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WINSTON F. GARCIA, as President and General Manager of the GSIS, Petitioner, vs. COURT OF APPEALS and RUDY C. TESORO, Respondents.
FACTS
The Government Service Insurance System (GSIS) conducted a public bidding for the construction of its Iloilo City Field Office building. The Bids and Awards Committee (BAC) declared Embrocal Builders, Inc. as the winning bidder. Respondent Rudy C. Tesoro, then the Senior Vice-President of the Field Operations Group (SVP-FOG), approved the award and signed the corresponding construction contract and disbursement voucher for the mobilization fee. Subsequently, petitioner Winston F. Garcia, GSIS President, reassigned Tesoro to another position. An internal investigation was then initiated, prompted by protests from losing bidders and observations from the Commission on Audit regarding alleged irregularities in the bidding process and the release of funds.
Following the investigation, GSIS filed administrative charges against Tesoro for Gross Neglect of Duty and Grave Misconduct, alleging he approved the contract despite Embrocal not being the lowest bidder and authorized the mobilization fee payment without proper authority. The GSIS Board of Trustees found Tesoro guilty and dismissed him from service. Tesoro appealed to the Court of Appeals (CA), which granted his petition. The CA ruled that the GSIS Board acted without jurisdiction, as the power to discipline Tesoro, a presidential appointee, was vested solely in the GSIS President and General Manager. The CA annulled the dismissal and ordered Tesoro’s reinstatement.
ISSUE
Whether the Court of Appeals erred in ruling that the GSIS Board of Trustees lacked jurisdiction to discipline respondent Rudy C. Tesoro.
RULING
The Supreme Court denied the petition and affirmed the CA’s decision. The legal logic centers on the specific statutory grant of disciplinary authority under Republic Act No. 8291, the GSIS Act of 1997. Section 45 of this law explicitly vests the power to appoint and remove GSIS personnel, in accordance with Civil Service rules, in the GSIS President and General Manager, subject only to the approval of the Board of Trustees. The Court emphasized that this provision is a special law that governs the GSIS’s internal administration. Jurisprudence establishes that the power to appoint carries with it the power to remove or discipline. Since the President and General Manager holds the appointing authority for GSIS personnel, the concomitant disciplinary authority is also vested in him, not in the Board. The Board’s role is limited to approval. Therefore, the Board acted without jurisdiction when it directly initiated and decided the administrative case against Tesoro. The proper disciplining authority was the GSIS President. The Court upheld the CA’s reinstatement order, as the void proceedings conducted by the Board produced no legal effect.
