Santos vs. Macaraig

A finding of dishonesty against a foreign service officer cannot stand without substantial evidence of an intent to cheat or defraud the government, especially where the use of discounted tickets saved government funds; but the President’s prerogative to assign and recall diplomatic personnel is unquestionable, and a recall to the home office is a change of post, not a dismissal.

Petitioner Rosalinda de Perio-Santos was a career service officer with the rank of Chief of Mission II and Ambassador Extraordinary and Plenipotentiary who held the Philippine Mission to the United Nations and other International Organizations in Geneva, Switzerland. Respondents were the Executive Secretary and the Secretary of Foreign Affairs, the officials through whom the President acted on petitioner’s administrative case and foreign assignment. The statutory backdrop includes the Foreign Service Act (R.A. 708), which fixes a minimum one-year and maximum four-year service in a foreign post, and P.D. 1578, which the SC had declared inoperative as an unpublished secret decree in Tanada vs. Tuvera and which Executive Order No. 168 expressly repealed.

On July 24, 1986, President Corazon C. Aquino appointed petitioner Rosalinda de Perio-Santos, a career service officer with the rank of Chief of Mission II and Ambassador Extraordinary and Plenipotentiary, as Permanent Representative of the Philippines to the Philippine Mission to the United Nations and other International Organizations in Geneva, Switzerland. On April 6, 1987, petitioner sought a leave of absence from the Department of Foreign Affairs to spend the Easter Holidays in New York, U.S.A., with her mother, brothers and sisters at no expense to the Government. She bought two non-transferable, non-refundable discounted tickets costing SFr.1,597 for herself and her adopted daughter Pia. Before they could leave Geneva, petitioner received instructions from the home office directing her to proceed to Havana as a member of the Philippine delegation to the UNCTAD G-77 Preparatory Conference from April 20-26, 1987. For that official trip outside her station, she was entitled, under the Foreign Service Personnel Manual on Travel, Per Diems, and Daily Allowance Abroad, to SFr.2,996 for the cost of economy roundtrip fare for the Geneva-New York-Geneva portion of her Geneva-New York-Havana-New York-Geneva trip.

Instead of buying an economy roundtrip ticket, she used for the Geneva-New York-Geneva portion of her trip the two discounted tickets costing only SFr.1,597 for herself and her daughter Pia. They left Geneva for New York en route to Havana on April 15, 1987, and on the same day the DFA approved her application for a leave of absence with pay from April 27 to May 1, 1987. After the Havana Conference, she and her daughter spent her vacation leave in New York before returning to Geneva. Instead of claiming reimbursement for SFr.2,996, she requested and received reimbursement of only SFr.1,597, which she spent for the Geneva to New York and New York to Geneva portion of her trip, thereby effecting savings of SFr.1,399 for the Government. On September 16, 1987, the DFA sent her cable GE-202/87 requesting clarification on why the Mission paid for the plane ticket of infant Pia de Perio-Santos, petitioner’s daughter, Geneva-New York-Geneva per CV 216/87 when she was not authorized to accompany her adopting mother at government expense. Petitioner replied that the airfare tickets were for her only and did not include her daughter, whose trip was paid from her personal funds. On September 21, 1987, the DFA required her to refund the amount representing her daughter’s round-trip ticket because the DFA received a copy of the facture from the travel agency showing that SFr.1,597 was payment of (a) 1 billet adulte Geneva/New York/Geneva SFr.950 and (b) 1 billet enfant Geneva/New York/Geneva SFr.673, and that SFr.673 represented the cost of her daughter’s portion of the ticket. Instead of refunding only SFr.673 to the Government, petitioner returned the full amount of SFr.1,597. She thereafter claimed payment for one round-trip economy plane ticket Geneva-New York-Geneva in the amount of SFr.2,996 to which she was entitled under the Foreign Service Personnel Manual on Travel, Per Diems and Daily Allowance Abroad.

