848 Phil. 367; 116 OG No. 9, 1447 (March 2, 2020)
REYES, J. JR., J.:
Administrative Order No. 135, Series of 2005 (A.O. No. 135) issued by former President Gloria Macapagal-Arroyo, confirmed the grant of CNA Incentive to rank-and-file employees.[6] Subsequently, the Department of Budget and Management (DBM) released Budget Circular No. 2006-1, dated February 1, 2006, to implement A.O. No. 135 and to lay down the guidelines in the grant of CNA Incentive. In Section 7.1 thereof, it was stated that "the CNA Incentive shall be sourced solely from savings from released Maintenance and Other Operating Expenses (MOOE) allotments for the year under review x x x."
- After completion of the work/activity for which the appropriation is authorized;
- Arising from unpaid compensation and related costs pertaining to vacant positions; or
- Realized from the implementation of the provisions of the CNA which resulted in improved systems and efficiencies, thus, enabled the agency to meet and deliver the required or planned targets, programs and services approved in the annual budget at a lesser cost.[5]
Premises considered, the instant Appeals are hereby DENIED for lack of merit. Accordingly, the assailed NDs are hereby affirmed.[10]Aggrieved, Lapid and Kagahastian filed a petition for review before the COA En Banc.
WHEREFORE, premises considered, the Petition for Review of Mr. Felixberto Q. Kagahastian and Ms. Cynthia E. Lapid, both Provincial Agrarian Reform Officer II, Department of Agrarian Reform Provincial Office (DARPO) Cavite, is hereby DENIED for lack of merit. Accordingly, the Commission on Audit Regional Office No. IV Decision No. 2011-21 dated September 1, 2011 and Notice of Disallowance Nos. 11-01-158-CNA(09) and 11-02-158-CNA(09) dated January 17, 2011 and January 31, 2011, respectively, on the payment of Collective Negotiation Agreement Incentives to DARPO-Cavite officials and employees, in the total amount of P2,694,800.00 are AFFIRMED.Petitioner James Arthur T. Dubongco (petitioner), the current Provincial Agrarian Reform Program Officer II of DARPO-Cavite, moved for reconsideration, but the same was denied by the COA on October 26, 2017.[13] Hence, this petition for certiorari.
The Prosecution and Litigation Office, Legal Services Sector, this Commission, is hereby directed to forward the case to the Office of the Ombudsman for investigation and filing of appropriate charges, if warranted, against the persons liable for the transaction.[12]
Petitioner argues that although the CARP Fund is a special fund, DARPO-Cavite holds the same for its own use and not for the benefit of another government agency; that although DBM Budget Circular No. 2006-01 uses the word "shall," the said circular did not specify the source of the savings which would be used in the grant of CNA Incentive; that DARPO-Cavite relied on the opinion of former DBM Secretary Andaya, Jr. to the effect that the use of the CARP Fund for the grant of the CNA Incentive is allowable; that the purpose for which the CARP Fund was created must necessarily include the grant of incentives to employees who are the lifeblood of the agency; and that the officials and employees acted in good faith when they received the CNA Incentive.[14]The Issues
WHETHER THE CARP FUND OR FUND 158 CAN BE A VALID SOURCE FOR THE GRANT OF CNA INCENTIVE TO RANK-AND-FILE EMPLOYEES; and
WHETHER THE RECIPIENTS MAY BE HELD LIABLE FOR THE REFUND OF THE DISALLOWED CNA INCENTIVE.
