CERTIFIED TRUE COPY: ESTELA TERESITA C. ROSETEsb.judiciary.gov.ph/DECISIONS/2009/C_Crim_27784_Fernandez, et al... · All of Municipality of Buenavista Province of Guimaras, ... People

Republic of the PhilippinesSANDIGANBA YAN

Quezon City

FIRST DIVISION

CERTIFIED TRUE COPY:

tQESTELA TERESITA C. ROSETE

Executive C/erk Of~QU" Ill.First Division. . \oq~\v

. PEOPLE OF THE PHILIPPINES,Plaintiff,

- versus -

ARTURO V. FERNANDEZ,Municipal Mayor,

RENATO M. GARONITA,Municipal Treasurer,

EMER B. GA YLAN,Municipal Budget Officer,All of Municipality of BuenavistaProvince of Guimaras,

Accused.

CRIM. CASE NO. 27784

Present:

GERALDEZ, .1., ChairmanPONFERRADA, &GESMUNDO, JJ.

)(-------------------------------------------------------------------------------------------------------)(

DECISION

PONFERRADA, J.:

Accused Arturo V. Fernandez, Renato M. Garonita and Emer B. Gaylan are

charged with violation of Section 3( e) of Republic Act No. 3019, as amended (The

Anti-Graft and Con-upt Practices Act), under the following Information:

"That on or about the 23rd day of December 1998in the Municipality of Buenavista, Province ofGuimaras,Philippines, and within the jurisdiction of this Honorable

xxx

"INFORMA TION .

xxx xxx

DECISION

People vs. Fernandez, et al.Crim. Case No. 27784

~age 2

Caurt, abave-named accused ARTURO V FERNANDEZ,RENA TO it! GARONITA and EMER B. GAYLAN, allpublic ,officers, being then the Municipal Mayar (a highranking public ,officer), Municipal Treasurer andMunicipal Budget Officer, respectively, ,of Buenavista,Guimaras, in such capacity and cammitting the ,offensein relatian ta their respective ,office, canspiring andcanfederating tagether and mutually helping ,one anatherwith deliberate intent thraugh evident bad faith, did thenand there willfully, unlawfitlly and criminally causeundue injury ta the gavernment by causing thedisbursement and release ,of public fimds in the tatalam aunt 0./ ONE MILLION TWO HUNDRED FIFTYTHREE THOUSAND TWO HUNDRED FORTY SIX

PESOS and 50/100 (P1,253,246.50), PhilippineCurrency, far the payments ,of increase ,of theRepresentatian and Transportation Allawance (RATA),Cash Gifts and Ameliaration Allowance ,of the Municipalemplayees ,ofBuenavista under Apprapriatian OrdinanceNa. 3, series of 98 withaut any legal basis, as said,ordinance was not approved by the SangguniangPanlalawigan and the suppased basis far the saidincrease ,of RATA, Cash Gifts and AmeliarationAllawance was the promise of P 1;500,000.00 fram thenGuimaras Representative, Emily Lapez, which amauntwas nat yet available at the time for the release ,of thebenefits abave-mentianed, thus, accused likewise giveunwarranted benefit to themselves and the otheremplayees of the Municipality of Buenavista.

CONTRARY TO LAW".

Upon separate arraignments, the three accused, assisted by their respective

counsel, pleaded not guilty to the offense charged in the Information against them.

After pre-trial proceedings, the Court issued a Pre-Trial Order dated Aug'ust

24, 2005, containing therein the parties' documentary exhibits, intended witness""",,

stipulations, and the issue to be resolved which is "whether or not the acts of the

DECISION


Page 3

accused, singly and collectively, constituted the violation charged against them in

the Information".

In the ensuing trial, the parties offered/presented their respective testimonial

and documentary evidence.

Evidence of the ProsecutionWitnesses

1. Modesto Uy- a retired Commission on Audit Auditor who testified

that from 1997-2000, he was designated as Provincial Auditor of

the Province of Guimaras and that under his audit jurisdiction was

the J\1unicipality of Bu'enavista, Guimaras; that sometime in 1999,

his office conducted a post audit examination of the transactions of

the said 'tvlunicipaJity of Buenavista and prepared the

conesponding annual audit report; that among the findings therein

are illegal payments disbursements for RATA, amelioration

allowances, and cash gifts amounting to more or less 1.25 million

pesos; and that said payments/disbursements were considered

illegal because the supposed basis, Municipal Appropriation

Ordinance No.3, series- of 1998 was null and void; and that he

cOlTespondingly issued a notice of disallowance for said

payments/disbursements.

