CASE DIGEST
Paguio v. Commission on
Audit
G.R. No. 223547, [April
27, 2021]
EN BANC, LOPEZ, M.V
Powers of COA;Commission on Audit Disallowances; Grave abuse of discretion; Net Disallowed Amount
The COA, in the exercise of its
constitutional duty, is accorded plenary discretion to determine, prevent, and
disallow irregular, unnecessary, excessive, extravagant, or unconscionable
expenditures of government funds. The court generally upholds the decisions of
the COA, intervening only when there is a showing of grave abuse of discretion,
evasion of a positive duty, or a refusal to perform a duty enjoined by law.
Petitioners, including Engr. Alex C. Paguio and Angeline R. Aguilar, officers of Pagsanjan Water District (PAGWAD), and members of the PAGWAD Board of Directors, received various benefits in 2009 and 2010 based on board resolutions. These benefits included extra year-end financial assistance, medical allowance, anniversary bonus, and productivity enhancement incentive. A Notice of Disallowance (ND) was issued on May 10, 2012, disallowing the disbursements amounting to P283,965.00 due to lack of legal basis. The benefits were given without approval from the Local Water Utilities Administration (LWUA), violating relevant regulations.
Whether or not the Commission on Audit
(COA) Proper properly disallowed the amounts for lack of legal basis of the
benefits given.
YES. The court dismissed the petition,
upholding the COA's decision. The COA's authority as the guardian of public
funds allows it discretion to determine, prevent, and disallow irregular,
unnecessary, excessive, extravagant, or unconscionable expenditures of
government funds. The court noted that there was no grave abuse of discretion
by the COA in dismissing the petitioners' appeal for being filed beyond the
prescribed period.
Regarding the propriety of the
disallowance, the court emphasized that the LWUA approval was required for
additional allowances to Board Members, and the PAGWAD Board did not comply
with this requirement. Even if LWUA issuances were cited, they did not legitimize
the grants, especially considering the suspension of new benefits under
Administrative Order No. 103. The court concluded that the COA did not commit
grave abuse of discretion in upholding the disallowance for lack of legal
basis.
As for the liability to refund the
disallowed amounts, the court cited Section 43 of the Administrative Code of
1987, holding that officials involved in the disallowed transactions are
jointly and severally liable to the government. The court affirmed the
liability of the PAGWAD Board of Directors to refund the unauthorized benefits,
grounded on their gross negligence and violation of laws and directives.
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