G.R. No. 253117 . March 29, 2022
RONALD S. ABRIGO, ANABELLA S. ALTUNA, RYAN JAMES V. AYSON, FLORENDO B. BATASIN, JR., LEONOR C. CLEOFAS, ALL OF WHOM WERE OFFICERS AND EMPLOYEES OF METROPOLITAN WATERWORKS AND SEWERAGE SYSTEM CORPORATE OFFICE [MWSS-CO], PETITIONERS, VS. COMMISSION ON AUDIT (COA)­COMMISSION PROPER; RUFINA S. LAQUINDANUM, DIRECTOR IV, CORPORATE GOVERNMENT SECTOR CLUSTER 3-PUBLIC UTILITIES; EYREN MARANAN­-YULDE, IN HER CAPACITY AS MWSS-CO RESIDENT COA AUDITOR; AND ANGELA B. BULOS, AUDIT TEAM LEADER, RESPONDENTS.

FACTS

Petitioners are current and former officials and employees of the Metropolitan Waterworks and Sewerage System-Corporate Office (MWSS-CO). In 2012 and 2013, they approved and/or received meal allowances pursuant to board resolutions of the MWSS Board of Trustees. The Commission on Audit (COA) issued four Notices of Disallowance (NDs) against these payments, totaling P8,173,730.00. The COA disallowed the payments on the grounds that: (1) for employees who were incumbents as of June 30, 1989, the amounts paid exceeded the P66.00 per month meal allowance authorized in the DBM-approved Corporate Operating Budget; and (2) for non-incumbents as of that date, there was no legal basis to grant any meal allowance at all. Petitioners appealed, arguing that the MWSS Charter grants the Board autonomy to provide benefits, that the meal allowance was an existing fringe benefit recognized in the Concession Agreements approved by the President, and that its discontinuance would constitute diminution of pay. The COA Cluster Director and later the COA Proper denied the appeals. The COA Proper ruled the appeal was filed beyond the reglementary period and, on the merits, that the grant and increase of the meal allowance lacked the required legal basis and prior approvals. Petitioners filed a petition for certiorari with the Supreme Court, which they admitted was filed 18 days late, citing pandemic-related difficulties.

ISSUE

Whether the COA Proper committed grave abuse of discretion in denying petitioners’ appeal for having been filed out of time and for lack of merit.

RULING

The petition is partly granted. The Supreme Court ruled that while the petition for certiorari was indeed filed out of time, strong considerations of substantive justice warranted a relaxation of the procedural rules. On the merits, the Court upheld the COA’s disallowance. It held that the grant and increase of the meal allowance had no legal basis. The authority of the MWSS Board is not absolute and must conform to existing laws and rules on compensation. Republic Act No. 6758 (the Compensation Standardization Law) integrated all allowances into the standardized salary, with certain exceptions requiring explicit authorization. The meal allowance for incumbents as of June 30, 1989 was allowed only up to the P66.00 monthly rate specified in the DBM-approved budget; any excess was disallowed. For non-incumbents, there was no legal basis for the grant at all. The reference to meal allowance in the MWSS Concession Agreements applied only to employees absorbed by the private concessionaire, not to remaining government employees like petitioners. The defense of good faith was rejected for the approving/certifying officers, as they were charged with knowledge of the budget and prior COA disallowances. However, the Court ruled that passive payees (recipients who did not approve the disbursements) need not refund the disallowed amounts, as they received the allowances in good faith. The liability to refund rests solely with the approving/certifying officers.