G.R. No. 255074, May 14, 2024
NILDA LAGUNA SALAZAR, PETITIONER, VS. COMMISSION ON AUDIT (COA), AND MA. MILEGUAS M. LEYNO, IN HER CAPACITY AS REGIONAL DIRECTOR OF COMMISSION ON AUDIT REGION III, RESPONDENTS.

FACTS

The Municipality of Mayantoc, Tarlac entered into a Contract Agreement with JQG Construction and Supplies for the construction of the Mayantoc Memorial Park. After a public bidding, JQG Construction was declared the bidder with the lowest calculated responsive bid. The Sangguniang Bayan ratified the bidding process. The Municipal Mayor issued a Notice of Award and a Notice to Proceed. Subsequently, an audit team noted several deficiencies and requested the submission of documents. Due to incomplete submission, a Notice of Suspension was issued, followed by a Notice of Disallowance (ND No. 12-001-101(09)(10)) dated September 18, 2012, disallowing the payment of PHP 23,048,230.15 to JQG Construction. The grounds for disallowance included: 1) Non-submission of numerous required documents (e.g., unit cost breakdowns, approved network diagrams, change order documents, test results); 2) Violations of Republic Act No. 9184 and its Revised Implementing Rules and Regulations (RIRR), such as no procurement conference, non-posting of the Invitation to Bid on the PhilGEPS website and for the required period, non-payment of bidding documents by bidders, non-invitation of NGOs to observe, and payment of only 10% performance security instead of the required 30%; and 3) Failure to submit the final payment for pre-audit as required by COA Circular No. 2009-002. Petitioner Nilda L. Salazar, the Municipal Treasurer and a Bids and Awards Committee (BAC) Member, was among those held liable. She appealed to the COA Regional Office, which denied the appeal and affirmed the disallowance. She then filed a Petition for Review before the COA Proper, which was denied through Decision No. 2018-212. A Motion for Reconsideration was also denied through Resolution in Decision No. 2020-386. Petitioner then filed the present Petition for Certiorari.

ISSUE

Whether the Commission on Audit committed grave abuse of discretion in affirming the disallowance of the payment for the Mayantoc Memorial Park Project and in holding petitioner Nilda L. Salazar liable.

RULING

The Court DISMISSED the petition. The Commission on Audit did not commit grave abuse of discretion. The disallowance was proper due to substantial violations of procurement laws and rules. The Court found that the Bids and Awards Committee, of which petitioner was a member, failed in its duty to ensure compliance with Republic Act No. 9184 and its implementing rules. Specifically, the Invitation to Bid was not posted on the Philippine Government Electronic Procurement System (PhilGEPS) as mandatorily required by law, which is a fatal defect that renders the entire bidding process void. Other violations included the non-payment for bidding documents and the insufficient performance security. The Court ruled that all approving and certifying officers involved in the illegal transaction are liable for the disallowance. Petitioner, as a BAC member, participated in declaring JQG Construction as the winning bidder despite the noted deficiencies. The defense of good faith was not available because the violations were evident from the records. Petitioner, along with the other named officials, was held solidarily liable to refund the disallowed amount.