Republic of the Philippines

SUPREME COURT
Manila

EN BANC

G.R. No. 81031 February 20, 1989

DR. ARTURO L. ALEJANDRO,

Rodolfo B. Fernandez for petitioner.

The Solicitor General for respondent.

PADILLA, J.:

This is a petition for review on certiorari of the decision ** of the Sandiganbayan, dated 30
July 1987, finding petitioner Dr. Arturo L. Alejandro guilty of the offense of violation of
Section 3(e) of R.A. 3019, known as the Anti-Graft and Corrupt Practices Act. The factual
background of the case is as follows:

Dr. Arturo L. Alejandro was the duly appointed officer-incharge (OIC) of the President
Ferdinand E. Marcos Emergency Hospital (FEMEH) in Diffun, Province of Quirino, from 20
March 1982 until his retirement from the service on 31 July 1982, or for a period of at least
four (4) months. The service record of the petitioner shows that he had been in the public
service since July 1942 until his retirement, serving the government for forty (40) long
years. He first worked at the Bayombong Hospital in Nueva Viscaya; thereafter, he was
made a resident physician of Mangan Hospital (now known as Ifugao Community Hospital).
He became the Chief of Itbayan Emergency Hospital in 1965-1971, Mayayao Emergency
Hospital in 1971-1975 and the Aglipay Emergency Hospital in 1975-1982.1

On 20 March 1982, while still the Chief of Aglipay Emergency Hospital, petitioner was
appointed as OIC of FEMEH. Petitioner held both positions concurrently, drawing his salary
from the Aglipay Emergency Hospital. He shuttled from one hospital to the other to attend
to and supervise both hospitals. 2

On 20 September 1982, thirty (30) employees of FEMEH filed a complaint against petitioner
Dr. Arturo L. Alejandro, Virgilio P. Bunao and Cesar R. Dupa, with the Office of the President,
alleging that during the term of petitioner as OIC of FEMEH, the hospital received an
allotment for the third quarter of 1982 (July, August and September) in the amount of P
93,950.00 for personnel services and P74,500.00 for maintenance and other operating
expenses. It is claimed that upon Petitioner's retirement on 30 July 1982, nothing was left of
the funds of the hospital with the bank except for the amount of P 168.00, as a result of
which, the employees of the hospital were not paid their salaries and allowances for the
second half of July and for the months of August and September 1982. 3
Acting on behalf of the President, the Ministry of National Defense referred the complaint to
the Tanodbayan for appropriate action. Pursuant to such referral, an investigation was
conducted by the NBI. After evaluating the evidence submitted, the Director of the NBI
made a recommendation for further investigation of the case on the ground that the specific
liabilities of the accused could not be ascertained due to the absence of vital evidence. 4

The Director of Regional Health Office No. 2 of Tuguegarao, Cagayan also ordered the
Regional Finance Officer and Accountant to conduct an investigation.

In an information dated 18 September 1985, petitioner Dr. Arturo L. Alejandro in his then
capacity as OIC of FEMEH, together with Virgilio P. Bunao and Cesar R. Dupa, in their
capacity as Administrative Officer and Bookkeeper of the hospital, respectively, were
charged with the crime of Technical Malversation before the Sandiganbayan, docketed as
Criminal Case No. 9721. 5

Subsequently, another information was filed against the same accused for violation of
Section 3(e) of the Anti-Graft and Corrupt Practices Act (R.A. No. 3019), docketed as
Criminal Case No. 10947. The information reads:

That during or between the period July 31, 1982 to September 30, 1982 in the Municipality
of Diffun, Quirino, Philippines, and within the jurisdiction of this Honorable Tribunal,
accused Dr. Arturo L. Alejandro, Chief of Hospital, Virgilio A. [sic] Bunao, Administrative
Officer, and Cesar R. Dupa, Bookkeeper, all of President Ferdinand E. Marcos District
Hospital of Diffun, Quirino Province, taking advantage of their public positions through
evident bad faith and/or gross inexcusable negligence, did then and there wilfully and
unlawfully disbursed [sic] P 116,283.49 for the maintenance and other operating expenses
(MOOE) when the third quarter 1982 allotment for the purpose was only P 74,500.00,
thereby incurring over-expenditure amounting to P 41,783.49 which latter amount was
taken from the P 93,950.00 intended for personnel services resulting in the non-payment of
the salaries, wages and allowances of employees of aforementioned hospital for the months
of July, August and September 1982, thereby causing undue injury and damage to the
employees of said hospital.

