GR 183161; (December, 2014) (Digest)
G.R. No. 183161, December 3, 2014
Office of the Ombudsman, Petitioner, vs. Amalio A. Mallari, Respondent.
FACTS
ECOBEL Land, Inc. applied for a surety bond with the Government Service Insurance System (GSIS) to guarantee a US$10,000,000.00 loan. Alex M. Valencerina, GSIS Vice-President, submitted the bond application via a memorandum to the GSIS Investment Committee (INCOM), stating the project was “viable” and “fully secured.” The memorandum was coursed through respondent Amalio A. Mallari, then Senior Vice-President of the GSIS General Insurance Group (GIG), who endorsed it with the note “Strongly reco. based on info and collaterals herein stated.” The INCOM approved the application. On March 11, 1998, GSIS issued the surety bond, signed by Mallari on behalf of GSIS GIG. The major collateral submitted, a land title, was later discovered to be spurious. The bond was cancelled by GSIS on February 12, 1999. Despite this, a certification of its validity was later issued by Valencerina and Fernando U. Campana, and ECOBEL obtained a loan using the bond. The Office of the Ombudsman found Mallari administratively liable for Grave Misconduct and imposed the penalty of dismissal. The Court of Appeals reversed, exonerating Mallari.
ISSUE
Whether the Court of Appeals erred in exonerating respondent Amalio A. Mallari from the administrative charge of Grave Misconduct.
RULING
The Supreme Court DENIED the petition and AFFIRMED the Court of Appeals decision exonerating Amalio A. Mallari. The Court held that the Office of the Ombudsman’s finding of Grave Misconduct was not supported by substantial evidence. Mallari’s act of endorsing the bond application and signing the issued bond, based on the evaluation and approval of the GSIS Investment Committee and the representations of his subordinates, did not constitute a willful intent to violate the law or a flagrant disregard of established rules. The Court found no evidence that Mallari acted with corruption, clear intent to violate the law, or conscious disregard for his duties. The subsequent fraudulent use of the bond occurred after Mallari had been reassigned to a different department. The administrative charge must be proven by substantial evidence, which was lacking in this case.