J.A.B. Bulao & Associates

CASE 2011-0029: OFFICE OF THE COURT ADMINISTRATOR VS. MERLINDA T. CUACHON, CLERK OF COURT, AND FE P. ALEJANO, COURT STENOGRAPHER, BOTH OF THE MCTC, ILOG-CANDONI, NEGROS OCCIDENTAL (A.M. NO. P-06-2179, 12 JANUARY 2011, BRION, J.) SUBJECTS: SIMPLE NEGLECT OF DUTY; RESTITUTION DOES NOT ERASE ADMINISTRATIVE LIABILIT; RESTITUTION TEMPERS PENALTY. (BRIEF TITLE: OCA VS. CUACHON ET AL)

        For consideration are the findings and recommendations of the Office of the Court Administrator (OCA) in its Memorandum of August 26, 2008^[1][1] on the financial audit conducted in the Municipal Circuit Trial Court (MCTC), Ilog-Candoni, Negros Occidental. A financial audit was conducted because of respondent Clerk of Court Merlinda T. Cuachon’s (Cuachon) compulsory retirement on November 25, 2005. The audit covered transactions from September 1, 2000 to September 30, 2005, and included the books of account of respondent Fe P. Alejano (Alejano), Court Stenographer and designated Officer-in-Charge (OIC)–Clerk of Court from September 1, 2000 to March 15, 2001. 

          The Initial Report of the OCA’s Financial Audit Team showed that Cuachon had incurred a shortage of P15,065.00 in her Fiduciary Fund collections due to the difference between undeposited collections, amounting to P49,065.00, and withdrawals from cash on hand, amounting to P35,000.00, plus an unauthorized withdrawal of P1,000.00 due to an overwithdrawal under Official Receipt (OR) No. 14847505. Cuachon made restitutions by depositing with the Land Bank of the Philippines (LBP), Kabankalan Branch, P4,065.00 and P11,000.00 on January 25, 2006 and February 7, 2006, respectively. On the other hand, Alejano incurred a shortage of P31,800.00 for undeposited collections of P26,800.00 and an unauthorized withdrawal of P5,000.00 on February 28, 2001.  She, likewise, failed to account for two hundred (200) pieces of OR, with serial numbers 11653401 to 11653500 and 11654001 to 11654100.

          Also noted in the Initial Report were the following irregularities committed in the administration of the court’s funds: (1) collections were not properly deposited with the LBP within the month they were collected; (2) withdrawals from the Fiduciary Fund were made without supporting documents; (3) cash bond deposits were withdrawn from the undeposited collections; (4) the funds were deposited with the Municipal Treasurer’s Office (MTO), in violation of Supreme Court (SC) Circular No. 50-95; (5) unwithdrawn bail bonds amounting to P151,986.03 (as of September 2005) were still deposited with the MTO; (6) the court’s financial transactions were not recorded in the official cashbooks; and (7) actual cash on hand and the entries reflected in the cashbooks were not reconciled.

        In a Memorandum dated May 12, 2006,^[2][2] the OCA recommended that the Initial Report be docketed as an administrative complaint against respondents Cuachon and Alejano for violation of SC Circular No. 50-95, and that they be fined five thousand pesos (P5,000.00) each for the delay in their deposit of Fiduciary Fund collections. Accordingly, the Court formally docketed the Initial Report as an administrative complaint and required the respondents to manifest their willingness to submit the case for decision based on the records and/or pleadings filed.^[3][3] 

          In her Manifestation,^[4][4] Cuachon acknowledged: the violations she committed caused by her poor record keeping of court transactions, resulting in her cash shortages; her delay in the deposit or remittance of collections; and her unauthorized withdrawals. She attributed her shortcomings to her unfamiliarity with accounting and bookkeeping principles, and with the Court’s circulars on the proper administration of court funds. She claimed that she incurred the shortages with no intention to defraud the Court or the government. She also faulted the Office of the Clerk of Court in the MCTC, Ilog-Candoni, for not having an updated compilation of the Court’s issuances that could guide her in her work, and the court’s Property Division for turning a deaf ear to her repeated requests for cashbooks. Ultimately, she asked this Court to grant her leniency and to allow her to enjoy her retirement benefits in full since she had restituted her shortages by depositing the amounts of these shortages with the LBP.

