5. ALBERT vs.

COA

G.R. No. 126557 March 6, 2001

Facts: The National Home Mortgage Finance Corporation (NHMFC) issued a letter
of guaranty in favor of Severio H. Gonzales Construction Corporation Inc. (SHGCCI).
Due to the assurance that the project is above board and in accordance with the
NHMFC-CMP guidelines, petitioner approved the payment to SHGCCI. Upon
verification, it was discovered that the project was three months in arrears in their
amortization. As a consequence, petitioner tasked the Committee on Evaluation to
investigate.

Issue: Whether or not COA committed grave abuse of discretion when it held
petitioner liable for the payment of the loan.

Ruling: Yes. The actions taken by petitioner involved the very functions he had to
discharge in the performance of official duties. He cannot, therefore, be held civilly
liable for such acts unless there is a clear showing of bad faith, malice or gross
negligence. Inasmuch as no evidence was presented to show that petitioner acted in
bad faith and with gross negligence in the performance of his official duty, he is
presumed to have acted in the regular performance of his official duty. Similarly, it is
a basic tenet of due process that the decision of a government agency must state the
facts and the law on which the decision is based. The COA decision merely stated
conclusions of law. Facts and circumstances, as well as the whys, the whats and the
hows of the disallowance, were patently missing, inaccurate or incomplete. The COA
cannot just perform its constitutional function of disallowing expenditures of
government funds at sheer discretion. There has to be factual basis why the
expenditure is alleged to be fraudulent or why was there a misrepresentation.

Comment: I agree with the decision of the Supreme Court. The Commission on
Audit committed grave abuse of discretion when it held petitioner liable for the
payment of the loan since the decision was just based merely on conclusions of law
and not on factual and legal basis. Every person is entitled to the due process of law
before being held liable for a certain crime or offense. As in this case, petitioner’s
right to due process was denied for being held liable by COA simply because he is the
head of the government agency concerned. The acts of a head of a government
agency are indeed vital in the proper functioning of the government agency being
headed by him. He is the one in charge of the actions of his subordinates, but that
doesn’t mean that he will always be liable for the wrong committed by his
subordinates, because subordinates can act on their own and therefore have the
choice to disobey their heads or superiors.