On October 5, 1987, Deputy Armando Maglaque and some MISUNPHIL employees filed administrative charges against her for incompetence; inefficient; corrupt and dishonest activities; rude and uncouth manners; abusive and high-handed behavior; irregular and highly illegal transactions involving funds of the mission. The charges were referred to Ambassador Luis Ascalon for initial investigation, and petitioner explained the circumstances of the purchase of the discounted tickets. On November 26, 1987, Ambassador Ascalon submitted his findings which, with the complaints, were referred to a 5-man Ad Hoc Investigation Committee for preliminary investigation. The Committee found a prima facie case against petitioner for (1) dishonesty; (2) violation of existing rules and regulations; (3) incompetence and inefficiency; and (4) conduct prejudicial to the best interest of the service. Ambassador Eduardo Rosal also charged her with estafa before the Tanodbayan, but the case was dismissed for insufficiency of evidence. On November 23, 1987, the DFA recalled her to Manila for consultation, and she came home on November 29, 1987.

On March 17, 1988, the Board of Foreign Service Administration constituted a new 5-man investigating committee to evaluate the evidence presented by the parties. Three members of the committee, Atty. Pineda and Ambassadors Pastores and Garrido, found her liable for misconduct only and recommended dismissal of the other charges, as well as reprimand and recall to Manila; Ambassador Arague dissented with respect to the penalty, which he thought should include a six-month suspension; and Atty. De Vera found all the charges against Ambassador de Perio-Santos to be unmeritorious. The BFSA met en banc on April 22, 1988, and on April 26, 1988, through its Chairman, Undersecretary Jose D. Ingles, submitted a memorandum to the Secretary of Foreign Affairs adopting the findings and recommendations of the investigating committee. In a letter-decision dated April 27, 1988, the Secretary of Foreign Affairs affirmed the BFSA’s recommendation declaring Ambassador de Perio-Santos guilty of the lesser offense of misconduct instead of dishonesty, meted to her the penalty of reprimand, and recalled her to the home office. Petitioner filed a motion for reconsideration on the ground that she was denied due process when she was declared guilty of misconduct although it was not one of the charges against her. The Secretary conceded the point and ordered the records remanded to the BFSA for hearing to give petitioner an opportunity to defend herself against the charge of misconduct, which was deemed to have been filed by the Secretary himself since an administrative complaint can be initiated directly by the Department Head under Section 37(b), P.D. 807; petitioner, insisting that no formal charge of misconduct had been filed and that hence there was nothing to investigate, refused to attend the hearing. Consequently, in his resolution of August 18, 1988, Secretary Manglapus declared his decision of April 27, 1988 final and executory, effective immediately.

Petitioner appealed that resolution to the Office of the President, where it was docketed as O.P. Case No. 3903. On January 24, 1989, President Aquino nominated Narcisa L. Escaler as Ambassador and Permanent Representative to the United Nations and other International Organizations in Geneva in lieu of petitioner, and the nomination was confirmed by the Commission on Appointments on March 15, 1989. On March 30, 1989, President Aquino issued Administrative Order No. 122 finding petitioner guilty of dishonesty instead of misconduct and imposing upon her the penalty of reprimand, with recall to the home office. The finding of dishonesty was based on (1) the certification made in support of her request for reimbursement of the discounted round-trip ticket stating that she purchased the said round trip ticket, which consists of two one-way tickets instead of two roundtrip tickets, one from Geneva to New York and the other from New York to Geneva, as shown in the attached receipt of payment to the travel agency, for which she was reimbursed per Check No. UBS-4455589 dated May 7, 1987; and (2) the allegation in her telex ZGE-373-87, in answer to the DFA cable of September 16, 1987, that the Geneva Mission never paid for the trip of Ambassador de Perio-Santos’ daughter to Mexico which was paid from the ambassador’s personal fund, although the DFA in fact refunded Pia’s portion of the discounted round-trip tickets from Geneva-New York-Geneva. Petitioner filed a motion for reconsideration and a supplemental memorandum and letter addressed to the President. In a Resolution dated January 9, 1990, Executive Secretary Catalino Macaraig, Jr., by authority of the President, denied the motion for reconsideration. Petitioner then filed this petition for certiorari.

