The Supreme Court affirmed the conviction of SPO1 Ramon Lihaylihay and C/Insp. Virgilio V. Vinluan for violation of Section 3(e) of the Anti-Graft and Corrupt Practices Act. The Court found that Lihaylihay and Vinluan acted with evident bad faith when they certified the acceptance and inspection of combat, clothing, and individual equipment (CCIE) items that were never actually delivered, causing undue injury to the government. This case underscores the principle that public officials cannot blindly rely on their subordinates when irregularities are apparent, emphasizing the importance of due diligence and accountability in public service.

Beyond Blind Trust: When Official Duty Demands Scrutiny in Procurement

This case arose from a special audit report revealing “ghost” purchases of CCIE worth P8,000,000.00 within the Philippine National Police (PNP). The audit uncovered that funds were surreptitiously channeled to the PNP Service Store System (SSS) for items purportedly delivered to the PNP General Services Command (GSC), but which were never received. Consequently, an Information was filed before the Sandiganbayan, charging several PNP officers, including petitioners Vinluan and Lihaylihay, with violating Section 3(e) of Republic Act No. 3019 (RA 3019), also known as the Anti-Graft and Corrupt Practices Act.

The core legal question revolved around whether Vinluan and Lihaylihay acted with evident bad faith, causing undue injury to the government, or whether they could invoke the “Arias doctrine,” which generally protects heads of offices from liability if they rely in good faith on their subordinates’ work. The Sandiganbayan found Vinluan, as Chairman of the Inspection and Acceptance Committee, and Lihaylihay, as Inspector, guilty of violating Section 3(e) of RA 3019. They were found to have certified the inspection and acceptance of undelivered items, leading to the disbursement of public funds for nonexistent purchases.

The Supreme Court, in upholding the Sandiganbayan’s decision, emphasized that the elements of Section 3(e) of RA 3019 were present. Section 3(e) of RA 3019 states:

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

Specifically, the Court highlighted that both petitioners were public officers performing administrative functions, they acted with evident bad faith, and their actions resulted in undue injury to the government. The Court underscored that Vinluan signed certificates of acceptance despite incomplete or missing information, and Lihaylihay certified inspection reports despite the lack of actual deliveries. These actions, according to the Court, demonstrated a concerted effort amounting to a conspiracy to defraud the government.

The petitioners argued that they relied on the presumption of regularity in the performance of their duties and that the “Arias doctrine” should exculpate them. The Supreme Court rejected this argument, distinguishing this case from Arias v. Sandiganbayan. The Court clarified that the “Arias doctrine,” which generally protects heads of office who rely in good faith on their subordinates, does not apply when there are glaring irregularities that should have prompted a higher degree of circumspection. In this case, the Court noted several red flags that should have alerted the petitioners:

• Tampered dates on the Requisition and Invoice Vouchers (RIVs).
• Incomplete certification by the GSC Supply Accountable Officer (SAO).
• Missing details on the Reports of Public Property Purchased.
• The fact that sixteen checks, all dated January 15, 1992, were payable to PNP SSS.

The Supreme Court cited Cruz v. Sandiganbayan, to emphasize that the Arias doctrine does not apply when there are exceptional circumstances that should have prompted an official to be more diligent.

“Unlike in Arias, however, there exists in the present case an exceptional circumstance which should have prodded petitioner, if he were out to protect the interest of the municipality he swore to serve, to be curious and go beyond what his subordinates prepared or recommended. In fine, the added reason contemplated in Arias which would have put petitioner on his guard and examine the check/s and vouchers with some degree of circumspection before signing the same was obtaining in this case.“

The Court emphasized the responsibilities of Vinluan and Lihaylihay in the procurement process, noting that their roles should have led them to examine the documents with greater detail. This is further supported by the ruling in Bacasmas v. Sandiganbayan, which asserts that officials cannot hide behind the Arias doctrine when their duties require them to thoroughly examine documents before approval.

Moreover, the Court addressed the admissibility of the prosecution’s evidence, stating that the parties had already stipulated on the existence and authenticity of the documents, except for the checks. The Court noted that the obvious alterations and superimpositions on the documents were sufficient to establish a general appearance of forgery, without needing a comparison with the original documents.

FAQs

What was the key issue in this case?	The key issue was whether petitioners Vinluan and Lihaylihay were guilty of violating Section 3(e) of RA 3019 for their role in the “ghost” purchases of CCIE items, causing undue injury to the government. The Court had to determine whether they acted with evident bad faith or could invoke the Arias doctrine for relying on their subordinates.
What is Section 3(e) of RA 3019?	Section 3(e) of RA 3019, also known as the Anti-Graft and Corrupt Practices Act, penalizes public officers who cause undue injury to the government or give unwarranted benefits to private parties through manifest partiality, evident bad faith, or gross inexcusable negligence. This provision is intended to promote integrity and accountability in public service.
What is the Arias doctrine?	The Arias doctrine generally states that heads of offices are not liable for every single detail in documents they approve if they rely in good faith on the recommendations or preparations of their subordinates. However, this doctrine does not apply if there are circumstances that should have prompted the official to exercise greater scrutiny.
What evidence was presented against the petitioners?	The prosecution presented evidence that Vinluan and Lihaylihay certified the inspection and acceptance of CCIE items that were never delivered. This was supported by tampered RIVs, incomplete certifications, missing details in reports, and the fact that multiple checks were issued on the same date to the PNP SSS.
Why did the Court reject the petitioners’ reliance on the Arias doctrine?	The Court rejected the petitioners’ reliance on the Arias doctrine because the irregularities in the documents were too evident to ignore. The tampered dates, incomplete certifications, and missing details should have raised suspicion and prompted them to investigate further instead of blindly approving the transactions.
What does “evident bad faith” mean in this context?	In this context, “evident bad faith” means that the petitioners acted with a dishonest purpose or conscious doing of a wrong, reflecting moral obliquity or some ulterior motive or ill will. It implies a breach of faith and a willful intent to inflict injury or damage.
What was the penalty imposed on the petitioners?	The petitioners were sentenced to imprisonment for a term of six years and one month, as minimum, to nine years and one day, as maximum. They were also perpetually disqualified from holding public office and ordered to jointly and severally indemnify the government the amount of P8,000,000.00.
What is the significance of this case?	This case highlights the importance of due diligence and accountability in public service, especially in procurement processes. It clarifies that public officials cannot blindly rely on their subordinates when there are clear signs of fraud or irregularities, reinforcing the principle that public office is a public trust.

In conclusion, the Supreme Court’s decision in this case serves as a stern reminder to public officials of their duty to exercise due diligence and uphold the integrity of public office. The ruling clarifies the limits of the “Arias doctrine” and underscores that public officials cannot turn a blind eye to irregularities that should prompt further investigation. The case reinforces the principle of accountability and the importance of preventing corruption in government transactions.

For inquiries regarding the application of this ruling to specific circumstances, please contact ASG Law through contact or via email at frontdesk@asglawpartners.com.

Disclaimer: This analysis is provided for informational purposes only and does not constitute legal advice. For specific legal guidance tailored to your situation, please consult with a qualified attorney.
Source: SPO1 Ramon Lihaylihay and C/Insp. Virgilio V. Vinluan v. People, G.R. No. 191219, July 31, 2013