G.R. No. 253688, February 8, 2023.
MEHOL K. SADAIN, PETITIONER, VS. OFFICE OF THE OMBUDSMAN, RESPONDENT.

FACTS

The case stemmed from the utilization of the Priority Development Assistance Fund (PDAF) allocated to then Senator Gregorio B. Honasan II, channeled through the National Commission on Muslim Filipinos (NCMF) as the implementing agency. On April 23, 2012, the Department of Budget and Management issued a Special Allotment Release Order (SARO) for P30 Million for livelihood projects. On June 5, 2012, Senator Honasan requested that Focus on Development Goals Foundation, Inc. (Focus) be designated as the partner NGO. Petitioner Mehol K. Sadain, then Secretary of the NCMF, along with other NCMF officials and the Office of Senator Honasan, executed an undated Memorandum of Agreement. Pursuant to this, the NCMF released P29.1 Million (90%) to Focus. The Commission on Audit (COA) audited the transaction and found that Focus was handpicked without the required competitive public bidding, violating COA Circular No. 2007-001 and Government Procurement Policy Board (GPPB) Resolution No. 12-2007. The Field Investigation Office of the Office of the Ombudsman filed a complaint for Grave Misconduct and Conduct Prejudicial to the Best Interest of the Service against petitioner and other officials for giving unwarranted benefits to Focus. The Ombudsman found petitioner guilty and meted the penalty of dismissal. The Court of Appeals affirmed the Ombudsman’s decision.

ISSUE

Whether the Ombudsman and the Court of Appeals correctly found petitioner guilty of Grave Misconduct and Conduct Prejudicial to the Best Interest of the Service for awarding a government contract and releasing funds to an NGO without public bidding.

RULING

Yes. The Supreme Court denied the petition and affirmed the findings of the Ombudsman and the Court of Appeals. The Court held that petitioner disregarded established procurement rules. GPPB Resolution No. 12-2007 and Section 53(j) of the Implementing Rules and Regulations of Republic Act No. 9184 (the Government Procurement Reform Act) required that when an appropriation law specifically earmarks funds for projects to be contracted to NGOs, the procuring entity must select the NGO through competitive public bidding or negotiated procurement. The General Appropriations Act of 2012 did not specifically appropriate funds for Focus, thus a public bidding was mandatory. Petitioner’s act of awarding the contract and releasing 90% of the funds to Focus based solely on the Senator’s endorsement, without public bidding, constituted a clear violation of these rules. This intentional violation of the law and disregard of established rules constitutes Grave Misconduct. Furthermore, his failure to exercise due diligence, resulting in the illegal disbursement of public funds, tarnished the integrity of his public office, constituting Conduct Prejudicial to the Best Interest of the Service. The Court rejected petitioner’s defense of having conducted an accreditation process, as this did not substitute for the required public bidding and selection process, and noted that the disbursement voucher and check were prepared even before Focus was formally informed of its qualification.