G.R. No. 263014 - ENGR. NUMERIANO M. CASTAÑEDA, JR., IN HIS CAPACITY AS THE GENERAL MANAGER OF SAN RAFAEL WATER DISTRICT (SRWD), ON HIS OWN BEHALF AND ON BEHALF OF OTHER SRWD OFFICIALS AND EMPLOYEES, VS. COMMISSION ON AUDIT.D E C I S I O N - Supreme Court E-Library

Ruling

WHEREFORE, premises considered, the Petition for Review of Engr. Numeriano M. Castañeda, Jr., et. al., all of San Rafael Water District, San Rafael, Bulacan, is PARTIALLY GRANTED. Accordingly, Commission on Audit Regional Office No. Ill Decision No. 2014-32 dated April 30, 2014, and Notice of Disallowance (ND) Nos. 12-001-101(11) and 12-0002-101(11), both dated November 21, 2012, on the payment of additional allowances and bonuses to employees hired after December 31, 1999, and of year-end financial assistance and cash gift to the members of the SRWD Board of Directors (BOD) for the period of January 1 to December 31, 2011, in the total amount of [PHP] 1,096,340.75, are hereby AFFIRMED with MODIFICATION. The payees under ND. No. 12-001-101(11) need not refund the disallowed benefits they had received. All other persons named liable under ND Nos. 12-001-101(11) and 12-002-101(11) shall remain liable therefor. [23] (Emphasis supplied.) The COA ruled that the allowances granted to the employee­-recipients were already deemed integrated in the employees' basic sala1y rate pursuant to Section 12 [24] of Republic Act No. 6758 [25] and Sub­paragraph 5.4 [26] of DBM Corporate Compensation Circular (CCC) No. 10-99; [27] and that the year-end financial assistance were granted without the requisite authorization from the President, pursuant to DBM Budget Circular No. 005-6. [28] Anent the award of year-end financial assistance and cash gift to the members of the SRWD BOD, the COA noted that while allowances and benefits to the BOD in addition to per diem compensation are allowed, these grants must be authorized by law or charter and approved by the President, pursuant to Section 8(d) [29] of Executive Order No. 24. [30] The COA found that the records are bereft of any evidence that the subject year-end financial assistance and cash gift granted to the members of SRWD BOD were approved by the President. [31] Finally, the COA absolved the employee-recipients from the liability to refund the disallowed benefits having received the same m good faith. [32] On October 19, 2018, Castañeda, Jr., and Ms. Marivel Suarez (Suarez), the General Manager and Division Manager of SRWD, respectively, filed a Motion for Partial Reconsideration [33] of the COA's ruling insofar as they are found jointly and solidarily liable for the disallowed amounts under ND Nos. 12-001-101 (11) and 12-002-101(11). Castañeda, Jr., and Suarez maintained that they both acted in utmost good faith when they relied on the blanket authority given per the Garcia Letter, authorizing the grant of benefits to employees hired after December 31, 1999, and the SRWD Board Resolution Nos. 2011-02, s. 2011 [34] and 2011-07, s. 2011, [35] authorizing the release of year-end financial assistance and cash gift to the SRWD BOD. In its Resolution in Decision No. 2022-118, [36] the COA denied the Motion for lack of merit but modified the decision in that all the payees are held liable for the amount of the disallo