CNA Incentive may be granted to rank-and-file employees only if there are savings from operating expenses |
5.0 Policy GuidelinesFrom the foregoing provisions, it is unequivocal that the CARP Fund could not be legally used to finance the grant of the CNA Incentive. Both A.O. No. 135 and DBM Budget Circular No. 2006-01 use the word "shall" when pertaining to the funds to be used in the CNA Incentive, that is, savings from operating expenses. The word "shall" is imperative, underscoring the mandatory character of the provisions.[24] Petitioner cannot give a different interpretation to the provisions of A.O. No. 135 and DBM Budget Circular No. 2006-01 and insist that the CNA Incentive may be taken from the CARP Fund. The words of the abovementioned issuances are clear and unambiguous. A cardinal rule in statutory construction is that when the law is clear and free from any doubt or ambiguity, there is no room for construction or interpretation. There is only room for application.[25] As the provisions are clear, plain, and free from ambiguity, they must be given their literal meaning and applied without attempted interpretation. This is what is known as the plain meaning rule, as expressed in the maxim, verba legis non est recedendum, or from the words of a statute there should be no departure.[26]
5.6 The amount/rate of the individual CNA Incentive:5.6.1 Shall not be pre-determined in the CNAs or in the supplements thereto since it is dependent on savings generated from cost-cutting measures and systems improvement, and also from improvement of productivity and income in GOCCs and GFIs;5.6.2 Shall not be given upon signing and ratification of the CNAs or supplements thereto, as this gives the CNA Incentive the character of the CNA Signing Bonus which the Supreme Court has ruled against for not being a truly reasonable compensation (Social Security System vs. Commission on Audit, 384 SCRA 548, July 11, 2002);5.6.3 May vary every year during the term of the CNA, at rates depending on the savings generated after the signing and ratification of the CNA[.]x x x x
5.7 The CNA Incentive for the year shall be paid as a one-time benefit after the end of the year, provided that the planned programs/activities/projects have been implemented and completed in accordance with the performance targets for the year.
x x x x
7.0 Funding Source
7.1 The CNA Incentive shall be sourced solely from savings from released Maintenance and Other Operating Expenses (MOOE) allotments for the year under review, still valid for obligation during the year of payment of the CNA, subject to the following conditions:7.1.1 Such savings were generated out of cost-cutting measures identified in the CNAs and supplements thereto;7.1.2 Such savings shall be reckoned from the date of signing of the CNA and supplements thereto;x x x x
7.3 GOCCs/GFIs and LGUs may pay the CNA Incentive from savings in their respective approved corporate operating budgets or local budgets. (Emphasis supplied)
SEC. 20. Agrarian Reform Fund. — As provided in Proclamation No. 131 dated July 22, 1987, a special fund is created, known as The Agrarian Reform Fund, an initial amount of FIFTY BILLION PESOS (P50 billion) to cover the estimated cost of the CARP from 1987 to 1992 which shall be sourced from the receipts of the sale of the assets of the Asset Privatization Trust (APT) and receipts of sale of ill-gotten wealth recovered through the Presidential Commission on Good Government and such other sources as government may deem appropriate. The amount collected and accruing to this special fund shall be considered automatically appropriated for the purpose authorized in this Order.Considering that the CARP Fund is a special trust fund, the ruling of the Court in Confederation of Coconut Farmers Organizations of the Philippines, Inc. v. Aquino III,[27] thus, finds application in this case, viz.:
SEC. 21. Supplemental Appropriations. — The amount of TWO BILLION SEVEN HUNDRED MILLION PESOS (P2.7 billion) is hereby appropriated to cover the supplemental requirements of the CARP for 1987, to be sourced from the receipts of the sale of ill-gotten wealth recovered through the Presidential Commission on Good Government and the proceeds from the sale of assets by the APT. The amount collected from these sources shall accrue to The Agrarian Reform Fund and shall likewise be considered automatically appropriated for the purpose authorized in this Order.
R.A. No. 6657
SEC. 63. Funding Source. — The initial amount needed to implement this Act for the period often (10) years upon approval hereof shall be funded from the Agrarian Reform Fund created under Sections 20 and 21 of Executive Order No. 229.
Additional amounts are hereby authorized to be appropriated as and when needed to augment the Agrarian Reform Fund in order to fully implement the provisions of this Act.
Sources of funding or appropriations shall include the following:
(a) Proceeds of the sales of the Assets Privatization Trust;
(b) All receipts from assets recovered and from sales of ill-gotten wealth recovered through the Presidential Commission on Good Government;
(c) Proceeds of the disposition of the properties of the Government in foreign countries;
(d) Portion of amounts accruing to the Philippines from all sources of official foreign grants and concessional financing from all countries, to be used for the specific purposes of financing production credits, infrastructures, and other support services required by this Act;
(e) Other government funds not otherwise appropriated.
