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GR. No. 81563 & GR. No.

82512

Amado C. Arias & Cresencio D. Data vs. The SANDIGANBAYAN


Facts
Petitioners Arias Arias (District Engineer) and Data (Chief Auditor), were found guilty by SB for violating sec. 3 (e)
of the Anti-Graft Practices Act:

SEC. 3. Corrupt Practices of Public Officers-In addition to acts or omissions of public officers already penalized by existing
law. the following shall constitute corrupt practices of any public officer and are hereby declared to be unlawful:
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(e) Causing any undue injury to any party, including the Government, or giving any private party any unwarranted benefits,
advantage or preference in the discharge of his official administrative or judicial functions through manifest partiality, evident
bad faith or gross inexcusable negligence. This provision shall apply to officers and employees of offices or government
corporations charged with the grant of licenses or permits or other concessions

Arias and Data were convicted by SB violating the above provision together with their 3 subordinates & 1 private
citizen Gutierrez (seller of land) (6 silang lahat na convicted).

The background of the story dates back in year 1975, when the Bureau of Public Works planned the “Mangahan
Floodway Project” to ease the perennial floods in some parts of Marikina and Pasig, Metro Manila. This floodway project will
traverse certain portions of Ortigas, where the land sold by Gutierrez to the Govt (subject matter in this case) was located.

The implementation of this floodway project was entrusted to the Pasig Engineering District headed by Data
(District Engineer). In this regard, Data formed a committee headed by Fernando (Supervising Civil Engr) as over-all in-
charge (Fernando did not face trial and remains at-large) and 3 other subordinates. The subordinates were Mendoza & Hucom,
for acquisition and improvements, and Jose the Instrument man for surveys (Mendoza & Jose are 2 other convicted co-
accused). This committee was tasked to inform affected lot owners affected by the floodway project and to receive and
process payments.

Among the lot owners affected was a 19, 004 sq.m. riceland (subject matter in this case) owned by Agleham, which
was previously owned by parents of Gutierrez (private citizen & convicted co-accused) from whom Agleham acquired his
property. Gutierrez was one of those who filed an application for payment, holding with her a Special Power of Attorney
allegedly executed by Agleham. In her application, she submitted fake and falsified documents i.e. Tax Declaration
Certificate purporting that the land was residential with fair market value of P80/sq m.

These documents were submitted to 2 other convicted co-accused -- examined by Arcaya (Admin. Officer) while
Cruz (Senior Engineer) initialed the documents & prepared a Deed of Sale. Cruz later transmitted them to District Engineer
Data. Data and Gutierrez both later signed the Deed of Sale. These documents were sent to Director Anolin of Bureau of
Public Works, who recommended approval of the Deed of Sale and later returned to Data’s office. Hence the sale was registered
and a TCT was issued in the name of the Govt.

For this sale, a General Voucher was prepared, for the amount of P1.5M plus with certifications of Data and his 3
subordinates (Fernando ,Cruz, and one accountant). This general voucher and other supporting documents were pre-audited
and approved for payment by Arias (Chief Auditor), petioner and convicted co-accused. Arias then later issued 16 PNB
checks for total sum of P1.5M plus for Gutierrez as payment of property in 1978.

In 1979, an investigation was conducted by the Ministry of National Defense on this alleged gross overpricing of
Agleham’s property. Several Government employees denied signing the certification and gave sworn statements. One of them
is Oco, an Assistant Mun. Assessor who provided the genuine Tax Declaration Certificate, showing among others that the
subject property is actually a riceland (but classified as residential) and overpriced at P80/sq.m. (instead of appraised
value of P5/sq.m.) -- showing that the officials of the District Engineering Office falsified them. The investigators also found
that the Deed of Sale was approved by Arias for payment of P1.5, who didn’t question the altered amount (snowflaked and
amount superimposed) nor checked the veracity of the fake documents.

The case was on trial for 6 years, and SB found 2 petitioners ARIAS & DATA, their 3 subordinates (CRUZ, JOSE,
& ARCAYA) & private citizen GUTIERREZ guilty of violation of Anti-Graft and Corrupt Practices Act.
Among the 6 convicted accused, only the 2 petitioners, Arias (District Engineer) and Data (Chief Auditor) appealed.

