G.R. No. 207348 - ROWENA R. SOLANTE, VS. COMMISSION ON AUDIT, CHAIRPERSON MA. GRACIA PULIDO-TAN, COMMISSIONER JUANITO G. ESPINO, JR., COMMISSIONER HEIDI L. MENDOZA, AND FORTUNATA M. RUBICO, DIRECTOR IV, COA COMMISSION SECRETARIAT, in their official capacities.D E C I S I O N - Supreme Court E-Librar

Ruling

Accordingly, petitioner Rowena B. Rances (now Rowena Rances-Solante), Human Resource Management Officer III, prepared and, with the approval of Samuel B. Darza (Darza), then issued Disbursement Voucher (DV) No. 102-07-88-97 dated July 24, 1997 [7] for PhP 1,084,836.42 in favor of F.F. Cruz. In the voucher, Solante certified that the expense covered by it was necessary, lawful and incurred under my direct supervision. Thereafter, Darza addressed a letter-complaint to the Office of the Ombudsman, Visayas, inviting attention to several irregularities regarding the implementation of MCDP II. The letter was referred to the COA which then issued Assignment Order No. 2000-063 for a team to audit the accounts of MCDP II. Following an audit, the audit team issued Special Audit Office (SAO) Report No. 2000-28, par. 5 of which states: F.F. Cruz and Company, Inc. was paid P1,084,836.42 for the cost of the property affected by the widening of Plaridel Extension, Mandaue Causeway. However, under Section 5 of its MOA with Mandaue City, the former was no longer the lawful owner of the properties at the time the payment was made. [8] Based on the above findings, the SAO audit team, through Rexy Ramos, issued the adverted ND 2000-002-101-(97) [9] disallowing the payment of PhP 1,084,836.42 to F.F. Cruz and naming that company, Darza and Solante liable for the transaction. Therefrom, Solante sought reconsideration, while F.F. Cruz appealed, but the motion for reconsideration and the appeal were jointly denied in Legal and Adjudication Office (LAO) Local Decision No. 2004-040 dated March 5, 2004, which F.F. Cruz in time appealed to COA Central. In the meantime, the adverted letter-complaint of Darza was upgraded as an Ombudsman case, docketed as OMB-V-C-03-0173-C, against Solante, et al., albeit the Ombudsman, by Resolution of June 29, 2006, [10] would subsequently dismiss the same for lack of merit. The Ruling of the Commission on Audit In its February 15, 2008 Decision, [11] the COA, as indicated at the outset, affirmed ND 2000-002-101-97 on the strength of the following premises: From the above provision of the MOA, it is clear that the improvements introduced by F.F. Cruz x x x would be owned by the City upon completion of the project which under the Contract of reclamation should have been in 1995. However, the project was not completed in 1995 and even in 1997 when MDCP paid for these improvements. The fact that the reclamation project had not yet been completed or turned over to the City of Mandaue by F.F. Cruz in 1997 or two years after it should have been completed, does not negate the right over such improvements by the City x x x. Clearly, the intention of the stipulation is for F.F. Cruz x x x to compensate the government for the use of the land on which the office, pavement, canteen, extension shed, house and septic tank were erected. Thus, to make the government pay for the cost of the demolished improvements will defeat the intention of parties as