2. Jonayreh Gaitano - the private complainant who testified that he

- is an incumbent Sanguniang Bayan member of Buenavista and that

ri

DECISION


Page 4

he first filed the complaint against then Mayor Arturo Fernandez

and the municipal budget officer Emer Gaylan but later he filed an

amended complaint to include accused Renato Garonita, the then

municipal treasurer.

The prosecution likewise presented its documentary evidence consisting of

Exhibits "A to V", with some corresponding sub-markings.

Evidence of the Defense

Witnesses

1. Arturo V. Fernandez ~ the then municipal mayor and one of the

accused who testified that he signed the subject ordinance upon his

understanding that the source of funding is the general fund; that

he signed the Office Order No. 99-01 which- ordered the payment

of the subject disbursements; that the source of said funds was the

general fund; and that subsequently, he ordered the municipal

treasurer to refund the amount disbursed.

2. Richard G. Gaboy - the incumbent municipal accountant who

testified on the procedure and process of payment of the salaries~ .

and benefits of the employees; and that the municipality per \\s .."

records has paid all its financial obligations.

DECISION


Page 5

3. Emer B. Gaylan - the then municipal budget officer and one of the

accused who testified that it was the municipal treasurer not him

who certified as to the availability of funds for the subject

appropriation; that his participation is only that he certified that the

amount is included in the appropriation in the budget; and that he

admitted that he is a beneficiary of the subject disbursement but

because of the notice of disallowance, he refunded the amount he

received.

4. Renato W. Garonita - the then municipal treasurer and one of the

accused whose Deposition, upon authority of the court, was taken

before Branch 65, Regional Trial Court of the 6th Judicial Region

in San Miguel, Jordan, Guimaras, wherein he stated inter alia that

he made a notation or proviso in the Certification of Availability of

Funds that "any payment for the amelioration allowance or any

items attached to the fund shall only be paid upon the receipt of

financial assistance"; that he released the subject funds because of

the order of the mayor and thus, he is not allegedly liable therefor

pursuant to Art. 454 of the Rules and Regulations implementing

suffered by the municipality because the funds paid were refunde

or returned.

DECISION

People ys. Fernandez, et al.Crim. Case No. 27784

Page 6

Accused Aliuro V. Fernandez and Emer Gaylan likewise offered their

respective documentary evidence, to wit:

1. for accused Arturo V. Fernandez Exhibit" I to 38"

with conesponding submarkings; and

2. for accused Emer Gaylan Exhibits "1 to 6" withcorresponding submarkings.

Accused Renato Garonita attached his documentary exhibits" 1 to 4 and 5"

and corresponding submarkings in his Deposition but failed to formally offer them

to the Court.

Only the prosecution and accused Arturo Fernandez filed their respective

memoranda.

Facts of the Case

From the evidence presented and records of this case, it appears that the

municipality of Buenavista, Guimaras enacted ApprQpriation Ordinance No. 3

series of 1998, granting increase of the RATA, amelioration assistance and cash

gifts to its municipal officials and employees in the total amount Pl,263,040.00

and stated therein is that the source of funds for the grant appropriation is the

financial assistance of 1.5 million from Congress\voman Emily R. Lopez; that

without the approval of said ordinance by the provincial board as the latter returned

it to the municipality 'without action and non-receipt of the said funds from ·t\\

\

Congresswoman Lopez, accused Mayor Fernandez issued Office Order No. ,\

dated February 9, 1999, to accused Renato Garonita directing him "to

(

DECISION


Page 7

payment ,of ameliaration allawance and ather benefits extended ta municipal

,official ,officials and emplayees pursuant ta Municipal Apprapriatian Ordinance

Na. 003, series ,of 1998", and accordingly the accused municipal treasurer Renato

Garonita released the funds and paid the corresponding employees; that because

of such payments, the three accused together with other municipal officials were

charged before the Ombudsman (Visayas) with Malversation of Public Funds.

After preliminary investigation, however, the Ombudsman found probable cause'

against the three accused herein for violation of Sec. 3(e) of R.A. 3019 instead of

Malversation and dismissed the cases against the other employees/respondents.