• Substantial Evidence and Abuse of Discretion: Petitioner alleged that the President’s reprimand and recall orders are not supported by substantial evidence and were issued with gross abuse of discretion and serious error of law.
• Due Process: Petitioner moved for reconsideration on the ground that she was denied due process when she was declared guilty of misconduct although it was not one of the charges against her; she insisted that no formal charge of misconduct had been filed and refused to attend the hearing.
• Tour of Duty: Petitioner contended that her tour of duty in Geneva was for four years under Section 260 of P.D. No. 1578.

• P.D. 1578 Inoperative and Repealed: Respondent pointed out that P.D. 1578 was one of the unpublished secret decrees declared inoperative or without legal force and effect in Tanada vs. Tuvera and was expressly repealed on May 5, 1987 by Executive Order No. 168.
• Applicable Law and Minimum Service: Respondent argued that the applicable law is Section 6, Part B, Title III of R.A. 708, and that since petitioner was appointed to her post on July 24, 1986, she had already served the minimum one-year period when her recall on April 22, 1988 came; her reassignment to Manila did not have to be explained and justified by the Secretary of Foreign Affairs or the President.
• Executive Prerogative over Foreign Affairs: Respondent argued that the conduct of the country’s foreign affairs is vested in the President through the Secretary of Foreign Affairs as alter ego, that foreign service officers abroad represent the Philippines under the direction, supervision and control of the Chief Executive through the Secretary, and that courts may not inquire into the wisdom or unwisdom of the exercise of this executive prerogative.
• Primarily Confidential Position: Respondent argued that petitioner’s designation was based on the special trust and confidence of the appointing power, that once that trust and confidence ceased to exist her continuance in the position became untenable, and that the tenure of officials holding primarily confidential positions ends upon loss of confidence, with separation being an expiration of term rather than removal.
• Recall as Change of Post: Respondent argued that the recall order terminating her tour of duty in Geneva and returning her to the home office was merely a change of post or transfer of location of work.
• Appointment of Replacement: Respondent argued that petitioner may not justifiably assail the appointment of Narcisa Escaler as her replacement because the power to appoint is essentially discretionary, and that the SC may not order her reinstatement to Geneva because that would usurp the appointing power of the Chief Executive under Article VII, Section 16, 1987 Constitution and violate separation of powers.
• Secretary’s Alter Ego Act: Respondent argued that the recall order issued by the Secretary of Foreign Affairs was a valid exercise of his authority as alter ego of the President, and that his acts performed and promulgated in the regular course of business are presumptively the acts of the Chief Executive unless disapproved or reprobated.

• Dishonesty and Reprimand: Whether the finding of dishonesty and the penalty of reprimand in Administrative Order No. 122 are supported by substantial evidence.
• Recall and Tour of Duty: Whether the order recalling petitioner to the home office should be set aside, considering her claim to a four-year tour of duty under P.D. No. 1578 and the executive prerogative over diplomatic assignments.

• Dishonesty and Reprimand: No. A careful review of the records fails to yield any evidence of dishonesty or intent to cheat and defraud the government; the failure to disclose the child fare was harmless because the discounted tickets were inseparable and non-refundable, and using them saved the government SFr.1,399, so the reprimand was unmerited.
• Recall and Tour of Duty: No. P.D. 1578 was inoperative and repealed, R.A. 708 allowed the transfer after the minimum one-year service, and the assignment and recall of diplomatic personnel are executive prerogatives; the recall was a change of post, not dismissal.

