CAMILO LOYOLA SABIO (FORMER CHAIRMAN), PETITIONER, VS. SANDIGANBAYAN (FIRST DIVISION), RESPONDENT.

Sabio versus Sandiganbayan

The Case

This is a petition for review on certiorari brought by Camilo Loyola Sabio, former Chairman of the Presidential Commission on Good Government, against the First Division of the Sandiganbayan. Sabio was convicted of two counts of violation of Section 3(e) of Republic Act Number 3019, the Anti-Graft and Corrupt Practices Act, for entering into lease agreements for service vehicles without the required public bidding. The case matters because it settles two questions every student of political law and graft law must be able to answer: whether the Presidential Commission on Good Government is exempt from the Government Procurement Reform Act, and whether an alter ego of the President shares the President's immunity from suit.

Procedural History

The Field Investigation Office of the Office of the Ombudsman filed criminal cases against Sabio and four Commissioners of the Presidential Commission on Good Government for violations of Section 3(e) of Republic Act Number 3019 and of the Government Procurement Reform Act. Two Informations for violation of Section 3(e) were later filed before the Sandiganbayan. In a Resolution dated May 29, 2014, the Sandiganbayan dismissed the cases against three Commissioners for violation of their constitutional right to a speedy disposition of cases, while one Commissioner passed away during the pendency of the case. Sabio was arraigned as the sole accused and pleaded not guilty. On June 22, 2017, the Sandiganbayan rendered judgment finding Sabio guilty beyond reasonable doubt in both cases and sentencing him to an indeterminate penalty of six years and one month as minimum to ten years as maximum, with perpetual disqualification from holding public office. Sabio moved for reconsideration, which the Sandiganbayan denied on August 25, 2017. Sabio then filed the present petition for review on certiorari before the Supreme Court.

Facts

On April 18, 2007, the Presidential Commission on Good Government and United Coconut Planters Bank Leasing and Finance Corporation entered into a Lease Agreement for five motor vehicles, in the total amount of 5,393,000 pesos. In 2009, a second lease contract was executed for six service vehicles, in the total amount of 6,734,610 pesos. Both contracts were entered into through negotiated procurement, without the required public bidding.

At the time, Sabio was the Acting Chairman of the Presidential Commission on Good Government. He was also a member of the Board of Directors of the United Coconut Planters Bank, the parent company of the leasing corporation. During trial, the prosecution established that no fund was appropriated to the Commission for the purchase of motor vehicles in those years, that the Commission's procurement plan did not include the lease of vehicles, and that its Bids and Awards Committee conducted no bidding for the lease of motor vehicles from 2006 to 2009.

For his defense, Sabio argued that the Commission, by reason of its unique mandate, is exempt from the procurement law, that the lease agreements merely followed the practice of his predecessors, that he gained nothing personally, and that as an alter ego of the President he could not be sued.

Issues

• Whether or not the Presidential Commission on Good Government, being a unique body, is exempt from the requirements of the procurement law.
• Whether or not Sabio, being an alter ego of the President, is immune from suit.
• Whether or not the Sandiganbayan committed reversible error in finding Sabio guilty of violation of Section 3(e) of Republic Act Number 3019.

Applicable Provisions

Section 4 of Republic Act Number 9184, the Government Procurement Reform Act, provides:

Section 4. Scope and Application. - This act shall apply to the Procurement of Infrastructure Projects, Goods and Consulting Services, regardless of source of funds, whether local of foreign, by all branches and instrumentalities of government, its departments, offices and agencies, including government-owned and/or-controlled corporations and local government units, subject to the provisions of Commonwealth Act No. 138. Any treaty or international or executive agreement affecting the subject matter of this Act to which the Philippine government is signatory shall be observed.

This provision fixes the reach of the law over all branches and instrumentalities of government, and it is the textual anchor for rejecting any claim of exemption.

Section 10 of the same law provides:

Section 10. Competitive Bidding. - All Procurement shall be done through Competitive Bidding, except as provided for in Article XVI of this Act.

This is the rule that Sabio violated when the lease agreements were awarded through negotiated procurement.

Ruling

On the first issue, the Court held that the claim of exemption has no basis in law and jurisprudence. Where the words of a statute are clear, plain, and free from ambiguity, they must be given their literal meaning and applied without attempted interpretation. Section 4 covers all branches and instrumentalities of government, and Section 10 commands that all procurement be done through competitive bidding except as provided in Article XVI. The Commission, an attached agency under the administrative supervision of the Department of Justice, is not among the exceptions. It is therefore not exempt from the procurement law.

On the second issue, the Court held that Sabio is not immune from suit. The President is immune from suit during his tenure, but that immunity does not extend to his alter egos. It was the Commission, through Sabio and his Commissioners, and not the President, that entered into the lease agreements without public bidding. The Court stressed that unlawful acts of public officials are not acts of the State, and the officer who acts illegally stands on the same footing as any other trespasser.

On the third issue, the Court upheld the conviction. All four elements of Section 3(e) were present: Sabio is a public officer, as stipulated; the acts were done in the discharge of his official functions; the acts were attended by bad faith; and unwarranted benefit was given to the leasing corporation. Bad faith was shown by the failure to undertake the required procurement process and by subjecting government funds to unnecessary expenditure without pre-allocation. The Court noted that Sabio sat on the Board of Directors of the parent bank, which bolstered the finding of unwarranted benefit. As the agency charged with instituting corruption preventive measures, the Commission should have been the first to follow the law.

Doctrine

First, the Government Procurement Reform Act applies to all branches and instrumentalities of government, including government-owned or controlled corporations, and all procurement must be done through competitive bidding except as provided in Article XVI. No agency is exempt unless the law itself exempts it.

Second, presidential immunity from suit does not extend to the President's alter egos. Unlawful acts of public officials are not acts of the State, and the officer who acts illegally stands on the same footing as any other trespasser.

Third, the elements of Section 3(e) of Republic Act Number 3019 are: the offender is a public officer; the act was done in the discharge of official functions; the act was done through manifest partiality, evident bad faith, or gross inexcusable negligence; and the public officer caused undue injury or gave unwarranted benefit, advantage, or preference. Proof of any one of the three modes is sufficient.

Disposition

The petition was denied, and the Decision and Resolution of the Sandiganbayan convicting Sabio of two counts of violation of Section 3(e) of Republic Act Number 3019 were affirmed.

Remember This

Memorize this line: the immunity of the President does not extend to his alter egos, and unlawful acts of public officials are not acts of the State. Examiners use this case to test the scope of the procurement law and the limits of presidential immunity.