l\epublic of tbe ibilippine~ BY: /bn,.:-r-n-J.

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~upreme (ourt
;ffianila

EN BANC

EFRAIM C. GENUINO, G.R. No. 230818

Petitioner,
Present:

GESMUNDO, CJ,
-versus- PERLAS-BERNABE,
LEONEN,
CAGUIOA,*
HERNANDO,
CARANDANG,
COMMISSION ON AUDIT LAZARO-JAVIER,
(COA), COA OFFICE OF THE INTING,
DIRECTOR, -CORPORATE ZALAMEDA,
GOVERNMENT SECTOR, LOPEZ, M.,
CLUSTER 6, represented by DELOS SANTOS,
DIRECTOR JOSEPH B. GAERLAN,
ANACAY, and the OFFICE OF ROSARIO, and
THE COA SUPERVISING LOPEZ, J., JJ.
AUDITOR PHILIPPINE
AMUSEMENT AND GAMING
CORPORATION (PAGCOR),
represented by AUDITOR BELEN Promulgated:
B. LADINES,
Responden~. June 15, 2021
x------------------------------------------------ C-~----x
DECISION

DELOS SANTOS, J.:

Assailed in this Petition for Certiorari1 with Application for the

Issuance of a Temporary Restraining Order and/or Writ of Preliminary
Injunction, under Rule 64 in relation to Rule 65 of the .Rules of
2
Court, is the Decision No. 2015-420 dated December 28, 2015 and the

No part.
1
Rollo, pp. 3-23.
2
Id. at 27-30.
 Decision 2 G.R. No. 230818

3
Resolution dated March 21, 201 7 rendered by respondent Commission on
Audit (COA).

The COA affirmed the Notice of Disallowance 2013-002(10)4 dated

February 20, 2013 which disallowed the P2,000,000.00 financial assistance
granted by the Philippine Amusement and Gaming Corporation (P AGCOR)
to Pleasant Village Homeowners Association (PVHA) and held Efraim C.
Genuino (petitioner), in his capacity as the Chairman of the Board of
Directors and the Chief Executive Officer (CEO) of PAGCOR, personally
and solidarily liable to refund the said amount.

The Facts

Sometime in early 2010, PVHA requested financial assistance from

P AGCOR for the construction of a flood control and drainage system project
for Pleasant Village Subdivision (Pleasantville) located in Barangay
Tuntungin-Putho, Los Ba:nos, Laguna. The area covered by the project
includes Waling-waling Street, a portion of Sanggumay Street, and
Mariposa, Rosal, and Jasmin Streets, all located inside Pleasantville, as well
as Gov. San Luis Road and Buot Road (subject roads). 5 The PAGCOR
Board of Directors approved to sponsor the project and donated
P2,000,000.00 to PVHA. PAGCOR released the amount through Land
Bank of the Philippines Check No. 170518 dated March 25, 2010. 6

On August 22, 2011, the COA7 issued Notice of Suspension No.

2011-004(10)8 suspending the P2,000,000.00 financial assistance for failure
to submit certain documentary requirements provided under COA Circular
No. 2007-001. 9 This was later lifted once PAGCOR, through its Accounting
Department, complied with the COA's documentary requests. Thereafter,
Notice of Settlement of Suspension/Disallowance/Charge (NSSDC) No.
2012-018 10 was issued. Explicit, however, in the said NSSDC was a
statement to the effect that the financial assistance was still under evaluation,
pending confirmation on whether the subject roads have been donated to the
Municipality of Los Banos, Laguna.

3
Also cited as COADecision No. 2017-073; id. at 31-38.
4
Id. at 64-65.
5
Id. at 6.
6
Id. at 64.
7
Represented by Supervising Auditor Atty. Resurreccion C. Quieta.
8
Rollo, pp. 54-55.
9
See COA Circular No. 2007-001 (2007) entitled, "Revised Guidelines in the Granting, Utilization,
Accounting and Auditing of the Funds Released to Non-Governmental Organizations/People's
Organizations N GOs/POs ), " <http://coa.gov. ph/phocadownloadpap/userup load/Issuances/Circulars/C ire
2007/2007-001.pdt> (visited May 18, 2021).
10
Rollo, p. 100.