• Dishonesty and Reprimand: The general rule is that factual findings of administrative agencies are binding on the SC and controlling on reviewing authorities if supported by substantial evidence (Planters Products, Inc. vs. NLRC; Doruelo vs. Ministry of National Defense), and courts will not interfere with purely administrative matters rendered by administrative bodies within the scope of their power and authority (Gegare vs. CA). A careful review of the records, however, fails to yield any evidence of dishonesty on the part of petitioner or an intent to cheat and defraud the government. Her failure to disclose that her discounted tickets included the fare for her child was harmless and inconsequential because the two discounted Geneva-New York-Geneva tickets for herself and her daughter were inseparable, intransferable, non-cancellable and non-refundable, in effect one whole fare only for purposes of the discount; the mother and daughter tickets were “married to each other,” and one without the other would not have been entitled to the discount, while leaving the daughter behind would have made no difference because the ticket was not refundable. Using the discounted tickets benefited the Government because they cost 50% less than an economy round trip ticket petitioner was entitled to purchase for the same trip if she travelled alone, and she saved SFr.1,399 even if her daughter’s fare was included. Since petitioner was moved by the best of motives in using the discounted tickets, which she had purchased before receiving the order to attend the UNCTAD conference in Havana, her action should be commended instead of condemned (Hernandez vs. Chairman, Commission on Audit). Her problem would probably not have arisen if she had asked the DFA for permission to use the two discounted round-trip tickets for the Geneva-New York-Geneva portion of her trip, but her inadvertence was construed by the Government as lack of candor and honesty. The SC believed she did not intend to falsify or conceal the truth when she filed a claim for the refund of the total cost of her discounted tickets (SFr.1,597); her claim was based on the fact that her daughter’s ticket was inseparable from her own fare and their fare was indivisible, so the Government’s offer to shoulder only her portion (SFr.950) excluding her daughter’s portion (SFr.647) was neither fair nor reasonable. After the DFA objected to the refund of the entire discounted fare, petitioner returned the whole SFr.1,597 and asked for the cost of the regular economy fare she was legally entitled to purchase; the Secretary then reprimanded her for misconduct and recalled her, and the Office of the President found her guilty of the more serious offense of dishonesty. The SC held that her actuation constituted neither dishonesty nor misconduct, hence the reprimand was unmerited.
• Recall and Tour of Duty: The SC was not disposed to disturb the DFA and Office of the President’s order recalling petitioner to the home office. Petitioner’s contention that her tour of duty in Geneva was for four years under Section 260 of P.D. No. 1578 had no merit because P.D. 1578 was one of the unpublished secret decrees declared inoperative or without legal force and effect in Tanada, et al. vs. Tuvera, et al., and it was expressly repealed on May 5, 1987 by Executive Order No. 168. The applicable law was Section 6, Part B, Title III of R.A. 708, the Foreign Service Act of the Philippines, which provides that a Foreign Service Officer may be assigned by the Secretary to serve in the Department or in a diplomatic or consular post abroad, with a minimum period of one year and a maximum period of four years, except in case of emergency or extraordinary circumstances, in which event he may be transferred from one foreign post to another or to the Department by order of the Secretary without regard to his length of service in his former post. Since petitioner had been appointed to her post on July 24, 1986, she had already served the minimum one-year period when her recall on April 22, 1988 came, and her reassignment to Manila did not have to be explained and justified by the Secretary of Foreign Affairs or the President. The presidential prerogative to determine the assignments of the country’s diplomatic personnel is unquestionable; the conduct of foreign affairs is vested in the President through the Secretary of Foreign Affairs as alter ego, and courts may not inquire into the wisdom or unwisdom of the exercise of that prerogative. The assignment to and recall from posts of ambassadors are prerogatives of the President, to be exercised as the exigencies of the foreign service and the interests of the nation may dictate. Petitioner’s designation was based on the special trust and confidence of the appointing power; once that trust and confidence ceased to exist, her continuance in the position became untenable, because the tenure of officials holding primarily confidential positions ends upon loss of confidence, and separation from the service is not removal from office but merely an expiration of term (Corpus vs. Cuaderno; Cadiente vs. Santos; Ingles vs. Mutuc). Primarily confidential denotes not only confidence in the aptitude of the appointee for the duties of the office but primarily close intimacy which insures freedom of intercourse without embarrassment or freedom from misgivings of betrayals of personal trust or confidential matters of state (Pinero vs. Hechanova, citing De los Santos vs. Mallare). It is the fact of loss of confidence, not the reason for it, that is important and controlling; as holder of a primarily confidential position, petitioner’s foreign assignment was at the pleasure of the President. The recall order terminating her tour of duty in Geneva and returning her to the home office was merely a change of post or transfer of location of work. Petitioner may not justifiably assail the appointment of Narcisa Escaler as her replacement because the power to appoint is essentially discretionary, and the SC may not order her reinstatement to her former position in Geneva because that would be tantamount to a usurpation of the power of appointment, which is the exclusive prerogative of the Chief Executive under Article VII, Section 16, 1987 Constitution, and would violate the system of separation of powers. The recall order issued by the Secretary of Foreign Affairs was a valid exercise of his authority as alter ego of the President (Villena vs. Secretary of Interior); his acts performed and promulgated in the regular course of business are, unless disapproved or reprobated by the Chief Executive, presumptively the acts of the latter, and since the President affirmed the recall order, any doubts as to its validity and propriety were laid to rest.

