Republic of the Philippines . SANDIGANBAYAN ~_~3' City

THIRD DIVISION

PEOPLE OF THE PHILIPPINES, Plaintiff,

CRIM CASE NO. SB-16-CRM-0467 -ver sus- For: Violation of R. A. No. 3019, Sec. 3 (e) ROEL RAGAY DEGAMO, CRIM. CASES NOS. DANILO CUAL MENDEZ, and SB-16-CRM-0468 to 0478 TEODORICO GUEVARA For: Malversation through REYES, falsification Accused. x------x

Present:

CABOTAJE-TANG, A. M., P.J.j Chairperson FERNANDEZ, B. R., J., MORENO, R. B., J.

Promulgated: .1 _ t .jNVlJAn,"i :i1,~ ~ x------x

DECISION

FERNANDEZ B. R., J.

Accused Roel Ragay Degamo, Danilo Cual Mendez and Teodorico Guevara Reyes are charged before this Court for violation of Section 3 (e) of Republic Act No. 3019, otherwise known as the Anti-Graft and Corrupt Practices Act, as amended, in a criminal Information dated May 2, 2016, the accusatory portion of which reads as follows ~ /'J

I SB-16-CRM-0467-0478 DECISION 2 x------X

Criminal Case No. SB-16-CRM-0467

That on 24 August 2012, or sometime prior or subsequent thereto, in Dumaguete City, Province of , and within the jurisdiction of this Honorable Court, Philippines, accused Provincial Governor ROEL RAGAYDEGAMO, with Salary Grade 30, Provincial Treasurer DANILO CUAL MENDEZ, with Salary Grade 26, and Provincial Accountant TEODORICO GUEVARA REYES, with Salary Grade 26, all high-ranking public officers, while in the performance of their official functions, committing the offenses in relation to office and taking advantage of their official positions, did there and then wilfully, unlawfully and criminally, through evident bad faith, manifest partiality and/ or gross inexcusable negligence, conspiring, confederating and mutually helping one another, disburse the total amount of ONE HUNDRED FORTY THREE MILLION TWO HUNDRED SIXTY EIGHT THOUSAND FOUR HUNDRED FORTY-ONE PESOS AND FIFTY-NINE CENTAVOS (Php 143,268,44l.59) from the FOUR HUNDRED EIGHTY MILLION SEVEN HUNDRED SEVENTY-FIVE THOUSAND PESOS (Php 480,775,000.00) FY2012 Calamity Fund released to the Province of Negros Oriental, covered by Special Allotment Release Order (SARO)No. ROVII- 12-0009202, when in truth and in fact there were no funds for the disbursements because the said SARO had earlier been withdrawn by the Department of Budget and Management (DBM) on 29 June 2012, thereby causing undue injury to the Government in the amount of ONE HUNDRED FORTY-THREE MILLION TWO HUNDRED SIXTY• EIGHT THOUSAND FOUR HUNDRED FOUR HUNDRED FORTY-ONE PESOS AND FIFTY NINE CENTAVOS (Php 143,268,441.59).

CONTRARYTO LAW.

The same three (3) accused are likewise charged for malversation through falsification of public documents in Criminal Cases Nos. SB-16-CRM-0468 to SB-16-CRM-0478 (11 counts). The accusatory portion of Criminal Case No. SB- 16-CRM-0468 reads as follows - - A i DECISION 3 SB-16-CRM-0467-0478 x------X

Criminal Case No. SB-16-CRM-0468

That on 24 August 2012, or sometime prior to or subsequent thereto, in Dumaguete City, Province of Negros Oriental, Philippines, and within the jurisdiction of this Honorable Court, accused Governor ROEL RAGAYDEGAMO, with Salary Grade 30, Provincial Treasurer DANILO CUAL MENDEZ, with Salary Grade 26 and Provincial Accountant TEODORICO GUEVARA REYES, with Salary Grade 26, all high-ranking public officers, by reason of the duties of their said respective offices are accountable for public funds or properties of the Province of Negros Oriental, committing the complex crime charged herein while in the performance of, in relation to and/ or taking advantage of their official positions and functions, conspiring and confederating with one another, did then and there wilfully, unlawfully and feloniously appropriate, take or misappropriate or consent, or through abandonment or negligence, permit any person to take the public funds, from the FY 2012 Calamity Fund of the Province of Negros Oriental, covered by Special Allotment Release Order (SARO)No. ROVII- 12-0009202 under their charge and custody amounting to SIX MILLION SIX HUNDRED SEVENTY-ONE THOUSAND FIVE HUNDRED THIRTY-FIVE PESOS AND NINETY-TWO CENTAVOS (Php 6,671,535.92) by making it appear that there were funds available, when and in truth and in fact the SARO for the FY 2012 Calamity Fund had already been withdrawn by the Department of Budget and Management (DBM) on June 29, 2012, thereby causing the appropriation and disbursement of 15% advance payment to Fiat Construction Services under Check No. 40066145 and Disbursement Voucher 100 (01)-2012-08- 13743, both dated 24 August 2012, to the damage and prejudice of the Government in the amount of SIX MILLION SIX HUNDRED SEVENTY-ONE THOUSAND FIVE HUNDRED THIRTY-FIVEPESOS AND NINETY-TWO CENTAVOS (Php 6,671,535.92).

CONTRARYTO LA'/t-b

I DECISION 4 SB-16-CRM-0467-0478 x------X

The ten (10) other Informations from Criminal Cases Nos. SB-16-CRM-0469 to SB-16-CRM-0478 also for malversation through falsification of public documents are similarly worded except for the date, Check number, Disbursement Voucher number, the Contractor's name and the amount involved, best outlined hereunder - -

Case Date Check Disbursement Contractor's name Amount No. Number Voucher No. Involved

0468 8-24-2012 40066145 100(01)-2012-08-13743 Fiat Construction Services P6,671,535.92

0469 8-24-2012 40066147 100(01)-2012-08-13736 Richmark Canst. and Supply P6,741,762.18

0470 8-24-2012 40066146 100(01)-2012-08-13742 Legazpi Premium Dev. Corp. P29,970,762.86

0471 8-24-2012 40066148 100(01)-2012-08-13739 Legazpi Premium Dev. Corp. P29,972,423.52

0472 8-24-2012 40066150 100(01)-2012-08-13738 Legazpi Premium Dev. Corp. P7,279,260.90

0473 8-24-2012 40064149 100(01)-2012-08-13741 Lim General Contractors Corp. P22,477,057.11

0474 8-24-2012 40066187 100(01)-2012-08-13766 CTC Builders & Supplies Inc. P14,985,131.70

0475 8-24-2012 40066188 100(01)-2012-08-13767 CTC Builders & Supplies Inc. P7 ,492,367 .07

0476 8-24-2012 40064189 100(01)-2012-08-13768 Ajan JAeda Inc. PI4,985,042.11

0477 9-4-2012 40066552 100(01)-2012-09-14059 Bigfoot Canst. and Supply P1,196,913.52

0478 9-4-2012 40066553 100(01 )-20 12-09-14058 Bigfoot Canst. and Supply PI ,496, 150.70

When arraigned, the three (3) accused, assisted by their respective counsels, individually and separately pleaded not guilty to all charges (Order, August 14,2017).

During pre-trial, the parties agreed to stipulate on the following (Pre-Trial Order, January 15,2018) - -

(1) At the time material and relevant to the cases, accused Degamo was the Governor of the Province of Negros Oriental; accused Mendez was the Provincial Treasurer; and accused Reyes was the Provincial Accountant;

(2) In 2011, Typhoon Sendong struck the Province of Negros Oriental, causing damage to various public and private infrastructures;

(3) In 2012, an earthquake hit the Province of Negros Oriental which caused further damage and destruction to the various public and private infrastructures within the province; and,

(4) The Provincial Government of Negros Oriental requested for funding from the Office of DECISION 5 SB-16-CRM-0467-0478 x------x

the President to cover its rehabilitation requiremen ts.

Thereafter, trial on the merit proceeded.

As its first witness, the prosecution presented lannie Opinion Bulos, who testified on direct testimony through her sworn Judicial Affidavit dated November 14, 2017, that she was the Team Leader of Audit Team RI6-01, Commission on Audit (COA), LGS-C, Province of Negros Oriental 1 since January 11, 2013, principally tasked, among others, to supervise the conduct of financial, compliance and value for money audit or any other special audit of the audited agency; to supervise the effective implementation of audit plans and/ or work programs and activities of the Office, prepare/review Annual Audit Reports; and, to take custody of and to certify vouchers, receipts, transaction documents.

In compliance with the subpoena from the Office of the Special Prosecutor (OSP) of the Office of the Ombudsman (OMB), witness Bulos submitted and identified the following documents specific to Criminal Cases Nos. SB-16-CRM- 0467 to 0478, to wit: (1) Audit Observation NegOr 2012-019 dated 09 October 2012 (Exh. "A-9); (2) Commission on Audit Observation NegOr 2012-019 from accused Governor Degamo dated 24 October 2012 (Exh. "A-I0"); (3) Rejoinder of the Commission on Audit dated 15 November 2012 to the Comments of accused Governor Degamo on Audit Observation NegOr 2012-019 from accused Governor Degamo dated 24 October 2012 (Exh. "A-II"); (4) Reply of accused Governor Degamo dated 17 December 2012 to the Rejoinder of the Commission on Audit dated 15 November 2012 (Exh. "A-12").