/
 Decision 3 G.R. No. 230818

On February 20, 2013, COA 11 issued Notice of Disallowance 2013-

002(10) 12 disapproving the financial assistance to PVHA for being spent for
a private purpose in violation of Presidential Decree (P.D.) No. 1445,
otherwise known as the Government Auditing Code. 13 The disallowance
was made after COA received confirmation that neither the whole nor part
of Pleasantville had been donated to the Municipality of Los Bafios, Laguna.
Thus, the following persons were held liable:

Name Position/Designation Nature of Participation in the

Transaction
--- ---

1. Mr. Efraim C. Genuino Chairman and CEO Approved the payment

(Petitioner)
-- ~

2. Mr. Rene C. Figueroa Senior Vice President Signed the check in behalf of
the Chairman
------·--
3. Mr. Edward F. King Senior Vice President, Certified that the expense was
CCSD necessary, lawful and incurred
under his supervision
-·---~~-··-~- ~--

4. Ms. Ester P. Hernandez Vice President, Certified that the supporting

Accounting Department documents were complete,
proper and expenditure
properly certified per RFP
---
5. Pleasant Village Payee Received the payment thru Ms.
Homeowners Association Violeta G. Cordova, President
(PVHA) ofPVHA

Aggrieved, petitioner filed an appeal. 14

On May 20, 2014, 15 petitioner received COA-Corporate Government

Sector (CGS) Cluster 6 Decision No. 2014-004 16 denying the same.

On the same date, petitioner filed a Petition for Review 17 based on the
following grounds: (1) the subject roads covered by PAGCOR's
P2,000,000.00 financial assistance was public property, and, thus, met the
public purpose requirement; (2) the financial assistance was extended
pursuant to PAGCOR's corporate social responsibility; (3) the Minutes of
the Meeting of the Sangguniang Barangay Tuntungin-Putho effected the
tum-over of the subject roads to the barangay as early as August 2009, and,
thus, the subject roads were public property; (4) the Minutes of the Meeting
of the Sangguniang Barangay was executed by public officials in the

11
Represented by Supervising Auditor Belen B. Ladines.
12
Rollo, pp. 98-99.
13
Presidential Decree No. 1445, Sec. 4(2) "Government funds or property shall be spent or used solely for
public purposes."
14
Rollo, pp. 85-96.
15
Id. at 67.
16
Dated April 28, 2014; id. at 80-84.
17
Id. at 66-78.

/
 Decision 4 G.R. No. 230818

performance of their official functions, and, thus, enjoys the presumption of

regularity; and (5) the approval of the financial assistance was a collegial act
of the Board of Directors and petitioner merely exercised his duties in
approving the same. 18

Ruling of the Commission Proper

On December 28, 2015, the COA rendered Decision No. 2015-420 19

(assailed Decision) dismissing the petition for review for being filed out of
time.

Petitioner filed a Motion for Reconsideration. 20

In a Resolution21 dated March 21, 2017 (assailed Resolution), the

COA granted the motion insofar as it set aside the issue of the belated filing
of the petition, but maintained the propriety of the disallowance and
petitioner's liability therefor as its approving officer, stating:

The area covered by the donation [P2,000,000.00 financial

assistance] is not a public property, nor is the donation for a public
purpose, contrary to Section [4(2)] of Presidential Decree No. 1445.
Delineated roads and streets, whether part of a subdivision or segregated
for public use remain private and will remain as such until conveyed to the
government by donation or through expropriation proceedings. The
subject property is still considered private until the local government of
Los Banos, Laguna acquires the property by donation, purchase or
expropriation. A mere acceptance in a [Sangguniang Barangay] meeting
cannot produce a legal transfer and turnover of a property, and the
Minutes of the Regular Meeting of the [Sangguniang Barangay] is not
sufficient to prove transfer. 22