ISSUE: WON SB petitioners ARIAS and DATA are guilty as co-conspirators in the conspiracy to cause injury to the
Government through the irregular disbursement and expenditure of public funds. NO

RATIO: No.
1. Under the Sandiganbayan's decision, a department secretary, bureau chief, commission chairman, agency head, and
all chief auditors would be equally culpable for every crime arising from disbursements which they have approved.
The department head or chief auditor would be guilty of conspiracy simply because he was the last of a long line
of officials and employees who acted upon or affixed their signatures to a transaction. Guilt must be premised on
a more knowing, personal, and deliberate participation of each individual who is charged with others as part of a
conspiracy.

2. The Sandiganbayan, without any clear factual basis for doing so has assumed that the P5.00 per square meter value
fixed by the assessor in the tax declarations was the correct market value of the Mangahan property and if the
Government purchased the land for P80.00 a square meter, it follows that it must have suffered undue injury. In the
instant case, the assessor's low evaluation, in the fixing of which the landowner had no participation, was used for a
purpose infinitely more weighty than mere expropriation of land. It forms the basis for a criminal conviction by the
SB.
The Court is not prepared to say that P80.00 to P500.00 a square meter for land in Pasig in 1978 would be a
fair evaluation. The value must be determined in eminent domain proceedings by a competent court. We are
certain, however, that it cannot be P5.00 a square meter. Hence, the decision, insofar as it says that the "correct"
valuation is P5.00 per square meter and on that basis convicted that petitioners of causing undue injury, damage, and
prejudice to the Government because of gross overpricing, is grounded on shaky foundations.
There can be no overpricing for purposes of a criminal conviction where no proof adduced during
orderly proceedings has been presented and accepted.

3. BASIC REASON OF SC: We would be setting a bad precedent if a head of office plagued by all too common
problems-dishonest or negligent subordinates, overwork, multiple assignments or positions, or plain
incompetence is suddenly swept into a conspiracy conviction simply because he did not personally examine
every single detail, painstakingly trace every step from inception, and investigate the motives of every person
involved in a transaction before affixing, his signature as the final approving authority.
There appears to be no question from the records that documents used in the negotiated sale were falsified.
A key tax declaration had a typewritten number instead of being machine-numbered. The registration stampmark was
antedated and the land reclassified as residential instead of ricefield. But were the petitioners guilty of conspiracy
in the falsification and the subsequent charge of causing undue in injury and damage to the Government?
We can, in retrospect, argue that Arias should have probed records, inspected documents, received
procedures, and questioned persons. It is doubtful if any auditor for a fairly sized office could personally do all
these things in all vouchers presented for his signature. The Court would be asking for the impossible. All heads
of offices have to rely to a reasonable extent 'on their subordinates and on the good faith of those prepare bids,
purchase supplies, or enter into negotiations. If a department secretary entertains important visitors, the auditor is
not ordinarily expected to call the restaurant about the amount of the bill, question each guest whether he was present
at the luncheon, inquire whether the correct amount of food was served and otherwise personally look into the
reimbursement voucher's accuracy, propriety, and sufficiency. There has to be some added reason why he should
examine each voucher in such detail. Any executive head of even small government agencies or commissions can
attest to the volume of papers that must be signed. There are hundreds of document , letters and supporting
paper that routinely pass through his hands. The number in bigger offices or departments is even more
appalling.
There should be other grounds than the mere signature or approval appearing on a voucher to sustain a
conspiracy charge and conviction.

ARIAS’ PARTICIPATION: Arias joined the Pasig office on July 19, 1978. The negotiations for the purchase of the
property started in 1977. The deed of sale was executed on April 20, 1978. Title was transferred to the Republic on June 8,
1978. In other words, the transaction had already been consummated before his arrival. Should the big amount of
P1,520,320.00 have caused him to investigate . gate the smallest detains of the transaction? Yes, if the land was really
worth only P5.00 a square meter. However, if land in Pasig was already worth P80.00 a square meter at the time, no
warning bell of intuition would have sounded an inner alarm. Land along Ortigas Avenue on the way to Pasig is now
worth P20,000.00 to P30,000.00 a square meter.