• Substantial evidence rule for administrative findings — Factual findings of administrative agencies are binding on the SC and controlling on reviewing authorities if supported by substantial evidence, and courts will not interfere with purely administrative matters within the agency’s power and authority. Applied: because the records yielded no evidence of dishonesty or intent to cheat and defraud the government, the reprimand based on dishonesty could not stand.
• Dishonesty requires intent to cheat or defraud — A finding of dishonesty cannot rest on a harmless nondisclosure where the acts show no intent to cheat or defraud the government. Applied: petitioner’s failure to disclose the child fare was harmless because the discounted tickets were inseparable, non-transferable, non-cancellable, and non-refundable, and their use saved the government SFr.1,399.
• Executive prerogative over foreign affairs and diplomatic assignments — The conduct of foreign affairs is vested in the President, who may assign and recall diplomatic personnel through the Secretary of Foreign Affairs as alter ego; courts may not inquire into the wisdom of the exercise of this prerogative. Applied: the recall to the home office was upheld.
• Primarily confidential position and loss of confidence — An official holding a primarily confidential position serves at the pleasure of the appointing power; when confidence is lost, the term expires and the separation is not removal from office. Applied: petitioner’s foreign assignment was at the pleasure of the President, and the recall was not a dismissal.
• Recall as change of post, not dismissal — A recall order terminating a foreign tour of duty and returning the officer to the home office is merely a change of post or transfer of location of work. Applied: the SC affirmed the recall while setting aside the reprimand.
• Appointment power and separation of powers — The power to appoint is essentially discretionary and exclusively vested in the Chief Executive; the SC may not order reinstatement because that would usurp the appointing power and violate separation of powers. Applied: the SC declined to order petitioner’s reinstatement to Geneva, especially after Narcisa Escaler’s appointment was confirmed.
• Unpublished secret decrees are inoperative — Unpublished secret decrees are without legal force and effect. Applied: P.D. 1578 was inoperative under Tanada vs. Tuvera and expressly repealed by EO No. 168, so its four-year tour of duty provision did not govern.
• Qualified political agency / alter ego doctrine — Acts of the Secretary performed and promulgated in the regular course of business are presumptively the acts of the President unless disapproved or reprobated by the Chief Executive. Applied: the Secretary’s recall order was a valid alter ego act and was affirmed by the President.