Witness Bulos likewise submitted and identified the following documents specific to Criminal Cases Nos. SB-16- CRM-0467 and 0468, namely: (1) Notice of Disallowance 2012-039-100-(12) dated November 29,2012 (Exh. "B"), for the amount of six million six hundred seventy one thousand, five hundred thirty five pesos and ninety-two centavos (P6,671,535.92) released to Fiat Construction Services; (2) Disbursement Voucher 100(01) 2012-08-13743 dated August 22,2012 (Exh. "B-1"); (3) Check No. 40066145 dated August 24, 2012 (Exh. "B-2"); (4) Official Receipt dated August 24, 2012 (Exh. "B-3"); (5) Journal Entry Voucher dated August 24, 2012 (Exh. "B-4"); (6) Collection letter from Contractor DECISION 6 SB-16-CRM-0467-0478 x------x

dated August 16,2012 (Exh. "B-5"); (7) Statement of Account of Phil. Phoenix Surety and Insurance, Inc dated August 22, 2016 (Exh. "B-6"); (8) Philippine Phoenix Security and Insurance, Inc. Surety Bond dated August 22,2012 (Exh. "B- 7"); (9) Certificate of Authority No. 2012/ 53-R effective July 1, 2012 (Exh. "B-8"); (10) Letter of BAC Secretary Head to ATL submitting copies of Purchase Orders/Contract issued to the winning bidders dated August 22, 2012 (Exh. "B-9"); (11) Contract Agreement dated August 16,2012 (Exh. "B-I0"); (12) undated Special Conditions of Contract (Exh. "B-l1"); (13) Invitation of BAC Chairman to contractor to submit quotation for the proposed project dated July 23, 2012 (Exh. "B-12"); (14) BAC Resolution No. 222-12 dated June 29,2012 (Exh. "B-13"); (15) BAC Resolution No. 266 (B)-12 dated July 30, 2012 (Exh. "B-14"); (16) Notice of Award dated August 1,2012 (Exh. "B-1S"); (17) Notice of Award posted in the Agency's website dated August 9,2012 (Exh. "B-16"); (18) Certification dated August 22,2012 of Asst. BAC Secretariat Head that the Notice of Award was posted on the Bulletin Board of the PGSO (Exh. "B-l7"); (19) undated Job Order (Exh. "B-18"); (20) Omnibus Sworn Statement dated July 1 7, 2012 (Exh. "B-19"); and, (21) photocopies of COA Circular No. 2012-001, pp. 34, 35, 43,44 and 48 (Exh. "B-20").

For Criminal Cases Nos. SB-16-CRM-0467 and 0469, witness Bulos submitted and identified the following documents: (1) Notice of Disallowance 2012-140-100-(12) dated November 29,2012 (Exh. "C") for the amount of P6,741,796.18, released to Richmark Construction and Supply; (2) Disbursement Voucher 100 (01)-2012-08-13736 dated August 23,2012 (Exh. "C-1"); (3) Check No. 40066147 dated August 24, 2012 (Exh. "C-2"); (4) Official Receipt dated August 24, 2012 (Exh. "C-3"); (5) Journal Entry Voucher dated August 24, 2012 (Exh. "C-4"); (6) Collection letter from contractor dated August 17,2012 (Exh. "C-S"); (7) Receipt for Surety Bond dated August 22, 2012 (Exh. "C-6"); (8) People's General Insurance Corp. Surety Bond dated August 22, 2012 (Exh. "C-7"); (9) Letter from Insurance Commission transmitting License No. 2012/10-R to People's General Insurance Corp dated June 25, 2012 (Exh. "C-9"); (10) Certificate of Authority No. 2012/ 10-R effective July 1, 2012 (Exh. "C-10"); (11) Contract Agreement dated August 16,2012 (Exh "C-11"); (12) undated Special Conditions of Contract (Exh. "C-12"); (13) Invitation of BAC Chairman to contractor to submit quotation for the proposed contract dated July 23, 2012 (Exh. "C-13"); (14) BAC Resolution No. 222-12 dated A /", DECISION 7 SB-16-CRM-0467-0478 x------x

June 29,2012 (Exh. "C-14"); (15) BAC Resolution 266 (E)-12 dated July 30,2012 (Exh. "C-15"); (16) Notice of Award posted in the Agency's website published on August 09, 2012 (Exh. "C-16"); (17) Notice of Award dated August 1,2012 (Exh. "C- 1 7"); (IS) Letter of BAC Secretary Head to Audit Team Leader submitting copies of Purchase Orders/Contract issued to the winning bidders dated August 22, 2012 (Exh. "C-1S"); (19) Certification of Asst. BAC Secretariat Head that the Notice of Award was posted on the Bulletin Board of the PGSO dated August 22,2012 (Exh. "C-19"); (20) undated Job Order (Exh. "C-20"); (21) Omnibus Sworn Statement dated July 17, 2012 (Exh. "C-21"); and, (22) photocopies of COA Circular No. 2012-001, pp. 34, 35, 43, 44 and 4S (Exh. "C-22").

Witness Bulos further identified the following documents for Criminal Cases SB-16-CRM-0467 and 0470, namely: (1) Notice of Disallowance 2012-141-100-(12) for the amount of P29,970,762.S6 released to Legazpi Premium Development Corporation dated November 29, 2012 (Exh. "D"); (2) Disbursement Voucher 100 (01)-2012-0S-13742 dated August 24,2012 (Exh. "D-1"); (3) Check No. 40066146 dated August 24,2012 (Exh. "D-2"); (4) Official Receipt dated August 24, 2012 (Exh. "D-3"); (5) Journal Entry Voucher dated August 24, 2012 (Exh. "D-4"); (6) Collection letter from Contractor dated August 13, 2012 (Exh. "D-5"); (7) Office Receipt for Surety Bond dated August 22, 2012 (Exh. "D-6"); (S) People's General Insurance Corp Surety Bond (Exh. "D-7"); (9) Letter from Insurance Commission transmitting License No. 2012/10-R to People's General Insurance Corp dated June 25,2012 (Exh. "D-S"); (10) Certificate of Authority No. 2012/ 10-R effective July 1, 2012 (Exh. "D-9"); (11) Contract Agreement dated August 10,2012 (Exh. "D-I0"); (12) undated Special Conditions of Contract (Exh. "D-11"); (13) Invitation of BAC Chairman to contractor to submit quotation for the proposed project dated July 23,2012 (Exh. "D-12"); (14) BAC Resolution 222-12 dated July 29, 2012 (Exh. "D-13"); (15) BAC Resolution 266 (C)-12 dated July 30,2012 (Exh. "D-14"); (16) Notice of Award posted in the Agency's website published on August 9,2012 (Exh. "D-15"); (17) Letter ofBAC Secretary Head to ATL submitting copies of Purchase Orders/Contract issued to the winning bidders dated August 22, 2012 (Exh. "D-16"); (18) Certification of Asst BAC Secretariat Head that the Notice of Award was posted on the Bulletin Board of the PGSO dated August 22,2012 (Exh. "D-17"); (19) undated Job Order (Exh. "D-1S"); (20) undated Omnibus Sworn Statement DECISION 8 SB-16-CRM-0467-0478 x------X

(Exh. "D-19"); and, (21) photocopies of COA Circular No. 2012-001, pp. 34, 35,43,44 and 48 (Exh. "D-2-").

In Criminal Cases SB-16-CR-0467 and 0471, witness Bulos submitted and identified the following documents: (1) Notice of Disallowance 2012-142-100(12) for the amount of P29,972,423.52 released to Legazpi Premium Development Corporation dated November 29, 2012 (Exh. "E"); (2) Disbursement Voucher No. 100 (01)-2012-08-13739 dated August 24,2012 (Exh. "E-1"); (3) Check No. 40066148 dated August 24, 2012 (Exh. "E-2"); (4) Official Receipt dated August 24, 2012 (Exh. "E-3"); (5) Journal Entry Voucher dated August 24, 2012 (Exh. "E-4"); (6) Collection Letter from Contractor dated August 14, 2012 (Exh. "E-5"); (7) Official Receipt for Surety Bond dated August 22, 2012 (Exh. "E-5- a"); (8) People's General Insurance Corporation Surety Bond with Acknowledgment dated August 23,2012 (Exh. "E-6"); (9) Letter from Insurance Commission transmitting License No. 2012/ 10-R to People's General Insurance Corporation dated June 25, 2012 (Exh. "E-7"); (10) Certificate of Authority 2012/10-R effective July 1,2012 (Exh. "E-8"); (11) Letter of BAC Secretary Head to Audit Team Leader submitting copies of Purchase Orders/Contract issued to the winning bidders dated August 22,2012 (Exh. "E-9"); (12) Contract Agreement dated August 10, 2012 (Exh. "E-10"); (13) undated Special Conditions of Contract (Exh. "E-l1"); Invitation of BAC Chairman to contractor to submit quotation for the proposed project dated July 23, 2012 (Exh. "E-12"); (14) BAC Resolution No. 222-12 dated June 29, 2012 (Exh. "E-13"); (15) BAC Resolution No. 266 (J)-12 dated July 30,2012 (Exh. "E-14"); (16) Notice of Award dated August 1,2012 (Exh. "E- 15"); (17) Notice of Award posted on the Agency's website on August 9,2012 (Exh. "E-16"); (17) Certification of Assistant BAC Secretariat Head that the Notice of Award was posted on the Bulletin Board of the PGSO dated August 22,2012 (Exh. "E-17"); (18) undated Job Order (Exh. "E-18"); (19) Omnibus Sworn Statement dated July 12, 2012 (Exh. "E-19"); and, (20) photocopies of COA Circular No. 2012-001 Page No. 34,35, 43,44 and 48 (Exh. "E-20").

In Criminal Cases SB-16-CRM-0467 and 0472, she submitted and identified the following documents: (1) Notice of Disallowance 2012-143-100(12) for the amount of P7,279,260.90 released to Legazpi Premium Development Corporation dated November 29, 2012 (Exh. "F"); (2) Disbursement Voucher No. 100(01)-2012-08-13738 dated

l.A / DECISION 9 SB-16-CRM-0467 -04 78 x------X

August 24,2012 (Exh. "F-1"); (3) Check No. 40066150 dated August 24,2012 (Exh. "F-2"); (4) Official Receipt dated August 24, 2012 (Exh. "F-3"); (5) Journal Entry Voucher dated August 24, 2012 (Exh. F-4"); (6) Collection Letter from contractor dated August 15, 2012 (Exh. "F-5"); (7) Official Receipt for Surety Bond dated August 22, 2012 (Exh. "F-6"); (8) People's General Insurance Corporation Surety Bond dated August 22,2012 (Exh. "F-7"); (9) Letter from Insurance Commission transmitting License No. 2012/ 10-R to People's General Insurance Corp dated June 25, 2012 (Exh. "F-8"); (10) Certificate of Authority effective July 1,2012 (Exh. "F-9"); (11) Letter of BAC Secretary Head to ATL SUbmitting copies of Purchase Orders/Contract issued to the winning bidders dated August 22, 2012 (Exh. "F-10"); (12) Contract Agreement dated August 10, 2012 (Exh. "F-11"); undated Special Conditions of Contract (Exh. "F-12"); (13) Invitation of BAC Chairman to contractor submit quotation for the proposed project dated July 23, 2012 (Exh. "F-l3"); (12) BAC Resolution No. 222-12 dated June 29, 2012 (Exh. "F-14"); (13) BAC Resolution No. 266 (F)-12 dated July 30,2012 (Exh. "F- 15"); (14) Notice of Award dated August 1,2012 (Exh. "F-16"); (15) Notice of Award posted in the Agency's website on August 9,2012 (Exh. "F-1T'); (16) Certification of Asst BAC Head Secretariat Head that the Notice of Award was posted on the Bulletin Board of the PGSO dated August 22,2012 (Exh. "F- 18"); (17) undated Job Order (Exh. "F-19"); (18) Omnibus Sworn Statement dated July 25,2012 (Exh. "F-20"); and, (19) photocopies of COA Circular No. 2012-001, Page 34, 35, 43,44 and 48 (Exh. "F-21").