DATA’S PARTICIPATION: The committee he formed determined the authenticity of the documents presented to them for
processing and on the basis thereof prepared the corresponding deed of sale; thereafter, the committee submitted the deed of
sale together with the supporting documents to petitioner Data for signing; on the basis of the supporting certified documents
which appeared regular and complete on their face, petitioner Data, as head of the office and the signing authority at that level,
merely signed but did not approve the deed of sale as the approval thereof was the prerogative of the Secretary of Public Works
for its final approval.

HELD: SB decision SET ASIDE insofar as it convicts and sentences petitioners Arias & Data. They are both acquitted on
grounds of reasonable doubt. Inadequacy of evidence is not sufficient to warrant a conviction.

DISSENTING OPINION OF GRINO-AQUINO: Conspiracy of Silence and Inaction - The petitioner's partiality for
Agleham/Gutierrez may be inferred from their having deliberately closed their eyes to the defects and irregularities of the
transaction in his favor and their seeming neglect, if not deliberate omission, to check, the authenticity of the documents
presented to them for approval. Since partiality is a mental state or predilection, in the absence of direct evidence, it may be
proved by the attendant circumstance instances.

CRUZ vs SANDIGANBAYAN
456 SCRA 52

Following the May 1992 local elections and his proclamation as mayor-elect of the Municipality of Bacoor, Cavite, Victor
Miranda sought an audit investigation of the municipality’s 1991-1992 financial transactions. Petitioner Buencamino Cruz
served as municipal mayor of the town in 1991 until his term ended in the middle of 1992.
Acting on the request, the Commission on Audit (COA) issued COA Order No. 19-1700 constituting a Special Audit Team. In
the course of the investigation, the Special Audit Team discovered that certain anomalous and irregular transactions transpired
during the covered period, the most serious being the purchase of construction materials evidenced by Sales Invoices No.
131145 and 131137 in the aggregate amount of P54,542.56, for which payment out of municipal funds was effected twice. The
double payments were made in favor of Kelly Lumber and Construction Supply and were accomplished through the issuance
of two (2) disbursement vouchers (DVs), i.e., DV No. 101-92-06-1222 and DV No. 101-92-01-195. Petitioner signed the
vouchers and encashed the two (2) corresponding PNB checks, both of which were payable to his order.
The findings of the Audit Team were embodied in a 336-page SAO Report No. 93-28, on the basis of which petitioner was
charged with violation of Section 3(e) of R.A. 3019.

The Information3 against petitioner, filed before the Sandiganbayan and thereat docketed as Criminal Case No. 22830, alleged:
“That on June 26, 1992, or sometime prior or subsequent thereto, in the Municipality of Bacoor, Cavite, Philippines, and within
the jurisdiction of this Honorable Court, the above-named accused Buencamino M. Cruz, a public officer being then the
Municipal Mayor of Bacoor, Cavite and while in the performance of his official function, acting in evident bad faith, did then
and there wilfully, unlawfully and criminally pay Kelly Lumber and Construction Supply the amount of Fifty Four Thousand
Five Hundred Forty-Two Pesos and 56/100 (P54,542.56), Philippine Currency, despite the fact that said account had been
previously paid by theMunicipality, thus, causing undue injury to the Government in the amount aforestated.
CONTRARY TO LAW.”

