G.R. No. P-02-1597. February 17, 2003
Mary Grace G. Frias vs. Palermo Aguilar, Clerk III, RTC, Branch 46, San Jose, Occidental Mindoro

FACTS

Complainant Mary Grace G. Frias, manager of the San Jose Vendors Multi-Purpose Cooperative, filed an administrative complaint against respondent Palermo Aguilar, a Clerk III at the RTC, for willful failure to pay just debts under Presidential Decree No. 6. The complaint alleged that Aguilar obtained several loans from the cooperative in 1997 and 1998. As of December 2000, his total obligation, including accumulated interests and penalties, amounted to ₱63,244.96. Despite repeated demands and summons for barangay conciliation meetings, Aguilar refused to pay and failed to attend the scheduled settlement conferences.
In his Comment, Aguilar admitted the loans but explained his financial difficulties. He cited a decrease in income from his farming sideline due to weather problems and mounting family expenses, even risking foreclosure of his mortgaged house. He claimed he had offered to apply his capital share in the cooperative to his debt, but it was rejected. He also alleged that the cooperative was singling him out, as it did not file complaints against other delinquent borrowers. He offered to settle his obligations only when he could afford to do so.

ISSUE

Whether respondent Palermo Aguilar is administratively liable for willful failure to pay just debts.

RULING

Yes, the respondent is administratively liable. The Court agreed with the Office of the Court Administrator’s findings and recommendation. While Aguilar’s financial difficulties were acknowledged, they do not excuse him from his legal and moral duty to pay his just debts when they become due. His offer to pay only when his financial situation permits, coupled with his failure to attend barangay conciliation meetings, constitutes a willful refusal to pay.
The applicable law is Executive Order No. 292 (Revised Administrative Code of 1987). Under the implementing rules, a “just debt” includes claims the existence and justness of which are admitted by the debtor, which Aguilar conceded. Willful failure to pay such debts is a light offense. For a first offense, the prescribed penalty is reprimand. As a court employee, Aguilar must uphold high ethical standards, comply with contractual obligations, and act fairly to preserve the judiciary’s integrity. Accordingly, the Court reprimanded Aguilar and sternly warned that a repetition would be dealt with more severely.