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Legal eagles back SC ruling on dubious contracts

TWO legal experts agree with the decision of the Supreme Court that clears government officials and heads of local government units of criminal, civil and administrative liabilities for ministerially approving contracts.

Former law deans Pacifico Agabin and Tranquil Salvador III said the ruling was correct when it held that mere approval of contracts that later on turned out to be irregular or deficient does not automatically make government officials liable.

“I agree with that decision of the Supreme Court,” Agabin, former dean of the University of the Philippines College of Law, said in a text message.

This doctrine, which grants the presumption of regularity on the approval of projects by heads of agencies or local executives, was already set by the Supreme Court in previous rulings, he said. The latest decision in the case of former Nueva Ecija Gov. Tomas Joson III is just a reiteration.

Salvador, former dean of Pamantasan ng Lungsod ng Maynila law dean and president of Integrated Bar of the Philippines - Quezon City chapter, shared Agabin’s view, saying the decision was “a sound and reasonable ruling.”

“This has been well established by jurisprudence and was only reiterated in the Joson ruling,” Salvador said.

“If the sole participation of the head of the local government unit is just to sign the contract and nothing more, then he should not be held liable,” he added.

In its decision on the Joson case released to the media recently, the Court held that the signatures of local government  executives as well as heads of agencies in procurement contracts that are found to be anomalous or irregular are not enough to establish their criminal and administrative liabilities.

“Mere signature [of the head of office or local government unit] in the award of the contract and the contract itself without anything more cannot be considered as a presumption of liability,” read the SC decision written by Associate Justice Noel Tijam.

`“Liability depends upon the wrong committed and not solely by reason of being the head of a government agency,” the tribunal ruled.

The Court made this ruling as it cleared Joson, who was found liable by the Commission on Audit for the P155.03-million construction of Nueva Ecija Friendship Hotel, now named Sierra Madre Suites.

The CoA found Joson liable along with members of the Bids and Awards Committee, the BAC Technical Working Group, the provincial accountant, and the provincial engineer.

Joson had filed a petition for exclusion from liability, arguing that “the determination of whether a prospective bidder is eligible or not is the exclusive responsibility of the BAC and if there is indeed a liability, the members of the BAC should be held liable since they are the persons directly responsible for the transaction.”

But CoA, in its 2015 decision, denied the petition and ruled that Joson was liable for the disallowed amount since “he failed to exercise due diligence in the performance of his duty.”

The commission also ruled that “being a signatory in the contracts, Joson is presumed to have prior knowledge that the bidding process was tainted with ineligibility.”

The Court disagreed and sided with Joson’s defense that he only approved the contract upon BAC’s recommendation to award the contract to A.V.T. Construction after evaluation of all the documents submitted by the firm and that he also only signed the contracts on behalf of the provincial government.

Citing the Government Procurement Act (Republic Act No. 9184), the Court said that determination of whether a prospective bidder is eligible or not falls on the BAC.

The Court said that even assuming that Joson did not ensure that the eligibility documents were attached to the contract, “it is settled that mistakes committed by a public officer are not actionable absent any clear showing that they were motivated by malice or gross negligence amounting to bad faith.”

 “In this case, there is no showing that petitioner was motivated by malice or gross negligence amounting to bad faith in failing to ensure that the eligibility documents of A.V.T. Construction were not attached to the contract,” the Court said.

Lastly, the Court reiterated the doctrine it set in earlier rulings in 1989 and 2001, which held that “every person who signs or initials documents in the course of transit through standard operating procedures does not automatically become a conspirator in a crime which transpired at a stage where he had no participation.”

Topics: Supreme Court , Contracts
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