Constitutional Law Case Digest:

ENGR. ALEX C. PAGUIO, in his capacity as General Manager, ANGELINE R. AGUILAR, Administrative Division Manager, EDITA B. ABARQUEZ, Board of Directors (BOD) Secretary, MARIFEL B. PABILONIA, BOD Chairperson, NINA P. VELASCO, BOD Vice Chairperson, FRED V. CAPISTRANO, BOD Chairman, ANGELITO T. BOMBAY, BOD Vice Chairman v COMMISSION ON AUDIT (COA), and DIRECTOR CLEOTILDE M. TUAZON, COA Regional Director, Region IV-A

Principle:

A party to an original action, who fails to question an adverse judgment or decision by not filing the proper remedy within the period prescribed by law, loses the right to do so, and the judgment or decision, as to him or her, becomes final and binding. The doctrine of immutability is grounded upon the fundamental principles of public policy and sound practice that, at the risk of occasional error, the judgment of courts and quasi-judicial agencies must become final at some definite date fixed by law.

Facts:

The herein petitioners are officers and members of Pagsanjan Water District (PAGWAD), a government-owned and controlled corporation (GOCC) organized under Presidential Decree (PD) No. 198, otherwise known as the “Provincial Water Utilities Act of 1973,” as amended. 

In 2009 and 2010, the PAGWAD Board Members received several benefits pursuant to the board resolutions that they issued. On May 10, 2012, Notice of Disallowance (ND) was issued, disallowing the disbursements with an aggregate amount of P283,965.00 for lack of legal basis. It was found that the benefits were given to the Board Members without approval from the Local Water Utilities Administration (LWUA), in violation of Section 13 of PD No. 198, as amended, COA Resolution No. 2004-006 and Department of Budget and Management (DBM) regulations. Petitioners were made liable to settle the disallowed transactions. They received a copy of the ND on May 23, 2012.

On November 14, 2012, petitioners filed an Appeal Memorandum before the COA Regional Office and argued that the Board of Directors is authorized to prescribe additional allowances and benefits to its members under Section 13 of PD No. 198, as amended by Republic Act (RA) No. 9286; that the grant of yearend financial assistance was based on LWUA Board of Trustees Resolution but the same was denied by COA Regional Office and affirmed the ND.

Petitioners sought for reconsideration but were likewise denied in the COA Proper’s Resolution.

Issue:

Whether the COA Proper committed grave abuse of discretion in dismissing petitioners’ Petition for Review for being filed out of time

Ruling:

No. The COA Proper did not commit grave abuse of discretion in dismissing the petitioner’s petition for review.

The Court ruled that no less than the Constitution vested the COA, as the guardian of public funds, with enough latitude to determine, prevent, and disallow irregular, unnecessary, excessive, extravagant or unconscionable expenditures of government funds. In the exercise of its constitutional duty, the COA is accorded plenary discretion, and the Court generally sustains its decisions in recognition of its expertise in the laws it is entrusted to enforce. Only when the COA acts without or in excess of jurisdiction or with grave abuse of discretion may the Court grant a petition assailing the COA’s actions. There is grave abuse of discretion only when there is an evasion of a positive duty or a virtual refusal to perform a duty enjoined by law or to act in contemplation of law as when the judgment rendered is not based on law and evidence but on caprice, whim and despotism.

This complements the limited scope of the Court’s review under the extraordinary remedy of certiorari, wherein the Court is confined solely to questions of jurisdiction whenever a tribunal, board or officer exercising judicial or quasi-judicial function acts without jurisdiction or in excess of jurisdiction, or with grave abuse of discretion amounting to lack or excess of jurisdiction.

Further, the 2009 Revised Rules of Procedure of the COA prescribed a period of six months or 180 days from receipt of the ND to appeal an auditor’s decision to the regional director up to the COA Proper. 36 Petitioners admit that their appeal before the COA Proper was filed beyond this reglementary period without any explanation.

Moreover, the Government Auditing Code of the Philippines” states that “[a] decision of the Commission or of any auditor upon any matter within its or his jurisdiction, if not appealed shall be final and executory.” A party to an original action, who fails to question an adverse judgment or decision by not filing the proper remedy within the period prescribed by law, loses the right to do so, and the judgment or decision, as to him or her, becomes final and binding. The decision becomes immutable and unalterable, and may no longer be modified in any respect, even if the modification is meant to correct erroneous conclusions of fact and law.  

This doctrine of immutability is grounded upon the fundamental principles of public policy and sound practice that, at the risk of occasional error, the judgment of courts and quasi-judicial agencies must become final at some definite date fixed by law. Thus, no grave abuse of discretion can be imputed against the COA in dismissing petitioners’ Petition for Review for being filed beyond the reglementary period.