Upon arraignment, petitioner entered a plea of “Not Guilty.” In time, trial ensued. The respondent court found petitioner guilty
beyond reasonable doubt of violation of Section 3(e) of R.A. 3019 and sentenced him “to serve imprisonment of Seven (7)
years, and One (1), month as minimum, to Ten (10) years of prision mayor as maximum, with consequent perpetual
disqualification from holding public office, as provided by law.”
The anti-graft court predicated its judgment of conviction on the strength of the following main premises:
The numerous, other alleged anomalies and irregularities fully detailed and outlined in said S.A.O. Report No. 93-28 did not
appear to the Special Audit Team, as meriting prosecution of those who might have been guilty thereof. But, the same report
strongly recommended prosecution as notwithstanding . . . the subsequent refund of the total amount of P54,542.56 from the
supplier, Kelly Lumber . . . for the alleged double payment especially due . . . to the fact that the amount was not directly paid
to the supplier but the Municipal Mayor, as shown in Exh. “1” for P150,000.00 and Exh. “H” for P20,000.00 and Exhs. “1-1”
and “H-1” showing that the said two checks were actually encashed by the Municipal Mayor, respondent herein (See: p. 192
of the S.A.O. Report No. 93-28). A painful examination of Exhs. “B” and “B-1” to “B-11” shows that although there was a
total sum due of P31,198.01 and supported by documents under Disbursement Voucher No. 101-9201-194, they are really,
only supported by documents showing the statement of the account thereof and yet Sales Invoice No. 131145 was not attached
to support the voucher. Besides, said Sales Invoice No. 131145 had already been paid previously as shown by a photocopy of
PNB Check No. 214785, dated January 30, 1992 (see Exh. “B-2-A”) which proves that payment was made upon the prior
request of the accused Buencamino M. Cruz, and that the said amount of P21,041.56 had already been paid under the same
Voucher No. 101-9201-194. Also Exhs. “E,” “E-1” to “E-7” show that under Disbursement Voucher No. 1163, dated June 26,
1992, payment had been made together with other invoices, per PNB Check No. 197813 in the total sum of P150,000.00;
whereas, the same account of P33,501.00 had already been paid on January 30, 1992, thereby, showing that there is double
payment and the two checks issued in payment of these two invoices to the accused: Buencamino Mallari-Cruz as payee, shows
indubitably, that there was a willful act, with malice aforethought, in having a second payment made, in order that the accused
may be able to pocket the money, as he in fact did by encashing the said two checks. For it is likewise evident under the principle
RES IPSA LOQUITOR (The thing speaks for itself), namely: that if the money of P54,542.56 were indeed payment for the
goods delivered by the supplier-Kelly Lumber and Construction Supply, simple reason and well accepted commercial practice
demand for the checks in the first place, to made payable to the suppliers of goods sold in payment thereof. But, why should
payment be made to Mayor Buencamino M. Cruz, when he ought not to derive any material benefits, whatsoever, or any
pecuniary interest from the transactions entered into by him, for and on behalf of the Municipality, . . . .
The only excuse given by the accused when he finally testified in his own defense, is very lame. For the excuse he gave, in
explaining the anomaly or irregularity is that he was not aware of the double payment and that, he just signed the voucher for
payment, as the last officer to sign the voucher, in order to effect payment thereon, to the supplier . . ., and that it was the duty
of the Municipal Treasurer to verify the actual deliveries of the goods sold and their payment afterwards. This may be true, if
the ensuing checks issued in payment of the goods covered by the voucher for payment, were made payable, indeed, to the real
suppliers of the goods, and not made payable to the Mayor, . . ., and who in fact encashed the checks. The only real defense put
up here by the accused is that: The supplier-Kelly Lumber and Construction Supply had subsequently reimbursed the
Municipality of the amount of P54,542.56 thereby precluding denial of the double payment as shown in Exh. “1” of the accused.

MR Denied. Petitioner acknowledges signing the DVs which paved the way for the double payment situation. He also admits
encashing the checks corresponding to the DVs in question. He nonetheless urges the setting aside of the assailed decision,
anchoring his virtual plea for acquittal on four (4) basic issues, to wit: (1) the fatally flawed Information filed against him; (2)
the applicability in his favor of what he tagged as the Arias Doctrine; (3) the absence of bad faith on his part; and (4) the refund
of the amount representing overpayment.
We have carefully reviewed the records of this case and found nothing therein to warrant a reversal of the challenged decision
of the respondent court.

Invoking the lessons taught in Arias vs. Sandiganbayan, petitioner next argues that he cannot be held guilty of violation of
Section 3(e) of RA 3019 for, following the doctrine established in that case, he had every right to rely, to a reasonable extent,
on the bona fides of his subordinates, referring to the municipal treasurer and accountant, who prepared the DVs and the checks
in question.
Petitioner’s reliance on Arias is very much misplaced. As may be recalled, this Court, in acquitting the accused in Arias, made
the following pronouncements:
We can, in retrospect, argue that Arias should have probed records, inspected documents, received procedures, and questioned
persons. It is doubtful if any auditor for a fairly-sized office could personally do all these things in all vouchers presented for
his signature. The Court would be asking for the impossible. All heads of offices have to rely to a reasonable extent on their
subordinates and on the good faith of those who prepare bids, purchase supplies, or enter into negotiations. If a department
secretary entertains important visitors, the auditor is not ordinarily expected to call the restaurant about the amount of the bill,
question each guest whether he was present at the luncheon, inquire whether the correct amount of food was served, and
otherwise personally look into the reimbursement voucher’s accuracy, propriety, and sufficiency. There has to be some added
reason why he should examine each voucher in such detail. Any executive head of even small government agencies or
commissions can attest to the volume of papers that must be signed.