Discussio n/Rulin g

In this case, the three accused are charged, in conspiracy with one another, with

violation of Paragraph (e) of Section 3 ofR.A. 3019, as amended, which reads as

fo11ow8-

Section 3. Carrupt Practices ,of Public Officers. - Inadditian to acts ,or amissians ,ofpublic ,officers alreadypenalized by existing law, the fallawing shall canstitutecarrupt practices ,of any public ,officer and are herebydeclared to be unlawfitl:

xxx xxx xxx.

(e) Causing any undue injUlJl ta any party,including the Gavernment, ,or giving any party anyunwarranted benefits, advantage ,or preference in thedischarge ,of his ,official, administrative ,or judicialfunctians thraugh manifest partiality, evident bad faith ,orgrass inexcusable negligence. This pravisian shall applyta ,officers and emplayees ,of ,offices ,or gavernmentcarparations charged with the grant ,of licenses ,orpermits ,orather cancessians.

DECISION

People vs. Fernandez, et at.Crim. Case No. 27784

Page 8

In Santos v. Sandiganbayan,l the Supreme Court enumerated the essential

elements of violation of the above-quoted Section 3(e) ofRA 3019, as amended, to

wit-

a. that the accused is a public officer dischargingadministrative, judicial or official functions;

b. that he must have acted with manifest partiality, evidentbad faith, or inexcusable negligence,' and

c. that his action has caused any undue injury to any party,including the Government, or has given any party anyunwarranted benefit, advantage or preference in thedischarge of his functions.

In Fonacier v. Sandiganbayan,2 the Supreme Court explained the three (3)

different modes by which means the second element of the offense may be

committed. "Partiality" is synonymous with "bias"] which "excites a disposition

to see and report matters as they are wished for rather than as they are". 4 "Bad

faith does not simply connote bad judgment or negligence; it imputes a dishonest

purpose or some moral obliquity and conscious doing of a wrong; a breach of

sworn duty through some motive or intent or ill will; it partakes of the nature of

fraud".5 "Gross negligence has been defined as negligence characterized by the-

want of even slight care, acting or omitting to act to a situation where there is duty

to act, not inadveliently but willfully and intentionally with a

I G.R. No. 161877, March 23, 2006, Finacier vs. Sandiganbayan 238 SCRA 657, 687 [1994] citingVillanueva v. Sandiganbayan, 223 SCRA 543, 547 and Medjia, 1r. v. Sandiganbayan, 218 SCRA 219.2 Supra.3 Ibid citing 31 WORDS AND PH RASES 212.

4. Ibid citing PHILIPPINE LA 'IN DICTIONARY by F.B. Moreno, 3rd ed., p. 103.

5[bid citing Marcelo v. Sandiganbayan, 185 SCRA 346,349.

DECISION


Page 9

indifference to conseq uences in so far as other persons may be affected. It is the

omission of that care vvhich even inattentive and thoughtless men never fail to take

on their own property.,,6 These three modes are distinct and different from each

other so that proof of the existence of any of theses modes in connection with the

prohibited acts under Section 3 (e) should suffice to warrant conviction.

Likewise, in P31dfico C. Velasco vs. Sandiganbayan, 7 the Supreme Court

explained that there are two (2) ways by which a public official violated Section

3(e) of RA 3019 in the performance of his functions namely: (a) by causing

undue injury to any party, including the Government; or (b) by giving any private

party any unwarranted benefits, advantage or preference. The accused maybe

charged under either way or under both. The term "unwarranted" has been

defined lacking adequate or official support; unjustified; unauthorized (Webster,

Third New International Dictionary, p. 2514); or without justification or adequate

reason (Philad~lphia -Newspapers, Inc. vs. Dept. of Justice, C.D. Pa., 405 F. Supp.

8,12, cited in Words and Phrases, Permanent Edition, Vol. 43-A 1978, Cumulative

Annual Pocket Part, p. 19)".8 "Advantage" means a more favorable or improved

position or condition; benefit or gain of any kind; benefit from course of action.9

6 Ibid citing Alejandro v. People, 170 SCRA 400, 4057.G.R. No. 160991, February 28,2005 citing Librada M. Cabrera, et a1. v. Sandiganbayan, G.R. Nos.162314-17, October 25, 2004.8 Gellego v. Sandiganbayan, 115 SCRA 793, 797 (1982)

9 Cabrera, et al vs. Sandiganbayan, G.R. No. 162314-17, October 25,2004, citing Webster's Third Ner...International Dictionary (Unabridged), p. 30.\

DECISION


Page 10

"Preference" signifies priority or higher evaluation or desirability; choice or

.. b 'I 10estImatIOn a ove anotner.