          After considering Cuachon’s explanation, the OCA maintained its recommendation to impose a fine of P5,000.00, to be deposited with the Judiciary Development Fund, in order to compensate the government for the lost interest income caused by her delay in the deposit or remittance of Fiduciary Fund collections.^[5][5]  In compliance with our Resolution,^[6][6] Cuachon expressed her willingness to submit the case for resolution based on the records and/or pleadings filed.  She also asked for the early resolution of her case^[7][7] and for the immediate release of her retirement benefits and the monetary value of her leave credits.  She claimed that she needed the money to buy her diabetes and hypertension medications. The Court noted her letters and motions in its subsequent resolutions.

          Alejano, on the other hand, also explained in her Letter of July 14, 2006^[8][8]  the circumstances behind her shortages and the loss or misplacement of receipts.  She faulted the lack of a proper turnover of documents and cash bonds from the outgoing Clerk of Court at the time she was designated as OIC-Clerk of Court.  She also alleged that the newly renovated building that housed most of their court records was infested by termites, and many court documents – including the receipts already audited by the OCA – were lost there. Accompanying Alejano’s letter-explanation were additional documents that could be useful in reducing her remaining accountability, and her humble request that the Court guide her on how to resolve her problem.

In a Resolution dated July 11, 2007,^[9][9] the Court directed Alejano: to pay and deposit her shortage of P12,800.00 in the Fiduciary Fund (which amount resulted from the re-computation of Alejano’s accountability based on additional documents presented); to furnish the Fiscal Monitoring Division, Court Management Office, OCA, with the machine-validated deposit slip as proof of compliance thereto; and to explain why she failed to record in the cashbook and report to the Court the amount of one thousand pesos (P1,000.00) she had collected pertaining to the unaccounted and missing OR No. 116544551 dated December 12, 2000.

In the same resolution, the Court also directed Judge Victor P. Magahud (Presiding Judge of the MCTC, Ilog-Candoni, Negros Occidental) to submit an inventory of cases with unwithdrawn cash bonds, indicating their OR numbers and the dates when they were issued by the court; to investigate the missing ORs with serial numbers 11653401 to 11653500, 11653452 to 11653500 and 11654001 to 11654100; and to submit a report and recommendation regarding these matters. The Court received Judge Magahud’s Report on December 7, 2007.^[10][10]

In a Letter dated March 28, 2008,^[11][11] Alejano asked the Court, for clearance purposes, for a clarification of the status of her accountability.  She also stated that she had tried her best to recover the necessary documents to prove that the funds were not used for her personal gain. As of November 14, 2007, Alejano’s remaining accountability showed a balance of nine thousand eight hundred pesos (P9,800.00), after the OCA considered the additional documents she had submitted.

After a careful review of the records, the OCA found both respondents guilty of simple neglect of duty for violating SC Circular No. 50-95.  This circular specifies the guidelines on the proper collection and deposit of court fiduciary funds.  The records showed that Cuachon and Alejano failed to deposit their collections within twenty-four (24) hours, in violation of the circular.  Also, the shortages incurred by the respondents were due to their failure to account for their collections, which could have been avoided had they immediately remitted or deposited these collections with the LBP.  Due to the delayed remittance of collections, the cash on hand was used to pay for other withdrawals, i.e., undeposited collections were used to pay for cash bond withdrawals instead of withdrawing their cash bond equivalent from the Fiduciary Fund, thus, circumventing the system of “check and balance.” Lastly, the respondents made withdrawals from the Fiduciary Fund without the necessary supporting documents. Under SC Circular No. 50-95, no withdrawals are allowed unless there is a lawful order of the court with jurisdiction over the subject matter involved.

THE COURT’S RULING

    We find the OCA’s recommended fine to be appropriate and in accord with jurisprudence.  We disagree, however, with the OCA’s finding that the respondents were only liable for simple neglect of duty.  We find both respondents liable for gross neglect of duty for the irregularities they committed in the administration of court funds.