In Criminal Cases SB-16-CRM-0467 and 0473, she identified the following documents: (1) Notice of Disallowance 2012-144-100(12) for the amount ofP22,477,057.11 released to Lim General Contractors Corporation dated November 29, 2012 (Exh. "G"); (2) Disbursement Voucher 100(01)-2012-08- 13741 dated August 23, 2012 (Exh. "G-1"); (3) Check No. 40066149 dated August 24, 2012 (Exh. "G-2"); (4) Official Receipt from Lim General Contractors Corporation dated August 24, 2012 (Exh. "G-3"); (5) Journal Entry Voucher dated August 24,2012 (Exh. "G-4"); (6) Collection Letter from contractor dated August 17, 2012 (Exh. "G-5"); (7) Official Receipt for Surety Bond dated August 22, 2012 (Exh. "G-6"); (8) Stronghold Insurance Company Surety Bond dated August 22, 2012 (Exh. "G-T'); (9) Certificate of Authority 2012/60R effective July 1, 2012 (Exh. "G-8"); (10) undated Indemnity Agreement Stronghold Insurance Company (Exh. )b~ /-> DECISION 10 SB-16-CRM-0467-0478 x------X

"G-9"); (11) Letter of BAC Secretary Head to Audit Team Leader submitting copies of Purchase Orders/ Contract issued to the winning bidders dated August 22, 2012 (Exh. "G-I0"); (12) Contract Agreement dated August 16, 2012 (Exh. "G-11"); (13) undated Special Conditions of Contract (Exh. "G-12"); (14) Invitation of BAC Chairman to contractor to submit quotation for the proposed project dated July 23, 2012 (Exh. "G-13"); (15) BAC Resolution No. 222-12 dated June 29,2012 (Exh. "G-14"); (16) BAC Resolution No. 266(G)- 12 dated July 30,2012 (Exh. "G-1S"); (17) Notice of Award dated August 1, 2012 (Exh. "G-16"); (18) Notice of Award posted in the agency's website, published on August 9, 2012 (Exh. "G-1 7"); (18) Certification of Asst BAC Secretariat Head that the Notice of Award was posted on the Bulletin Board of PGSO dated August 22,2012 (Exh. "G-18"); (19) undated Job Order (Exh. "G-19"); (20) Omnibus Sworn Statement dated July 17, 2012 (Exh. "G-20"); and, (21) photocopies of COA Circular No. 2012-001, Page Nos. 34,35,43,44 and 48 (Exh. "G-21").

In Criminal Cases SB-16-CRM-0467 and 0474, she submitted and identified the following documents: (1) Notice of Disallowance 2012-145-001-(12) for the amount of P14,98S,131.70 released to CTC Builders and Supplies, Inc. dated November 29, 2012 (Exh. "H"); (2) Disbursement Voucher 100(01)-2012-08-13766 dated August 24, 2012 (Exh. "H-1"); (3) Check No. 40066187 dated August 24,2012 (Exh. "H-2"); (4) Official Receipt dated August 24, 2012 (Exh. "H-3"); (5) Journal Entry Voucher dated August 24, 2012 (Exh. "H-4"); (6) Collection letter from contractor dated August 15, 2012 (Exh. "H-S"); (7) Official Receipt for Surety Bond dated August 22, 2012 (Exh. "H-6"); (8) People's General Insurance Corporation Surety Bond dated August 22, 2017 (Exh. "H-7"); (9) BIR Form No. 2000 dated August 22,2012 (Exh. "H-8"); (10) DBP BIR Tax Payment Deposit Slip dated August 22,2012 (Exh. "H-9"); (11) Certificate of Authority No. 2012/ 10-R effective July 1,2012 (Exh. "H-10"); (12) Contract Agreement dated August 16,2012 (Exh. "H-11"); (13) undated Special Conditions of Contract (Exh. "H-12"); (14) Invitation of BAC Chairman to contractor to submit quotation for the proposed project dated July 23,2012 (Exh. H-13"); (15) BAC Resolution No. 222-12 dated June 29, 2012 (Exh. "H-14"); (16) BAC Resolution No. 266 (D)-12 dated July 30,2012 (Exh. "H-1S"); (17) Notice of Award dated August 1,2012 (Exh. "H- 16"); (18) Notice of Award posted in the agency's website published on August 9,2012 (Exh. "H-17"); (19) Letter of BAC

)b L j // / DECISION 11 SB-16-CRM-0467-0478 x------X

Secretary Head to ATL submitting copies of Purchase Orders/Contract issued to the winning bidders dated August 22, 2012 (Exh. "H-18"); (20) Certification of Asst BAC Secretariat Head that the Notice of Award was posted on the Bulletin Board of the PGSO dated August 22,2012 (Exh. "H- 19"); (21) undated Job Order (Exh. "H-20"); (21) Omnibus Sworn Statement dated July 13, 2012 (Exh. "H-21"); and, photocopies of COA Circular No. 2012-001 Page Nos. 34,35, 43, 44 and 48 (Exh. "H-22").

In Criminal Cases SB-16-CRM-04767 and 0475, witness Bulos submitted and identified the following documents: (1) Notice of Disallowance 2012-146-100-(12) for the amount of P7,492,367.07 released to CTC Builders and Supplies Inc. dated November 10, 2012 (Exh. "I"); (2) Disbursement Voucher 100 (01)-2012-08-13767 dated August 24,2012 (Exh. "I-I"); (3) Check No. 40066188 dated August 24,2012 (Exh. "1-2");(4) Official Receipt dated August 24,2012 (Exh. "1-3");(5) Journal Entry Voucher dated August 24, 2012 (Exh. "1-4"); (6) Collection letter from contractor dated August 15, 2012 (Exh. "1-5"); (7) Official Receipt for Surety Bond dated August 22, 2012 (Exh. "1-6"); (8) People's General Insurance Corporation Surety Bond dated August 22, 2012 (Exh. "1-7");(9) DBP BIR Tax Payment Deposit Slip (Exh. "1-8");(10) BIR Form 2000 dated August 22,2012 (Exh. "1-8"); (11) BIR Form 2000 (Exh. "1-9"); (12) Certificate of Authority No 2012/10-R effective July 1,2012 (Exh. "1-10"); (13) Letter of BAC Secretary Head to Audit Team Leader submitting the copies of Purchase Orders/Contract issued to the winning bidders dated August 22, 2012 (Exh. "1-11"); (14) Contract Agreement dated August 16,2012 (Exh. "1-12"); (15) undated Special Conditions of Contract (Exh. "1-13"); (16) Invitation of BAC Chairman to contractor to submit quotation for the proposed project dated July 23,2012 (Exh. "1-14"); (17) BAC Resolution No. 222-12 dated June 29,2012 (Exh. "1-15");(18) BAC Resolution No. 266(K)-12 dated July 30,2012 (Exh. "1- 16"); (19) Notice of Award dated August 1,2012 (Exh. "1-17"); (20) Notice of Award posted in the agency's website published on August 9, 2012 (Exh. "1-18");(21) Certification of Asst BAC Secretariat Head that the Notice of Award was posted on the Bulletin Board of the PGSO dated August 22, 2019 (Exh. "1- 19"); (22) undated Job Order (Exh. "1-20"); (23) Omnibus Sworn Statement dated July 13, 2012 (Exh. "1-21");and, (24) photocopies of COA Circular No. 2012-001 Page Nos. 34, 35, 43, 44, and 48 (Exh. "1-22"). .AD

I DECISION 12 SB-16-CRM-0467 -0478 x------X

In Criminal Cases SB-16-CRM-0467 and 0476, she submitted and identified the following documents: (1) Notice of Disallowance 2012-147-100-(12) for the amount of P 14,985,042.11 released to Alan J aeda Incorporated dated November 29,2012 (Exh. "J"); (2) Disbursement Voucher 100 (01)-2012-08-13768 dated August 24,2012 (Exh. "J-1"); (3) Check No.40066189 dated August 24,2012 (Exh. "J-2"); (4) Official Receipt dated August 24, 2012 (Exh. "J-3"); (5) Journal Entry Voucher dated August 24,2012 (Exh. "J-4"); (6) Collection letter from contractor dated August 16, 2012 (Exh. "J-S"); (7) DBP BIR Tax Payment Deposit People's General Insurance Corp. dated August 22, 2012 (Exh. "J-6"); (8) People's General Insurance Corporation Surety Bond dated August 22,2012 (Exh. "J-7"); (9) BIR Form 2000 dated August 22,2012 (Exh. "J-8"); (10) Certificate of Authority No. 2012/10-R effective July 1,2012 (Exh. "J-9"); (11) Contract Agreement dated August 16,2012 (Exh. "J-10"); (12) Special Conditions of Contract (Exh. "J-11"); (13) Invitation of BAC Chairman to contractor to submit quotation for the proposed project dated July 23,2012 (Exh. "J-12"); (14) BAC Resolution 222-12 dated July 29, 2012 (Exh. "J-13"); (15) BAC Resolution 222-266(A)-12 dated July 30,2012 (Exh. "J-14"); (16) Notice of Award posted in agency's website published on August 9, 2012 (Exh. "J-lS"); (17) Notice of Award dated August 1,2012 (Exh. "J-16"); (17) Letter of BAC Secretary Head to ATL submitting copies of Purchase Orders/Contract issued to the winning bidders dated August 22, 2012 (Exh. "J -1 7"); (18) Certification of Asst BAC Secretariat Head that the Notice of Award was posted on the Bulletin Board of PGSO dated August 22,2012 (Exh. "J-18"); (19) undated Job Order (Exh. "J-19"); (20) Omnibus Sworn Statement dated July 16, 2012 (Exh. "J-20"); and, (21) photocopies of COA Circular No. 2012-001, Page Nos. 34.35.43.44 and 48 (Exh. "J-21").

