150 Uy v.

COA
Date: March 21, 2000 G.R. No. 130685 Puno, J.
Article III, Section 1: Procedural Due Process - Pilar Rotor Hilado
Dismissal in Government Boards and
Commissions
Petitioner: Felix Uy, et. al. Respondent: Commission on Audit (COA)
Doctrine:
Facts:
1. Uy et. al. (Uy) were among more than 60 permanent employees of the Provincial
Engineering Office, Province of Agusan del Sur (PAS), who were dismissed from the
service by then Gov. Paredes, Jr. when he assumed office, allegedly to scale down the
operations of the said office. A petition for reinstatement was filed by Uy before the
Merit Systems Protection Board (MSPB), alleging that Governor Paredes was motivated
by political vengeance when he illegally dismissed them and hired new employees to
replace them.
2. During the pendency of the petition for reinstatement, Paredes issued a memorandum
providing for the hiring of casual employees to replace Uy, allegedly due to exigency of
service.
3. Contrary to Uy’s claim, Paredes specifically denied the allegations of Uy that their
dismissal was illegal. The MSPB rendered a decision holding that the reduction in work
force was not done in accordance with civil service rules and regulations, and ordering
the reinstatement of petitioners. The MSPB issued an Order directing PAS to pay Uy
their back salaries and other money benefits for the period that they had been out of
the service until their reinstatement.
4. In another motion, Uy sought an order directing PAS to reinstate them and declare
invalid the appointments of those who replaced them. Paredes continued to refuse to
implement said order. An Order from the MSPB directed Paresed to show cause why
he should not be declared in contempt. The matter was thereafter brought before the
CSC which directed Paredes to comply with the order or else face contempt
proceedings. The CSC actually initiated indirect contempt proceedings against the
Provincial Governor who was by then Democrito Plaza. Plaza complied, and Uy were
finally reinstated.
5. The Provincial Administrator, in behalf of Plaza, wrote a letter to COA, inquiring w/n
COA is the only proper authority to determine the matter; and w/n Paredes, Jr. would
be personally liable for payment of back salaries and other benefits." In the meantime,
the Provincial Treasurer made a partial payment to the reinstated employees,
representing back salaries.
6. COA said it sees no more legal impediment to the payment for back salaries and other
monetary benefits, which has become the personal liability of Paredes. As a result, the
Provincial Government refused to release Uy's remaining back salaries and other
monetary benefits.
Issue/s: Ruling:
1. W/N COA can disallow the payment of back wages of illegally NO
dismissed employees by the Provincial Government of Agusan del
Sur
Rationale/Analysis/Legal Basis:
1. COA is bereft of power to disallow the payment of petitioner's back wages. Relying
solely on the decision of the Merit Systems Protection Board (MSPB), the COA
concluded that bad faith attended the dismissal of petitioners. The MSPB, however,
never made a categorical finding of fact that Governor Paredes acted in bad faith and
hence, personally liable for the payment of petitioners' backwages. Then also,
Governor Paredes was never made a party to nor served a notice of the proceedings
before the COA. It would be unfair to hold him personally liable for the claims of
petitioners without giving him an opportunity to be heard and present evidence in his
defense. Further, the MSPB decision is already final and executory; and the ruling of
the COA radically altered the MSPB decision holding the provincial government liable
to petitioners. The COA decision affected both the procedural and the substantive
rights of the parties.