Osmena vs COA, 238 SCRA 363

Osmena v COA 238 SCRA 363

FACTS:

           

Reynaldo de la Cerna was stabbed and was rushed to Cebu City Medical Center but died in the same day due to severe loss of blood. His parents claimed that Reynaldo would not have died were it not for the “ineptitude, gross negligence, irresponsibility, stupidity and incompetence of the medical staff” of the Medical Center. The parents subsequently instituted in the RTC an action for recovery of damages which the City of Cebu was impleaded as defendant on the theory that as employer of the alleged negligent doctors, it is vicariously responsible for the latters' negligence.

           

To put an end to the controversy, a compromise agreement was entered into by the plaintiffs and defendant City of Cebu for the payment of the sum of P30,000. The agreement was ratified by the Sangguniang Panglungsod of the City and authorized the City Budget Officer of Cebu to include in Supplemental Budget No. 6 of the Ciy for the year 1989 the amount of P30,000 for financial assistance to the parents of the late Reynaldo de la Cerna”.

            

However, the respondent COA disallowed the financial assistance granted to the spouses de la Cerna holding that it is not within the power of the Sangguniang to provide financial assistance, either on general welfare clause or humanitarian grounds, to promote economic and private interests of certain individual only. Respondent further stressed that not being a party to the compromise agreement, it was not bound by it and that any money claim arising therefrom was subjected to its usual audit in the pursuance of the valid exercis and discharge of its constitutional power, authority and duty. The City of Cebu filed a Motion for Reconsideraton but was denied.

            

Hence this instant petition.

ISSUE:

            

Whether COA committed grave abuse of discretion in disallowing the city's appropriaton of P30,000 made conformably with the compromise agreement in the civil suit against the City?

HELD:

            

YES. There can be no question of COA's competence to act on the supplemental budget for 1989 of the City of Cebu. It appears that respondent COA greivously misconstrued the undertaking of Cebu City to pay P30,000 to the heirs of the deceased Reynaldo de la Cerna. It was construed as intended only to promote the private welfare and interest of the de la Cerna family. The respondent is well aware that the appropriation was a part of the package agreed upon by all parties in a civil case for the amicable settlement of the controversy. Judicial compromise is conclusive and binding on all the parties.