A.M. No. P-12-3047

Republic of the Philippines
SUPREME COURT
Manila

EN BANC

A.M. No. P-12-3047 October 1, 2013

OFFICE OF THE COURT ADMINISTRATOR, Petitioner,
vs.
NANCY R. LEAL, Clerk of Court II, Municipal Circuit Trial Court MCTC) -Sta. lgnacia-Mayantoc-San Clemente- San Jose, Tarlac, Respondent.

D E C I S I O N

PER CURIAM:

This administrative case arose from a financial audit conducted in the Municipal Circuit Trial Court MCTC), Sta. lgnacia-Mayantoc-Clemente-San Jose, Tarlac pursuant to Travel Order Number 021-2011¹ dated January 24, 2011.

The financial audit, conducted from February 28 to March 19, 2011, was prompted by the request of the Accounting Division, Financial Management Office, Office of the Court Administrator (OCA) due to the non-submission of the monthly financial reports by Ms. Nancy R. Leal (Leal), Clerk of Court II of said MCTC. Her salaries from September 15, 2004 to May 15, 2005 were withheld due to her failure to submit the Monthly Report of Collections and Deposits.²

Leal has been an Accountable Officer since January 1, 1992 to October 25, 2005, and from January 1, 2009 to the present. On October 26, 2005, Leal was relieved from her duties as Accountable Officer by Judge Domingo R. Joaquin, former Acting Judge of MCTC, Sta. Ignacia- Mayantoc-San Clemente-San Jose, Tarlac. In her stead, Mr. Rodelio A. Pedroche, Court Interpreter I of the same court was designated as the Officer-in-Charge until it was ordered revoked on February 27, 2009 by Judge Stela Marie Q. Gandia-Asuncion (Judge Gandia-Asuncion), the incumbent Presiding Judge. Leal was reinstated as Accountable Officer of the same court.³

Among other findings, and respecting matters solely attributable to Leal, the audit revealed the following, to wit: a) there were undocumented withdrawals of cash bond deposits amounting to ₱220,000.00;⁴ b) there were unreported and undeposited collections amounting to ₱1,047,400.00 which resulted in a total shortage amounting to ₱567,757.71;⁵ c) delayed remittances that deprived the government of bank interest that should have been earned amounting to ₱296,809.47;⁶ d) there was a shortage in the Judiciary Development Fund (JDF) amounting to ₱928.50;⁷ e) certain documents were withheld and retained in Leal’s possession while the audit team was conducting its examination;⁸ and f) among the Official Receipts that were issued to said court, there were four (4) booklets and four (4) pieces missing which correspond to the following series of numbers: 18843701 to 18843750, 2574101 to 2574150, 2574151 to 2574200, 2574201 to 2574250, and 4063301 to 4063304.⁹

Based on the Financial Report¹⁰ of the audit team, the OCA submitted a memorandum to the Office of the Chief Justice where it was recommended that:

1. This report be DOCKETED as a regular administrative matter against Ms. NANCY R. LEAL , Clerk of Court II of the Municipal Circuit Trial Court, Sta. Ignacia-Mayantoc-San Clemente-San Jose, Tarlac;

2. Ms. NANCY R. LEAL , Clerk of Court II of the Municipal Circuit Trial Court, Sta. Ignacia-Mayantoc-San Clemente-San Jose, Tarlac be DIRECTED within ten (10) days from notice to: 2.a) SUBMIT to the Fiscal Monitoring Division, Court Management Office all necessary documents stated below to authorize the refund of the cash bonds amounting to ₱220,000.00 , to wit:
1âwphi1

