Galindo vs. Commission on Audit

In administrative disciplinary cases decided by the COA, the proper remedy in case of an adverse decision is an appeal to the Civil Service Commission and not a petition for certiorari before the Supreme Court under Rule 64.

COA personnel assigned to the MWSS Audit Unit (COA-MWSS) received unauthorized bonuses and allowances funded through cash advances drawn by MWSS Supervising Cashier Iris Mendoza from 2005 to 2007. They also availed of the Car Assistance Plan (CAP) under the MWSS Employees Welfare Fund (MEWF), where the MEWF paid 60% of the vehicle purchase price as a fringe benefit. This practice was discovered when the MWSS Administrator wrote to the COA Chairman about unrecorded checks and irregular cash advances.

• Filed: Administrative complaints before the COA (Adm. Case No. 2010-036 for Galindo; Adm. Case No. 2010-039 for Pinto)
• COA Decision: Decision No. 2013-001 dated January 29, 2013 — found petitioners guilty of Grave Misconduct and Violation of Reasonable Office Rules and Regulations; imposed suspension for one year without pay and ordered refund of amounts received
• Motion for Reconsideration: Denied by COA Resolution dated October 2, 2013
• Elevated to SC: Petition for certiorari filed on January 30, 2014 (received by previous counsel on October 8, 2013; counsel withdrew on October 21, 2013)

• Nature: Administrative disciplinary cases against COA personnel assigned to MWSS
• Parties:
  • Petitioners: State Auditor II Annaliza J. Galindo and State Auditing Examiner II Evelinda P. Pinto
  • Respondent: Commission on Audit (COA)
  • Unauthorized Benefits (2005-2007): COA-MWSS personnel received cash from Mendoza's cash advances totaling P9,182,038.00 (2005-2006) and P38,551,133.40 (2007) for bonuses and allowances, supported by Office Orders signed by MWSS Administrators but not by payrolls
  • Historical Benefits (1999-2003): Based on Indices of Payments, COA-MWSS personnel received P1,171,855.00 in bonuses and benefits
• Specific Receipts by Petitioners:
  • Galindo: P428,745.00 on December 16, 2005
  • Pinto: P385,000.00 (November 15, 2005); P428,745.00 (December 13, 2005, jointly with Tiongson); P428,745.00 (January 2, 2006); and P85,526.00 (1999-2003 based on Indices of Payments)
  • Car Assistance Plan (CAP-MEWF): Petitioners availed of car loans where MEWF paid 60% of purchase price (fringe benefit)
  • Galindo: P358,004.03
  • Pinto: P300,000.00
  • Procedural Irregularity: Cash advances were processed without passing through usual procedures; vouchers not forwarded to Accounting Section for booking; acknowledgment receipts bore signatures of COA personnel

• Error in Characterizing MEWF Benefits: The COA erred in ruling that the 60% paid by MEWF for car loans constitutes fringe benefits prohibited under COA Memorandum No. 89-584 and Section 18, R.A. 6758
• Insufficient Evidence: The COA erred in finding that the prosecution established the required quantum of evidence by relying on circumstances surrounding Mendoza's cash advances and documentary evidence consisting mostly of private documents
• Deemed Admissions: The COA erred in ruling that Mendoza's cash advances contained statements of circumstances that were deemed established because not controverted
• Factual Errors: The COA erred in concluding that petitioners received bonuses and benefits from Mendoza's cash advances totaling P47,733,171.40 from 2005-2007

• Substantial Evidence Standard: The quantum of evidence in administrative cases is substantial evidence — that amount of relevant evidence which a reasonable mind might accept as adequate to justify a conclusion
• Documentary Proof: The prosecution presented acknowledgment receipts, testimony of Mendoza, Indices of Payments, and car loan contracts establishing petitioners' receipt of unauthorized amounts
• Public Funds: The funds managed by MEWF remained public funds; the car loan contracts were between MWSS and availees
• Grave Misconduct: Receipt of unauthorized bonuses and fringe benefits constitutes Grave Misconduct involving corruption and willful intent to violate the law, specifically Section 18, R.A. 6758, which prohibits COA personnel from receiving additional emoluments from government entities
• Preservation of Independence: The prohibition is designed to insulate COA officials from unwarranted influences and preserve their independence and integrity

• Procedural Issues:
  • Whether a petition for certiorari under Rule 64 is the proper remedy to assail a COA decision in an administrative disciplinary case
  • Whether the petition was filed within the reglementary period
• Substantive Issues:
  • Whether the COA committed grave abuse of discretion in finding petitioners guilty of Grave Misconduct and Violation of Reasonable Office Rules and Regulations

