The Supreme Court’s decision underscores the stringent standards imposed on court personnel in handling public funds. Ashary M. Alauya, Clerk of Court VI of the Shari’a District Court in Marawi City, was dismissed from service for gross neglect of duty, dishonesty, and grave misconduct. This ruling emphasizes that those entrusted with managing judiciary funds must adhere strictly to regulations and ethical standards, ensuring public trust in the judicial system. Failure to do so can lead to severe penalties, including dismissal and perpetual disqualification from government service.

Custodial Chaos: Can a Clerk of Court Pass the Buck for Missing Funds?

This case arose from a financial audit conducted on the books of accounts of the Shari’a District Court (SDC) in Marawi City. The audit, covering a significant period, revealed numerous financial irregularities, including non-remittance of collections, falsification of official receipts and Legal Fees Forms (LFF), and a substantial cash shortage. Ashary M. Alauya, the Clerk of Court VI, was found responsible for these discrepancies, leading to administrative charges against him.

The audit team’s findings painted a grim picture of financial mismanagement. Key issues included a failure to remit judiciary fund collections within the prescribed period. Several official receipts were unaccounted for, raising suspicions of misuse. Further investigation revealed that some official receipt numbers were used in multiple transactions, and that Legal Fees Forms (LFF) were falsified to mask irregularities. These actions suggested a deliberate attempt to deceive both the public and the Court regarding the proper collection and recording of fees.

One of the most glaring findings was the initial cash shortage of One Hundred Four Thousand Eight Hundred Fifty-Two Pesos (P104,852.00). This amount represented unremitted collections from various funds, including the Fiduciary Fund (FF), Judiciary Development Fund (JDF), Special Allowance for the Judiciary Fund (SAJF), and Legal Research Fund (LRF). When confronted, Mr. Alauya claimed that the P100,000.00 from the Fiduciary Fund was kept in his house due to the court’s lack of a trust fund account. However, he failed to produce the money when directed by the audit team, further damaging his credibility. The Court emphasized that clerks of court are not supposed to keep funds in their custody. The Court cited Office of the Court Administrator v. Fortaleza, emphasizing the delicate function of clerks of court as judicial officers entrusted with the correct and effective implementation of regulations on legal fees.

The audit also uncovered shortages in various funds, including the Fiduciary Fund, Sheriff’s Trust Fund, Judiciary Development Fund, Special Allowance for the Judiciary Fund, General Fund-Old, Sheriff’s General Fund, and Mediation Fund. These shortages, totaling P37,414.00, indicated a systemic failure in the proper handling of court finances. The audit team also discovered delayed remittances, with some collections being remitted only after several years from the date of collection. For instance, the court violated OCA Circular No. 50-95, which provides that “all Fiduciary Fund collections shall be deposited within twenty-four (24) hours upon receipt thereof with the depository bank.”

In his defense, Mr. Alauya attempted to shift the blame to Ms. Alejandrea L. Guro, the designated financial custodian of the SDC. He argued that he had designated her as the cash clerk and placed her in charge of collecting docket and legal fees. However, the Court rejected this argument, emphasizing that as the court’s administrative officer, Mr. Alauya had a responsibility to oversee and supervise the work of his subordinates. He could not simply delegate his responsibilities and absolve himself of accountability. Office of the Court Administrator v. Dureza-Aldevera, emphasized that clerks of court cannot pass the blame for shortages to subordinates.

The Supreme Court, in its decision, emphasized the critical role of clerks of court in the judicial system. The Court noted that the clerk of court is the custodian of the court’s funds, revenues, records, property, and premises. As such, they are liable for any loss, shortage, destruction, or impairment of said funds and property. The Court also cited several circulars and guidelines that provide explicit instructions on how clerks of court should handle court funds, including the requirement to deposit collections within twenty-four hours and to render monthly reports.

The Court also addressed Mr. Alauya’s claim that the audit team had pre-judged his case. The Court found no evidence to support this claim, noting that Mr. Alauya had failed to present any proof of ill motive on the part of the audit team. In the absence of such evidence, the Court concluded that the audit team’s report was worthy of full faith and credit.

