G.R. No. 159794 December 19, 2006
MACLARING M. LUCMAN, in his capacity as the Manager of the LAND BANK OF THE PHILIPPINES, Marawi City, petitioner, vs. ALIMATAR MALAWI, ABDUL-KHAYER PANGCOGA, SALIMATAR SARIP, LOMALA CADAR, ALIRIBA S. MACARAMBON and ABDUL USMAN, respondents.

FACTS

Respondents were incumbent Punong Barangays whose barangays experienced a failure of elections in May 1997. Consequently, they continued in a holdover capacity pursuant to law. The Land Bank of the Philippines (LBP), Marawi City, became the new depositary for their Internal Revenue Allotment (IRA). Petitioner Lucman, as LBP Manager, required respondents to present a Municipal Accountant’s Advice, per Commission on Audit (COA) Circular No. 94-004, to withdraw funds. Respondents complied but were still refused withdrawal. Subsequently, five other persons presented certifications from DILG-ARMM officials claiming to be the newly proclaimed Punong Barangays. Without verifying these certifications, petitioner released the IRA for the second and third quarters of 1997 to these third parties. Respondents then filed a petition for mandamus to compel petitioner to allow them to withdraw their barangays’ IRA.

ISSUE

Whether petitioner, as bank manager, acted with grave abuse of discretion in releasing the IRA funds to third parties without proper verification, thereby justifying the grant of mandamus to compel payment to the rightful holdover officials.

RULING

Yes. The Supreme Court affirmed the decisions of the lower courts granting the writ of mandamus. The legal logic rests on the nature of a bank’s duty and the petitioner’s ministerial duty under the circumstances. A bank, acting as a depositary, is bound to deliver the deposit only to the persons authorized to receive it. Petitioner failed in this duty. The certifications presented by the third parties were not sufficient to establish their authority, as they were not the certifications required by the pertinent COA Circular and the Government Accounting and Auditing Manual. The required certification must come from the Commission on Elections, not the DILG. Petitioner’s act of releasing the funds based on unverified and insufficient documents constituted gross negligence. Meanwhile, respondents, as holdover officials, were the lawful custodians entitled to the IRA. Mandamus lies to compel the performance of a ministerial duty. Petitioner’s duty to release the funds to the lawful holders was ministerial once respondents established their authority and complied with the necessary requirements. His refusal, based on an improper insistence on an Accountant’s Advice which was not the sole governing rule for fund release, and his subsequent wrongful release to impostors, warranted judicial compulsion. The Court upheld the order for petitioner to pay the IRA amounts directly to the respondents.