The presence of the first element is not disputed. On the date alleged in the

information accused Arturo V. Fernandez as municipal mayor, Renato M.

Garonita as municipal treasurer and ErneI' B. Gaylan as municipal budget officer,

were all public officers.

On the second element, evident bad faith is imputed against the accused for

the alleged payments/disbursements. As shown earlier, there is evident bad faith

when there is a dishonest purpose or conscious doing of a wrong or a breach of

sworn duty through some motive or intent of ill will or the act partakes the nature

of fraud. It is fundamental that no money shall be paid out of the local treasury

unless properly and validly appropriated by law or ordinance. Section 305 of

Local Government Code is hereby pertinently quoted:

"Section 305. Fundamental Principles. - The financialaffairs, transactions, and operations of local governmentunits shall be governed by the following fundamentalprinciples:

(a) No money shall be paid out of the local treasuryexcept in pursuance of an appropriations ordinanceor law'",

xxx xxx xxx

Thus, when accused Arturo Fernandez as mayor ordered the payment of the

payment without the necessary valid appropriation ordinance therefor, they cle

increased RATA, amelioration allowance and cash gifts amounting to more 9\ lerP 1.25 million and accused Renato Garonita as municipal treasurer effe~te~ ~h~"

10 Ibid, citing Webster's Third New International Dictionary (Unabridged), p. 1787.

DECISION

People vs. Femandez, et al.Crim. Case No. 27784

Page 11

violated the afore-quoted legal provision which they know or ought to know as

such public officials. It is noted that accused Fernandez admitted, nay contended,

that the funds used for such payment came from the general fund of the

municipality. Such being the case, said funds could not be used without the

necessary valid and appropriate appropriation ordinance contrary to what they did

in this case. For doing so, both accused evinced evident bad faith. An act which

may even constitute the more serious crime of Malversation of Public Funds.\ J

Municipal Appropriation Ordinance No.3 Series of 1998, is quite clear, to

wit:

xxx

"Part I-Resources

xxx xxx

1. Financial Assistance from Hon. Congress

woman Emily R. Lopez PI ,500,000.00"

xxx xxx xxx

It is understandable that accused Fernandez, did not, as he could not, use as

basis for the payment the aforequoted Municipal Appropriation Ordinance No.3

series of 1998, because not only was it not approved and returned without action

by the provincial board but as clearly shown above the source of the fund for the

subject payment should be the grant of PI.5 million from Congresswoman Emily

Lopez which was never received or realized. By contending that the funds used

for subject payments/disbursements were from the general

" See Art. 217, Revised Peoal Code; U.S. vs. Calimag 12 Phi!. 687 cited in Reyes The Revised p~n7Code, ] S· Edi'ion, Book II, p. 400. ( Y

DECISION

People vs. Fernandez, et a\.Crim. Case No. 27784

Page 12

Fernandez unwittingly revealed a violation of the earlier quoted Section 305 of

the Local Government Code because there was no valid appropriation ordinance

therefor, thereby showing bad faith. There was also bad faith on the part of

accused Garonita when he agreed accordingly to release the funds under his

custody without a valid appropriation ordinance therefor.

It appears, however, that accused budget officer Emer Gaylan had no

participation in the payments/disbursements as such was effected only by accused

Fernandez as mayor and accused Garonita as municipal treasurer and custodian of

the funds. Hence, the Court believes and so holds that the element of evident bad

faith is present only insofar as accused Fernandez and Garonita are concerned and

not with respect to accused Gaylan, the municipal budget officer.

As to the third element, the accused contend that there is no actual injury

suffered by the government because the amount paid was refunded but· the

evidence submitted shows that the whole amount has not yet been fully refunded

and that there is stil1 a balance of P458,027.08. Hence, to say the least, the

government suffered injury for such unpaid balance or the recipients thereof

enjoyed unwarranted benefits, thereby showing the presence of this element.

