Bulilan vs. Commission on Audit

A government officer accountable for public funds is negligent when he or she fails to exercise the degree of care and vigilance which the prevailing circumstances reasonably require in safeguarding those funds. The findings of fact of administrative bodies, such as the Commission on Audit, are generally respected and even given finality by the courts, as long as they are supported by substantial evidence, and may not be reviewed in a petition for review on certiorari under Rule 45, which allows only questions of law.

Petitioner Hermogina U. Bulilan was the Cashier of Visaya State College of Agriculture (VISCA) in Baybay, Leyte, responsible for preparing the payroll of the State College's employees. The Commission on Audit is the constitutional body tasked with auditing government accounts and has the authority to relieve accountable officers from responsibility for losses of government funds under certain conditions. Section 73 of Presidential Decree No. 1445 provides the mechanism for an accountable officer to seek relief from liability for losses caused by fire, theft, or other casualty or force majeure.

Petitioner Hermogina U. Bulilan was the Cashier of Visaya State College of Agriculture (VISCA) in Baybay, Leyte, whose responsibility was to prepare the payroll of employees of the State College. As the first quincina of the March payroll was due on March 12, 1990, on March 9, 1990, a Friday, petitioner withdrew the needed amount from the Land Bank Branch in Tacloban City. Since she was scheduled to leave for Baguio City on the day the payroll was to be released, petitioner and her staff rendered overtime service without pay on March 10, a Saturday, and March 11, a Sunday, to ensure that payment of salaries would be on time.

Petitioner's methodology in preparing the salaries was based on the standard practice of government offices, placing the net pay of every employee in individual pay envelopes. When the corresponding amounts were placed in the pay envelopes, they became too bulky for the Mosler safe of petitioner to accommodate. Confronted with this problem, she placed the pay envelopes in a steel cabinet without a lock. According to petitioner, when she left her office, she saw to it that its main door was double-locked.

On the night of March 11, 1990, a robbery took place at the Cashier's Office of VISCA, resulting in the loss of government funds amounting to Five Hundred Sixty-Six Thousand Four Hundred Sixty-Eight and 91/100 (P566,468.91) Pesos. Mr. Dominador Ugsang, Chief Security Officer of VISCA, submitted a report detailing that personnel of the Cash Division discovered the robbery at around 8:30 a.m. on March 12, 1990. The NBI assisted in tracing fingerprints on window glasses and the route of the culprit, noting that the route taken could only be done by one very familiar with the building. The culprit gained entrance through the fire exit, passed through the Personnel Office, the Office of Business Affairs, and the Budget Office, and lifted the iron grills of the sliding frame to gain entrance to the Cashier's Office, taking the envelopes containing the salaries placed inside a steel cabinet.

Because of the incident, petitioner cancelled her trip to Baguio City and reported the incident to the authorities. On March 27, 1990, petitioner wrote the Commission on Audit seeking relief from accountability for the loss, invoking Section 73 of P.D. 1445. The COA denied her plea on June 20, 1995, based on the November 24, 1992 Report of Director Santos M. Alquizalas of COA Regional Office VIII, which found petitioner negligent. The report noted that the Cash Division had a concrete vault with double steel doors secured by big Yale padlocks, which was more secured for safekeeping purposes compared to the unlocked storage cabinet where the payroll money was placed. The report also noted petitioner's failure to turn over the payroll money to Ms. Anecia Fernandez, the Disbursing Officer, and discrepancies in petitioner's account of her travel to Tacloban City.

Petitioner argued that the concrete room was not a vault but merely a concrete room, that the storage cabinet was strategically placed in an area visible to the guard, and that she did travel to Tacloban City on March 9, 1990, upon the directive of her superior. The Court found that the COA's findings were supported by substantial evidence, including the November 24, 1992 Report of Director Alquizalas, the April 8, 1992 Report of Salvador L. Paril, resident Auditor of VISCA, and the Ad Hoc Committee Report.

