EN BANC
[G.R. No. 213494. March 19, 2019.]
FABI'S ENTERPRISES AND R. OBED'S ENTERPRISES, petitioners, vs.COMMISSION ON AUDIT AND DEPARTMENT OF EDUCATION-REGIONAL OFFICE NO. VI, respondents.
NOTICE
Sirs/Mesdames :
Please take notice that the Court en banc issued a Resolution datedMARCH 19, 2019, which reads as follows:
"G.R. No. 213494 (Fabi's Enterprises and R. Obed's Enterprises vs. Commission on Audit and Department of Education-Regional Office No. VI). — This is a petition for certiorari 1 under Rule 65 of the Rules of Court seeking (in relation to Rule 64) to annul and set aside the Decision 2 No. 2013-024 dated January 30, 2013 and Resolution 3 dated April 4, 2014 of respondent Commission on Audit (COA) denying the money claims of petitioners Fabi's Enterprises and R. Obed's Enterprises in the amounts of P13,066,464.20 and P13,268,328.38, respectively.
The Factual Antecedents
Petitioners Fabi's Enterprises and R. Obed's Enterprises filed with COA a letter dated September 18, 2008 for the payment of Grade School Instructional Materials/Textbooks allegedly delivered during the calendar year (CY) of 1997 to the Department of Education (DepEd) Regional Office (R.O.) No. VI-Western Visayas, Duran Street, Iloilo City in the total amounts of P13,066,464.20 and P13,268,328.38, respectively. 4
In said letter, petitioners Fabi's Enterprises and R. Obed's Enterprises alleged that in the CY of 1997, the Divisions of DepEd R.O. No. VI namely: the Divisions of Iloilo Province; the Cities of San Carlos, Silay, Cadiz, Bacolod; and La Carlota, all of Negros Occidental; and Roxas City, Capiz requested for the purchase of various DepEd Grade School Instructional Materials/Textbooks with corresponding Requisition and Issue Vouchers (RIV), Purchase Requests (PR) and Purchase Orders (PO). Petitioners Fabi's Enterprises and R. Obed's Enterprises delivered the Grade School Instructional Materials/Textbooks to the Divisions of DepEd R.O. No. VI-Western Visayas, Iloilo City, however the deliveries were not paid.
In an answer dated June 29, 2009, the Officer-in-Charge (OIC) of the DepEd R.O. No. VI-Western Visayas, Iloilo City, denied petitioners Fabi's Enterprises and R. Obed's Enterprises money claims for lack of proof to substantiate their claims. The OIC questioned the validity of petitioners Fabi's Enterprises and R. Obed's Enterprises claims for lack of available records in the R.O. — such as a copy of perfected contract, copy of deliveries made, Certificate of Availability of Funds (CAF) — and that there was no record or clear indication as to who ordered the Instructional Materials/Textbooks. Further, the POs and RIVs were dated and signed by a former DepEd Regional Director (RD) sometime in 1999 and did not correspond to the period of the alleged deliveries made by petitioners in 1997. cDHAES
Due to the denial of petitioners Fabi's Enterprises and R. Obed's Enterprises money claims, the COA Audit Team Leader (ATL) of R.O. No. VI recommended that petitioners Fabi's Enterprises and R. Obed's Enterprises submit additional proofs that the Instructional Materials/Textbooks were actually received and utilized by the beneficiaries. The COA ATL also recommended that the claims be directed to each Division Office concerned and not against the DepEd R.O. No. VI.
After verifying that the DepEd R.O. No. VI was not aware of the deliveries made in CY of 1997, the RD of DepEd and the COA ATL of R.O. No. VI in an indorsement dated December 1, 2009, recommended the denial of the claims for lack of legal basis.
