Source: http://lawlibrary.chanrobles.com/index.php?option=com_content&view=article&id=82914:56768&catid=1582&Itemid=566
Timestamp: 2019-04-19 10:47:15+00:00

Document:
G.R. No. 198271, April 01, 2014 - ARNALDO M. ESPINAS, LILIAN N. ASPRER, AND ELEANORA R. DE JESUS, Petitioners, v. COMMISSION ON AUDIT, Respondent.
ARNALDO M. ESPINAS, LILIAN N. ASPRER, AND ELEANORA R. DE JESUS, Petitioners, v. COMMISSION ON AUDIT, Respondent.
Assailed in this petition for certiorari 1 is respondent Commission on Audit’s (CoA) Decision No. 2011–0392 dated August 8, 2011 which affirmed Notice of Disallowance No. 09–001–GF(06)3 dated July 21, 2009 covering petitioners’ reimbursement claims for extraordinary and miscellaneous expenses for the period January to December 2006.
Petitioners’ appeal was denied by CoA Cluster Director IV Divinia M. Alagon (CoA Cluster Director Alagon) in Decision No. 2010–00322 dated April 13, 2010, thereby affirming Notice of Disallowance No. 09–001–GF(06).
Unconvinced, petitioners elevated the ruling to the Commission Proper, docketed as CoA CP Case No. 2010–101,33 averring that: (a) the principle of ejusdem generis does not apply since there is no enumeration of things followed by general words in CoA Circular No. 2006–01;34 (b) the certifications fall under the category of documents evidencing disbursements under Item III(3) of the same issuance, which, in any case, have been previously allowed under Section 397 of GAAM – Vol. I and CoA Circular No. 89–300;35 and (c) there exists no valid classification between officials of NGAs and officials of GOCCs and GFIs.36 Petitioners’ previous contention on the circular’s lack of publication was no longer raised in their petition to the Commission Proper.
In its Decision No. 2011–03937 dated August 8, 2011, the CoA affirmed Notice of Disallowance No. 09–001–GF(06) but differed from CoA Cluster Director Alagon’s reasoning.
Dissatisfied, petitioners filed the present certiorari petition, imputing grave abuse of discretion on the part of the CoA.
The primordial issue for the Court’s resolution is whether or not grave abuse of discretion attended the CoA’s ruling in this case.
Sec. 2. x x x.
[T]he CoA is endowed with enough latitude to determine, prevent, and disallow irregular, unnecessary, excessive, extravagant or unconscionable expenditures of government funds. It is tasked to be vigilant and conscientious in safeguarding the proper use of the government’s, and ultimately, the people’s property. The exercise of its general audit power is among the constitutional mechanisms that gives life to the check and balance system inherent in our form of government.
Viewed in the foregoing light, the Court finds that the CoA did not commit any grave abuse of discretion as its affirmance of Notice of Disallowance No. 09–001–GF(06) is based on cogent legal grounds.
First off, the Court concurs with the CoA’s conclusion that the “certification” submitted by petitioners cannot be properly considered as a supporting document within the purview of Item III(3) of CoA Circular No. 2006–01 which pertinently states that a “claim for reimbursement of [EME] expenses shall be supported by receipts and/or other documents evidencing disbursements.” Similar to the word “receipts,” the “other documents” pertained to under the above–stated provision is qualified by the phrase “evidencing disbursements.” Citing its lexicographic definition, the CoA stated that the term “disbursement” means “to pay out commonly from a fund” or “to make payment in settlement of debt or account payable.”47 That said, it then logically follows that petitioners’ “certification,” so as to fall under the phrase “other documents” under Item III(3) of CoA Circular No. 2006–01, must substantiate the “paying out of an account payable,” or, in simple term, a disbursement.48 However, an examination of the sample “certification”49 attached to the petition does not, by any means, fit this description. The signatory therein merely certifies that he/she has spent, within a particular month, a certain amount for meetings, seminars, conferences, official entertainment, public relations, and the like, and that the certified amount is within the ceiling authorized under the LWUA corporate budget. Accordingly, since petitioners’ reimbursement claims were solely supported by this “certification,” the CoA properly disallowed said claims for failure to comply with CoA Circular No. 2006–01.