The settled rule is that a clerk of court is grossly negligent for his or her failure to promptly remit or deposit cash collections with the local or nearest LBP Branch, in accordance with Court administrative circulars and issuances.^[12][12] No protestation of good faith can override the mandatory observance of court circulars which are designed to promote full accountability of government funds.^[13][13] Restitution of the amount of the shortages does not erase administrative liability.^[14][14]

          The irregularities committed by both respondents were direct violations of SC Circular No. 50-95.^[15][15]  This circular mandates that all collections from bail bonds, rental deposits, and other fiduciary collections should be deposited with the LBP upon receipt by the Clerk of Court within twenty-four (24) hours; the circular also requires that only one depository bank be maintained.  In localities where there are no branches of the LBP, fiduciary collections should be deposited by the Clerk of Court with the Provincial, City or Municipal Treasurer. 

    Gross negligence in the performance of duty is considered a grave offense for which the penalty of dismissal is imposed, even for the first offense.^[16][16] This Court has ordered the dismissal of clerks of court and other court personnel for failure to deposit fiduciary funds in authorized government depository banks.^[17][17]  We cannot countenance any conduct, act or omission, committed by those involved in administering justice, that violate the norm of public accountability and diminish the faith of the people in the Judiciary.^[18][18]  However, since both respondents have retired from the service, while Ms. Cuachon – though belatedly – restituted her shortages, we find the imposition of a fine to be the appropriate penalty in accordance with our previous rulings.^[19][19]

WHEREFORE, premises considered, the Court finds as follows:

1.     MERLINDA T. CUACHON, Clerk of Court, Municipal Circuit Trial Court, Ilog-Candoni, Negros Occidental, GUILTY of gross neglect of duty for which she is FINED five thousand pesos (P5,000.00), to be deducted from her retirement benefits.

2.     FE P. ALEJANO, Court Stenographer, Municipal Circuit Trial Court, Ilog-Candoni, Negros Occidental, GUILTY of gross neglect of duty for which she is FINED five thousand pesos (P5,000.00). She is also directed to RESTITUTE the amount of nine thousand eight hundred pesos (P9,800.00) as payment for her remaining accountability. Both amounts are to be deducted from her retirement benefits.

3.     The Financial Management Office, Office of the Court Administrator, is directed to RELEASE respondent MERLINDA T. CUACHON’s retirement benefits and the monetary value of her accrued leave credits, deducting therefrom five thousand pesos (P5,000.00) as payment for the fine imposed.

4.     The Financial Management Office, Office of the Court Administrator, is directed to RELEASE respondent FE P. ALEJANO’s retirement benefits and the monetary value of her accrued leave credits, deducting therefrom five thousand pesos (P5,000.00), as payment for the fine imposed, and nine thousand eight hundred pesos (P9,800.00), as payment for her remaining accountability.

5.     Presiding Judge VICTOR P. MAGAHUD of the Municipal Circuit Trial Court, Ilog-Candoni, Negros Occidental, is directed to CLOSELY MONITOR the financial transactions of the court; otherwise, he can be held equally liable for the infractions by the employees under his supervision.  He is advised to STUDY and IMPLEMENT procedures that shall strengthen the court’s internal control over financial transactions.

SO ORDERED.

ARTURO D. BRION

Associate Justice

WE CONCUR:

MARIA LOURDES P.A. SERENO

Associate Justice

CASE 2011-0028: PEOPLE OF THE PHILIPPINES VS. LUIS PAJARIN y DELA CRUZ and EFREN PALLAYA y TUVIERA (G.R. No. 190640, 12 JANUARY 2011, ABAD, J.) SUBJECTS: ILLEGAL DRUGS; FAILURE TO COMPLY WITH PROCEDURE IN TAKING CUSTODY OF DRUGS; FAILURE TO IDENTIFY SAME SUBSTANCES. BRIEF TITLE: PEOPLE VS. PAJARIN).

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DECISION

ABAD, J.:

          This case is about the need for the prosecution and all law enforcement agencies involved in illegal drugs operations to ensure proper observance of the rules governing entrapment of peddlers of prohibited substances.