There are hundreds of documents, letters, memoranda, vouchers, and supporting papers that routinely pass through his hands.
x x x.
There should be other grounds than the mere signature or approval appearing on a voucher to sustain a conspiracy charge and
conviction. (Italics in the original; Underscoring supplied).
Unlike in Arias, however, there exists in the present case an exceptional circumstance which should have prodded petitioner,
if he were out to protect the interest of the municipality he swore to serve, to be curious and go beyond what his subordinates
prepared or recommended. In fine, the added reason contemplated in Arias which would have put petitioner on his guard and
examine the check/s and vouchers with some degree of circumspection before signing the same was obtaining in this case.
We refer to the unusual fact that the checks issued as payment for construction materials purchased by the municipality were
not made payable to the supplier, Kelly Lumber, but to petitioner himself even as the disbursement vouchers attached thereto
were in the name of Kelly Lumber. The discrepancy between the names indicated in the checks, on one hand, and those in the
disbursement vouchers, on the other, should have alerted petitioner—if he were conscientious of his duties as he purports to
be—that something was definitely amiss. The fact that the checks for the municipality’s purchases were made payable upon
his order should, without more, have prompted petitioner to examine the same further together with the supporting documents
attached to them, and not rely heavily on the recommendations of his subordinates.
It need no stretching of the mind to understand that the person or entity in whose favor a voucher is processed should also be
the payee appearing in the checks issued to satisfy the same. Yet, for still unexplained reasons, petitioner chose to deviate from
what to us is an ordinary accounting procedure, doubtless for a consideration less than honest.

WHEREFORE, the instant petition is DENIED and the assailed decision and resolution of the Sandiganbayan
AFFIRMED, with the modification that petitioner BUEN-CAMINO MALLARI-CRUZ is hereby sentenced to a prison term
of seven (7) years and one (1) month, as minimum, to ten (10) years, as maximum, with perpetual disqualification from holding
public office, as provided by law.
SO ORDERED.

Morales v CA and Binay

GR no 217126-27

Facts:

 A complaint was filed against Binay and other public officers of the City Government of Makati charging them with
administrative cases for Grave Misconduct, Serious Dishonesty, and Conduct Prejudicial to the Best Interest of the
Service, and criminal cases for violation of RA 3019, Malversation of Public Funds, and Falsification of Public
Documents. Binay, Jr. was alleged to be involved in anomalous activities attending the procurement and construction
phases of the Makati Parking Building project, committed during his previous and present terms as City Mayor of
Makati.

 The Ombudsman issued a preventive suspension order, placing Binay Jr., et al., under preventive suspension for not
more than six (6) months without pay, during the pendency of the OMB Cases.

 Binay, Jr. filed a petition for certiorari before the CA seeking the nullification of the preventive suspension order.

 The CA granted Binay, Jr.'s prayer for a TRO, notwithstanding Peña, Jr.'s assumption of duties as Acting Mayor. Citing
Governor Garcia, Jr. v. CA, it found that it was more prudent on its part to issue a TRO in view of the extreme urgency
of the matter and seriousness of the issues raised, considering that if it were established that the acts subject of the
administrative cases against Binay, Jr. were all committed during his prior term, then, applying the condonation
doctrine, Binay, Jr.'s re-election meant that he can no longer be administratively charged.

Binay’s contention:

 Phases I and II were undertaken before he was elected Mayor of Makati in 2010; and

 (b) Phases III to V transpired during his first term and that his re-election as City Mayor of Makati for a second term
effectively condoned his administrative liability therefor, if any, thus rendering the administrative cases against him
moot and academic.