• Procedural:
  • Proper Remedy: Certiorari under Rule 64 is NOT the proper remedy. The proper remedy is an appeal to the Civil Service Commission under Section 47 of the Administrative Code of 1987, which grants the CSC appellate jurisdiction over administrative disciplinary cases involving suspension for more than thirty days
  • Timeliness: The petition was filed 84 days late. Previous counsel received the COA Resolution on October 8, 2013; the petition was filed on January 30, 2014. Under Section 3, Rule 64, the petition must be filed within 30 days from notice. Notice to counsel is notice to the client. The COA decision became final and executory on November 8, 2013
  • Rule 64 Scope: Rule 64 governs review of judgments of COA but refers to Rule 65 (certiorari) for mode of review, which requires grave abuse of discretion, not errors of judgment or factual appreciation
• Substantive:
  • No Grave Abuse of Discretion: The COA did not act with capricious or whimsical exercise of judgment equivalent to lack of jurisdiction. The COA conducted fact-finding investigations, issued formal charges, and conducted hearings
  • Substantial Evidence: The COA correctly applied the substantial evidence standard. Mendoza's testimony, acknowledgment receipts, and documentary evidence sufficiently established petitioners' receipt of unauthorized benefits
  • Violation of R.A. 6758: Petitioners violated Section 18, R.A. 6758, which prohibits COA personnel from receiving bonuses, allowances, or other emoluments from government entities. The 60% subsidy under CAP-MEWF constitutes prohibited fringe benefits

• Proper Remedy from COA Disciplinary Decisions — In administrative disciplinary cases decided by the COA, the proper remedy is an appeal to the CSC under the Administrative Code of 1987, not a petition for certiorari before the SC under Rule 64. The SC's power to review COA decisions under Rule 64 is limited to legal issues and does not extend to administrative disciplinary matters or factual findings.
• Substantial Evidence — In administrative proceedings, the quantum of proof required is substantial evidence, defined as "that amount of relevant evidence which a reasonable mind might accept as adequate to justify a conclusion" (Section 5, Rule 133, Rules of Court).
• Prohibition on Additional Compensation for COA Personnel (Section 18, R.A. 6758) — COA officials and employees are prohibited from receiving salaries, honoraria, bonuses, allowances, or other emoluments from any government entity, local government unit, GOCC, or government financial institution, except compensation paid directly by the COA. The purpose is to preserve the independence and integrity of the COA and remove temptations that might compromise its constitutional mandate to prevent irregular expenditures.
• Grave Misconduct — Misconduct is a transgression of some established and definite rule of action. It is grave if it involves any of the additional elements of corruption, willful intent to violate the law, or disregard of established rules, which must be proved by substantial evidence.
• Notice to Counsel is Notice to Client — When a party's counsel receives a copy of a court or quasi-judicial body's resolution, the party is bound by the reglementary period for filing remedies, regardless of subsequent change of counsel.

• "In administrative disciplinary cases decided by the COA, the proper remedy in case of an adverse decision is an appeal to the Civil Service Commission and not a petition for certiorari before this Court under Rule 64."
• "To be able to properly perform their constitutional mandate, COA officials need to be insulated from unwarranted influences, so that they can act with independence and integrity... The removal of the temptation and enticement the extra emoluments may provide is designed to be an effective way of vigorously and aggressively enforcing the Constitutional provision mandating the COA to prevent or disallow irregular, unnecessary, excessive, extravagant, or unconscionable expenditures or uses of government funds and properties."
• "Recipients of unauthorized sums would, after all, ordinarily evade traces of their receipt of such amounts. Resort to other documents from which such fact could be deduced was then appropriate."

• Saligumba v. Commission on Audit — Established that the SC's power to review COA decisions is limited to money matters and legal issues, not administrative disciplinary cases involving personnel
• Nacion v. Commission on Audit (G.R. No. 204757, March 17, 2015) — Offshoot of the same MWSS investigation; dismissed for lack of merit; held that no separate office order was needed for the investigation and that receipt of unauthorized benefits violates Section 18 of R.A. 6758
• Cadena v. Civil Service Commission (679 Phil. 165, 2012) — Cited for the rule that the proper remedy from COA disciplinary decisions is appeal to the CSC

• Section 7, Article IX-A of the Constitution — Allows review of COA decisions on certiorari within 30 days, but limited by statutory appeal provisions
• Section 47, Administrative Code of 1987 — Grants the CSC appellate jurisdiction over administrative disciplinary cases involving suspension for more than thirty days or fine exceeding thirty days' salary
• Section 49, Administrative Code of 1987 — Requires appeals to be filed within 15 days from receipt of decision
• Sections 45 and 61, 2012 Revised Rules on Administrative Cases in the Civil Service — Governs finality of decisions and appeals to the CSC
• Section 18, R.A. No. 6758 (Salary Standardization Law) — Prohibits COA personnel from receiving additional compensation from government entities other than the COA
• COA Memorandum No. 89-584 (January 9, 1989) — Prohibits grant of fringe benefits to COA personnel
• Rule 64, Rules of Court — Governs review of judgments of COA and COMELEC, but held inapplicable to administrative disciplinary cases
• Section 5, Rule 133, Rules of Court — Definition of substantial evidence

• Jardeleza, J. — Took no part in the deliberations