CASE DIGEST
Abrenica v. Commission
on Audit
G.R. No. 218185, [September 14, 2021]
EN BANC, LOPEZ, M.V
Commission on Audit
Notice of Disallowances; petition for Review;
Liability of Public Officers; Disallowance of Hazard Pay
Administrative rules or regulations,
such as Department of Health (DOH) Administrative Order (AO) No. 2006-0011,
must conform to and not contradict the provisions of the enabling law. Such administrative
issuances may be considered valid only if they align with the clear letter of
the law, and any discrepancy between the enabling law and an implementing rule
or regulation should be resolved in favor of the former.
Petitioners, who are employees of San Lazaro Hospital (SLH) with Salary Grades (SG) 20 to 26, received hazard allowances amounting to P4,989.75 per month from January to June 2009. However, this rate was found to be inconsistent with Section 21 of Republic Act (RA) No. 7305, also known as "The Magna Carta of Public Health Workers," and Section 7.1.5.a, Rule XV of its revised implementing rules and regulations (IRR). These provisions mandate hazard allowances to be proportional to the employee's monthly salary, specifically at least five percent (5%) of the monthly basic salary of health workers within SG 20 and above. As a result, a Notice of Disallowance (ND) No. 09-006-101MDS-(09) was issued on November 23, 2009, disallowing an aggregate amount of P1,094,188.98, representing hazard pay paid beyond the prescribed five percent (5%) of basic salaries.
Whether the amounts of hazard pay given
beyond the minimum rate prescribed by RA No. 7305 were validly disallowed
YES. The COA National Government Section (NGS) ruled that the hazard pay, based on Department of Health (DOH) Administrative Order (AO) No. 2006-0011, cannot be relied upon as a legal basis, citing a previous court decision that declared the DOH AO void. The Court upheld the COA's decision, reiterating the void status of DOH AO No. 2006-0011 for conflicting with RA No. 7305. The Court rejected petitioners' claims that the DOH AO enjoyed a presumption of validity, stating that the Court's determination in a previous case formed part of the legal system until subsequently overturned. The Court emphasized that administrative issuances must conform to the enabling law, and the DOH exceeded its power by fixing an exact amount for hazard pay.
Whether the petitioners were validly
held liable to refund the disallowed amounts.
NO. While the Court upheld the disallowance due to the
invalid DOH AO, it found that petitioners should not be held liable to refund
the disallowed amounts. The recipients' good faith or bad faith was deemed
inconsequential, as liability was grounded on principles of solutio indebiti
and unjust enrichment. The Court cited exceptions where liability could be
excused, such as genuine consideration for services rendered or undue
prejudice, social justice considerations, and other bona fide exceptions. In
this case, the hazard pay was within the amount authorized by law, petitioners
were entitled to it, and there was a clear connection to the actual performance
of their duties. The COA Proper was deemed to have committed grave abuse of
discretion in holding petitioners liable.
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