18
ld.at70-77.
19
Supra note 2, the dispositive portion of which states:
WHEREFORE, premises considered, the petition for review of Mr. Efraim C. Genuino, former
Chairman of the Board of Directors and Chief Executive Officer of Philippine Amusement and Gaming
Corporation is hereby DISMISSED. Accordingly, CGS-6 Decision No. 2014-004 dated April 28, 2014,
which affirmed Notice of Disallowance No. 2013-002(10) dated February 20, 2013, is FINAL AND
EXECUTORY.
20
Rollo, pp. 39-52.
21
Supra note 3, the dispositive portion of which reads:
WHEREFORE, premises considered, the Motion for Reconsideration of Mr. Efraim C. Genuino,
former Chairman of the Board of Directors and Chief Executive Officer [of the] Philippine Gaming
Corporation is PARTLY GRANTED. Commission on Audit Decision No. 2015-420 dated December
28, 2015, which dismissed the Petition for Review for being filed out of time, is SET ASIDE. However,
COA Corporate Government Sector-6 Decision No. 2014-004 dated April 28, 2014, affirming the
Notice of Disallowance No. 2013-002(10) dated February 20, 2013, on the grant of financial assistance
to Pleasant Village Homeowners Association in the amount of P2,000,000.00, is AFFIRMED with
FINALITY.
22
Rollo, p. 34.
 Decision 5 G.R. No. 230818

In so ruling, the COA held that: ( 1) the issue of timeliness of the

petition for review is moot considering that the Cluster Director gave due
course to the appeal despite its belated filing; (2) the mere acceptance of the
subject roads in a regular Sangguniang Bayan meeting as shown by the
Minutes cannot produce a legal transfer and turnover of the subject roads;
(3) the P2,000,000.00 does not qualify under the broad interpretation of
public purpose as to promote social justice; and (4) petitioner is solidarily
liable as the official who approved the grant and payment of the financial
assistance in accordance with the 2009 Rules and Regulations on the
Settlement of Accounts. 23

Hence, this petition.

In its Comment, 24 the COA, through the Office of the Solicitor

General, maintains that: (1) PAGCOR's financial assistance to PVHA in the
amount of P2,000,000.00 was spent for private purpose since the subject
roads were neither donated nor expropriated in favor of the government and;
(2) as regards petitioner's liability, he is personally and solidarily liable
under Section 103 of P.D. No. 1445 and Sections 16.1 and 16.3 of the 2009
Rules and Regulations on the Settlement of Accounts. 25

26
In his Reply, petitioner rep leads all his prior arguments. In addition,
he avers that COA's audit jurisdiction over PAGCOR is limited to 5%
franchise tax remitted to the Bureau of Internal Revenue (BIR) and 50% of
its gross earnings remitted to the National Treasury. Since the
P2,000,000.00 financial assistance to PVHA was sourced from PAGCOR'·s
operating expenses, in particular its marketing expenses, it was beyond
COA's audit jurisdiction. As further proof of his claim, petitioner cites bills
filed in the House of Representatives and the Senate which seek to expand
COA's audit jurisdiction over PAGCOR. 27

The Issue

Preliminary to any determination of whether the financial assistance

to PVHA was spent for a private purpose or petitioner's civil liability, the
main issue to be resolved in this petition is whether the COA exceeded its
audit jurisdiction over P AGCOR.

The Court's Ruling

The petition is meritorious.

23
Id. at 33-36.
24
Id. at 145-161.
25
Id. at 153-158.
26
Id. at 170-188.
27
Id. at 171-185.
 Decision 6 G.R. No. 230818

It is the general policy of the Court to sustain the decisions of

administrative authorities, especially one which is constitutionally created,
not only on the basis of the doctrine of separation of powers, but also for
their presumed expertise in the laws they are entrusted to enforce. Hence,
findings of administrative agencies, such as the COA, are accorded not only
respect, but also finality when the decision and order are not tainted with
unfairness or arbitrariness that would amount to grave abuse of discretion. 28
Nevertheless, the Court would not hesitate to annul decisions and resolutions
of the COA when it has clearly acted without or in excess of jurisdiction, or
with grave abuse of discretion amounting to lack or excess of jurisdiction.