• “A careful review of the records fails to yield any evidence of dishonesty on the part of the petitioner, or an intent to cheat and defraud the government.” — The SC’s core finding on the dishonesty charge, which led to the setting aside of the reprimand.
• “Using the discounted tickets was beneficial to the Government for they cost 50% less than an economy round trip ticket that the petitioner was entitled to purchase for the same trip if she travelled alone.” — The SC’s explanation of why petitioner’s use of the discounted tickets did not amount to dishonesty and in fact saved public funds.
• “The presidential prerogative to determine the assignments of the countrys diplomatic personnel is unquestionable.” — The foundational statement for upholding the recall order despite the absence of dishonesty.
• “The recall order terminating her tour of duty in Geneva and returning her to the home office was merely a change of post or transfer of location of work.” — The SC’s characterization of the recall as a transfer, not a dismissal, which supported affirmance of the recall.

• Planters Products, Inc. vs. NLRC, 169 SCRA 328 — Controlling precedent for the rule that factual findings of administrative agencies are binding on the SC if supported by substantial evidence.
• Gegare vs. CA, 177 SCRA 471 — Followed for the rule that courts will not interfere with purely administrative matters rendered by administrative bodies within the scope of their power and authority.
• Hernandez vs. Chairman, Commission on Audit, 179 SCRA 39 — Cited in support of the SC’s statement that petitioner’s action, moved by the best of motives, should be commended instead of condemned.
• Tanada, et al. vs. Tuvera, et al., 146 SCRA 446 — Controlling precedent declaring unpublished secret decrees inoperative; used to reject P.D. 1578 as the basis for petitioner’s four-year tour-of-duty claim.
• Corpus vs. Cuaderno, 13 SCRA 591 — Followed for the rule that the tenure of officials holding primarily confidential positions ends upon loss of confidence.
• Cadiente vs. Santos, 142 SCRA 280 — Followed for the rule that separation from service due to loss of confidence is not removal from office but merely an expiration of term.
• Pinero vs. Hechanova, 18 SCRA 417 — Followed for the definition of a primarily confidential position as denoting close intimacy that insures freedom of intercourse without embarrassment or freedom from misgivings of betrayal of personal trust or confidential matters of state.
• Villena vs. Secretary of Interior, 67 Phil. 451 — Followed for the rule that the Secretary’s acts as alter ego of the President are valid when performed and promulgated in the regular course of business.

• Section 260, P.D. No. 1578 (Administrative Code of 1978) — Petitioner invoked the four-year tour of duty for foreign service officers; the SC held P.D. 1578 was an unpublished secret decree declared inoperative in Tanada vs. Tuvera and expressly repealed by EO No. 168, so it did not govern.
• Executive Order No. 168 — Expressly repealed P.D. No. 1578 on May 5, 1987; applied to remove the four-year tour-of-duty basis for petitioner’s claim.
• Section 6, Part B, Title III, R.A. 708 (Foreign Service Act of the Philippines) — Provides that a Foreign Service Officer may be assigned by the Secretary to serve in the Department or in a diplomatic or consular post abroad, with a minimum period of one year and a maximum period of four years, except in emergency or extraordinary circumstances, in which event he may be transferred from one foreign post to another or to the Department by order of the Secretary without regard to length of service; applied because petitioner had served the minimum one-year period when recalled on April 22, 1988.
• Section 37(b), P.D. 807 — Allows an administrative complaint to be initiated directly by the Department Head; applied when the Secretary deemed the misconduct charge filed by himself after petitioner’s due process objection.
• Article VII, Section 16, 1987 Constitution — Vests the power to appoint in the Chief Executive; applied to hold that the SC may not order petitioner’s reinstatement to Geneva because that would usurp the appointing power and violate separation of powers.
• Foreign Service Personnel Manual on Travel, Per Diems, and Daily Allowance Abroad — Entitled petitioner to SFr.2,996 for the cost of economy roundtrip fare for the Geneva-New York-Geneva portion of her trip; applied to show that her use of the discounted tickets saved the government SFr.1,399.