CASE NO. BONDS MAN RECEIPT NO. COURT ORDER WITHDRAWAL AMOUNT CO AR
DATE
Crim Case no. 995-Sc (96) Shirita Gabriel 4063367 7/21/97 08/08/97 3,000.00 X
Crim no. 27878 – 27881 Maria Bagay 4063374 11/26/97 3,000.00 X
Crim no. 1103-M Danilo F. dela Cruz 4063373 6/5698 06/08/98 2,000.00 X
Crim no. 1204-SI Alberto Rana 4063383 10/26/98 2,000.00 X X
98-2109 MTC SAN FERNANDO PAM Florentina B. Navarro 4063387 10/26/98 6,000.00 X
1491-M Ignacio Casco 9903959 12/04/01 6,000.00 X
04-2001 Paniqui George Cawigan 9903980 03/25/02 5,000.00 X
Crim. 1423-M Rodney Espejo 9903955 11/18/03 6,000.00 X
Crim. 1423-M Isagani Pablo 9903956 11/18/03 6,000.00 X
2347-SI Fiden I. Torre 13612736 04/06/04 100,000.00 X
2307-SI Cristina Bergonio/ Junedel Rafanan 13612733 01/11/05 6,000.00 X
1847-SC Gregorio Mangoba 9903985 02/24/05 2,000.00 X
2529-SI Noel Ubaldo 13612747 02/24/05 6,000.00 X
2398-SI Rey Ferrer 13612741 05/05/05 6,000.00 X
2337-SI Hector Agustin 13612740 05/05/05 20,000.00 X
2519-SI Simeon Tipay Opena 13612748 07/01/05 6,000.00 X
2468 SI(04) Rosalino Andres 2468 10/26/05 18,000.00 X
2348-SI Fiden I. Torre 13612739 8/11/06 08/11/06 12,000.00 X
2935-SI Regino Esteban 3469203 8/10/10 08/13/10 5,000.00 X
Total 220,000.00

Legend: AR - Acknowledgement Receipt; CO - Court Order

2.b) RESTITUTE the total shortages incurred amounting to ₱865,495.68, including the undocumented withdrawals referred to in No. 2.a above in case of failure to comply, broken down as follows:

Fund
Period Covered Balance of
Accountability
Fiduciary Fund (FF)
Judiciary Development Fund
(JDF) 07/01/96 to
02/28/11

01/01/92 to
10/25/08 567,757.71

928.50
UNEARNED Interest due to delayed remittances (JDF)
TOTAL ACCOUNTABILITY 07/25/03 to
11/09/05 296,809.47

865,495.68

2. c) EXPLAIN the following findings (a) unreported and undeposited collections amounting to ₱1,047,400.00; (b) issuing temporary receipts; (c) cancelled official receipts but with court orders that proved otherwise; (d) delayed remittances that deprived the government of the interest that should have been earned amounting to ₱296,809.47; (e) gross neglect of duty, for failure to perform her functions and duties as an accountable officer; and (f) documents withheld and retained in her possession while the audit team was conducting their examination; and

2. d) ACCOUNT for the missing official receipts issued by the Court to the Municipal Circuit Trial Court, Sta. Ignacia-Mayantoc-San Clemente-San Jose, Tarlac, with series nos.

● 18843701 to 18843750;

● 2574101 to 2574150;

● 2574151 to 2574200;

● 2574201 to 2574250; and

● 4063301 to 4063304 (4 pieces)

3. Ms. NANCY R. LEAL be placed under preventive SUSPENSION EFFECTIVE IMMEDIATELY WITHOUT salary and other benefits;

4. Ms. GENELYN C. GRAGASIN, Court Stenographer I be designated as Accountable Officer of the Municipal Circuit Trial Court, Sta. Ignacia-Mayantoc-San Clemente-San Jose, Tarlac;

5. Ms. GENELYN C. GRAGASIN be DIRECTED to:

5. a) VERIFY and ACCOUNT the remaining fiduciary fund accounts deposited with the Municipal Treasurer’s Office (MTO), and render a report thereon; and

5. b) STRICTLY ADHERE with the guidelines and Circulars issued by the Honorable Court with regards [sic] to the proper handling of judiciary funds;

6. Hon. STELA MARIE Q. GANDIA-ASUNCION, Presiding Judge, Municipal Circuit Trial Court, Sta. Ignacia-Mayantoc-San Clemente-San Jose, Tarlac be DIRECTED to strictly MONITOR the financial transactions of the court and be REMINDED that a repetition of the same infractions of the employees under her supervision shall be held her equally liable for the same.¹¹

Forthwith, the Court issued a Resolution¹² on February 27, 2012 adopting the aforesaid memorandum and recommendations of the OCA.

Leal then filed a letter¹³ on April 12, 2012 asking for an extension of sixty (60) days within which to comply with the Court’s Resolution and/or submit her answer considering that the ten (10) days given to her was too short.