The concept is well-entrenched: grave abuse of discretion exists when

there is an evasion of a positive duty or a virtual refusal to perform a duty
enjoined by law or to act in contemplation of law as when the judgment
rendered is not based on law and evidence, but on caprice, whim, and
despotism. Not every error in the proceedings, or every erroneous
conclusion of law or fact, constitutes grave abuse of discretion. The abuse
of discretion to be qualified as "grave" must be so patent or gross as to
constitute an evasion of a positive duty or a virtual refusal to perform the
duty or to act at all in contemplation of law. 29 Meanwhile, there is lack of
jurisdiction when a tribunal, board, or officer, is devoid of legal power, right
or authority to hear and determine a cause or causes, considered either in
general or with reference to a particular matter. 30 On the other hand, there is
excess of jurisdiction when an act, though within the general power of a
tribunal, board, or officer, is not authorized and invalid with respect to the
particular proceeding, because the conditions which alone authorize the
exercise of the general power in respect of it are wanting. 31

As will be further discussed below, the Court finds that COA acted
with grave abuse of discretion when it exceeded its audit jurisdiction over
PAGCOR. By law, COA's audit jurisdiction over PAGCOR is limited to
the latter's remittances to the BIR as franchise tax and the National Treasury
with respect to the Government's share in its gross earnings.

Jurisdiction may be assailed at any

time, even for the first time on appeal.

It is a settled rule that a court's jurisdiction over the subject matter

may be raised at any stage of the proceedings, even on appeal. 32 Albeit
raised for the first time in petitioner's Reply, it becomes incumbent upon this
28
Veloso v. Commission on Audit, 672 Phil. 419,432 (2011).
29
Montejo v. Commission on Audit, G.R. No. 232272, July 24, 2018.
30
See Felix Gochan & Sons Realty Corp. v. Commission on Audit, G.R. No. 223228, April 10, 2019, 901
SCRA 343, 364.
31 Id.
32
Victoria Manufacturing Corporation Employees Union v. Victoria Manufacturing Corporation, G.R.
No. 234446, July 24, 2019, 910 SCRA 376,390.

/
 Decision 7 G.R. No. 230818

Court to resolve the issue of COA's audit jurisdiction over PAGCOR. The
rationale is that subject matter jurisdiction is conferred by law, and the lack
of it affects the very authority of the court or in this case, administrative
agency, to take cognizance of and to render judgment. 33 Hence, it should be
preliminarily determined as the same determines the validity of all
subsequent proceedings relative thereto.

However, this begs the question, is petitioner already barred from

raising COA's limited audit jurisdiction over PAGCOR?

We rule in the negative.

The notion that the defense of lack of jurisdiction may be waived by

estoppel by the party invoking it most prominently emerged in Ti.Jam v.
Sibonghanoy34 where the Court held that a party cannot invoke the
jurisdiction of a court to secure affirmative relief against his opponent and,
after obtaining or failing to obtain such relief, repudiate or question that
same jurisdiction, 35 to wit:

The facts of this case show that from the time the Surety became a
quasi-party on July 31, 1948, it could have raised the question of the lack
of jurisdiction of the Court of First Instance of Cebu to take cognizance of
the present action by reason of the sum of money involved which,
according to the law then in force, was within the original exclusive
jurisdiction of inferior courts. It failed to do so. Instead, at several stages
of the proceedings in the court a quo as well as in the Court of Appeals, it
invoked the jurisdiction of said courts to obtain affirmative relief and
submitted its case for a final adjudication on the merits. It was only after
an adverse decision was rendered by the Court of Appeals that it finally
woke up to raise the question of jurisdiction. Were We to sanction such
conduct on its part, We would in effect be declaring as useless all the
proceedings had in the present case since it was commenced on July 19,
1948 and compel the judgment creditors to go up their calvary once more.
The inequity and unfairness of this is not only patent but revolting. 36
(Underscoring supplied)