The Court finds invalid or, at the very least, ineffective or of no effect

Appropriation Ordinance No. 3 series of 1998 which authorized the subject

payments/disbursements not only for the reason that it was not approved by the

provincial board but more importantly because its source of the fund.~ as stated

therein i.e. financial assistance from Congresswoman Emily Lopez, nev\e'r ca~e or

DECISION


Page 13

materialized. For this reason, it is immaterial that accused Fernandez made a

reservation in his orde:r of payment that the subject payments shall be "subject to

refund when found to be contravention to present policies"; and that he actually

ordered the refund as the whole amount paid was not totally or fully refunded

before the filing of this case. It is likewise immaterial that accused Garonita

made a notation in the Certified Statement of Additional Realized Income that

payment shall be made upon receipt of the financial assistance because that

appears to refer or connect to Appropriation Ordinance No.3, Series of 1998,

which turned later to be invalid. In fact, he should be held liable because he

disregarded and/or did not comply with such condition and in effect allowed

payment without a valid appropriation ordinance. His invoked Art. 454 of the

Rules and Regulations Implementing the Local Government. Code, does not

absolve or exculpate him from liability because as provided for in the said article,

(i) 12 to avoid liability he should have registered his objection in writing but he

failed to do so and instead readily agreed to the order of his co-accused mayor and

as stated earlier, even disregarded the condition he himself imposed in his

certification. In sum, what matters is that accused Fernandez as mayor ordered

and accused Garonita as treasurer implemented the payments/disbursements

without a proper and valid appropriation ordinance in clear violation of the law.

On the matter of conspiracy, suffice it to say that conspiracy need not be

proved by direct evidence and may be interfered from the conduct of the (~ccL\ed

"See leU" 0) of M. 454 of the Roles aod Regola,;ons Implementing the Locol Government COd;1991. II

DECISION


Page 14

before, during, and after the commission of the crime, which are indicative ofa

joint purpose, concerted action and concurrence of sentiments. 13 In conspiracy, the

act of one is the act of all so that conspiracy is present when one concurs with the

criminal design of another, indicated by the performance of an overt act leading to

the crime committed. Hence, only accused Fernandez and Garonita should be

held liable because their combined acts caused or resulted into the illegal

payments/disbursements. Accused Gaylan had no actual participation in said

payments/disbursements. If at all, his participation is limited to the preparation of

the Supplemental Budget on Funds Actually Available which had no direct

connection to the actual payments/disbursements, and as one of the recipients but

it appears that he already refunded the amount he received. Like the other mere

recipients who were not even charged, he should not be held criminally liable.

In conclusion, with the presence of all the elements of the offense charged

against accused Arturo Fernandez and Ramon Garonita, the COUl1 is constrained to

render a verdict of conviction against them. And as aforediscussed it appearing

that accused Emer Gaylan had no direct or actual participation in the actual

payments/disbursements, he is entitled to an acquittal. There being a balance of

the amount ofP458,027.08 unrefunded, ac'cused Fernandez and Garonita should be

jointly and severally liable to pay the said amount without prejudice however to

their right to collect the said amount from the actual recipients thereof.

13 People v. Panida, 310 SCRA 66 [1999]; People v. Bolivar, 352 SCRA 438 [200]]; peOPlep'Gar ia,400

SCRA 229, 238 [2003] .

. .

DECISION


Page 15

WHEREFORE, judgment is hereby rendered finding accused ARTURO

v. FERNANDEZ and RENA TO M. GARONIT A guilty of violation of Sec.

3(e) of R.A. 3019, as amended as charged and sentencing each of them to suffer

the indeterminate penalty of six (6) years and one (1) month as minimum to ten

(10) years as maximum, and perpetual disqualification from public office and to

jointly and severally pay to the municipality of Buenavista, Guimaras the amount

of P458,027.08 with legal interest from the time this Decision shall have become

final until the said amount is fully paid, and the cost of the proceedings; and

acquitting accused El\IER B. GAYLAN of the offense charged.

RODOLF,o A. PONFERRADAAssociate Justice

We con

ER GESMUNDO~ . J .ssocrate ustlce

DECISION


Page 16

ATTESTATION

I attest that the conclusions in the above-decision were reached in

consultation before the case was assigned to the writer of the opinion of the

Court's Division.

CERTIFICATION

Pursuant to Article VIII, Section 13, of the Constitution, and the DivisionChairman's Attestation, it is hereby certified that the conclusions in the abovedecision were reached in consultation before the case was assigned to the writer ofthe opinion of the Court's Division.

d1Jj~ ~ C krl~bILBERTO G. S>1Nbov AtL. a

Acting Presiding Justice

Documents

CERTIFIED TRUE COPY: ESTELA TERESITA C. ROSETEsb.judiciary.gov.ph/DECISIONS/2009/C_Crim_27784_Fernandez, et al... · All of Municipality of Buenavista Province of Guimaras, ... People