A.M. No. 2519-MJ September 10, 1981
Esther Montemayor, petitioner, vs. Judge Francisco Collado, respondent.

FACTS

Complainant Esther Montemayor, representing the plaintiff in an ejectment case (Civil Case No. 1298) pending before respondent Municipal Judge Francisco Collado of San Fernando, La Union, discovered that the accrued monthly rentals deposited by the defendant, totaling P42,000.00, were in the personal possession of the judge and had not been turned over to the Municipal Treasurer. Upon this discovery, complainant, through counsel, formally requested in February and March 1981 that the funds be transferred to the Municipal Treasurer’s custody for safekeeping, citing the lack of secure facilities in the court. Respondent judge initially promised to make the deposit by April 15, 1981.
When the judge failed to comply by the promised date, complainant sent a telegram on April 27, 1981, giving him until May 11 to deposit the money, warning of a report to the Supreme Court. Instead of complying, respondent judge issued an order denying the request for transfer, arguing that the disposition of the deposit was at the option of the depositing defendant, who objected to the transfer. He later evaded a subsequent motion to withdraw the rentals by stating it would be resolved in the final decision of the case.

ISSUE

Whether respondent Judge Francisco Collado is administratively liable for his refusal to deposit court-held funds with the Municipal Treasurer as required by law.

RULING

Yes, respondent judge is administratively liable. The Supreme Court found his actions constituted serious misconduct and gross ignorance of the law. Section 93 of Republic Act No. 296 (The Judiciary Act of 1948) mandatorily requires that all trust or depository funds paid into municipal courts “shall be received by the municipal or city treasurer.” The Court emphatically rejected the judge’s defense that the money was a “private deposit” whose disposition required the defendant’s consent. Having accepted the rental deposits in connection with a case pending in his court, the funds became official trust funds subject to the statutory mandate for immediate turnover to the municipal treasurer, the lawful custodian.
The Court ruled that the judge’s obstinate refusal to deposit the funds, despite repeated lawful demands and his own promise, was a devious excuse to retain possession. This conduct raised grave suspicions of possible misuse or misappropriation, severely undermining public confidence in his integrity and the judiciary. A judge’s conduct must be beyond reproach and above suspicion. By flouting a clear legal duty and placing substantial funds at risk, respondent committed grave misfeasance. The Court deemed the record sufficient for adjudication, dispensing with a formal investigation. Consequently, Judge Francisco Collado was dismissed from service with forfeiture of all retirement benefits and with prejudice to reinstatement in any government office. He was also ordered to deposit the funds with the Municipal Treasurer within 48 hours.