On January 30, 2013, the COA rendered its Decision 5 No. 2013-024 denying petitioners' Fabi's Enterprises and R. Obed's Enterprises money claims in the amounts of P13,066,464.20 and P13,268,328.38, respectively. The COA relied on the verification made by the COA ATL of R.O. No. VI that there were no available records at the DepEd R.O. No. VI pertaining to the said deliveries. The COA also ruled that the undated POs and the February 18, 1999 RIVs which were allegedly signed by the former DepEd RD were insufficient to prove that deliveries were made. The COA likewise ruled that petitioners Fabi's Enterprises and R. Obed's Enterprises failed to submit CAF and other documentary evidence to substantiate the validity of their claims as required under Section 168 of the Government Accounting and Auditing Manual. The COA further ruled that petitioners Fabi's Enterprises and R. Obed's Enterprises cannot recover the reasonable value of Instructional Materials/Textbooks allegedly delivered based on the principle of quantum meruit in the absence of proof that the DepEd R.O. No. VI is liable thereof. The dispositive portion of the January 30, 2013 COA Decision, provides:
WHEREFORE, this Commission finds the instant claims without merit. Accordingly, the claims of Fabi's Enterprises and R. Obed's Enterprises for the payment of Grade School Instructional Materials/Textbooks allegedly delivered at the DepEd R.O. No. VI-Western Visayas, Iloilo City, in the amounts of P13,066,464.20 and P13,268,328.38, respectively, are DENIED. 6
Petitioners Fabi's Enterprises and R. Obed's Enterprises Motion for Reconsideration were likewise denied in the April 4, 2014 Resolution, 7 which states:
The CP denied the Motion for Reconsideration for lack of merit. The movants failed to raise a new matter or show sufficient ground to justify a reconsideration of COA Decision No. 2013-024 dated January 30, 2013.
Hence, petitioners Fabi's Enterprises and R. Obed's Enterprises filed this instant petition for certiorari.
Issues
Petitioners Fabi's Enterprises and R. Obed's Enterprises raise the following issues:
1. Whether petitioners Fabi's Enterprises and R. Obed's Enterprises are entitled to their respective money claims; and
2. Whether respondent Commission on Audit committed grave abuse of discretion amounting to lack or excess of jurisdiction when it denied petitioner's money claims against DepEd-Regional Office No. VI-Western Visayas in the amount of P13,066,464.20 and P13,268,328.38, respectively.
Ruling of the Court
The petition is unmeritorious.
The COA did not commit grave abuse of discretion in denying petitioners' Fabi's Enterprises and R. Obed's Enterprises money claims.
This Court has consistently held that findings of administrative agencies are generally accorded not only respect but also finality, unless found to have been tainted with grave abuse of discretion. The same was aptly discussed in the case of Maritime Industry Authority v. Commission on Audit, 8 to wit:
It is the general policy of the Court to sustain the decisions of administrative authorities, especially one which is constitutionally-created not only on the basis of the doctrine of separation of powers but also for their presumed expertise in the laws that they are entrusted to enforce. Findings of administrative agencies are accorded not only respect but also finality when the decision and order are not tainted with unfairness or arbitrariness that would amount to grave abuse of discretion. It is only when the COA has acted without or in excess of jurisdiction, or with grave abuse of discretion amounting to lack or excess of jurisdiction, that this Court entertains a petition questioning its rulings. There is grave abuse of discretion 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. 9 (Citation omitted) ASEcHI
Under Section 2, Article IX-D of the 1987 Constitution, the COA has the power, authority, and duty to examine, audit, and settle all accounts pertaining to the revenue and receipts of, and expenditures or uses of government funds and vested with the authority to determine whether the government entities, comply with laws and regulations in disbursing government funds, and to disallow illegal or irregular disbursements. 10 Section 2, Article IX-D of the 1987 Constitution gives an outline of the powers and functions of the COA, to wit:
Section 2. (1) The Commission on Audit shall have the power, authority, and duty to examine, audit, and settle all accounts pertaining to the revenue and receipts of, and expenditures or uses of funds and property, owned or held in trust by, or pertaining to, the Government, or any of its subdivisions, agencies, or instrumentalities, including government-owned or controlled corporations with original charters, and on a post-audit basis: (a) constitutional bodies, commissions and offices that have been granted fiscal autonomy under this Constitution; (b) autonomous state colleges and universities; (c) other government-owned or controlled corporations and their subsidiaries; and (d) such non-governmental entities receiving subsidy or equity, directly or indirectly, from or through the Government, which are required by law or the granting institution to submit to such audit as a condition of subsidy or equity. However, where the internal control system of the audited agencies is inadequate, the Commission may adopt such measures, including temporary or special pre-audit, as are necessary and appropriate to correct the deficiencies. It shall keep the general accounts of the Government and, for such period as may be provided by law, preserve the vouchers and other supporting papers pertaining thereto.