In Criminal Cases SB-16-CRM-0467 and 0477, she submitted and identified the following documents: (1) Notice of Disallowance 2012-148-100(12) for the amount of PI, 196,913.52 released to Bigfoot Construction and Supply dated November 29, 2012 (Exh. "K"); (2) Disbursement Voucher 100 (01)-2012-08-14059 dated August 24, 2012 (Exh. "K-1"); (3) Check No. 4066552 dated September 4,2012 (Exh. "K-2"); (4) Official Receipt from Bigfoot Construction Supply dated September 4, 2012 (Exh. "K-3"); (5) Journal Entry Voucher dated September 4, 2012 (Exh. "K-4"); (6) Collection letter from contractor dated August 28, 2012 (Exh. "K-5"); (7) Bank Guarantee-BDO dated August 29,2012 (Exh. /tL /'7 .. J ',-

DECISION 13 SB-16-CRM-0467-0478

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"K-6"); (8) Letter of BAC Secretary Head to Audit Team Leader submitting copies of Purchase Orders/Contract issued to the winning bidders dated August 22, 2012 (Exh. "K-7"); (9) Contract Agreement dated August 10,2012 (Exh. "K-8"); (10) undated Special Conditions of Contract (Exh. "K-9"); (11) Invitation of BAC Chairman to contractor to submit quotation for the proposed project dated July 23, 2012 (Exh. "K-10"); (12) BAC Resolution 222-12 dated July 29, 2012 (Exh. "K- 11"); (13) BAC Resolution 266(H)-12 dated July 30, 2012 (Exh. "K-12"); (14) Notice of Award dated August 1, 2012 (Exh, "K-13"); (15) Notice of award posted on the agency's website published on August 9,2012 (Exh. "K-14"); (16) Certification of Asst BAC Secretariat Head that the Notice of Award was posted on the Bulletin Board of PGSO dated August 20, 2012 (Exh. "K-lS"); (17) undated Job Order (Exh. "K-16"); (18) Omnibus Sworn Statement dated July 18, 2012 (Exh. "K-17"); and, (19) photocopies of COA Circular No. 2012-001 Pages 34, 35, 43,44 and 48 (Exh. "K-18").

Finally, in Criminal Cases SB-16-CRM-0467 and 0478, witness Bulos submitted and identified the following documents: (1) Notice of Disallowance 2012-149-100-(12) for the amount of P1,496,lS0.70 released to Bigfoot Construction and Supply dated November 29,2012 (Exh. "L"); (2) Disbursement Voucher 100 (01)-2012-09-14058 dated September 4, 2012 (Exh. "L-1"); (3) Check No. 40066553 dated September 4, 2012 (Exh. "L-2"); (4) Official Receipt dated September 4, 2012 (Exh. "L-3"); (5) Journal Entry Voucher dated September 4,2012 (Exh. "L-4"); (6) Collection letter from contractor dated August 28, 2012 (Exh. "L-S"); (7) Bank Guarantee from BDO dated August 29, 2012 (Exh. "L- 6"); (8) Letter BAC Secretary Head of ATL submitting copies of the Purchase Orders/Contract issued to the winning bidders dated August 22,2012 (Exh. "L-7"); (9) Contract Agreement dated August 10, 2012 (Exh. "L-8"); (10) undated Special Conditions of Contract (Exh. "L-9"); (II) Invitation of BAC Chairman to contractor to submit quotation for the proposed project dated July 23,2012 (Exh. "L-10"); (12) BAC Resolution 222-12 dated June 29, 2012 (Exh. "L-11"); (13) BAC Resolution No. 266{I)-12 dated July 30, 2012 (Exh. "L-12"); (14) Notice of Award dated August 1,2012 (Exh. "L-13"); (IS) Notice of Award posted on the agency's website published on August 9, 2012 (Exh. "L-14"); (16) Certification of Asst BAC Secretariat Head that the Notice of award posted on the bulletin board of the PGSO dated August 20, 2012 (Exh. "L• IS"); (17) undated Job Order (Exh. "L-16"); (18) Omnibus , .'

DECISION 14 SB-16-CRM-0467-0478

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Sworn Statement dated July 18,2012 (Exh. "L-I7"); and, (19) photocopies of COA Circular No. 2012-001, Page Nos. 34,35, 43, 44 and 48 (Exh. "L-18").

When cross-examined, witness Bulos admitted that she did not personally conduct the audit on the subject transactions and only knew of the specific details or circumstances surrounding the Notices of Disallowance Issue. d t 0 th e accuse d (Ex h s. "B", "C", "D", "E", "F", "G", "H", "I", "J", "K", "L") from the documents. She also admitted that this was the first time she heard about the withdrawal of a Special Allotment Release Order (SARO).

The next witness for the prosecution was Elenita G. Gatbonton. Her testimony was stipulated on by both parties, as follows - - (1) that she is currently the Presidential Staff Officer VI and the Chief of the File Management and Retrieval Division since 2007 of the Malacafiang Records Office; (2) that her functions and duties include being the records custodian of the Malacanang Records Office and keeping all presidential action papers and issuances which include written instructions from the President as well as official correspondences received and released by the Office of the President, among others; (3) that, in compliance with the subpoena from the Office of the Special Prosecutor, she brought with her one of the original documents requested in the said Subpoena, particularly Exhibit "A-I" for the prosecution and Exhibit "9" for the defense which is the Letter dated May 24, 2012 addressed to the then Department of National Defense Secretary Voltaire D. Gasmin, and signed by the Executive Secretary Paquito N. Ochoa, Jr. (Order, January 30, 2018).

When queried by the Court, witness Gatbonton testified that the May 24, 2012 Letter addressed to Hon. Voltaire Gasmin and signed by Executive Secretary Paquito N. Ochoa (Exh. "A-I"; Exh. "9") was also sent to other government agencies such as the Department of Budget and Management (DBM); Department of Public Works and Highways (DPWH); the Provincial Governor Degamo (herein accused); Mayor Isidro Camado, province of ; Mayor Caridad Balaot, ; Mayor Faustino Minas of Cabalan, province of ; and, Dir. Jonathan Martir, Limay, . This same Letter was officially released last May 25, 2012 and received by the NDRRMCon May 28, 2012. Based on the registry return cards, the Office of Governor Roel , "

DECISION 15 SB-16-CRM-0467-0478

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Degamo and Mayor Isidro Cabatuan respectively received the said Letter on June 6,2012 (Registry Receipt Nos. 02733 and 02734). On the other hand, the same Letter was received by Mayor Caridad Balaot on June 7,2012 (Registry Receipt No. 02375), by Mayor Faustino Minez's son on June 8, 2012 (Registry Receipt No. 02736) and by Dir. Jonathan Martir in June 2012 (Registry Receipt No. 2737).

The prosecution then called to the witness stand, COA Supervising Auditor Sylvia M. Almazan. She is a State Auditor IV of the COA and an Audit Team Leader tasked, among others, to supervise the conduct of the accounts of the agencies under their audit jurisdiction and review the outputs of her audit team.

In 2012, witness Almazan audited the implementation of infrastructure projects, the payment of aid in crisis situations, the scholarship programs, the confidential and intelligence funds and the collection of income from the provincial structures and facilities, all of the province of Negros Oriental.

The infrastructure projects personally audited by her were the projects charged to the 2012 Calamity Fund of the Province, particularly the subject eleven (11) contracts which involved, two (2) projects each for the Municipalities of Sta. Catalina and Sibulan and one (1) project each for the Municipalities of Siaton, Valencia, the City of Dumaguete, San Jose, Amlan, the City of Tanjay and the City of Bais.

Witness Almazan first learned of the aforementioned projects when she was furnished a copy of a letter from DBM Regional Director Carmela Fernan for Region 7, informing the then Governor of the Province of Negros Oriental (accused Degamo) that the Special Allotment Release Order (SARO)No. ROVII-12-0009202 dated June 5, 2017 (Exh. "A-2") for the prosecution and Exh. "11 for the defense" previously issued to the Province was withdrawn by the DBM. The same Letter also requested Governor Degamo (herein accused) to return the cash initially downloaded to the depository account of the Province, representing one-half of the total amount of the SARO or Four Hundred Eighty Million Seven Hundred Seventy Five Thousand Pesos (P480,775,000.00). She was then informed, through a follow-up Letter (Exh. "A-7") dated June 29, 2012, also from DBM Regional Director Fernan DECISION 16 SB-16-CRM-0467-0478 x------x requesting for the return of the cash initially downloaded to the account of the Province.

Witness Almazan further testified that sometime in September or October of 2012, accused Reyes, as the Provincial Accountant, submitted a Liquidation Report (not identified) with eleven (11) Disbursement Vouchers (DVs) (Exhs. "B-1" to "L-1" and their respective attachments) for her verification. Attached to these DVs were payment checks, copies of the contracts, BAC documents, among others. These DVs pertained to the fifteen percent (150/0) advanced payments made to each contractor or 15% of the total contract price for each contract.

Upon receipt of the aforementioned eleven (11) DVs and their respective attachments, DBM Regional Director Fernan, in reply to a letter of witness Almazan, clarified that the DBM initially issued positive SARO No. ROVII-12-0009202 (Exh. "A-2") dated June 5, 2017 and, thereafter, issued negative SARO No. ROVII-12-0012208 (Exhs. "A-6" and "II") dated June 29, 2012 withdrawing the earlier positive SARO. The cash initially downloaded was half of the positive SARO.

With this verification, witness Almazan issued an Audit Observation Memorandum (AOM)(Exh. "A-9") dated October 9,2012, received by accused Degamo, informing the latter of their audit findings and that no allotment can cover the contracts because of the withdrawal of the SARO. Accused Degamo subsequently sent his Comments (Exh "A-10") dated October 24, 2012 thereto.

Witness Almazan further confirmed issuing the eleven (11) Notices of Disallowance dated November 29,2012 (Exhs. "B" to "L") and also testified on the individual liabilities of each accused. Although accused accused Degamo appealed the disallowances with the COA Regional Office 7, witness Almazan knew that this was eventually denied and that she did not receive any notice that a SARO was re-issued.

When cross-examined, witness Almazan testified that the funds involved herein were calamity funds and their audit was partly to determine legal compliance for the release and approval of the funds. Although she adds that the release of the calamity funds required a prior approval from the Office of the President, witness Almazan could not confirm if one was secured. ;L ! I I DECISION 17 SB-16-CRM-0467-0478 x ------X

Witness Almazan, however, confirmed that the funds were downloaded and deposited to the deposit account of the Province of Negros Oriental after the SARO and the Notice of Cash Allowance (NCA)were issued.