The Facts and the Case

The City Prosecutor of Manila charged the accused Luis Pajarin and Efren Pallaya before the Regional Trial Court (RTC) of Manila in Criminal Cases 05-237756 and 05-237757 with violation of Section 5 in relation to Sections 26 and 11 (3) in relation to Section 13, respectively, of Article II of Republic Act (R.A.) 9165 or the Comprehensive Dangerous Drugs Act of 2002.

          The prosecution presented PO2 Nestor Lehetemas, member of the buy-bust team and PO2 James Nolan Ibañez, the poseur-buyer.  They testified that on June 1, 2005 at around 10:00 p.m., an informant arrived at their Station Anti-Illegal Drugs (SAID) with the report that drugs would be sold on P. Ocampo and Dominga Streets the next day at around 5:00 pm.  As the poseur-buyer, PO2 Ibañez marked a P500.00 bill with SAID on top of its serial number.

          On June 2, 2005 the buy-bust team went to the site of the operation on board a Tamaraw FX which they parked near Dominga Street.  The informant pointed to the two accused, Luis Pajarin and Efren Pallaya.  They stood 10 to 20 steps away beside a red scooter.  PO2 Ibañez and the informant approached them.  After the informant introduced PO2 Ibañez as an interested buyer, the police officer bought shabu from the two, using the marked P500.00 bill.  Pajarin opened the compartment of the red scooter and took from it one heat-sealed transparent plastic sachet containing a white crystalline substance.  When Pallaya asked for the money, PO2 Ibañez handed it to him.  Then Pajarin gave one plastic sachet containing the suspected shabu to the officer, who raised his right hand as a pre-arranged signal.  PO2 Ibañez’s companions immediately rushed to the group.  PO2 Ibañez grabbed Pallaya.  Pajarin tried to escape but PO2 Lehetemas got hold of him.

          The police searched the red scooter’s compartment and recovered another plastic sachet containing the same substance.  They then brought the accused to their station.  The arresting officers turned over the seized suspected shabu to PO3 Roel Young who marked the plastic sachet seized from the scooter with the letters “ETP,” and the sachet Pajarin handed over with the letters “LDCP.”  Chemistry Report D-369-05 showed that upon examination of the submitted specimen, the same yielded positive result for Methylamphetamine hydrochloride, a regulated drug.

          The defense had a completely different version.  Pajarin said that at around 2:00 p.m. of June 2, 2005 he was at Pallaya’s house, repairing the latter’s motor pump.  As he left the house and got into the street, someone hit his helmet, grabbed him, and dragged him into a Tamaraw FX.  They then brought him back to Pallaya’s house where four police officers got in and brought Pallaya out with them after about three minutes.  The officers brought the two accused to the police station where they were investigated.  PO2 Ibañez showed Pajarin a plastic sachet which he supposedly recovered from Pajarin’s scooter.  Pajarin denied owning the sachet.  It was a police officer who drove the scooter to the police station. 

          For his part, Pallaya testified that on June 2, 2005 he was taking a bath at the fourth floor of his four-storey house when he heard knocking at the door.  When he opened it, he was surprised to see four men there, claiming to be police officers.  They broke open the doors of the house from the ground to the third floor.  The officers ordered him to dress up and forced him to go with them.  Pallaya asked for a warrant of arrest or a search warrant but he got no response from them.  They made him board a Tamaraw FX where Pajarin sat.  They then brought the accused to the police station.

          On March 31, 2008 the RTC found both accused guilty of the crime charged and imposed on them the penalty of life imprisonment and a fine of P500,000.00 in Criminal Case 05-237756.  In Criminal Case 05-237757, the RTC sentenced Pajarin to suffer 12 years and 1 day to 17 years and 4 months of imprisonment and to pay a fine of P300,000.00.  The RTC absolved Pallaya of this second offense. 

          On appeal to the Court of Appeals (CA) in CA-G.R. CR-HC 03291, the latter rendered a decision dated September 30, 2009, affirming the RTC decision, hence the present appeal to this Court.