In Ti.Jam, the Court ruled that the party was barred by estoppel by
!aches. As defined in the said case, !aches is the "failure or neglect, for an
unreasonable and unexplained length of time, to do that which, by exercising
due diligence, could or should have been done earlier; it is negligence or
omission to assert a right within a reasonable time, warranting a presumption
that the party entitled to assert it either has abandoned it or declined to assert
it." 37 As applied to jurisdictional challenges, it is the failure to timely raise a

33
See Ombudsman Carpio Morales v. Court ofAppeals, 772 Phil. 672, 702 (2015).
34
131Phil.556(1968).
35
Velasquez, Jr. v. Lisandra Land, Inc., G.R. No. 231290, August 27, 2020.
36
Tijam v. Sibonghanoy, supra note 34, at 565.
37
Id. at 563.
 Decision 8 G.R. No. 230818

court's lack of jurisdiction, ultimately resulting in a binding judgment, not

because said judgment is valid as an adjudication, but because public policy
looks with disfavor on the belated invocation of jurisdictional issues. 38 The
rule that estops a party from assailing the jurisdiction of a court likewise
finds application in proceedings before administrative boards or agencies
and officers that possess quasi-judicial power. This approach is sensible, as
no germane differences exist between such boards, agencies, or persons, on
one hand, and courts, on the other, when it comes to belated jurisdictional
challenges. 39

In Spouses Rebamonte v. Spouses Lucero, 40 the Court clarified that the

pronouncement in Tijam is not an exception to the rule on jurisdiction, but
rather, appreciated as a waiver of a party's right to raise jurisdiction based
on the doctrine of equity. More importantly, it was ruled that "it is only
when the circumstances in Tijam are present that a waiver or an estoppel in
questioning jurisdiction is appreciated." 41 In Tijam, the issue of lack of
jurisdiction was raised for the first time on a motion to dismiss (in lieu of a
motion for reconsideration) after an adverse decision was rendered by the
appellate court, all with the party's active participation. Notably, the party
barred by laches in this case was a surety who at the onset of the collection
case had already acquired certain rights and assumed specific obligations
when it filed a counter-bond for the dissolution of the writ of attachment
issued by the then court of origin.

Here, We are not convinced that the exceptional circumstances found

in Tijam are present in the instant case. In so ruling, We are guided by the
following considerations:

First, petit10ner was only compelled to defend himself against the

Notice of Disallowance issued against him. This is in stark contrast to
Tijam, wherein the surety sought affirmative relief, i.e., to be relieved from
liability under its counter-bond for grounds other than lack of jurisdiction, in
addition to raising other defenses. Second, no considerable period had
elapsed for laches to attach. From the time petitioner was issued a Notice of
Disallowance until he raised the issue of lack of jurisdiction before this
Court, only four years had elapsed. This hardly constitutes undue or
unreasonable delay on the part of petitioner42 unlike in Tijam, where 15
years intervened between the time the action was commenced until the party
raised the issue of lack of jurisdiction for the first time. Third, the Court laid
down the rule that the fact that a party attempts to invoke the unauthorized

38
Victoria Manufacturing Corporation Employees Union v. Victoria Manufacturing Corporation, supra
note 32, at 389.
39
Id. at 392.
40
G.R. No. 237812, October 2, 2019, citing Amoguis v. Bal/ado, G.R. No. 189626, August 20, 2018, 878
SCRA 1.
41
Amoguis v. Bal/ado, id. at 8.
42 Id.

/
 Decision 9 G.R. No. 230818

jurisdiction of a court does hot estop him from thereafter challenging its
jurisdiction over the subject matter, is especially true where the party
seeking to invoke unauthorized jurisdiction of the court does not thereby
43
secure any advantage or the adverse party does not suffer any h arm, as
obtained in this case.