She further testified that the June 29, 2012 Letter of DBM Regional Director Fernan prompted the issuance of their Audit Observation Memorandum (AOM) dated October 9, 2012 (Exh. "A-9") and that she was unaware of the reasons for the withdrawal of subject SARO.

Thereafter, prosecution witness Reich G. Ybiernas was presented. She testified that she is a Records Officer of the Department of Budget & Management - Region VII, whose duties and responsibilities include the safekeeping of documents in their office with the authority to certify them.

In compliance with the subpoena, witness Ybiernas retrieved the requested documents from their files, photocopied them and stamped "certified true copies" on the photocopies, then signed them. She then sent the certified true copies to the Legal Services, DBM Central Office, for verification. When the same documents were returned to her, she sent them to the Office of the Ombudsman.

Witness Ybiernas then submitted and identified the following documents, namely: (1) Special Allotment Release Order (SARO)No. ROVII-12-0009201 issued on June 5,2012 (Exh. "A-2"); (2) Notice of Cash Allocation (NCA)dated June 5, 2012 (Exh. "A-3"); (3) Letter from Dir. Carmela Fernan dated June 6, 2012 (Exh. "A-4"); (4) Letter from Undersecretary Relampagos dated June 19, 2012 (Exh. "A-5"); (5) a negative SARO issued on June 29,2012 (Exh. "A-6"); (6) a Letter from Dir. Carmela Fernan dated June 29,2012 (Exh. "A-7"); and, (7) a Letter from Dir. Carmela Fernan dated July 10, 2012 (Exh. "A-B").

When cross-examined, witness Ybiernas admitted that, although the subpoena was addressed "Attention: To the Chief Records Officer", she was the records officer of their administrative division and that she had no personal knowledge on the entries and contents of the documents she submitted. She also testified that she was not familiar with the signature of USec. Mario Relampagos on June 19, 2012 (Exh. "A-5").

,I A rU / DECISION 18 SB-16-CRM-0467-0478 x------X

The next prosecution witness was Regional Director Carmela S. Fernan of the Department of Budget and Management (DBM) Region VII, whose duties and responsibilities include releasing funds to the agencies within the Region upon instructions from the Central Office.

She recalls that, in June 2012, upon instructions from the DBM Central Office and the Office of the President, the calamity funds of the Province of Negros Oriental (Province) were released for the rehabilitation and repair of the damage caused by Typhoon Sendong. Being a local government unit (LGU), the subject funds were released to the Province through Special Allotment Release Order (SARO)No. ROVII- 12-0009202 (Exh. "A-2") dated June 5, 2012 in the amount of nine hundred sixty one million five hundred fifty thousand pesos (P961,550,000.00).

After their Regional Office released the SARO, it then issued the Notice of Cash Allocation (NCA)(Exh. "A-3") dated June 5, 2012 for the amount of four hundred eighty million seven hundred seventy five pesos (P480,775,000.00), representing fifty percent (50%) of the total amount of the SARO.

With the issuance of the SARO (Exh. "A-2") and the NCA (Exh. "A-3"), Check No. 58275 (Exh. "A-4-A") dated June 7, 2012 was prepared and deposited (Exh. "A-4-B") to the account of the Province.

After depositing the said Check, the DBM Regional Office informed accused Degamo, being then the Governor of the Province of Negros Oriental, through a Letter dated June 6, 2012 (Exh. "A-4"), that the amount of four hundred eighty million seven hundred seventy five thousand pesos (P480,775,000.00) was already released to the Province for the projects also stated in the same Letter.

Several days thereafter, the DBM Regional Office received instructions from the DBM Central Office to withdraw the amount released to the Province. Thus, it issued negative SARO No. ROVII-12-0012208 (Exh. "A-6") dated June 29, 2012 in the amount of nine hundred sixty one million five hundred fifty thousand (P961 ,550,000.00).

A Letter (Exh. "A-5") dated June 19, 2012 of the then Usee. Mario Relampagos was subsequently sent to accused , "

DECISION 19 SB-16-CRM-0467-0478

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Degamo, informing the latter that the SAROwill be withdrawn and that procedures will have to be complied with. The June 19,2012 Letter ofUsec. Relampagos was followed by another Letter (Exh. "A-T') dated June 29, 2012 from the DBM Regional Office with the same tenor and that a negative SARO was also issued.

Instructions were thus given to accused Degamo to return the amount of four hundred eighty million seven hundred seventy five thousand pesos (P4BO,775,000.00) to the National Treasury and to furnished the DBM, through the Regional Office, a certified copy of the bank deposit slip evidencing remittance of the said amount.

A follow-up Letter (Exh. "A-B") dated July 10, 2012 was again sent to accused Degamo.

In response, accused Degamo wrote a Letter (Exh. "A-8- A) dated July 16, 2012 to the DBM Regional Office, indicating that the Province had no intentions of returning the amount released to it. Neither did the DBM Regional Office received documents proving the return of the amount released.

On cross-examination, witness Fernan testified that she issued both the subject positive and negative SAROs and the NCA in compliance with the directives of the DBM Central Office and in accordance with the orders from the Office of the President.

Witness Fernan explained that the 2012 calamity fund was governed by the special provisions of the 2012 General Appropriations Act (GAA).When confronted with par. 2, no. 1, Sec. 37 entitled Calamity Fund of the 2012 GAA, witness Fernan admitted that their Office merely relied on the instructions from the DBM Central Office that handled the calamity fund, however, she had no personal knowledge as to the procedures in the Office of the President. She added that the release of the calamity fund, a special purpose fund, was upon the recommendation of the National Disaster Risk Reduction Management Council (NDRRMC)to the Office of the President.

Furthermore, witness Fernan testified that the issuance of the subject SARO (Exh. "A-2") on June 5, 2012 was upon the instructions of one Director Carmen Delantar. However, the instructions did not indicate that the SARO must bear the SB-16-CRM-0467-0478 DECISION 20 x------X

conformity of the DPWH Secretary and that she had no personal knowledge as to the participation of USec. Relampagos in the issuance of the subject SARO except for the latter's Letter (Exh. "A-5")dated June 19, 2012 to accused Degamo on the withdrawal of the SARO.

As to the issuance of the negative SARO No. ROVII-12- 0009202 (Exh. "A-6") dated June 29, 2012, witness Fernan testified that she neither discussed this with USec. Relampagos nor secured clearance from the Office of the President. She, nevertheless, denied writing to the DBM Sec. Diokno, requesting for the issuance of a SARO to replace the negative SARO and recommending to restore the positive SARO and the release of the NCA. She, however, clarified that these statements were contained in an internal Office Memorandum and were only re-statements of requests made by accused Degamo

On re-direct examination, witness Fernan reiterated her earlier explanation on the nature of the calamity fund as well as her compliance with the instructions of USec. Relampagos. She further explained that, per their rules, an Audit Observation Memorandum (AOM) is issued by their office when one cannot disburse funds without a corresponding allotment. Conversely, when an allotment is withdrawn, any releases made will be unauthorized. However, if a release was already made, the funds should be returned to the National Treasury.

Witness Fernan further clarified that an internal memorandum containing evaluations and recommendations is strictly for DBM use only. She added that after releasing the negative SARO, their Office did not receive any other directive from the Office of the President. On re-cross examination, witness Fernan merely read for the record, Sec. 88 of the 2012 GAAon calamity funds.

When queried by the Court, witness Fernan testified that it was Dir. Delantar, who instructed her to issue the positive SARO while USec. Relampagos directed her to withdraw the same SARO.

Upon a Formal Offer of Evidence dated March 22,2018 filed before the Court on March 23, 2018 and with the Comment dated March 22, 2018 filed by the three (3) accused, this Court admitted Exhs. "A-I" to A-I0; "B" to "B-20"; "C" to SB-16-CRM-0467 -0478 DECISION 21 x------X

"C-22"; "D" to "D-20"; "E" to "E-20"; "F" to "F-21"; "G" to "G- 21"; "H" to "H-22"; "I" to "1-22"; "J" to "J-21"; "K" to "K-18"; and, "L" to "L-18" (Minutes, April 16, 2018).

The accused, thereafter, filed a Motion dated May 11, 2018, seeking leave to file a demurrer to the evidence. This Court, after the prosecution filed its Opposition dated May 24, 2018, however, denied the same Motion (Minutes, May 25, 2018). Although the accused filed a Motion for Reconsideration dated July 4, 2018, this was also denied (Minutes, August 7,2018).

The first witness for the defense was Franco C. Alpuerto, who testified on direct testimony through his sworn Judicial Affidavit dated September 10,2018.

He testified that he served as the Provincial Engineer of the Province of Negros Oriental (Province) from November 24, 2011 but was placed on an inactive status on February 28, 2016. As Provincial Engineer, he was in charge of handling the infrastructure programs and public works in general of the Province, among others.

Among the projects undertaken by the Province during his tenure as Provincial Engineer were those involving the various infrastructures damaged by Typhoon Sendong in December 2011.

Upon instructions from the Governor then (herein accused Degamo), witness Alpuerto directed the Construction and Maintenance Division headed by Engr. Cresencio Jose F. Ada, to inspect and evaluate the extent of the damage caused by Typhoon Sendong while the Office of witness Alpuerto, through the Construction Division, Planning and Programming Division and the Materials Quality Control Section, was tasked to monitor the status and progress of the implementation of the projects and to prepare detailed reports thereon.

He explained that a Validation Report (Exh. "6") dated April 16, 2012 was prepared for his review and recommendation, detailing the extent of the damaged infrastructures and a summary of the estimated cost for their repair and rehabilitation. He added that one Cesar L. Villaflor and one Ver Neil B. Balaba, representatives of the DPWH and OCD Regional Offices, inspected and evaluated the extent of DECISION 22 SB-16-CRM-0467-0478 x------X

the damage and validated the estimated costs for the repair, rehabilitation, and improvement projects as reflected in the Validation Report.

Witness Alpuerto also identified the National Calamity Fund Project Status Reports (Exh. "17 -A") dated March 31, 2013, showing some of the completed projects and those nearing completion because they were temporarily suspended due to insufficient funds. He, however, knew that only half of the funds approved by the Office of the President was released while the other half necessary to complete the projects was not.

He cited the Balugo, Tambujangin and Tinago Bridges Projects and the Tapon Norte River Control Project as fully completed and do not require additional reconstruction. However, the Tanjay River Control Project, Banica River Control Project, Ocoy River Control Project and the Ajong River Control Protection Dike Project were not completed and sustained damage from floods caused by Typhoon Sendong, hence, required additional reconstruction.

