. 2020-058 dated 14 January 2020 of the Commission on Audit Proper is hereby AFFIRMED WITH MODIFICATION. The validity of Notice of Disallowance No. 2011-009-101-(08-10) dated 04 April 2011 is AFFIRMED. Nevertheless, petitioner Bernadette Lourdes B. Abejo is ABSOLVED from her solidary liability to return the disallowed amount. SO ORDERED.
Ratio Decidendi
On Issue 1: The Court affirmed the COA's disallowance of the additional remuneration, agreeing that while additional work outside a government official's regular function may be compensated, the grant must strictly comply with applicable laws and rules. Citing Sison v. Tablang, the Court emphasized that honoraria cannot be demanded as a matter of right and must be circumscribed by DBM guidelines. Section 5 of Republic Act No. 8043 clearly limits the per diem amount ICAB members are to receive, and Item 4.3 of DBM Budget Circular No. 2003-5 expressly prohibits the payment of honoraria to officers already receiving per diem, which includes ICAB members. The 'Intercountry Adoption Board Manual of Operation' was deemed an insufficient legal basis, as Section 5 of said manual pertains exclusively to members of the ICPC and cannot defeat an express provision of law or a specific rule governing honoraria. Furthermore, the Court, referencing Ngalob v. Commission on Audit, rejected petitioner's argument that the review of PAPs Dossiers constituted a 'special project' under Section 49 of RA 9970, as petitioner failed to present any approved special project plan of activities or undertakings as required by DBM Circular 2007-2, which specifies detailed requirements for such projects. On Issue 2: The Court absolved petitioner Bernadette Lourdes B. Abejo from liability for the disallowed amount, disagreeing with the COA Proper's finding of negligence. Applying the 'Madera Rules' for determining liability in audit disallowances, specifically Rule 2a, the Court found that petitioner acted in good faith. The Court considered 'badges of good faith' in favor of petitioner, noting that no prior disallowance of the same benefit had been issued against ICAB, and there was no precedent disallowing a similar case in jurisprudence. The Court distinguished the present case from another COA disallowance petition involving ICAB (Abejo v. Commission on Audit, G.R. No. 254570), which pertained to an entirely different incentive, thus not serving as a prior warning. Upholding the presumption of good faith in the performance of official functions accorded to public officers, the Court concluded that petitioner should not be held civilly liable for the disallowed amount.
Main Doctrine
The grant of additional compensation, such as honoraria, to government officials must strictly comply with applicable laws and rules, especially when officials already receive per diem, as expressly prohibited by Department of Budget and Management Budget Circular No. 2003-5 and limited by Republic Act No. 8043. Internal manuals cannot override statutory provisions. Furthermore, for an activity to qualify as a 'special project' warranting honoraria under the General Appropriations Act, it must meet stringent requirements, including an approved special project plan. In cases of audit disallowance, the 'Madera Rules' govern the civil liability of approving officers, who may be absolved if they acted in good faith, evidenced by factors such as the absence of prior disallowances or jurisprudential precedents.