G.R. No. 230931 , November 15, 2021
NAVOTAS INDUSTRIAL CORPORATION, PETITIONER, VS. ALBERTO C. GUANZON, RESPONDENT.

FACTS

Navotas Industrial Corporation (Navotas Industrial) had a monetary claim against Ganda Energy and Holdings Inc. (Ganda Energy). Knowing Ganda Energy had receivables from the National Power Corporation (NPC), Navotas Industrial requested NPC in 2000 to withhold payment to Ganda Energy and instead release it to Navotas Industrial. NPC declined, citing a policy against releasing payments to third parties without the contractor’s express authorization or a court order. In March 2003, purported representatives of Ganda Energy, namely Kay Swee Tuan of S.T. Kay & Company and Nora Go, presented a letter of authority allegedly signed by a Ganda Energy director to collect NPC’s payments. Based on this, and on a memorandum prepared by respondent Alberto C. Guanzon, then chair of NPC’s Committee on Contract Expiration on Insurance Capacities, recommending approval of the payment, NPC released Ganda Energy’s receivables amounting to millions to Kay Swee Tuan. A subsequent National Bureau of Investigation probe found the authorization letter to be spurious. The Office of the Ombudsman found Guanzon guilty of Grave Misconduct for recommending the payment to an unauthorized party despite knowledge of Navotas Industrial’s claim. The Court of Appeals initially affirmed this but later, in an Amended Decision, exonerated Guanzon, relying on the presumption of good faith. Navotas Industrial filed the present petition.

ISSUE

Whether or not there is substantial evidence to hold respondent Alberto C. Guanzon administratively liable for grave misconduct.

RULING

Yes. The Supreme Court granted the petition and reversed the Court of Appeals’ Amended Decision. The Court found substantial evidence to hold Guanzon liable for Grave Misconduct. The elements of misconduct are present: the unlawful act or omission is connected to the performance of his official duties, and it was intentional, involving a willful intent to violate the law or disregard established rules. Guanzon, as a public officer, had a duty to ensure that public funds were released only to duly authorized persons. His deliberate recommendation for the release of NPC funds to Kay Swee Tuan, despite knowing that Ganda Energy had other creditors (specifically, Navotas Industrial) and in the absence of a board resolution from Ganda Energy authorizing the representatives—a standard requirement for juridical entities—constituted a willful disregard of established rules and procedures. This failure to discharge his duties amounted to Grave Misconduct, which implies a wrongful intention and not a mere error of judgment. The presumption of good faith was sufficiently overturned by the evidence on record.