Abrigo v. Commission on Audit
REITERATIONFacts
1. The Antecedents: Petitioners, current and former officials and employees of the Metropolitan Waterworks and Sewerage System (MWSS)-Corporate Office (CO), approved and/or received meal allowances in 2012 and 2013, purportedly based on MWSS Board resolutions. The Commission on Audit (COA) subsequently issued notices of disallowance (NDs) for these payments, totaling P8,173,730.00. The COA asserted that the meal allowances lacked legal basis, particularly disallowing amounts exceeding P66.00 per month for incumbents as of June 30, 1989, and any allowance for non-incumbents, as these exceeded the amounts authorized by the Department of Budget and Management (DBM) or were not permitted at all. 2. Procedural History: Following the issuance of the NDs, petitioners appealed to the COA Cluster Director, arguing that the MWSS Charter granted the Board of Trustees autonomy to provide benefits and that the Concession Agreements recognized meal allowances as existing fringe benefits. The COA Cluster Director affirmed the disallowances, ruling that the appeal was untimely but also finding no merit on the substance, stating that payments to non-incumbents lacked Presidential approval and that standardized salaries under RA 6758 integrated all allowances. Petitioners then elevated the matter to the COA Proper, which denied the petition for review, again citing untimeliness and lack of merit. A subsequent motion for reconsideration was also denied, leading to the present petition for certiorari before the Supreme Court. 3. The Petition: This petition for certiorari under Rule 64, in relation to Rule 65 of the Rules of Court, seeks to reverse the COA Proper's decision and resolution upholding the disallowance of meal allowances. Petitioners argue that the COA committed grave abuse of discretion. While acknowledging a procedural lapse in filing the petition before the Supreme Court, they implore for leniency due to the substantial amount involved, the potential impact on 81 petitioners, and logistical difficulties caused by the pandemic. They contend that the MWSS Board had the authority to grant such benefits and that the Concession Agreements provided a basis. The petition also seeks to modify the liability of approving/certifying officers and recipients based on evolving jurisprudence, particularly the Madera rules, and to correct the reckoning date for incumbency from June 30, 1989, to July 1, 1989, as per RA 6758.
Issue(s)
Whether the COA Proper committed grave abuse of discretion in denying petitioners' appeal for having been filed out of time and for lack of merit. Whether the disallowance of meal allowances granted to MWSS officials and employees for calendar years 2012 and 2013 is proper. Whether petitioners are liable to return the disallowed amounts, and if so, to what extent; and the extent of liability for approving and certifying officers.
Ruling
The petition is partly granted. The COA Proper's Decision and Resolution are affirmed with modifications. The disallowances are sustained, but the cut-off date for incumbency is modified, and certain officers are exonerated from solidary liability.
Ratio Decidendi
On the timeliness of the petition and appeals: The Court acknowledged that the petition for certiorari and the appeals before the COA were filed out of time. However, citing substantive justice and the substantial disallowed amount affecting 81 petitioners, the Court relaxed the rules of procedure. It noted the logistical difficulties posed by the pandemic and the need to settle the controversy on its merits, consistent with jurisprudence allowing relaxation of rules in meritorious cases to avoid frustrating substantial justice. On the propriety of the disallowances and the cut-off date for incumbency: The Court affirmed the COA's disallowances, reiterating its ruling in Metropolitan Waterworks and Sewerage System v. Commission on Audit (MWSS). It held that MWSS is covered by Republic Act No. 6758 (RA 6758), which repealed all charters exempting agencies from the compensation and position classification system. The MWSS Board's grant of additional benefits was deemed an ultra vires act. Section 12 of RA 6758 mandates that all allowances, except those specifically excluded, are integrated into standardized salary rates. Meal allowances not integrated could only be continued for incumbents as of July 1, 1989, and any increase or grant to non-incumbents required Presidential approval. The Concession Agreements could not override RA 6758. The Court modified the cut-off date used in the NDs from June 30, 1989, to July 1, 1989, to align with the express text and effectivity date of RA 6758, as consistently applied in jurisprudence. This correction was deemed necessary to rectify ambiguity and ensure consistency with the law. On the liability to return disallowed amounts and the liability of approving and certifying officers: Applying the Madera Rules and subsequent clarifications, the Court held that recipients are liable to return the disallowed amounts they received, pursuant to the principle of solutio indebiti, unless exceptions apply. The exceptions under Rule 2(c) (proper basis in law but procedural irregularity) and Rule 2(d) (undue prejudice, social justice) were found not present, as the grant of meal allowance to those not entitled had no legal basis and did not involve humanitarian considerations. The Court distinguished between different categories of officers. Those who only certified the completeness of supporting documents and availability of funds (Category (b)) were exonerated from solidary liability, as their duty was ministerial and the disallowance was based on the illegality of the grant, not on fund availability or document adequacy. However, officers who certified that expenses were necessary, lawful, and incurred under direct supervision (Category (a)), those who approved payments (Category (c)), and the MWSS Board (Category (d)) were held solidarily liable. These officers were expected to ascertain the legal basis for disbursements and could not rely solely on board resolutions, especially when prior disallowances and lack of Presidential approval were evident. Their continued grant of the allowance despite knowledge of its questionable basis constituted gross negligence.
Main Doctrine
The grant of meal allowances to MWSS officials and employees is governed by Republic Act No. 6758, which integrates all allowances into standardized salary rates unless specifically excluded. Allowances not integrated may be continued only for incumbents as of July 1, 1989, and require Presidential approval for any increase or grant to non-incumbents. Approving and certifying officers are liable to return disallowed amounts, with exceptions for those performing purely ministerial functions.