All funds appropriated to implement the provisions of this Act shall be considered continuing appropriations during the period of its implementation. (Emphases supplied)
The revenue collected for a special purpose shall be treated as a special fund to be used exclusively for the stated purpose. This serves as a deterrent for abuse in the disposition of special funds. The coconut levy funds are special funds allocated for a specific purpose and can never be used for purposes other than for the benefit of the coconut farmers or the development of the coconut industry. Any attempt to appropriate the said funds for another reason, no matter how noble or beneficial, would be struck down as unconstitutional. (Emphasis supplied)Even petitioner admits that the CARP Fund is a special trust fund,[28] but he insists that the purpose of the CARP Fund may be broadened to include the grant of incentives to employees who play an integral role in the achievement of the CARP's objectives. While the Court recognizes the employees' indispensable part in the implementation of agrarian reforms, it cannot legally uphold the grant of incentives financed by the wrong source for to do so would lead to an abhorrent situation wherein the sources of funds for bonuses or incentives depend upon the whims and caprice of superior officials in blatant disregard of the laws which they are supposed to implement. In addition, it must be emphasized that the primary purpose of the CNA Incentive is to recognize the joint efforts of labor and management in the achievement of planned targets, programs and services at lesser cost. On the other hand, the CARP Fund is intended to support the State's policy of social justice which includes the adoption of "an agrarian reform program founded on the right of farmers and regular farmworkers, who are landless, to own directly or collectively the lands they till or, in the case of other farmworkers, to receive a just share of the fruits thereof."[29] The two serve very different purposes. The CNA Incentive is conditional as it is made to depend upon the availability of savings from operating expenses; whereas, the CARP Fund is derived from multiple sources of funding to ensure continued implementation of the agrarian reform program. In fact, the legislature deemed it proper to specifically state that "all funds appropriated to implement the provisions of [R.A. No. 6657] shall be considered continuing appropriations during the period of its implementation."[30] DARPO-Cavite's reliance on the opinion of former DBM Secretary Andaya, Jr. that "the use of CARP Fund for CNA is allowable provided that the conditions for the granting of the same (under [DBM] Budget Circular No. 2006-1 dated February 1, 2006) are complied with,"[31] is not only wrong but also inexcusable. DARPO-Cavite could not feign ignorance of PSLMC Resolution No. 4, Series of 2002, A.O. No. 135 and DBM Budget Circular No. 2006-01, the three issuances that govern the grant of CNA Incentive. Further, even former DBM Secretary Andaya, Jr. impliedly declared that DBM Budget Circular No. 2006-1 should prevail over his opinion on the matter.
All recipients of the disallowed incentives should refund the same |
Hence, it can be gleaned that unlike ordinary monetary benefits granted by the government, CNA Incentives require the participation of the employees who are the intended beneficiaries. The employees indirectly participate through the negotiation between the government agency and the employees' collective negotiation representative and directly, through the approval of the CNA by the majority of the rank-and-file employees in the negotiating unit. Thus, the employees' participation in the negotiation and approval of the CNA, whether direct or indirect, allows them to acquire knowledge as to the prerequisites for the valid release of the CNA Incentive. They could not feign ignorance of the requirement that CNA Incentive must be sourced from savings from released MOOE.Rule XII
COLLECTIVE NEGOTIATIONS
SEC. 1. Subject of negotiation. - Terms and conditions of employment or improvements thereof, except those that are fixed by law, may be the subject of negotiation.
SEC. 2. Negotiable matters. - The following concerns may be the subject of negotiation between the management and the accredited employees' organization:
x x x x
(m) CNA incentive pursuant to PSLMC Resolution No. 4, s. 2002 and Resolution No. 2, s. 2003[.]
x x x x
SEC. 4. Effectivity of CNA. - The CNA shall take effect upon its signing by the parties and ratification by the majority of the rank-and-file employees in the negotiating unit.
SEC. 103. General liability for unlawful expenditures. Expenditures of government funds or uses of government property in violation of law or regulations shall be a personal liability of the official or employee found to be directly responsible therefor.Finally, the payees received the disallowed benefits with the mistaken belief that they were entitled to the same. If property is acquired through mistake or fraud, the person obtaining it is, by force of law, considered a trustee of an implied trust for the benefit of the person from whom the property comes.[39] A constructive trust is substantially an appropriate remedy against unjust enrichment. It is raised by equity in respect of property, which has been acquired by fraud, or where, although acquired originally without fraud, it is against equity that it should be retained by the person holding it.[40] In fine, the payees are considered as trustees of the disallowed amounts, as although they committed no fraud in obtaining these benefits, it is against equity and good conscience for them to continue holding on to them.