Witness Alpuerto further confirmed that the funds released to the Province were used to pay the contractors' fifteen percent (15%) mobilization fee/advances for each contract. Some of the contractors were also paid based on their progress billings submitted to and verified by their Office as shown by the disbursement vouchers they prepared and eventually approved by accused Degamo. The specific amounts paid to each contractor were contained in a Table entitled "Fund Project Status Report (Exh "17 -A") dated March 31, 2013, prepared by and submitted to him by the Office of the Provincial Accountant.

On cross-examination, witness Alpuerto admitted that he was unaware if the subject Projects were submitted for technical review and inspection by the Commission on Audit (COA),although they submitted reports to them. However, he does not recall whether the COA issued any document certifying or confirming that the subject Projects were indeed accomplished according to contract specifications. On re• direct examination, witness Alpuerto reiterated that the subject Projects were not completed because only half of the funds was released. DECISION 23 SB-16-CRM-0467 -0478 x------X

The next witness for the defense was Miranda Morante. Her testimony was dispensed with after the parties agreed to stipulate on the following - - (1) that witness Morante was the former Chairperson of the Office of the Civil Defense (OCD) Region VII, National Disaster Risk Reduction Management Council (NDRRMC)from June 2008 to June 2014; (2) that she endorsed to Undersecretary Benito Ramos, Administrator, OCD-DND and Executive Director of the NDRRMC, the request of accused Degamo, Provincial Governor and Chair of the Provincial DDRMC, for funding assistance from the 2012 Calamity Fund for the repair, restoration and rehabilitation of infrastructure projects damaged by Typhoon Sendong in 2011 in the amount of P961,550,000.00; (3) that, based on the checklist of documents provided by the NDRRMC, she reviewed the documents required to be attached to the Fund request submitted by the Provincial Governor of the 2012 Calamity Funds, including the Validation Report and Damage Report submitted by the Regional Office of the Department of Public Works and Highways (DPWH) and the Provincial Disaster Risk Reduction Management Council (PDRRMC), respectively; (4) that the same documents were attached to her endorsement to the NDRRMC; and, (5) that witness Morante had no participation in the preparation of the documents marked as Exhs. "5" and "5-A" (Order, October 23, 2018).

Thereafter, defense witness Vivian G. Solomon was called. She testified, on direct examination through her sworn Judicial Affidavit dated September 13, 2018, that she was the Provincial Engineer of Negros Oriental on February 2017 and was in charge of the infrastructure programs and public works in general, among others.

She also identified the National Calamity Fund Status Report (Exh. "17") as of August 25, 2017, prepared by her Office, which shows the status of the various construction projects in the Province of Negros Oriental that required rehabilitation and repair due to the damage caused by Typhoon Sendong.

When cross-examined, witness Solomon admitted that she approved the National Calamity Fund Status Report (Exh. "17"), relying only on photographs presented and reports submitted to her by her subordinates. She likewise admitted that she was not privy to the exchanges made between the DBM and accused Degamo regarding these Projects and that SB-16-CRM-0467-0478 DECISION 24 x------x she learned of the withdrawal of the funding only through radio reports, being then a member of the media.

On re-direct examination, she confirmed that when she heard about the withdrawal of the funding, the Projects were already on-going.

The next witness for the defense was Cesar L. Villaflor. Initially, the parties agreed to stipulate on the following - - (1) that the witness is an Engineer II and a Regional Action Officer of the DPWH, Region VII; (2) that he was part of the team that conducted the validation of the damage sustained by the infrastructures in Negros Oriental due to Typhoon Sendong in 2011; (3) along with the Provincial Engineer's Office of Negros Oriental and the Office of Civil Defense (OCD) Region VII, he prepared a Validation Report (Exh. "6"), detailing the extent of the damage caused by Typhoon Sendong and prepared rehabilitation projects; and, (4) that apart from the Validation Report (Exh. "6"), witness Villaflor had no participation in the application for the Calamity Fund and had no knowledge on the withdrawal of the SARO by the DBM Region VII (Order, October 30,2018).

Additionally, witness Villaflor testified that he prepared an undated Validation Report (Exh. "6"), in accordance with the requirements imposed by the Office of Civil Defense (OCD) but did not receive any feedback therefrom. This usually signifies that the Validation Report was acceptable to the NDRRMCand required no further validation.

Accused Danilo Mendez was then called and testified through his sworn Judicial Affidavit dated November 5, 2018. He was the Provincial Treasurer tasked to take charge of the treasury office of the Province of Negros Oriental and had custody of and manage the funds of the Provincial Government, among others.

He explained that his specific role in the disbursement of funds was anchored on Commission on Audit Circular No. 93-382, which tasked him to certify as to the availability of funds for every request for disbursement. This usually comes in the form of a disbursement voucher (DV) , that is likewise processed by the different departments and units within the provincial government. Similarly, once a DV is approved by the local chief executive or the local administrator, he prepares the check and countersigns it along with either the DECISION 25 SB-16-CRM-0467 -0478 x------x local chief executive or the local chief administrator. In the processing of DVs, witness-accused Mendez also certifies the availability of funds by affixing his signature on the DVs directly below the statement indicating "certified funds available" .

Witness-accused Mendez further explains that he also determines whether funds are indeed available by verifying the respective control ledgers and cash books and whether the Provincial government has sufficient balance for the requested disbursement and that the amounts and balances entered in the control ledgers and cash books are accurately reflected in the balance of the Province's depository accounts.

Further, witness-accused Mendez elaborates that, apart from the Treasurer's Office, a DV usually passes through and is processed by the office or unit requesting the payment as well as the Provincial Accountant's Office before it is approved by the Governor.

Normally, it is the requesting unit that prepares the DV, specifically describing the purpose of the payment requested and attaching the necessary supporting documents to establish the legality and validity of the requests such as the bidding documents, among others. After the requesting unit prepares the DV, the head of the unit recommends the payment by affixing his signature thereon.

The DV also passes through the Office of the Provincial Accountant, which ensures and certifies that the supporting documents are indeed complete and that the relevant allotment has been obligated for the purpose indicated in the DV. This certification is shown by the signature of the Provincial Accountant on the DV.

After the disbursement voucher (DV) is signed and processed by all the departments concerned, it is forwarded to the office of the local chief executive for his appropriate action, as required by eOA circulars.

Relative to the instant cases, witness-accused Mendez admitted that he certified that the funds for the payment of the fifteen (15%) advances for the subject eleven (11) rehabilitation Projects were available, by affixing his signature on the corresponding DVs processed by the Engineering and Accounting Offices. He added that, after the DECISION 26 SB-16-CRM-0467-0478 x------X

DVs were approved by accused Degamo, as Governor then, he (witness-accused Mendez) countersigned the checks issued to the different con tractors.

He emphasized that his certification was based on the fact that the Province of Negros Oriental was in actual custody of the funds, as these were already deposited in the account of the Province with the Development Bank of the Philippine (D BP). This was communicated to them through a letter dated June 6,2012 from DBM Director Carmela Fernan to accused Degamo, informing the latter that Check No. 7582751 dated June 7, 2012 in the amount of P480,757,000.00 was deposited with the DBP, City branch, for credit to the account of the Province of Negros Oriental. Aside from this, not only did Dir. Fernan call him to confirm the deposit, a credit advice from the DBP was also received by him (witness• accused Mendez) on June 8, 2012.

Witness-accused Mendez further confirmed that the funds were used as advance payments for mobilization to the winning contractors in accordance with COA Circular No. 82- 177 and were sourced from the National Government, specifically the National Disaster Risk Reduction and Management Fund (NDRRMF) or the Calamity Fund appropriated under the 2012 General Appropriations Act, pursuant to the approval of the President. The funds released were in the nature of special purpose funds and treated as trust funds. They can only be used for a specific purpose, particularly herein for the repair and rehabilitation of the thirteen (13) damaged infrastructures.

He also knew of the withdrawal of the SARO and recalled attending a meeting called by accused Degamo with the Provincial Accountant and the Provincial Legal Officer, as OIC of the Provincial Administrator's Office, to discuss the said withdrawal.

In the said meeting, Atty. Richard Enojo, the Provincial Legal Officer, explained that the DBM had no legal basis to unilaterally withdraw the SAROwithout the approval from the Office of the President or the NDRRMC. Atty. Enojo also informed them that the Province will not only question the authority ofUsec. Relampagos to withdraw the SARObut also ask proof of his (USec. Relampagos) authority to do so. He also knew that Usec. Relampagos was unable to show any proof of his authority to withdraw the SARa. SB-16-CRM-0467-0478 DECISION 27 x------X

Lastly, witness-accused Mendez admitted that he signed the certification regarding the availability of funds notwithstanding the withdrawal of the SARO because the funds was already deposited in the account of the Province. He adds that, since the funds were treated as trust funds, he was tasked to ensure that the released funds were spent only for the specific purpose of the repair and rehabilitation of the damaged infrastructure.

When cross-examined, the parties agreed to stipulate instead that, if presented to him, witness-accused Mendez can identify the subject Disbursement Vouchers (Exhs. "B-1" to "L-l") and the subject eleven (11) checks for the eleven (11) projects (Exhs. "B-2" to "L-2").

Witness-accused Mendez further admitted, when confronted with the Letter (Exh. "A-7") dated June 29,2012, that this was the only letter he read relative to the withdrawal of the SARO. He reiterated knowing of the withdrawal of the SARO and signing the subject Disbursement Vouchers from August 24 to September 4, 2012, despite the withdrawal of the subject SARO.

On re-direct examination, witness-accused Mendez further confirmed that the Province did not return the released funds to the DBM because they questioned the validity of the withdrawal and that USec. Relampagos had no authority to unilaterally withdraw the same.

Thereafter, witness-accused Teodorico Reyes, through his Amended Judicial Affidavit dated January 17, 2019, testified that he is the Provincial Accountant at the time material to these cases, tasked to head and manage the Accounting Office of the Province of Negros Oriental and take charge of both its accounting and internal audit services, among others.

Witness-accused Reyes alleges that he was charged for signing the subject Disbursement Vouchers (DVs) and certifying that: (1) the allotment was obligated for the purpose as indicated in the DVs and (2) the supporting documents are complete, notwithstanding, the supposed lack of certificate of availability of funds, as observed by eOA State Auditor Sylvia Almazan in her Notice of Disallowance.