Building on this principle, the Court highlighted that Mr. Alauya had repeated his infractions despite previous audit findings and warnings. The Supreme Court noted that Alauya had been previously administratively charged for similar offenses in A.M. No. 02-4-03-SDC, where he was found guilty of gross neglect of duty and suspended for eighteen months. Despite this prior disciplinary action, Mr. Alauya failed to correct his behavior, demonstrating a disregard for the rules and regulations governing the handling of court funds.

The Court’s decision sends a clear message that those who work in the judiciary must adhere to the highest ethical standards. Court personnel must be examples of responsibility, competence, and efficiency, and they must discharge their duties with due care and utmost diligence. Any conduct that violates the norm of public accountability or diminishes public faith in the judiciary will not be tolerated.

In light of these findings, the Court found Ashary M. Alauya guilty of gross neglect of duty, dishonesty, and grave misconduct prejudicial to the best interest of the service. The Court ordered his dismissal from the service, with cancellation of eligibility, forfeiture of all retirement benefits (except accrued leave credits), and perpetual disqualification for reemployment in any branch or instrumentality of the government.

FAQs

What was the key issue in this case?	The central issue was whether Ashary M. Alauya, Clerk of Court VI, was liable for financial irregularities, including non-remittance of collections, falsification of official receipts, and a cash shortage. The Supreme Court assessed his culpability in managing judiciary funds and adherence to prescribed regulations.
What specific violations was Mr. Alauya found guilty of?	Mr. Alauya was found guilty of gross neglect of duty, dishonesty, and grave misconduct prejudicial to the best interest of the service. These charges stemmed from the financial audit that revealed numerous discrepancies in the handling of court funds.
What penalties did Mr. Alauya face as a result of the Supreme Court’s decision?	As a result of being found guilty, Mr. Alauya was dismissed from service, his eligibility was canceled, he forfeited all retirement benefits (except accrued leave credits), and he was perpetually disqualified from reemployment in any government position.
Why did the Court reject Mr. Alauya’s attempt to blame his subordinate, Ms. Guro?	The Court emphasized that as the administrative officer, Mr. Alauya had a responsibility to oversee and supervise the work of his subordinates. He could not simply delegate his responsibilities and absolve himself of accountability for the financial irregularities.
What is the significance of OCA Circular No. 50-95 in this case?	OCA Circular No. 50-95 mandates that all fiduciary fund collections shall be deposited within twenty-four hours upon receipt. Mr. Alauya violated this circular by failing to remit cash bonds to the depository bank, keeping them until withdrawn by the bondsmen.
What does the decision say about the ethical standards expected of court personnel?	The decision underscores that court personnel must adhere to high ethical standards to preserve the court’s good name and standing. They must be responsible, competent, and diligent in discharging their duties, maintaining public trust in the judiciary.
What was the initial cash shortage discovered by the audit team?	The audit team discovered an initial cash shortage of P104,852.00, which included unremitted collections from the Fiduciary Fund, Judiciary Development Fund, Special Allowance for the Judiciary Fund, and Legal Research Fund.
What was the total amount of shortages across all the funds examined?	The total amount of shortages across all the funds examined was P37,414.00, encompassing the Fiduciary Fund, Sheriff’s Trust Fund, Judiciary Development Fund, Special Allowance for the Judiciary Fund, General Fund-Old, Sheriff’s General Fund, and Mediation Fund.
What was the impact of Mr. Alauya’s previous administrative case on the Court’s decision?	Mr. Alauya’s prior administrative case, where he was found guilty of gross neglect of duty, weighed heavily in the Court’s decision. It demonstrated a pattern of misconduct and a failure to learn from past mistakes, leading to the imposition of the extreme penalty of dismissal.

This case serves as a reminder of the critical importance of integrity and accountability in the management of public funds within the judicial system. The Supreme Court’s firm stance against financial mismanagement underscores its commitment to maintaining the public’s trust and confidence in the judiciary.

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: OFFICE OF THE COURT ADMINISTRATOR vs. ASHARY M. ALAUYA, A.M. No. SDC-14-7-P, December 06, 2016