G.R. No. 129064 November 29, 2000
JUAN A. RUEDA, JR., petitioner, vs. HONORABLE SANDIGANBAYAN and PEOPLE OF THE PHILIPPINES, respondents.

FACTS

Petitioner Juan A. Rueda, Jr., the Municipal Treasurer of Tigaon, Camarines Sur, was charged with malversation of public funds under Article 217 of the Revised Penal Code. An audit for the period February 8 to September 20, 1989, revealed a cash shortage of P107,299.02 in his accountabilities. He signed the audit report certifying the correctness of the stated accountability. Upon formal demand, he failed to produce the missing funds or submit a written explanation. The Sandiganbayan convicted him, finding that the audit established a prima facie case of malversation.
In his defense, Rueda claimed the shortage resulted from unliquidated cash advances taken by municipal officials and employees from collectors before remittance, evidenced by “chits” or “vales,” and from legitimate municipal expenses covered by disbursement vouchers. He asserted he did not present these documents during the COA audit as internal auditors advised they would be disallowed for lack of supporting papers. He later completed the documents, and the amounts were credited as restitution of his shortage before the preliminary investigation.

ISSUE

Whether the Sandiganbayan erred in convicting petitioner of malversation of public funds.

RULING

The Supreme Court affirmed the conviction. The legal logic rests on the prima facie presumption of malversation under Article 217 of the Revised Penal Code. When a public officer accountable for public funds fails to have them forthcoming upon demand, and cannot provide a satisfactory explanation, the law presumes they have appropriated the funds for personal use. Here, the audit established a shortage, and Rueda failed to produce the funds or give a valid written explanation upon demand. His defense of unliquidated cash advances and expenses was correctly rejected by the Sandiganbayan. The purported supporting documents were not presented during the audit to officially account for the funds. His subsequent “restitution” does not extinguish criminal liability, as the crime was consummated upon the shortage and his failure to explain. The defense of good faith was unavailing; as municipal treasurer, he had a strict duty to safeguard funds and ensure proper documentation for all transactions. His tolerance of an irregular practice of granting cash advances without proper procedure constituted gross negligence, making him liable for the shortage. The penalty imposed by the Sandiganbayan was within the range prescribed by law.