On May 21, 2012, Ms. Genelyn C. Gragasin submitted the Statement of Unwithdrawn Fiduciary Fund¹⁴ in compliance with the Court Resolution.

On June 5, 2012, Leal filed another letter¹⁵ requesting an additional extension of sixty (60) days within which to file her answer. However, on June 22, 2012, Judge Gandia-Asuncion reported that from the time Leal received a copy of the Court’s Resolution dated February 27, 2012 on April 3, 2012, she ceased to report for work.¹⁶

Per Resolution¹⁷ dated July 30, 2012, the Court noted, among others, Leal’s letters and granted her a non-extendible period of one hundred twenty (120) days from April 2, 2012 within which to file her answer.

On August 1, 2012, Leal filed her Answer/Letter-Compliance¹⁸ dated July 30, 2012 with the following assertions:

1) She denies that she incurred unauthorized refund of cash bonds. To support her claim, she submitted the affidavits of the respective bondsmen acknowledging receipt of withdrawn cash bond in Criminal Case Nos. 995-SC (96), 1103-M and 1204-SI. In addition, she also attached the affidavit¹⁹ of the Barangay Chairman of Poblacion East, Sta. Ignacia, Tarlac, Mr. Ricky T. Silverio (Silverio) to buttress her declaration that although the withdrawn cash bond in Criminal Case No. 2348-SI for then accused Fiden Torre was duly received by said accused’s surviving spouse, it has now become an impossibility to secure the affidavit of the latter since she already migrated to the United States of America;

2) She cannot produce the court orders which authorized the withdrawals of the concerned cash bonds because she cannot avail of the records in their office. Nevertheless, she was allegedly told that some records were destroyed during typhoon Quiel, while others were destroyed by termites. She further reasoned that if the said court orders did not exist, she could not have withdrawn the subject cash bonds since "she cannot just withdraw those cash bonds without said court orders to be submitted to the depository bank";

3) She has already reported said withdrawal in her monthly report, but unfortunately, she cannot produce any proof because her files are missing. According to her, the loss may also be due to the reason that their office was not well-secured. In addition, they had to transfer office to the Police Station while the records were brought to the old Municipal Health Center, to give way to the construction of a new municipal building. The old office and even the old municipal health center where the records were transferred were infested with termites. These missing receipts were not issued or used; hence, she should not be liable;

4) She allegedly failed to deposit the collections on time because the passbook and even the receipts were lost. She added that said receipts "were only given/brought out after the audit and all were submitted to the team when she went to the Supreme Court";

5) She failed to submit her answer on time due to health reasons. In fact, up to the present, she is still suffering poor vision in spite of the series of eye operations she underwent; and

6) She begs for the Court’s indulgence and prays that her suspension be recalled.

After evaluation, the OCA found Leal’s explanation unsatisfactory to absolve her from any accountability and/or recall her suspension and recommended that: a) Leal be dismissed from the service with forfeiture of all retirement benefits, except earned leave credits, and with prejudice to re- employment in the government, including government-owned and controlled corporations; and b) the monetary value of Leal’s accrued leave credits be applied to her monetary accountability amounting to ₱865,495.68.

The evaluation and recommendations of the OCA are well-taken.

The Answer/Letter-Compliance dated July 30, 2012 of Leal did little to help her case. The fact still remains that a cash shortage amounting to ₱865,495.68 was incurred during her period of accountability and it still remains unpaid. Further, Leal did not even offer any explanation why there are unreported and undeposited collections; the fact that said unreported and undeposited collections reached the amount of ₱1,047,400.00 is simply appalling.

Similarly, Leal did not offer any explanation for the following as well, to wit: a) issuance of temporary receipts; b) cancelled official receipts but with court orders that proved otherwise; c) delayed remittances that deprived the government of the bank interest that should have been earned amounting to ₱296,809.47; d) gross neglect of duty, for failure to perform her functions and duties as an accountable officer; and e) withholding of documents and retaining the same in her possession while the audit team was conducting its examination.

In A.M. No. MTJ-06-1620,²⁰ we gave credence to the OCA’s evaluation that a Clerk of Court "must be held liable for the missing official receipts, unaccounted official receipts, original copies of cancelled official receipts, the passbook of LBP Savings Account x x x and Supporting Documents of Fiduciary Fund Withdrawals and for the shortage incurred.