I DECISION 28 SB-16-CRM-0467 -0478 x------x

He, however, emphasized that he determined that there existed an allotment obligated for the purposes indicated in the DVs despite the withdrawal of the SARO, when the Province received a Letter from the DBM that 50% of the calamity fund was released with the approval. by the Office of the President. He added that his certification was based on the supporting documents attached to the DVs which included the procurement documents.

Aside from narrating the normal flow of documents they followed, witness-accused Reyes also alleged as inaccurate the observation of COA State Auditor Almazan regarding the lack of a certificate of availability of funds because this was based on the documents that the Provincial Government submitted to her as required in COA Circular No.20 12-00 1 (Exhs. "22" and series), which prescribes the documentary requirements for common government transactions.

Witness-accused Reyes, however, testified that the same COA Circular, specifically Sees. 9.2. and 9.2.5 thereof, states that a certificate of availability of funds is not among the documents required to be submitted to COA. The only documents submitted by the Province to the COA were those enumerated in the said COA Circular (Exhs. "B-20," "C-22," "D-20" "E-20", "F-21 , " "G-21 , " "H-22 , " "1-22", "J-21 , " "K-18" and "L-18"; adopted by the defense).

He further clarified that, aside from the certificate of availability of funds, there was no other deficiency or irregularity in the procurement process as well as in the procurement documents submitted. He also identified a Certification (Exhs. "9" and "9-a") dated May 24, 2012 attesting to the availability of funds, as shown in a Bank Credit Advice dated June 8, 2012 of the DBP Dumaguete, indicating that the funds were deposited and credited to the account of the Province and that the funds released were advance payments or fifteen percent (15%) mobilization to the winning contractors, as indicated in the DVs, which he signed with the supporting documents which he reviewed.

Witness-accused Reyes also confirmed being informed by accused Degamo on the withdrawal of the SARO as well as the meeting called by accused Degamo to discuss the same and the position of Atty. Enojo, the Provincial Legal Officer, to question the withdrawal. He, however, noted that no communication came from DPWH. A I DECISION 29 SB-16-CRM-0467-0478 x------X

He further identified a Decision of the Court of Appeals (CA-GRSp No. 146151) entitled Roel Degamo vs. Office of the Ombudsman (Exh. "18") and an appeal of the accused before the eOA (Exh. "19").

When cross-examined, witness-accused Reyes testified that, when shown the negative SARO (Exh. "A-5"), he confirmed that the first SAROwas indeed withdrawn and that the withdrawal covered the entire amount of the original SARO of P961,550,000.00.

He also admitted that when he signed the subject DVs, the negative SARO was already issued and that he did not make any reservation or protest regarding the release of the funds to the contractors or indicate any notation on the negative SARO and the demand to return of the DBM.

Witness-accused Reyes also admitted that, at the time the funds were released, the negative SARO was neither revoked by the DBM nor by the Office of the President and that the deposited amount of P480,775,000.00 was never returned. Likewise, the balance of fifty percent (50%) of the fund was neither released nor received by the Province. He concludes that, with respect to procurements using alternative modes under COA Circular 2009-001, the Certificate (Exh. "19-A") dated June 15, 2012 of the availability of funds was one of the documentary requirements mentioned therein.

On re-direct examination, witness-accused Reyes reiterated that he issued the Certificate (Exh. "19-A") dated June 15, 2012 and that the Province disbursed the released funds in accordance with the contracts after the procurement process. He further stated that, although the negative SARO was issued by the DBM, it had no authority from the President. When re-cross examined, witness-accused Reyes added that he did not officially receive the negative SARO but only saw the Letter withdrawing the original SARO. He also stated that he was only told about the demand from the DBM Regional Office to return the P480,770,000.00. Witness• accused Reyes emphasized that the released funds of 50% had a significant effect on the Province because it saved life and property and was able to protect some of the danger zones therein, particularly, its river banks.

I DECISION 30 SB-16-CRM-0467-0478 x------X

The last witness for the defense was Atty. Froilan Joseph B. Pinili. His testimony was initially stipulated on by the parties on the following, namely: (1) that witness Atty. Pinili is the Asst. Provincial Administrator of Negros Oriental appointed in 2014; (2) that his functions include having custody over official documents; (3) that he is the custodian of and can identify the following documents: (a) a Letter dated January 5,2012 (Exh. "1"); (b) a Letter dated June 30,2012 (Exh. "14"); (c) a Letter dated July 12,2015 (Exh. "15"); and, (d) a Letter dated July 16, 2012 (Exh. : 16") (Order, May 23, 2019).

When cross-examined, witness Atty. Pinili testified being unaware of any reply to the letter dated January 30, 2012 (Exh. "14") because he was only appointed in 2014.

Subsequently, all the accused filed an Omnibus Motion dated November 18, 2018, principally praying that they be allowed to present two (2) additional witnesses, namely: Marcelo G. Adanza and Ronald Rojas. However, this was denied (Minutes, December 3, 2018).

A Motion for Reconsideration dated January 22, 2019 was thereafter filed by the accused. However, while the said Motion for Reconsideration was pending resolution, the accused filed their Formal Offer of Evidence ad cautelam dated June 3,2019. Eventually, this Court denied the Motion for Reconsideration dated June 24, 2019 of the accused (Order, June 24,2019).

In the interim, the defense sought to present defense witnesses Marcelo A. Adanza and Ronald A. Rojas. However, their testimonies made through their respective sworn Judicial Affidavits both dated September 26, 2018, were excluded (Minutes, December 3, 2018).

A Manifestation and Motion dated July 12, 2019 was subsequently filed by the accused, seeking to tender the same sworn Judicial Affidavits of their two (2) intended witnesses. This Court granted the said Motion, hence, the sworn Judicial Affidavits both dated September 26, 2018 of Marcelo A. Adanza and Ronald A. Rojas became part of the records of these cases pursuant to Section 40 of Rule 132 (Resolution, August 22,2019).

, ! t ! / DECISION 31 SB-16-CRM-0467 -0478 x ------X

Eventually, upon a Formal Offer of Evidence dated June 3 , 2019 , this Court admitted defense' Exhibits" I"; "2"; "4"; "5"; "5-A"; "6"; "7"; "S"; "10" (Exh. "A-I"); "II" (Exh. "A-2"); "12" (Exh. "A-3"); "13" (Exh. "A-4"); "14"; "15"; "16"; "1 7"; "1 7 - A"·, "IS'", "IS-A'", "19'"" and "19-A".

We now rule.

Criminal Case No. SB-16-CRM-0467 charges the three (3) accused for violation of Section 3 (e) of Republic Act No. 3019, otherwise known as the Anti-Graft and Corrupt Practices Act, as amended.

Section 3 (e) provides - -

Section 3. Corrupt practices of public officers. - In addition to acts or omissions of public officers already penalized by existing law, the following shall constitute corrupt practices of any public officer and are hereby declared to be unlawful:

x x x

(e) Causing any undue injury to any party, including the Government, or giving any private party any unwarranted benefit, 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.

From the foregoing, the elements that are required to be present are as follows - - (a) that the accused must be a public officer discharging administrative, judicial, or official functions (or a private individual acting in conspiracy with such public officers); (b) that he acted with manifest partiality, evident bad faith, or gross inexcusable negligence; and, (c) that his action caused any undue injury to any party, including the government, or giving any private party unwarranted benefits, advantage, or preference in the discharge of his functions (Cuerpo vs. People, G. R. No. 203382, September 18,2019).

I~ i I l I DECISION 32 SB-16-CRM-0467-0478 x------X

The three (3) accused already admitted being public officers at the time material to these cases: accused Degamo was the Governor of the Province of Negros Oriental; accused Mendez was the Provincial Treasurer; while accused Reyes was the Provincial Accountant (Pre-Trial Order, January 15. 2018).

Thus, the core of the controversy now lies on a determination of the presence or absence of the second and third elements.

Anent the second element, Section 3 (e) can be committed in three (3) ways, namely - - through manifest partiality, evident bad faith or gross inexcusable negligence. Proof of any of these three (3) in connection with the prohibited acts mentioned in Section 3 (e) of R. A. No. 3019, is enough to convict.

We are thus reminded of Fuentes vs. People (G. R. No. 186421, April 17, 2017 citing Coloma vs. Sandiganbayan), where our Supreme Court explained these important terms in the Section concerned, as follows - -

Partiality" is synonymous with "bias" which "excites a disposition to see and report matters as they are wished for rather than as they are." "Bad faith does not simply connote bad judgment or negligence; it imputes a dishonest purpose or some moral obliquity and conscious doing of a wrong; a breach of sworn duty through some motive or intent or ill will; it partakes of the nature of fraud." "Gross negligence has been so 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. It is the omission of that care which even inattentive and thoughtless men never fail to take on their own property.

In other words, there is "manifest partiality" when there is a clear, notorious, or plain inclination or predilection to favor one side or person rather than another. On the other hand, "evident bad faith" connotes not only bad judgment DECISION 33 SB-16-CRM-0467-0478 x------X

but also palpably and patently fraudulent and dishonest purpose to do moral obliquity or conscious wrongdoing for some perverse motive or ill will. It contemplates a state of mind affirmatively operating with furtive design or with some motive or self-interest or ill will or for ulterior purposes.

On the other hand, the third element describes two (2) ways by which a public official violates Section 3 (e) of R. A. No. 3019 in the performance of his functions, to wit - - (1) by causing undue injury to any party, including the Government; or (2) by giving any private party any unwarranted benefit, advantage or preference. The accused may be charged under either mode or both. The disjunctive term "or" connotes that either act qualifies as a violation of Section 3 (e) ofR. A. No. 3019 (Tan vs. People, G. R. No. 218902, October 17,2016).

It must be recalled that bad faith does not simply connote bad judgment or negligence; it imputes a dishonest purpose or some moral obliquity and conscious doing of a wrong; a breach of sworn duty through some motive or intent or ill will; it partakes of the nature of fraud (Fonacier vs. San diganb ayan , G.R. No. 50691, December 5, 1994, 238 SeRA 655).

Further, gross negligence is 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 willfully and intentionally with a conscious indifference to consequences in so far as other persons may be affected.

Although it is clear that the accused resolved to proceed with the subject rehabilitation projects despite the withdrawal of the subject SARO, this, however, cannot equate to evident bad faith or gross inexcusable negligence.

The decision to proceed was principally based on a firm belief that U/ Secretary Relampagos had no authority to unilaterally withdraw the subject SARO and that the process in the issuance of the original SARO No. ROVII-12-0009202 (Exh. "A-2")dated June 5, 2012 was properly followed.