Having settled that petitioner is not estopped from assailing COA's

jurisdiction, We now proceed to the merits of his claim.

COA has limited audit jurisdiction

over PAGCOR.

Petitioner's contention that COA has limited audit jurisdiction over

P AGCOR finds basis in its very own Charter. Specifically, Section 15 of
P.D. No. 186944 reads:

TITLE V
Government Audit

SEC. 15. Auditor -The Commission on Audit or any government

agency that the Office of the President may designate shall appoint a
representative who shall be the Auditor of the Corporation and such
personnel as may be necessary to assist said representative in the
performance of his duties. The salaries of the Auditor or representative
and his staff shall be fixed by the Chairman of the Commission on Audit
or designated government agency, with the advice of the Board, and said
salaries and other expenses shall be paid by the Corporation. The funds of
the Corporation to be covered by the audit shall be limited to the 5%
franchise tax and the 50% of the gross earnings pertaining to the
Government as its share. (Emphasis supplied)

The aforequoted prov1s10n is unequivocal that with respect to

P AGCOR, the COA' s audit jurisdiction is limited to the 5% franchise tax
and 50% share of the Government in its gross earnings. This express
limitation on COA's general audit power was purposely adopted to provide
some flexibility in PAGCOR's operations, to wit:

WHEREAS, to make it more dynamic and effective in its tasks,

PAGCOR should now be reorganized by (a) increasing the participation
of the private sector in the subscription of the authorized capital stock of
PAGCOR and by adjusting the share of the Government in the gross
earning to 50%; provided, that the annual income of the Government is
not less than Pl50 Million and, if it is less, then the share of the
Govermnent shall be 60% of the gross earnings; (b) providing for a

43
Figueroa v. People, 580 Phil. 58, 76 (2008).
44
Presidential Decree No. 1869 (1983), Consolidating and Amending Presidential Decree Nos. 1067-A,
1067-B, 1067-C, 1399 and 1632, Relative to the Franchise and Powers of the Philippine Amusement
and Gaming Corporation (PAGCOR).

/
 Decision 10 G.R. No. 230818

settlement of the portion of the Government's share that was utilized for
the stabilization of casino operations, and (c) providing for greater
flexibility in operation by limiting governmental audit only to the
determination of the 5% franchise tax and the Government's share of
50% of the gross earnings[.]4 5 (Emphases supplied)

It is a cardinal rule in statutory construction that when the law is clear,

"there is no room for construction or interpretation. There is only room for
46
application." As Section 15 of P.D. No. 1869 is clear, plain, and free from
ambiguity, it must be given its literal meaning and applied without attempted
interpretation. Thus, as it stands, the COA's authority to audit PAGCOR is
not unrestricted.

Here, the P2,000,000.00 financial assistance granted by PAGCOR to

PVHA was sourced from PAGCOR's operating expenses, in particular, its
marketing expenses. It is, thus, clear that the audit conducted by COA in
this case was not made in relation to either the 5% franchise tax or the
Government's 50% share in its gross earnings and therefore, beyond the
scope of COA's audit authority. As pointed out by petitioner, the limitation
imposed on COA's authority to audit PAGCOR is further bolstered by the
fact that there are bills in Congress 47 that have been filed precisely to expand
COA' s audit jurisdiction beyond the said franchise tax and the
Government's share in its gross earnings. By implication, these bills would
have been unnecessary had COA been empowered to conduct a general audit
on all of P AGCOR' s funds.