CONTRARY TO LAW. 6

It was established that two (2) finding checks were released in favor of the hospital in July
1982 for the third quarter of that same year in the amounts of P 93,950.00 and P74,500.00,
earmarked for personnel services and for maintenance and other operating expenses,
respectively.

Out of the P93,950.00 alloted for personnel services for the third quarter of 1982, the
amount of P45,389.93 was used for payment of the back salaries of the hospital employees
for the second quarter of 1982, and the amount of P7,610.00 was used to pay for the
salaries of the employees for the first half of July 1982. The remaining balance of
P40,950.07 was spent for maintenance and other operating expenses, as a consequence of
which, the hospital employees were not paid their salaries for the second half of July and for
the whole months of August and September 1982. The allotment for the third quarter of
1982 for personnel services as well as the fund reserved for maintenance and operating
expenses had already been used up before the end of the third quarter or as early as 26 July
1982.

On 27 October 1982, the Regional Health Office undertook payment of the salaries of the
employees of FEMEH for the remainder of the third quarter of 1982.

After joint hearing of the two (2) criminal cases against petitioner and his co-accused, the
Sandiganbayan rendered a decision 7 dated 30 July 1987, acquitting the accused of the
charge of Technical Malversation, holding that there was no proof of diversion of funds. As
to the criminal charge for violation of Section 3(e) of the Anti-Graft and Corrupt Practices
Act, the accused were found guilty thereof.

The dispositive part of the decision reads as follows:

WHEREFORE, in Criminal Case No. 10947, the Court finds the accused Dr. Arturo L.
Alejandro, Virgilio P. Bunao and Cesar R. Dupa GUILTY beyond reasonable doubt of the
offense of Violation of Sec. 3 (E) of R.A. 3019, otherwise known as the Anti-Graft and
Corrupt Practices Act, as approved on August 17, 1960. Appreciating in favor of the accused
the fact that the accused gave themselves up to the authorities voluntarily and, there being
no circumstances in aggravation of the offense, the Court sentences each and every one of
the aforesaid accused, namely, Dr. Arturo L. Alejandro, Virgilio P. Bunao and Cesar R. Dupa,
to the indeterminate penalty of imprisonment of, from ONE YEAR to THREE YEARS; to
perpetual disqualification from holding public office; and to pay proportionate costs.

No civil liability is adjudged in view of the fact that the offended parties were paid their
back salaries and allowances on October 27, 1982.

In Criminal Case No. 972 1, upon failure of proof beyond reasonable doubt, it is the
judgment of this Court that the accused should be, as they are, hereby ACQUITTED of the
offense of Technical Malversation herein charged, with costs de oficio.

The bail bonds posted by the accused for their temporary liberty in respect to this case is
ordered cancelled.

SO ORDERED. 8

A motion for reconsideration was filed by petitioner Dr. Arturo L. Alejandro and Cesar R.
Dupa, but the same was denied in a resolution dated 1 December 1987. 9 From the
aforequoted decision, petitioner filed the appeal at bar questioning his conviction for
alleged violation of Section 3(e) of the Anti-Graft and Corrupt Practices Act. It is the
contention of Petitioner that in signing the disbursing checks for July 1982, he did not
commit any act amounting to evident bad faith and/ or gross negligence for he never
derived any pecuniary benefit from said checks. He further argues that he never had
anything to do with the preparation or filling up of the material data in the checks and
vouchers, and that all that be did was to ministerially sign them after verifying that the
necessary signatures and approval of the administrative officer and the bookkeeper existed.
Good faith and lack of malice is a valid defense to the charge of violation of Sec. 3(e) of the
Anti-Graft and Corrupt Practices Act.

On the other hand, the public respondent through the Office of the Solicitor General, argues
that when the accused over-spent for maintenance and other operating expenses, utilizing
in the process funds allocated for personnel services, and thereby failed to pay the salaries
of hospital employees for the entire third quarter of 1982, causing damages to the latter, a
violation of Sec. 3(e) of the Anti-Graft and Corrupt Practices Act was committed; and that
petitioner's act amounted to a total abdication of duty and responsibility amounting to
gross negligence which rules out the defense of good faith. Sec. 3(e) of the Anti-Graft and
Corrupt Practices Act punishes any public officer for-

(e) Causing any undue injury to any party, including the Government, or giving any private
party any unwarranted benefits, advantage or preference in the discharge of his official
administrative or judicial functions through manifest partiality, evident bad faith or gross
inexcusable negligence. This provision shall apply to officers and employees of offices or
government corporations charged with the grant of licenses or permits or other
concessions.