This unwavering position can be shown when the accused, particularly accused Degamo, immediately sought DECISION 34 SB-16-CRM-0467-0478

X------X clarification and verification in three (3) Letters, namely - - (1) addressed to Executive Secretary Ochoa dated June 30, 2012; (2) addressed to the Office of the President dated July 12, 2012; and, (3) addressed to Undersecretary Relampagos (Exh. "16") dated July 16, 2012, specifically questioning the legality of his actions with a request to show evidence of his (Relampagos) authority from the Office of the President. These Letters came in response to two (2) DBM Letters, respectively dated June 19,2012 (Exh. "A-5") and June 29,2012 (Exh. "A-7").

On the other hand, there can be no undue injury to the government.

Evidently, the eleven (11) contracts were already entered into with various contractors and that the subject rehabilitation projects were already either partially or totally completed as of 2013.

We recall that there can be no violation of Section 3 (e) without actual proof of undue injury to the government. This cannot be presumed even after a wrong or a violation of a right has been established. Its existence must be proven as one of the elements of the crime. Thus, it is required that the undue injury be specified, quantified and proven to the point of moral certainty (Soriano vs. Ombudsman, G.R. No. 163178, January 30, 2009, 577 SCRA 312, citing Llorente vs. Sandiganbayan, G. R. No. 122166, March 11, 1998, 287 SCRA 382).

With the foregoing, We find that the accused cannot be held criminally liable for Section 3 (e) of Republic Act No. 3019, as amended.

The three (3) accused are likewise charged in Criminal Cases Nos. SB-16-CRM-0468 to SB-16-CRM-0478 for eleven (11) counts of the complex crime of malversation through falsification of public documents.

Malversation as described in Article 21 7 of the Revised Penal Code, as amended, is committed when-

Any public officer who, by reason of the duties of his office, is accountable for public funds and property, shall appropriate the same, or shall take or misappropriate or shall consent, or through DECISION 35 SB-16-CRM-0467-0478 x------X

abandonment or negligence, shall permit any other person or take such public funds or property, wholly or partially, or shall otherwise be guilty of the misappropriation or malversation of such funds or property, shall suffer: x x x.

As could be gleaned from the foregoing, malversation can be committed in any of the following manner - - (1) by appropriating public funds or property; (2) by taking or misappropriating the same; (3) by consenting, or through abandonment or negligence; by permitting any other person to take such public funds or property; or, (4) by being otherwise guilty of the misappropriation or malversation of such funds or property (Pondevida vs. Sandiganbayan, G. R. Nos. 160929-31, August 16,2005,504 Phil 489-511).

The elements common to all acts of malversation, are thus - - (a) that the offender be a public officer; (b) that he had custody or control of funds or property by reason of the duties of his office; (c) that those funds or property were public funds or property for which he was accountable; and (d) that he appropriated, took, misappropriated or consented, or through abandonment or negligence, permitted another person to take them (Zoleta vs. Sandiganbayan, G. R. No. 185224, July 29,2015).

On the other hand, Article 171 of the Revised Penal Code, as amended, states that the common elements for all the acts of falsification are - - (1) that the offender is a public officer, employee, or notary public; (2) that he takes advantage of his official position; and, (3) that he falsifies a document by committing any of the eight (8) acts enumerated thereat.

Guided by the foregoing, it is undisputed that the three (3) accused, as admitted by them, are public officers at the time material to these cases (Pre-Trial Order, January 15, 2018). The funds subject of these cases and alleged to have been misappropriated are public in character because they originated from the National Treasury and released to the Province of Negros Oriental by virtue of SARO No. ROVII-12- 0009202 (Exh. "A-2")dated June 5, 2012.

The three (3) accused are likewise accountable public officers since, at the time material to these cases, accused Degamo was the Governor of the Province of Negros Oriental;

J DECISION 36 SB-16-CRM-0467-0478 x------x accused Mendez was its Provincial Treasurer while accused Reyes was its Provincial Accountant.

We recall that accused Reyes even admitted, during cross examination (pp. 36-37, TSN, January 24, 2019), that they proceeded with the eleven (11) infrastructure Projects, despite the withdrawal of the SARO. Moreover, even the checks representing payments for the eleven (11) infrastructure Projects were all signed and issued after the said withdrawal.

He even went further by admitting, on cross examination (p. 44, TSN, January 24,2019), that they did not return the funds to the National Treasury.

However, despite these admissions and as previously indicated, the accused went on to maintain that, in several occasions, they questioned the validity and legality of the withdrawal of the subject SARO. In support of this, the accused presented several letters, namely: (1) the Letter of accused Degamo to the Executive Secretary (Exh. "14") dated June 30, 2012 and (2) the Letter from accused Degamo to the Office of the President (Exh. "15") dated July 12,2012, both seeking clarification regarding the actions of DBM Undersecretary Relampagos; and (3) the Letter of accused Degamo addressed to DBM Undersecretary Relampagos (Exh. "16") dated July 16, 2012, questioning the legality and actions of the latter with a request to show evidence of his (Relampagos) authority from the Office of the President.

Coupled with this, is their persistent claim of good faith and that the funds were indeed used for the good of the Province and its citizenry and not for their personal benefit.

In the crime of malversation, all that is necessary for conviction is sufficient proof that the accountable officer had received public funds, that he did not have them in his possession when demand therefor was made, and that he could not satisfactorily explain his failure to do so. Direct evidence of personal misappropriation by the accused is hardly necessary (Sarigumba vs. Sandiganbayan, G.R. No. 154239-41, February 16,2005,451 SeRA 533,554) as long as the accused cannot explain satisfactorily the shortage in his accounts. DECISION 37 SB-16-CRM-0467-0478 x------X

Furthermore, there is a presumption in Article 217 of the Revised Penal Code which states that the failure of a public officer to have duly forthcoming any public funds or property with which he is chargeable, upon demand by any duly authorized officer, is prima facie evidence that he has put such missing fund or property to personal uses. This presumption is, of course, rebuttable (Davalos, Sr. vs. People, G.R. No. 145229, April 24, 2006, 488 SCRA 84, 92- 93)

Accordingly, if the accused is able to present adequate evidence that can nullify any likelihood that he had put the funds or property to personal use, then that presumption would be at an end and the prima facie case is effectively negated. This Court has repeatedly said that when the absence of funds is not due to the personal use thereof by the accused, the presumption is completely destroyed; in fact, the presumption is never deemed to have existed at all (Davalos, Sr., ibid.).

In the instant case, it is clear that the public funds were used for the payment of the several contractors who have already partially or totally completed their respective projects. There is no evidence that will show that the public funds were misappropriated for the personal use of the accused, hence, the absence of criminal intent (see Garcia, Jr. vs. Office of the Ombudsman, et al., G.R. No. 197567, [November 19,2014], 747 PHIL 445-468).

On the issue of good faith, our Supreme Court in Tabuena vs. Sandiganbayan, et al. (G.R. Nos. 103501-03 February 17, 1997), ruled that good faith is a valid defense in a prosecution for malversation for it would negate criminal intent on the part of the accused. Thus, in the two (2) vintage, but significant malversation cases of US vs. Catolico (citing Tolentino, Civil Code of the Philippines, vol. 1, 1985 ed., 31- 32, citing Waxman vs. US, 12 Fed. 2nd, 775) and US v. Elvina (citing People vs. Malasugui, 63 PhI. 221 (1936); de Garcia vs. Locsin, 65 Phil. 689 (1938), the Court stressed that:

To constitute a crime, the act must, except in certain crimes made such by statute, be accompanied by a criminal intent, or by such negligence or indifference to duty or to consequences as, in law, is equivalent to criminal DECISION 38 SB-16-CRM-0467-0478 x------x

intent. The maxim is actus non jacit reum, nisi mens sit rea - a crime is not committed if the mind of the person performing the act complained of is innocent.

The rule was reiterated in People vs. Pacana (47 Phil. 48), although this case involved falsification of public documents and estafa:

Ordinarily, evil intent must unite with an unlawful act for there to be a crime. Actus non facit reum, nisi mens sit rea. There can be no crime when the criminal mind is wanting.

American jurisprudence echoes the same principle. It adheres to the view that criminal intent in embezzlement is not based on technical mistakes as to the legal effect of a transaction honestly entered into, and there can be no embezzlement if the mind of the person doing the act is innocent or if there is no wrongful purpose (Lewis vs. People, 99 Colo. 102, 60 Pac. (2d) 1089; Lawyer vs. State, 221 Ind. 101,46 N.E. (2d) 592; Stare vs. Schmidt, 72 N. Dak. 719, 10 N.W. (2d) 868. Underhill's Criminal Evidence, 5th Ed., Book 3, p. 1421). The accused may thus always introduce evidence to show he acted in good faith and that he had no intention to convert (Federal Lindgren vs. US, 260 Fed. 772. Underhill, ibid.).

To Our mind, the accused meritoriously showed good faith.

WHEREFORE, in view of the foregoing, judgment IS hereby rendered in the following manner - -

In SB-16-CRM-0467 - - This Court hereby ACQUITS accused Roel Ragay Degamo, accused Danilo Cual Mendez and accused Teodorico Guevera Reyes of a violation of Section 3 (e) of Republic Act No. 3019, otherwise known as the Anti-Graft and Corrupt Practices Act, as amended, for failure of the prosecution to prove the guilt of the accused beyond reasonable doubt.

/.J. j ! / DECISION 39 SB-16-CRM-0467-0478 x------X

In SB-16-CRM-0468 to SB-16-CRM-0478 - - This Court hereby ACQUITS accused Roel Ragay Degamo, accused Danilo Cual Mendez and accused Teodorico Guevara Reyes of the complex crime of malversation through falsification of public documents as described in the Revised Penal Code, as amended, for failure of the prosecution to prove the guilt of the accused beyond a reasonable doubt.

Consequently, the Hold Departure Orders issued against the accused are hereby ordered RECALLED and SET ASIDE. The cash bonds secured by them for their provisional liberty are hereby ordered RELEASED subject to the usual accounting and auditing procedures.

Send copy of this Decision to the Bureau of Immigration for its appropriate action.

SO ORDERED.

We concur: DECISION 40 SB-16-CRM-0467-0478 x------X

ATTESTATION

I attest that the conclusions in the above Decision were reached in consultation before the case was assigned to the writer of the opinion of the Court's Division.

CERTIFICATION

Pursuant to Article VIII, Section 13 of the Constitution, it is hereby certified that the conclusions in the above Decision were reached in consultation before the case was assigned to the writer of the opinion of the Court.