(2) The Commission shall have exclusive authority, subject to the limitations in this Article, to define the scope of its audit and examination, establish the techniques and methods required therefor, and promulgate accounting and auditing rules and regulations, including those for the prevention and disallowance of irregular, unnecessary, excessive, extravagant, or unconscionable expenditures, or uses of government funds and properties.
The COA as a constitutional office and guardian of public funds is endowed with the exclusive authority to determine and account government revenue and expenditures, which includes establishing techniques and methods for such review, and promulgate accounting and auditing rules and regulations. 11 The COA is also endowed with enough latitude to determine, prevent, and disallow irregular, unnecessary, excessive use of government funds. 12 The COA is likewise tasked to be vigilant and conscientious in safeguarding the proper use of the government's, and ultimately the people's, property. 13 In the case of Metropolitan Waterworks and Sewerage System v. Commission on Audit, 14 the High Court states that:
The COA as a constitutional office is endowed with enough latitude to determine, prevent and disallow irregular, unnecessary, excessive, extravagant, or unconscionable expenditures of government funds. It has the power to ascertain whether public funds were utilized for the purpose for which they had been intended. The 1987 Constitution has expressly made COA the guardian of public funds, vesting it with broad powers over all accounts pertaining to government revenue and expenditures and the uses of public funds and property, including the exclusive authority to define the scope of its audit and examination, establish the techniques and methods for such review, and promulgate accounting and auditing rules and regulations. 15 (Citations omitted)
On this note, We find no grave abuse of discretion amounting to lack or excess of jurisdiction on the part of COA in denying petitioners Fabi's Enterprises and R. Obed's Enterprises money claims. Contrary to petitioners Fabi's Enterprises and R. Obed's Enterprises contention, the COA denied their claims not on the sole basis of doubt, but because there was no record at the Regional Office pertaining to the transaction and/or deliveries of Grade School Instructional Materials/Textbooks for the CY of 1997, which was the basis of their money claims required under Sections 168 and 138 of the Government Accounting and Auditing Manual (GAAM).
Sections 168 and 138 of the GAAM provides for the basic requirements and principles applicable to all classes of disbursements of public funds that shall be complied with, to wit: ITAaHc
SECTION 168. Basic requirements applicable to all classes of disbursements. — The following basic requirements applicable to all classes of disbursements shall be complied with:
a. Certificate of Availability of Fund. — Existence of lawful appropriation, the unexpended balance of which, free from other obligations, is sufficient to cover the expenditure, certified as available by an accounting officer or any other official required to accomplish the certificate.
Use of moneys appropriated solely for the specific purpose for which appropriated, and for no other except when authorized by law or by a corresponding appropriating body.
b. Approval of claim or expenditure by head of office or his duly authorized representative.
c. Documents to establish validity of claim. — Submission of documents and other evidences to establish the validity and correctness of the claim for payment.
d. Conformity of the expenditure to existing laws and regulations.
e. Proper accounting treatment. (Emphasis Ours)
While, Section 138 of the GAAM, provides:
SECTION 138. Fundamental principles. — Financial transactions and operations of any government agency shall be governed by the following fundamental principles:
a. No money shall be paid out of any public treasury or depository except in pursuance of an appropriation, law or other specific statutory authority.
b. Government funds or property shall be spent or used solely for public purposes.
c. Trust funds shall be available and may be spent only for the specific purpose for which the trust was created or the funds received.
