Joson vs. Office of the Ombudsman

Consultancy contracts for professional advice, characterized by the absence of an employer-employee relationship, exclusion from civil service benefits, lack of sovereign authority, and no requirement of an oath of office, do not constitute government service or create a public office, precluding liability for unlawful appointment under Article 244 of the Revised Penal Code and negating the application of civil service disqualification rules to the consultant.

Governor Aurelio M. Umali of Nueva Ecija engaged Atty. Ferdinand R. Abesamis as Consultant-Technical Assistance under two six-month contracts dated July 2, 2007 and February 28, 2008 (retroactive to January 2, 2008). At the time of engagement, Ferdinand had been dismissed from service as Senior State Prosecutor pursuant to Administrative Order No. 14 dated August 27, 1998, which carried the accessory penalty of perpetual disqualification from re-employment in government. Petitioner Edward Thomas F. Joson, a taxpayer, filed criminal complaints alleging that the consultancy appointments violated the prohibition against employing dismissed government personnel and constituted violations of Section 3(e) of R.A. No. 3019 (Anti-Graft Law) and Article 244 of the RPC (Unlawful Appointment), together with an administrative charge for Grave Misconduct against the governor and other provincial officials who processed Ferdinand’s honoraria.

• The Consultancy Contracts: Governor Umali entered into two contracts of consultancy with Ferdinand. The first, dated July 2, 2007, engaged Ferdinand as Consultant-Technical Assistance for six months. The second, dated February 28, 2008, renewed the engagement for another six months with retroactive effect to January 2, 2008. The contracts stipulated lump-sum honoraria rather than salaries, and Ferdinand did not receive standard government employee benefits such as PERA, COLA, or RATA.
• Ferdinand’s Prior Dismissal: Ferdinand had been dismissed as Senior State Prosecutor under Administrative Order No. 14 dated August 27, 1998 for conduct prejudicial to the best interest of the service. The penalty carried perpetual disqualification from re-employment in government. At the time of the consultancy engagements, no executive clemency had been granted. Notably, during the pendency of the Ombudsman proceedings, the Office of the President reversed and set aside A.O. No. 14 via Resolution dated March 11, 2010, effectively lifting the disqualification.
• Processing of Payments: Provincial Administrator Alejandro R. Abesamis, Provincial Treasurer Edilberto M. Pancho, and Officer-in-Charge Ma. Cristina G. Roxas processed obligation requests and disbursement vouchers authorizing payment of honoraria to Ferdinand for services rendered under the contracts.
• Ombudsman Proceedings: The Ombudsman found that Ferdinand’s rights and duties arose from contract, not law; he was not vested with sovereign authority; the contracts were for limited duration and terminable on five days’ written notice; and he did not enjoy benefits given to government employees. The Ombudsman concluded that consultancy service was not government service under CSC Resolution No. 93-1881 and DILG opinions, and that Governor Umali relied in good faith on legal advice from the Provincial Legal Office.

• Nature of Consultancy as Government Service: Joson maintained that the consultancy contracts created a non-career service position under Section 9, Chapter 2, Title I, Book V of Executive Order No. 292 (Administrative Code of 1987), thereby subjecting Ferdinand to civil service laws and disqualification rules.
• Unlawful Appointment: Petitioner argued that Governor Umali knowingly appointed a disqualified person in violation of Article 244 of the RPC, given Ferdinand’s prior dismissal with perpetual disqualification.
• Violation of Anti-Graft Law: Joson contended that the appointment and payment of honoraria evidenced manifest partiality, evident bad faith, and gross inexcusable negligence, giving unwarranted benefit to Ferdinand and causing damage to the provincial government and taxpayers.
• Retroactivity Defect: The February 2008 contract’s retroactive effect to January 2, 2008 violated Rule IV of the Omnibus Rules on Appointment providing that appointments cannot take effect earlier than their issuance date, rendering payments for that period illegal.

• Non-Government Service: Governor Umali countered that consultancy services fall outside "government service" under Civil Service Law. Citing DILG Opinions Nos. 72 and 100 (s. 2004), he argued consultancy creates a client-professional relationship, not an employer-employee relationship, and requires no CSC approval as the position is not in the DBM index of position titles.
• Absence of Public Office: Respondents maintained that the contracts were for lump-sum services of limited duration; Ferdinand did not exercise sovereign authority, did not take an oath of office, and received only honoraria without standard government benefits.
• Good Faith Reliance: Governor Umali asserted he relied in good faith on legal opinions from the Provincial Legal Office and DILG issuances confirming no legal impediment to engaging Ferdinand, negating the "knowingly" element of Article 244 RPC and the bad faith element of R.A. No. 3019.
• Clerical Error on Date: The February 28, 2008 date was a notarial stamp error; the true execution date was January 2, 2008, explaining the retroactive effect.
• Prematurity of Charges: Alejandro, Pancho, and Roxas argued the charges regarding payment processing were premature absent COA post-audit disallowance.

• Grave Abuse of Discretion in Criminal Dismissal: Whether the Ombudsman committed grave abuse of discretion in dismissing the criminal complaints for lack of probable cause.
• Finality of Administrative Dismissal: Whether the dismissal of administrative charges for grave misconduct had become final and unappealable.
• Consultancy as Government Service: Whether consultancy contracts create a public office or government employment subject to disqualification rules and requiring an oath of office.
• Elements of Unlawful Appointment: Whether the "knowingly" element of Article 244 RPC was present where the appointing authority relied on legal opinions in good faith.
• Violation of Anti-Graft Law: Whether the respondents acted with manifest partiality, evident bad faith, or gross inexcusable negligence in engaging Ferdinand’s services.

