SC partially grants gov’t appeal on DAP
The Supreme Court has clarified that only 'authors' of the Disbursement Acceleration Program – and not project proponents and implementors – may be held liable

MANILA, Philippines – The Supreme Court on Tuesday, February 3, partially granted the government’s appeal on its earlier ruling on the Disbursement Acceleration Program (DAP).

In a news conference, SC spokesperson Theodore Te announced that the High Court reversed itself on its ruling on one of 3 executive acts under the Disbursement Acceleration Program (DAP) that it had deemed unconstitutional in its July 1, 2014 decision, while affirming the unconstitutionality of the two other acts.

‘Partial reversal’

The SC partially granted the Motion for Reconsideration filed by the Office of the Solicitor General, reversing its ruling on the act under DAP pertaining to the funding of projects, activities and programs that were not covered by any appropriation in the GAA, which was earlier declared unconstitutional.

Te said the SC agreed with the argument of the Solicitor General Florin Hilbay that “there is no requirement in the Constitution or the GAA that the subject of augmentation should be the expense category or allotment class” and that what is required is only for Congress to create items to comply with the line-item veto of the president.

“Accordingly, so long as there is an item in the GAA for which Congress had set aside a specified amount of public funds, savings may be transferred thereto for augmentation purposes,” he said.

Te further explained, “This modified interpretation nonetheless does not take away the caveat that only DAP projects found in the appropriate GAAs may be subject of augmentation by legally accumulated savings.”

“Whether the 116 DAP funded projects had appropriation cover and were validly augmented require factual determination which is not within the scope of the present consolidated petitions under Rule 65 (or the Rules of Court),” he added.

Denied appeal

The High Court voted 13-0, denying Malacañang’s appeal on its earlier decision to declare unconstitutional two items:

  1. the withdrawal of unobligated allotments from implementing agencies and their use as savings before the end of the fiscal year
  2. the cross-border transfers of savings of the Executive to augment funds of agencies outside the department

The Court also upheld its earlier finding that the use of unprogrammed funds – despite the absence of the national treasurer’s certification that the revenue collections exceeded the revenue targets or were non-compliant with conditions in the GAA – was illegal.

All magistrates led by Chief Justice Maria  Lourdes Sereno approved the ruling, except for Associate Justice Teresita Leonardo-de Castro and Francis Jardeleza – who inhibited from the case.

‘Only DAP authors possibly liable’

The SC also clarified its earlier ruling that officials of the executive department may be held liable over the DAP.

In its July 2014 ruling, the High Court said that while recipients or those who benefitted in good faith from programs, activities and projects under the DAP cannot be held liable, the same cannot be said for the executive branch.

At the time, the SC had cited the doctrine of operative fact. This recognizes the validity of the assailed law or act, prior to the determination of its unconstitutionality, as an operative fact that produced consequences that cannot always be erased, ignored or disregarded.

In short, it nullifies the void law or executive act but sustains its effects.

In its original ruling, the High Court held that DAP authors and project proponents and implementors could be held liable “unless there are concrete findings of good faith in their favor by the proper tribunals determining their criminal, civil, administrative and other liabilities.”

“The Court also decided to clarify the language it used insofar as those subject to the consequences of the operation of the Operative Fact Doctrine by removing ‘proponents and implementors’ and leaving only ‘authors’ within the ambit of its coverage,” Te said. In its February 3 ruling, the SC left only “authors” of the DAP as those who may be held liable.

Te said that the presumption of good faith in the implementation of DAP-related projects still stands in the latest ruling.

He also said that the SC denied the motion for partial reconsideration from petitioner and former Manila Councilor Greco Belgica seeking to invalidate all PAPs under the DAP.

“The PAPs  (programs, activities and projects) under the DAP remain valid under the operative fact doctrine,” he said. –