d. Fiscal responsibility shall, to the greatest extent, be shared by all those exercising authority over the financial affairs, transactions, and operations of the government agency.
e. Disbursements or disposition of government funds or property shall invariably bear the approval of the proper officials.
f. Claims against government funds shall be supported with completed documentation.
g. All laws and regulations applicable to financial transactions shall be faithfully adhered to.
h. Generally accepted principles and practices of accounting as well as of sound management and fiscal administration shall be observed, provided that they do not contravene existing laws and regulations. (Emphasis ours)
As correctly ruled by COA, petitioners Fabi's Enterprises and R. Obed's Enterprises failed to present documentary evidence to substantiate the validity of their claims. Indeed, a review of the documents that petitioners Fabi's Enterprises and R. Obed's Enterprises annexed to their petition shows that there is no complete documentation or even substantial compliance to support the existence of the transaction and validity of their claims. It is well to note that there is no record of perfected contract, a CAF for that purpose, copy of deliveries made and that the procurement has undergone competitive bidding. 16 Likewise, the documents presented were incomplete and contain questionable blank entries — like missing purchase order number, 17 purchase request number, 18 and some were even undated — raising serious doubts whether the correct procedure was followed and whether the purchase order and purchase request were properly prepared. So also, even this Court is at a loss as to the truthfulness and veracity of petitioners' Fabi's Enterprises and R. Obed's Enterprises allegations as they did not even present before this Court the complete supporting documents that would serve as the basis for their claims.
Furthermore, the principle of quantum meruit presupposes the performance of an act that would entail payment based on reasonable compensation. In this case, there is no proof that petitioners Fabi's Enterprises and R. Obed's Enterprises delivered the Grade School Instructional Materials/Textbooks to the Divisions of DepEd R.O. No. VI. Hence, in the absence of proof that the subject books or instructional materials were delivered, they cannot recover the reasonable value thereof. CHTAIc
Thus, We find no grave abuse of discretion on the part of COA in issuing the assailed Decision and Resolution. The pieces of evidence that petitioners' Fabi's Enterprises and R. Obed's Enterprises presented before the COA and this Court were insufficient and incomplete to prove the validity of their claims. Moreover, they were given all the opportunity to argue their case and present any supporting evidence even before the COA ATL and the COA proper when they were required to submit additional proofs. The COA should, therefore, not be faulted in denying petitioners' Fabi's Enterprises and R. Obed's Enterprises money claims in the amounts of P13,066,464.20 and P13,268,328.38 respectively, as the COA is merely exercising its duty under the 1987 Constitution to exercise its general audit power.
WHEREFORE, the petition is DISMISSED. Decision No. 2013-024 dated January 30, 2013 and Resolution dated April 4, 2014 of respondent Commission on Audit are hereby AFFIRMED." Bersamin, C.J., on official business; Hernando, J., on leave. (adv22)
Very truly yours,
EDGAR O. ARICHETAClerk of CourtBy:(SGD.) ANNA-LI R. PAPA-GOMBIODeputy Clerk of Court En Banc
Footnotes
1.Rollo, pp. 3-24.
2.Id. at 27-30.
3.Id. at 31.
4.Id. at 115-120.
5.Id. at 27-30.
6.Id. at 29.
7.Id. at 31.
8. 750 Phil. 288 (2015).
9.Id. at 308.
10.Luciano Veloso v. COA, G.R. No. 193677, September 6, 2011.
11.Id.
12.Id.
13.Id.
14. G.R. No. 195105, November 21, 2017.
15.Id.
16. ARTICLE IV — COMPETITIVE BIDDING
Section 10. Competitive Bidding. — All Procurement shall be done through Competitive Bidding, except as provided for in Article XVI of this Act.
Republic Act No. 9184 — AN ACT PROVIDING FOR THE MODERNIZATION, STANDARDIZATION AND REGULATION OF THE PROCUREMENT ACTIVITIES OF THE GOVERNMENT AND FOR OTHER PURPOSES, January 10, 2003.
17.Rollo, pp. 38-41, 44-45, 48-55.
18.Id. at 46-47.