• Grave Abuse of Discretion in Criminal Dismissal: None was committed. The Ombudsman’s determination of lack of probable cause—based on evidence showing Ferdinand did not hold a public office, performed actual services, and respondents acted in good faith—was supported by substantial evidence and did not constitute capricious, whimsical, or arbitrary judgment equivalent to lack of jurisdiction.
• Finality of Administrative Dismissal: The dismissal of the administrative charge for grave misconduct had attained finality. Under Section 7, Rule III of the Ombudsman Rules, decisions absolving respondents are final and unappealable; the proper remedy was a petition for certiorari with the Court of Appeals, not a direct appeal to the Supreme Court.
• Consultancy Status: Consultancy contracts do not constitute government service or create a public office. The position was not in the DBM index of position titles, required no CSC approval, involved no sovereign authority, and lacked the qualifying requirement of an oath of office. Ferdinand’s engagement was contractual, not appointive, falling under contracts of service/job orders under CSC Circular No. 40, s. 1998.
• Unlawful Appointment: Article 244 RPC requires knowledge of disqualification. Governor Umali’s good faith reliance on DILG opinions and Provincial Legal Office advice negated the "knowingly" element.
• Anti-Graft Liability: No manifest partiality, bad faith, or gross negligence was established. Ferdinand rendered actual services, precluding undue injury to government; the honoraria payments were therefore proper and did not cause damage or prejudice to the provincial government.

• Consultancy vs. Government Service — Contracts for consultancy services, characterized by professional advice rendered on a job-order basis without employer-employee relationship, exclusion from civil service benefits, and absence of sovereign authority, are not considered government service under Civil Service Law and require no CSC approval.
• Elements of Public Office — Public office requires: (1) creation by law; (2) exercise of sovereign authority; (3) permanence and continuity; and (4) oath of office as qualifying requirement. Absence of these elements indicates contractual rather than appointive service.
• Probable Cause Standard — Probable cause demands more than bare suspicion but less than evidence establishing guilt beyond reasonable doubt or absolute certainty; it requires facts exciting belief in a reasonable mind that the accused is guilty.
• Grave Abuse of Discretion — Defined as capricious, whimsical, arbitrary, or despotic exercise of judgment equivalent to lack of jurisdiction; mere errors of law or fact do not constitute grave abuse.
• Finality of Ombudsman Decisions — Under Section 7, Rule III of the Ombudsman Rules of Procedure, decisions absolving respondents of administrative charges are final and unappealable; judicial review is available only via certiorari before the Court of Appeals upon showing of grave abuse of discretion.

• "Probable cause is defined as the existence of such facts and circumstances as would excite the belief in a reasonable mind, acting on the facts within the knowledge of the prosecutor, that the person charged was guilty of the crime for which he was prosecuted. Probable cause need not be based on clear and convincing evidence of guilt, or on evidence establishing guilt beyond reasonable doubt, and definitely not on evidence establishing absolute certainty of guilt, but it certainly demands more than bare suspicion and can never be left to presupposition, conjecture, or even convincing logic."
• "A 'consultant' is defined as one who provides professional advice on matters within the field of his specific knowledge or training. There is no employer-employee relationship in the engagement of a consultant but that of client-professional relationship."
• "All public officers and employees from the highest to the lowest rank are required to take an oath of office which marks their assumption to duty. It is well-settled that an oath of office is a qualifying requirement for public office, a prerequisite to the full investiture of the office."
• "By grave abuse of discretion is meant such capricious and whimsical exercise of judgment as is equivalent to lack of jurisdiction. The abuse of discretion must be grave as where the power is exercised in an arbitrary or despotic manner by reason of passion or personal hostility, and must be so patent and gross as to amount to an evasion of a positive duty or to a virtual refusal to perform the duty enjoined or to act at all in contemplation of law."

• Vergara v. The Hon. Ombudsman, 600 Phil. 26 (2009) — Defining probable cause standard.
• Posadas v. Sandiganbayan, 714 Phil. 248 (2003) — Holding that consultancy service is not government service; establishing client-professional relationship test.
• United Coconut Planters Bank v. Looyuko, 560 Phil. 581 (2007) — Defining grave abuse of discretion.
• Republic v. Desierto, 541 Phil. 57 (2007) — Explaining non-interference with Ombudsman’s investigatory powers based on practicality and constitutional respect.
• Reyes, Jr. v. Belisario, 612 Phil. 936 (2009) — Interpreting Section 7, Rule III of Ombudsman Rules regarding finality of decisions absolving respondents.

• Article 244, Revised Penal Code — Penalizes unlawful appointment of a person not qualified by law for the position; requires "knowing" appointment of a disqualified person.
• Section 3(e), Republic Act No. 3019 (Anti-Graft and Corrupt Practices Act) — Prohibits public officers from causing undue injury to government or giving unwarranted benefit through manifest partiality, evident bad faith, or gross inexcusable negligence.
• Section 9, Chapter 2, Title I, Book V, Executive Order No. 292 (Administrative Code of 1987) — Defining non-career service positions.
• Section 7, Rule III, Rules of Procedure of the Office of the Ombudsman — Providing that decisions absolving respondents are final and unappealable.
• Section 2(a), Rule XI, Civil Service Commission Circular No. 40, s. 1998 — Excluding contracts of service/job orders from civil service coverage.
• CSC Resolution No. 93-1881 (May 25, 1993) — Excluding consultancy contracts from civil service coverage as they are not found in the DBM index of position titles.

Antonio T. Carpio (Chairperson), Arturo D. Brion, Mariano C. Del Castillo, Marvic M.V.F. Leonen