 In view of the condonation doctrine, as well as the lack of evidence to sustain the charges against him, his suspension
from office would undeservedly deprive the electorate of the services of the person they have conscientiously
chosen and voted into office.

The Ombudman’s contentions:


 The condonation doctrine is irrelevant to the determination of whether the evidence of guilt is strong for purposes
of issuing preventive suspension orders.

 Reliance on the condonation doctrine is a matter of defense, which should have been raised by before it during the
administrative proceedings.

 There is no condonation because Binay, Jr. committed acts subject of the OMB Complaint after his re-election in
2013.

Issue: Whether or not the CA gravely abused its discretion in issuing the TRO and the WPI enjoining the implementation of
the preventive suspension order against Binay, Jr. based on the condonation doctrine.

Ruling: No. However, the condonation doctrine is abandoned, but the abandonment is prospective in effect.

A. The WPI against the Ombudsman's preventive suspension order was correctly issued.

1. The CA's resolutions directing the issuance of the assailed injunctive writs were all hinged on cases enunciating the
condonation doctrine. By merely following settled precedents on the condonation doctrine, which at that time,
unwittingly remained "good law," it cannot be concluded that the CA committed a grave abuse of discretion based
on its legal attribution above.

B. The Condonation Doctrine

1. Condonation is defined as "a victim's express or implied forgiveness of an offense, especially by treating the offender
as if there had been no offense."

2. Under the Condonation Doctrine,

a. First, the penalty of removal may not be extended beyond the term in which the public officer was elected
for each term is separate and distinct.

b. Second, an elective official's re-election serves as a condonation of previous misconduct, thereby cutting the
right to remove him therefor.

c. Third, courts may not deprive the electorate, who are assumed to have known the life and character of
candidates, of their right to elect officers.

3. It is not based on statutory law but a jurisprudential creation.

a. It originated from the 1959 case of Pascual v. Hon. Provincial Board of Nueva Ecija. In which case, as there
was no legal precedent on the issue at that time, the Court, resorted to American authorities and found that
the weight of authorities seems to incline toward the rule denying the right to remove one from office
because of misconduct during a prior term.

4. The condonation doctrine does not apply to a criminal case. Also, it would not apply to appointive officials since, as
to them, there is no sovereign will to disenfranchise.

C. The doctrine of condonation is actually bereft of legal bases.

1. There is really no established weight of authority in the US favoring the doctrine of condonation.

2. The plain difference in setting, including the sheer impact of the condonation doctrine on public accountability, calls
for Pascual's judicious re-examination.

a. Pascual was decided within the context of the 1935 Constitution which was silent with respect to public
accountability, or of the nature of public office being a public trust.
3. The concept of public office, under the 1987 Constitution, AS A PUBLIC TRUST and the corollary requirement of
ACCOUNTABILITY TO THE PEOPLE AT ALL TIMES is PLAINLY INCONSISTENT with the idea that an elective local
official's administrative liability for a misconduct committed during a prior term can be wiped off by the fact that
he was elected to a second term of office, or even another elective post.

4. Election is not a mode of condoning an administrative offense.

5. There is no constitutional or statutory basis to support the notion. In fact the Local Government Code and the
RRACCS precludes condonation since in the first place, an elective local official who is meted with the penalty of
removal could not be re-elected to an elective local position due to a direct disqualification from running for such
post.

6. If condonation of an elective official's administrative liability would perhaps, be allowed in this jurisdiction, then
the same should have been provided by law under our governing legal mechanisms.

7. The proposition that the electorate, when re-electing a local official, are assumed to have done so with knowledge
of his life and character, and that they disregarded or forgave his faults or misconduct, if he had been guilty of any,
is infirm. No such presumption exists in any statute or procedural rule.

a. Most corrupt acts by public officers are shrouded in secrecy, and concealed from the public. At a conceptual
level, condonation presupposes that the condoner has actual knowledge of what is to be condoned. Thus,
there could be no condonation of an act that is unknown.

8. Liability arising from administrative offenses may only be condoned by the President in light of Section 19, Article
VII of the 1987 Constitution.

D. The Court's abandonment of the condonation doctrine should be prospective in application. It should be, as a general
rule, recognized as "good law" prior to its abandonment. Consequently, the people's reliance thereupon should be respected.