It is incumbent upon him to ensure that all the files and documents are properly filed.

x x x In fact it even underscored the fact that he was unable to meet the demands of his office.

His claims of good faith, his forgetfulness and lack of secured storage area for their files during their transfer of office could only indicate his attempt to evade punishment for his neglect of duty."²¹

As correctly maintained by the OCA, Leal’s failure to perform her duties and responsibilities as Clerk of Court has caused tremendous losses both in financial and judicial aspects. As an Accountable Officer, she is primarily tasked to remit the court funds without further delay and to manage court records efficiently. Since Leal failed to offer any explanation on the foregoing audit findings, we shall consider the audit team’s report as conclusive and adjudge her liability on the sole basis thereof.

Leal’s failure to restitute the cash shortage amounting to ₱865,495.68 and "to adequately explain and present evidence thereon constitute gross dishonesty, grave misconduct, and even malversation of public funds."²² In that same vein, Leal’s acts of: a) issuance of temporary receipts; b) in making it appear that certain official receipts are cancelled but with court orders that proved otherwise; and c) withholding documents and retaining the same in her possession while the audit team was conducting its examination, constitute dishonesty and grave misconduct. "Dishonesty refers to a person’s ‘disposition to lie, cheat, deceive, or defraud; untrustworthiness; lack of integrity; lack of honesty, probity or integrity in principle; lack of fairness and straightforwardness; disposition to defraud, deceive or betray’"²³; while "in grave misconduct as distinguished from simple misconduct, the elements of corruption, clear intent to violate the law or flagrant disregard of established rule, must be manifest."²⁴

On the other hand, "failure to deposit on time her cash collections and her shortages in the remittances of collections amount to gross neglect of duty and dishonesty."²⁵

Under Section 52 of the Revised Uniform Rules on Administrative Cases in the Civil Service, dishonesty, grave misconduct and gross neglect of duty are classified as grave offenses, and merit dismissal even on their first commission.

In A.M. No. MTJ-06-1620,²⁶ the Court held that:

Safekeeping of public and trust funds is essential to an orderly administration of justice.

No protestation of good faith can override the mandatory nature of the circulars designed to promote full accountability of government funds. The Court has not hesitated to impose the ultimate penalty on those who have fallen short of their accountabilities. Any conduct that would violate the norms of public accountability and diminish, or even merely tend to diminish, the faith of the people in the justice system has never been tolerated or condoned by the Court. This ought to be so, as no less than the 1987 Constitution dictates:

"Public office is a public trust. Public officers and employees must at all times be accountable to the people, serve them with utmost responsibility, integrity, loyalty, and efficiency, act with patriotism and justice, and lead modest lives." (Emphasis supplied)

Clerks of court are the chief administrative officers of their respective courts.1âwphi1 As such, they are duty-bound to use skill and diligence in the performance of their officially designated functions. In

Office of the Court Administrator v. Paredes, this Court spelled out anew the nature of the function of clerks of court:

"Clerks of court perform a delicate function as designated custodians of the court’s funds, revenues, records, properties and premises. As such, they are generally regarded as treasurer, accountant, guard and physical plant manager thereof. Thus, they are liable for any loss, shortage, destruction or impairment of such funds and property."

By respondent’s assumption of the position of clerk of court, it is understood that he was ready and competent to do his job with utmost devotion and efficiency.²⁷ (Citations omitted)

For her failure to live up to the high ethical standards expected of her as a court employee, and an Accountable Officer at that, Leal’s dismissal is indeed in order.

WHEREFORE, the Court resolved to:

1. DISMISS respondent Nancy R. Leal from the service with forfeiture of all retirement benefits, excluding accrued leave credits, with prejudice to re-employment in any government office, including government-owned and controlled corporations;

2. DIRECT the Leave Division, Office of the Administrative Services, Office of the Court Administrator to compute the accrued leave credits of Nancy R. Leal and forward them to the Financial Management Office, Office of, the Court Administrator;

3. DIRECT the Financial Management Office, Office of the Court Administrator to apply the monetary value of the accrued leave credits of Nancy R. Leal, including the salaries withheld from her, to the cash shortages incurred, to wit:

Fiduciary Fund (FF) 07/01/96 to 02/28111 567,757.71

Judiciary Development

Fund (JDF) 01101/92 to 10/25/08 928.50

UNEARNED Interest due to

delayed remittances

(JDF) 07/25/03 to 11109/05 296,809.47

TOTAL ACCOUNTABILITY 865 495.68

4. After application of the monetary value of her accrued leave credits and withheld salaries, Nancy R. Leal is ORDERED to restitute the balance of the said shortages;

5. DIRECT Judge Stela Marie Q. Gandia-Asuncion, Presiding Judge, Municipal Circuit Trial Court, Sta. Ignacia-Mayantoc-San Clemente-San Jose, Tarlac to submit an inventory of the court records which were allegedly destroyed by typhoon Quiel or eaten by termites;

6. DIRECT the Office of the Court Administrator to file the appropriate criminal charges against Nancy R. Leal; and

7. DIRECT the Office of the Court Administrator to conduct another financial and judicial audit in the Municipal Circuit Trial Court, Sta. Ignacia-Mayantoc-San Clemente-San Jose, Tarlac from the finality of this Decision.

SO ORDERED.

WE CONCUR:

MARIA LOURDES P. A. SERENO
Chief Justice

ANTONIO T. CARPIO
Associate Justice PRESBITERO J. VELASCO, JR.
Associate Justice
TERESITA J. LEONARDO-DE CASTRO
Associate Justice ARTURO D. BRION
Associate Justice
DIOSDADO M. PERLATA
Associate Justice (On official leave)
LUCAS P. BERSAMIN*
Associate Justice
MARIANO C. DEL CASTILLO
Associate Justice ROBERTO A. ABAD
Associate Justice
(On leave)
MARTIN S. VILLARAMA, JR.**
Associate Justice JOSE PORTUGAL PEREZ
Associate Justice
(On official leave)
JOSE CATRAL MENDOZA*
Associate Justice BIENVENIDO L. REYES
Associate Justice
ESTELA M. PERLAS-BERNABE
Associate Justice MARVIC MARIO VICTOR F. LEONEN
Associate Justice

Footnotes

* On official leave.

** On leave.

¹ Rollo, p. 21.

² Id. at 4.

³ Id. at 22-23.

⁴ Id. at 1.

⁵ Id. at 6, 9.

⁶ Id. at 9.

⁷ Id. at 12.

⁸ Id. at 8-10; TSN, March 15, 2011, pp. 4-9; id. at 43-48.

⁹ Id. at 5.

¹⁰ Id. at 4-19.

¹¹ Id. at 1-3.

¹² Id. at 89-92.

¹³ Id. at 93-94.

¹⁴ Id. at 97-98.

¹⁵ Id. at 100-101.

¹⁶ Id. at 105.

¹⁷ Id. at 107-108.

¹⁸ Id. at 110-112.

¹⁹ Id. at 119.

²⁰ Initial Report on the Financial Audit Conducted at the Office of the Clerk of Court (OCC), Municipal Trial Court in Cities (MTCC), Lucena City, January 30, 2009, 577 SCRA 200.

²¹ Id. at 219.

²² Office of the Court Administrator v. Saddi, A.M. No. P-10-2818, November 15, 2010, 634 SCRA 525, 533, citing Article 217 of the REVISED PENAL CODE and Report on the Financial Audit Conducted on the Books of Accounts of the Municipal Circuit Trial Court, Mondragon-San Roque, Northern Samar, A.M. No. P-09-2721 (Formerly A.M. No. 09-9-162-MCTC), February 16, 2010, 612 SCRA 509, 531.

²³ Re: Failure of Various Employees to Register Their Time of Arrival and/or Departure from Office in the Chronolog Machine, A.M. No. 2005-21-SC, September 28, 2010, 631 SCRA 396, 409.

²⁴ Civil Service Commission v. Lucas, 361 Phil. 486, 490-491 (1999), citing Landrito v. Civil Service Commission, G.R. Nos. 104304-05, June 22, 1993, 223 SCRA 564.

²⁵ Office of the Court Administrator v. Bacani, A.M. No. P-12-3099, January 15, 2013, 688 SCRA 516, 526.

²⁶ Supra note 20.

²⁷ Id. 220-222.

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