• Improper Characterization of the Concrete Room: Petitioner argued that calling the concrete room a "concrete vault" was a misnomer, as the original plan to construct a vault was never fully implemented due to financial constraints, leaving only a concrete room. She alleged that former President Villanueva hurriedly improved the safety of government money after the robbery to cover up his own negligence.
• Travel to Tacloban City: Petitioner argued that the Auditor's allegation that she did not travel to Tacloban City on March 9, 1990, but only to Ormoc City, was misplaced. She claimed she was directed by Prof. Camilo D. Villanueva to proceed to Tacloban City to verify if money transmitted to Land Bank Tacloban City was received, and that she left VISCA at around 10:00 in the morning and arrived past 5:00 in the afternoon.
• Fortuitous Event: Petitioner theorized that what she did was what any reasonable person would have done under the attendant facts and circumstances, and therefore she should not be held liable for the effects of what she called a fortuitous event over which she had no control.

• Negligence in Safekeeping: The Commission on Audit found definite proof of negligence on the part of petitioner in the safekeeping of subject government funds, considering the adverse recommendation of the resident auditor of VISCA and the Director, COA Regional Office No. VIII.
• Availability of a Safer Storage Option: The COA noted that the Cash Division had a concrete vault with double steel doors secured by big Yale padlocks, which was more secured for safekeeping purposes compared to the unlocked storage cabinet where the payroll money was placed.
• Failure to Turn Over Funds: The COA considered petitioner's failure to turn over the payroll money to Ms. Anecia Fernandez, the Disbursing Officer, as another indication of her non-compliance with internal rules.

• Propriety of Remedy: Whether the petition for review on certiorari under Rule 45 was the appropriate remedy to question the COA's findings of negligence.
• Negligence: Whether the Commission on Audit erred in finding petitioner negligent and in denying her request for relief from accountability for the lost government funds.

• Propriety of Remedy: No. The petition under Rule 45 was an improper remedy because it raised questions of fact, specifically the presence or absence of negligence, which cannot be looked into and determined under Rule 45. The proper remedy is a petition for certiorari under Rule 65, as prescribed by Article IX-A, Section 7 of the Constitution.
• Negligence: No. The Commission on Audit did not err in finding petitioner guilty of negligence. The findings of fact of administrative bodies are generally respected and even given finality when supported by substantial evidence, and the Court found that the COA's findings were duly supported by substantial evidence.

• Propriety of Remedy: The Court noted that under Rule 45, only questions of law may be raised. Questions of fact, such as the presence or absence of negligence on the part of petitioner in the handling or custody of subject public funds, cannot be looked into and determined under Rule 45. Article IX-A, Section 7 of the Constitution provides that decisions, orders, or rulings of the Commission on Audit may be brought to the Supreme Court on certiorari by the aggrieved party within thirty (30) days from receipt of a copy thereof, and Rule 65 of the Revised Rules of Court prescribes such a remedy. The petition under consideration was premised on alleged misappreciation of facts by the respondent Commission, making it an improper remedy.

• Negligence: The Court defined negligence as "the omission to do something which a reasonable man, guided upon those considerations which ordinarily regulate the conduct of human affairs, would do, or the doing of something which a prudent man and reasonable man could not do." Negligence is a relative or comparative concept, and its application depends upon the situation the parties are in, and the degree of care and vigilance which the prevailing circumstances reasonably require. Applying this to the case, the Court found that petitioner was negligent in the performance of her duties as Cashier. The Court noted that VISCA had a concrete vault/room with a steel door secured by a big Yale padlock, which was very much safer than the unlocked storage cabinet in which petitioner placed the government funds. The storage cabinet could not be readily seen by the guard on duty, who was usually posted near the main entrance of the building. Furthermore, petitioner failed to follow the frequency of deposit prescribed by Joint COA-MOF Circular No. 1-81, as she did not make a single deposit during the month of March, 1990. Her failure to turn over the payroll money to the Disbursing Officer was another indication of her non-compliance with the internal rules of VISCA. The Court concluded that the COA correctly denied petitioner's request for relief from responsibility under Section 73 of P.D. 1445.

• Finality of Administrative Findings of Fact — The findings or conclusions of administrative bodies are generally respected and even given finality by the courts. By reason of the special knowledge and expertise of administrative agencies over matters falling under their jurisdiction, they are in a better position to pass judgment thereon. Their findings of fact must be respected as long as they are supported by substantial evidence, even if such evidence might not be overwhelming or even preponderant. It is not the task of an appellate court to weigh once more the evidence submitted before the administrative body and to substitute its own judgment for that of the administrative agency in respect of sufficiency of evidence. The Court applied this doctrine in affirming the COA's finding of negligence against petitioner.