In order that one may be held criminally liable under said section, the act of the accused
which caused undue injury must have been done with evident bad faith or with gross
inexcusable negligence. Gross negligence has been defined as negligence characterized by
the want of even slight care, acting or omitting to act in a situation where there is a duty to
act, not inadvertently but wilfully and intentionally with a conscious indifference to
consequences in so far as other persons may be affected. 10 It is the omission of that care
which even inattentive and thoughtless men never fail to take on their own property. 11

It has been established before the court a quo that in the disbursements of funds of the
hospital, a procedure had to be faithfully complied with. Upon filing of a Requisition and
Issue Voucher (RIV) the Administrative Officer must first certify that the expenditure is
necessary and lawful. The RIV is then sent to the Bookkeeper for certification as to the
availability of funds for the purpose. Only after the Chief of the Hospital has approved the
disbursement can the same be given due course. The check covering the disbursement
voucher has to be signed by the Chief of the Hospital and the Administrative Officer. 12

In case of refusal of any of said three (3) officials (i.e., Administrative Officer, Bookkeeper
and Chief of the Hospital) to sign the requisition and issue voucher (RIV) no fund could be
released for disbursement. The reason why each of these three (3) officials was required to
sign the RIV was to prevent any unofficial expenditure, in the disbursement of funds, each of
said official having a separate responsibility or obligation.

It was the responsibility of the Bookkeeper to inform the Chief of the hospital whether or
not there was an available fund from the allocated amount for a given expenditure. If there
was, he would issue a certification attached to the RIV upon its submission for approval to
the Chief of the Hospital. It was not, therefore, really the duty of the Chief of the hospital to
verify from the books of accounts of the hospital whether there was an available fund every
time a disbursement was needed for release. The same rule was also applied to the
Administrative Officer who was required to issue a certification to the effect that the
expenditure was necessary and lawful.

To impose criminal liability upon petitioner who was misled into giving his approval to a
particular disbursement on the basis of the Bookkeeper's certification that there was fund
available for said expenditure would be too harsh and inequitable (even if such fund turned
out to be unavailable).

Petitioner's reliance on the correctness of the certifications of the Bookkeeper and

It was also shown in the court a quo that transfer or "juggling" (if you may) of funds from
one quarter to a preceeding quarter had been practiced by the former Chief of the hospital
as early as 1978, and it was merely carried over during the term of herein petitioner.

Petitioner acted as OIC of the hospital for only about four (4) months, concurrently with his
position as Chief of the Aglipay Emergency Hospital. Considering that his duties as Chief of
both hospitals entailed a lot of responsibility not only on the management side but also in
the treatment of their patients, it is almost unreasonable to have expected petitioner to
directly and personally check the books of accounts of FEMEH to find out if indeed there
was an available fund from the allotted amount whenever a disbursement was submitted to
him for approval. His act of relying upon the Bookkeeper's certification to the effect that
there was an available fund for the disbursement sought to be approved cannot be
considered gross inexcusable negligence.

Moreover, one of the elements of the crime described in Sec. 3(e) of the Anti-Graft and
Corrupt Practices Act is that there should be undue injury caused to any party. However, in
the 30 July 1987 decision of the respondent Sandiganbayan, it is recognized that there was
no proof of damage caused to the employees of the hospital since they were in fact paid on
27 October 1982 their salaries for the entire third quarter of 1982. 13

WHEREFORE, the petition is GRANTED, and the decision of the Sandiganbayan dated 30
July 1987 in Criminal Case No. 10947 is SET ASIDE. Petitioner is ACQUITTED of the charge
of violation of Sec. 3(e) of the Anti-Graft and Corrupt Practices Act (R.A. 3019).
SO ORDERED.

Fernan, C.J., Narvasa, Melencio-Herrera, Gutierrez, Jr., Cruz, Paras, Feliciano, Gancayco,
Bidin, Sarmiento, Cortes, Griñ o-Aquino, Medialdea and Regalado JJ., concur.

Footnotes

** Penned by Justice Regino Hermosisima, Jr., with the concurrence of Justices Romeo M.
Ercareal and Augusto M. Amores.

1 Rollo, pp. 15-16.

2 Ibid.

3 Rollo, pp. 43-44.

4 Rollo, p. 47.

5 Rollo, p. 40.

6 Rollo, pp. 41-42.

7 Rollo, pp. 40-63.

8 Rollo, pp. 61-62.

9 Rollo, p. 64-69.

10 Ballentine's law Dictionary, 3rd Edition, p. 537.

11 Bouvier's Law Dictionary, Vol. 1, 3rd Revision, p. 1383.

12 Rollo, p. 59.

13 Rollo, p. 61.