The CoA also correctly rejected petitioners’ invocation of the provisions of Section 397 of GAAM – Vol. I and CoA Circular No. 89–300 since, at the outset, such rules are applicable only to NGAs, and not to GOCCs, GFIs and their subsidiaries which are specifically governed by CoA Circular No. 2006–01.50 A perusal of CoA Circular No. 89–300, from which Section 397 of GAAM – Vol. I was merely reproduced, clearly indicates in Item II thereof, captioned “Scope and Coverage,” that the rules thereunder applies to “appropriations authorized under [the GAA of 1989] for National Government agencies [that] may be used for incurrence of extraordinary and miscellaneous expenses at the rates and by the offices and officials specified therein for, among others x x x.”51 A similar inference may be reached from a reading of Item I of CoA Circular No. 89–300, captioned as “Rationale,” which states that the circular was made in response to the “increasing number of queries and requests for clarification as to the real import and true intent of [the provisions of the GAA of 1989] authorizing the use by certain national government officials of appropriations authorized for their agencies for extraordinary and miscellaneous expenses.”52 On the other hand, Item II of CoA Circular No. 2006–01, captioned as “Scope and Coverage,” explicitly states that “[t]his circular shall be applicable to all GOCCs, GFIs and their subsidiaries” and shall cover their “extraordinary and miscellaneous expenses and other similar expenses.”53 Item I of CoA Circular No. 2006–01, captioned as “Rationale,” also mentions the CoA’s declared policy to “prescribe rules and regulations specifically for government corporations to regulate the incurrence of these expenditures and ensure the prevention and disallowance of irregular, unnecessary, excessive, extravagant, or unconscionable expenditures or uses of government funds” considering that “[g]overning boards of [GOCCs/GFIs] are invariably empowered to appropriate through resolutions such amounts as they deem appropriate for extraordinary and miscellaneous expenses.”54 Based on the foregoing, it is readily apparent that petitioners’ reliance on Section 397 of GAAM – Vol. I and Item III(4) of CoA Circular No. 89–300 was improper, hence, the CoA’s apt dismissal of the same.
Lastly, the Court upholds the CoA’s finding that there exists a substantial distinction55 between officials of NGAs and the officials of GOCCs, GFIs and their subsidiaries which justify the peculiarity in regulation. Since the EME of GOCCs, GFIs and their subsidiaries, are, pursuant to law, allocated by their own internal governing boards, as opposed to the EME of NGAs which are appropriated in the annual GAA duly enacted by Congress, there is a perceivable rational impetus for the CoA to impose nuanced control measures to check if the EME disbursements of GOCCs, GFIs and their subsidiaries constitute irregular, unnecessary, excessive, extravagant, or unconscionable government expenditures. Case in point is the LWUA Board of Trustees which, pursuant to Section 69 of PD 198, as amended, is “authorized to appropriate out of any funds of the Administration, such amounts as it may deem necessary for the operational and other expenses of the Administration including the purchase of necessary equipment.” Indeed, the Court recognizes that denying GOCCs, GFIs and their subsidiaries the benefit of submitting a secondary–alternate document in support of an EME reimbursement, such as the “certification” discussed herein, is a CoA policy intended to address the disparity in EME disbursement autonomy. As pertinently stated in CoA Circular No. 2006–01, the consideration underlying the rules and regulations contained therein is the fact that “[g]overning boards of [GOCCs/GFIs] are invariably empowered to appropriate through resolutions such amounts as they deem appropriate for extraordinary and miscellaneous expenses.”56 Hence, in due deference to the CoA’s constitutional prerogatives, the Court, absent any semblance of grave abuse of discretion in this case, respects the regulation, and consequently dismisses the petition. With these pronouncements, the Court finds it unnecessary to delve on the other ancillary issues raised by the parties in their pleadings. Notice of Disallowance No. 09–001–GF(06) dated July 21, 2009 is therefore upheld and the persons therein held liable are ordered to duly return the disallowed amount of P13,110,998.26.
WHEREFORE, the petition is DISMISSED. Accordingly, Notice of Disallowance No. 09–001–GF(06) dated July 21, 2009 is hereby AFFIRMED.
Sereno, C.J. Carpio, Velasco, Jr., Leonardo–De Castro, Brion, Peralta, Bersamin, Del Castillo, Abad, Villarama, Jr., Perez, Reyes, and Leonen, JJ., concur.
Mendoza, J., on official leave.
1 Filed under Rule 64 in relation to Rule 65 of the Rules of Court; rollo, pp. 3–18.
2 Id. at 21–28. Signed by Chairperson Ma. Gracia M. Pulido–Tan and Commissioners Juanito G. Espino, Jr. and Heidi L. Mendoza.
SEC. 49. Charter. – There is hereby chartered, created and formed a government corporation to be known as the ‘Local Water Utilities Administration’ which is hereby attached to the Office of the President. The provisions of this Title shall be and constitute the charter of the Administration.
10 Entitled “Guidelines On The Disbursement Of Extraordinary And Miscellaneous Expenses And Other Similar Expenses In Government–Owned And Controlled Corporations/Government Financial Institutions And Their Subsidiaries,” id. at 35–37.
11 Id. at 32–33; emphases and underscoring supplied.
41Dimapilis–Baldoz v. CoA, G.R. No. 199114, July 16, 2013.
42 G.R. No. 198457, August 13, 2013.
43 “Under Rule 64, Section 2 of the 1997 Rules of Civil Procedure, a judgment or final order of the COA may be brought by an aggrieved party to this Court on certiorari under Rule 65. Thus, it is only through a petition for certiorari under Rule 65 that the COA’s decisions may be reviewed and nullified by us on the ground of grave abuse of discretion or lack or excess of jurisdiction.” (Benguet State University v. CoA, 551 Phil. 878, 883 2007).
44Delos Santos v. CoA, supra note 42.
46 Dimapilis–Baldoz v. CoA, supra note 41; citations omitted.
48 Id., citing BLACK’S LAW DICTIONARY, 6th Ed., p. 463.

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