• Negligence as Want of Care Required by Circumstances — Negligence is defined as "the omission to do something which a reasonable man, guided upon those considerations which ordinarily regulate the conduct of human affairs, would do, or the doing of something which a prudent man and reasonable man could not do." Negligence is a relative or comparative concept; its application depends upon the situation the parties are in, and the degree of care and vigilance which the prevailing circumstances reasonably require. The diligence which the law requires an individual to observe and exercise varies according to the nature of the situation in which he happens to be, and the importance of the act which he has to perform. The Court applied this doctrine in finding that petitioner did not do her best, as dictated by the attendant circumstances, to safeguard the public funds entrusted to her.

• "Negligence is defined as 'the omission to do something which a reasonable man, guided upon those considerations which ordinarily regulate the conduct of human affairs, would do, or the doing of something which a prudent man and reasonable man could not do.' Stated otherwise, negligence is want of care required by the circumstances." — This passage defines the controlling doctrine of negligence applied by the Court to petitioner's conduct in safeguarding public funds.

• "By reason of the special knowledge and expertise of said administrative agencies over matters falling under their jurisdiction, they are in a better position to pass judgment thereon; thus, their findings of fact in that regard are generally accorded great respect, if not finality, by the courts." — This passage articulates the principle of finality of administrative findings of fact, which the Court relied upon in declining to review the COA's factual findings.

• "The findings of fact of an administrative agency must be respected as long as they are supported by substantial evidence, even if such evidence might not be overwhelming or even preponderant. It is not the task of an appellate court to weigh once more the evidence submitted before the administrative body and to substitute its own judgment for that of the administrative agency in respect of sufficiency of evidence." — This passage establishes the standard of review applicable to administrative findings of fact, which the Court applied in affirming the COA's decision.

• Vicente Villaflor vs. Court of Appeals, 280 SCRA 297 [1997] — Cited as controlling precedent for the rule that findings of fact of administrative agencies are generally accorded great respect, if not finality, by the courts, due to their special knowledge and expertise over matters falling under their jurisdiction.
• Ting vs. Court of Appeals, 237 SCRA 797 [1994] — Cited in support of the rule that findings or conclusions of administrative bodies are generally respected and even given finality.
• McKee vs. Intermediate Appellate Court, 211 SCRA 517 (539) — Cited as the source of the definition of negligence as "the omission to do something which a reasonable man, guided upon those considerations which ordinarily regulate the conduct of human affairs, would do, or the doing of something which a prudent man and reasonable man could not do."
• Valenzuela vs. Court of Appeals, 253 SCRA 303 (320) — Cited for the proposition that negligence is want of care required by the circumstances.
• U.S. vs. Reyes, 1 Phil. 375 (377) — Cited, through J. Cesar S. Sangco's Torts and Damages, for the principle that the diligence which the law requires an individual to observe and exercise varies according to the nature of the situation and the importance of the act to be performed.

• Section 73, Presidential Decree No. 1445 — Provides for credit for loss occurring in transit or due to casualty or force majeure. The Court applied this provision in determining whether petitioner should be relieved of liability, holding that the COA correctly denied her request for relief because she was negligent in the safekeeping of the funds.
• Article IX-A, Section 7, 1987 Constitution — Provides that decisions, orders, or rulings of the Commission on Audit may be brought to the Supreme Court on certiorari by the aggrieved party within thirty (30) days from receipt of a copy thereof. The Court cited this provision in ruling that the proper remedy is a petition for certiorari under Rule 65, not a petition for review under Rule 45.
• Rule 45, Revised Rules of Court — Governs petitions for review on certiorari, which may raise only questions of law. The Court held that petitioner's petition was an improper remedy because it raised questions of fact.
• Rule 65, Revised Rules of Court — Prescribes the remedy of certiorari, which the Court identified as the proper remedy for questioning COA decisions under Article IX-A, Section 7 of the Constitution.
• Joint COA-MOF Circular No. 1-81 — Prescribes the frequency of deposits for government funds. The Court considered petitioner's failure to make a single deposit during March 1990 as evidence of her negligence.

Davide, Jr., C.J., Romero, Bellosillo, Melo, Puno, Vitug, Kapunan, Mendoza, Panganiban, Martinez, Quisumbing and Pardo, JJ., concurred.