The Issues Presented

Accused Pajarin and Pallaya raise two issues:

1.       Whether or not the CA erred in not excluding the evidence of the seized shabu on the ground that the prosecution failed to prove their integrity by establishing the chain of custody of the same until they got to the trial court; and

2.       Whether or not for this reason the CA erred in affirming their conviction.

The Rulings of the Court

          Appellants chiefly argue that the police officers involved in the buy-bust operation failed to comply with Section 21 (a), Article II of the Implementing Rules and Regulations of R.A. 9165, which requires them to take immediate inventory of and photograph the seized item in the presence of the accused or his representative or responsible third persons mentioned but always taking care that the integrity and evidentiary value of the seized articles are preserved. 

          The Court has held in numerous cases that the failure of the police to comply with the procedure laid down in R.A. 9165 would not render void the seizure of the prohibited substance for as long as the apprehending officers give justifiable reason for their imperfect conduct^[1][1] and show that the integrity and evidentiary value of the confiscated items had not been compromised.^[2][2] 

Here, the prosecution failed to show that the substances allegedly seized from the accused were the same substances presented in court to prove their guilt.  Usually, the seized article changes hands from the police officer who takes it from the accused, to the supervising officer at their station, to the messenger who brings them to the police crime laboratory, and then to the court where it is adduced as evidence.  Since custody and possession change over time, it has been held indispensable that the officer who seized the article places it in a plastic container unless it is already in one, seals it if yet unsealed, and puts his marking on the cover.  In this way there is assurance, upon inspection, that the substance reaches the laboratory in the same condition it was seized from the accused.^[3][3] 

Here, the police officers did not mark the sealed plastic sachets to show that they were the same things they took from the accused.  Rather, the marking on the items were done by the station investigator who would have no way of knowing that the substances were really seized from the accused.  The marking of captured items immediately after they are seized from the accused is the starting point in the custodial link.   This step is vital because succeeding handlers of the specimens will use the markings as reference.  Failure to place such markings paves the way for swapping, planting, and contamination of the evidence.^[4][4]  These lapses seriously cast doubt on the authenticity of the corpus delicti, warranting acquittal on reasonable doubt.^[5][5]

Further, as a rule, the police chemist who examines a seized substance should ordinarily testify that he received the seized article as marked, properly sealed and intact; that he resealed it after examination of the content; and that he placed his own marking on the same to ensure that it could not be tampered pending trial.  In case the parties stipulate to dispense with the attendance of the police chemist, they should stipulate that the latter would have testified that he took the precautionary steps mentioned.  Here, the record fails to show this. 

It is a serious concern that quite often the failure of the police to observe the rules governing buy-bust operations results in acquittals.  Drug enforcement agencies should continually train their officers and agents to observe these rules and transfer out those who would not.  The prosecutors conducting preliminary investigation should not file in court drugs cases where the sworn statements of the police officers, the report of the chemical analyst, and the object evidence do not show compliance with the same.  And trial courts should order the case dismissed and the accused released from detention if on examination the supporting documents are wanting in this respect.  They should not waste their precious time to useless exercise where the police and the prosecution fail to observe the rule of law especially in so serious offenses. 

          WHEREFORE, the Court REVERSES and SETS ASIDE the decision of the Court of Appeals dated September 30, 2009 in CA-G.R. CR-HC 03291 as well as the decision of the Regional Trial Court of Manila, Branch 2, in Criminal Cases 05-237756 and 05-237757, and ACQUITS the accused-appellants Luis Pajarin and Efren Pallaya on the ground of reasonable doubt.  The Court orders their immediate RELEASE from custody unless they are being held for some other lawful cause.

          SO ORDERED.

ROBERTO A. ABAD 

                                                              Associate Justice

WE CONCUR:

ANTONIO T. CARPIO

Associate Justice

ANTONIO EDUARDO B. NACHURA      DIOSDADO M. PERALTA

                  Associate Justice                                    Associate Justice

JOSE CATRAL MENDOZA

Associate Justice

ATTESTATION

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

                                                      ANTONIO T. CARPIO

                                                   Associate Justice

                                Chairperson, Second Division                  

CERTIFICATION

          Pursuant to Section 13, Article VIII of the Constitution and the Division Chairperson’s Attestation, I certify that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Court’s Division.

                                                             RENATO C. CORONA

                                                            Chief Justice