G.R. No. 230679 and G.R. Nos. 232228-30, February 10, 2021
THE OFFICE OF THE OMBUDSMAN AND THE DEPARTMENT OF INTERIOR AND LOCAL GOVERNMENT, PETITIONERS, VS. REXLON T. GATCHALIAN, RESPONDENT. / PEOPLE OF THE PHILIPPINES, PETITIONER, VS. REXLON T. GATCHALIAN, RENCHI MAY M. PADAYAO AND EDUARDO Y. CARREON, RESPONDENTS.

FACTS

On 13 May 2015, a fire at Kentex Manufacturing Corporation in Valenzuela City resulted in 74 deaths and multiple injuries. An Inter-Agency Anti-Arson Task Force (IATF) investigation found the immediate cause was the storage of a blowing agent near welding activities and a lack of fire exits. Kentex had been issued Business Permits by Valenzuela City for 2014 and 2015 despite lacking a Fire Safety Inspection Certificate (FSIC) for those years. The Business Permit for 2015 was issued upon the recommendation of Eduardo Carreon (Licensing Officer IV) and signed by Atty. Renchi May Padayao (OIC, Business Permits and Licensing Office) for Mayor Rexlon T. Gatchalian. The Ombudsman found Mayor Gatchalian, Atty. Padayao, and Carreon administratively liable for Grave Misconduct and Gross Neglect of Duty and ordered their dismissal. It also found probable cause to indict them criminally for violation of Section 3(e) and (j) of R.A. No. 3019 and for Reckless Imprudence Resulting in Multiple Homicides and Multiple Physical Injuries. Mayor Gatchalian filed a Petition for Certiorari under Rule 65 (not a Petition for Review under Rule 43) before the Court of Appeals (CA) to challenge the administrative ruling. The CA granted the petition and reversed the Ombudsman’s finding of administrative liability. Meanwhile, the criminal cases filed before the Sandiganbayan were dismissed for lack of probable cause. The Ombudsman and the Department of Interior and Local Government (DILG) assailed the CA’s administrative ruling in G.R. No. 230679 . The People, through the Office of the Special Prosecutor, assailed the Sandiganbayan’s dismissal of the criminal cases in G.R. Nos. 232228-30.

ISSUE

1. Whether Mayor Gatchalian correctly filed a Petition for Certiorari under Rule 65 instead of a Petition for Review under Rule 43 of the Rules of Court to challenge the Ombudsman’s decision.
2. Whether Mayor Gatchalian is administratively liable for grave misconduct and gross neglect of duty for the issuance of business permits to Kentex despite the absence of FSICs.
3. Whether the Sandiganbayan gravely erred in dismissing the criminal cases based on local ordinances and issuances against the mandate of the national Fire Code and in supplanting the Ombudsman’s finding of probable cause.

RULING

1. On the procedural issue: The petitions lack merit. The Court found it unnecessary to rule definitively on the propriety of the Petition for Certiorari, as the substantive issues were already before it. The Court noted that the Ombudsman and DILG did not timely challenge the CA’s issuance of a temporary restraining order and writ of injunction.
2. On administrative liability: The Court upheld the CA’s ruling and found Mayor Gatchalian NOT administratively liable. The Court ruled there was no substantial evidence to prove grave misconduct or gross neglect of duty. Mayor Gatchalian’s approval of the business permits was a ministerial act based on the recommendation of his subordinates and in accordance with existing local ordinances (specifically Valenzuela City Ordinance No. 62, Series of 2012) and a Joint Memorandum Circular which had adopted a “checklist approach” for business permit applications. Under this system, the absence of an FSIC was not a ground for automatic denial if the applicant submitted other required documents, such as a Barangay Clearance and a Fire Safety Evaluation Clearance. The Court found no proof of bad faith, malice, or gross negligence amounting to malice on the part of Mayor Gatchalian.
3. On criminal liability: The Court upheld the Sandiganbayan’s dismissal of the criminal cases for lack of probable cause. The Sandiganbayan did not err in considering local ordinances and issuances, as these were the operative rules followed by the city officials at the time. The Court agreed that the officials acted in good faith reliance on these existing procedures. The Sandiganbayan did not supplant the Ombudsman’s finding but correctly performed its duty to independently assess whether probable cause existed for issuing warrants of arrest. The evidence did not establish that the officials’ acts in issuing the permits were the proximate cause of the fire; the proximate cause was identified as the specific unsafe acts (welding near flammable material) and conditions within the Kentex premises.