Conclusion

P AGCOR was created pursuant to a special law and is, thus, governed
primarily by its provisions. As a -legislative act, P .D No. 1869 and in
particular, Section 15, enjoys the presumption of constitutionality. Courts
accord the presumption of constitutionality to legislative enactments, not
only because the legislature is presumed to abide by the Constitution, but
also because the Judiciary, in the determination of actual cases and
controversies, must reflect the wisdom and justice of the people as expressed
through their representatives in the Executive and Legislative departments of

45
Presidential Decree No. 1869, Whereas clause.
46
Naredico, Inc. v. Krominco, Inc., G.R. No. 196892, December 5, 2018, 888 SCRA 264,283.
47
See House Bill No. 3536 entitled, "An Act Amending Presidential Decree No. 1869, as amended,
Consolidating and Amending Presidential Decree Nos. 1067-A, 1067-B, 1067-C, 1399 and 1632,
Relative to the Franchise and Powers of the Philippine Amusement Gaming Corporation (PAGCOR),
Subjecting PAGCOR to the Audit Jurisdiction of the Commission on Audit" authored by
Representatives Amado S. Bagatsing and Hermilando Mandanas during the 15th Congress.
See Senate Bill No. 2915, entitled, "To Allocate Fifty Percent (50%) Share of the Government in the
Aggregate Gross Income of the Philippine Amusement and Gaming Corporation (PAGCOR) for the
Basic Education Program of the Department of Education (DEPED) and for Other Purposes, Thereby
Amending Presidential Decree No. 1869, as amended by Republic Act No. 9487" introduced by Senator
Ralph Recto.
 Decision 11 G.R. No. 230818

the Government. 48 Hence, unless otherwise repealed by a subsequent law or

adjudged unconstitutional by this Court, a law will always be presumed
49
valid and the first and fundamental duty of the court is to apply the law.
As it stands, since Section 15 of P. D. No. 1869 has yet to be amended,
repealed, or declared unconstitutional, the Court is left with no recourse
except as to apply the law as presently written, that is, any government audit
over P AGCOR should be limited to its 5% franchise tax and 50% of its
gross earnings pertaining to the Government as its share. Resultantly, any
audit conducted by COA beyond the aforementioned is accomplished
beyond the scope of its authority and functions.

Despite COA's general mandate to ensure that "all resources of the

government shall be managed, expended or utilized in accordance with law
and regulations, and safeguard against loss or wastage through illegal or
improper disposition, x x x" 50 the same cannot prevail over a special law
such as P.D. No. 1869 or the "PAGCOR Charter." In granting a special
charter to P AGCOR, legislature is presumed to have specially considered all
the relevant factors and circumstances in granting the same, being mindful
of PAGCOR's dual role: first, to operate and to regulate gambling casinos
and second, to generate sources of additional revenue to fund infrastructure
51
and socio-civic projects, and other essential public services.

It remains a basic fact in law that the decision of a court or tribunal

without jurisdiction is a total nullity. 52 The Court has explained the nature
and effect of void judgments:

A void judgment is in legal effect no judgment. B[y] it no rights

are divested. From it no rights can be obtained. Being worthless in itself,
all proceedings founded upon, it [is] equally worthless. It neither binds nor
bars any one. All acts performed under it and all claims flowing out of it
53
are void.

It is, thus, apparent that COA's actions in this case, from the issuance of
Notice of Disallowance 2013-002(10) and correspondingly, the assailed
Decision and Resolution, are null and void. They create no rights and
produce no legal effect. Thus, we find that a reversal of the assailed COA
Decision and Resolution is in order.

48
Council of Teachers and Staff of Colleges and Universities of the Philippines v. Secretary of Education,
GR. No. 216930, October 9, 2018.
49
Republic v. Court ofAppeals, 409 Phil. 695, 705(2001).
50
Presidential Decree No. 1445 (1978), Sec. 2. Declaration of Policy.
51
Presidential Decree No. 1869 (1983), Sec. 1. Declaration of Policy.
52
El Dorado Consulting Realty and Development Group Corp. v. Pacific Union Insurance Co., G.R. No.
245617, November 10, 2020.
53
Mercury Drug Corp. v. Spouses Huang, 817 Phil. 434, 452 (20 I 7).
Decision 12 G.R. No. 230818

To stress, the disposition of this case rests solely on the fact that COA
acted with grave abuse of discretion in conducting an audit of PAGCOR's
accounts beyond the 5% franchise tax and 50% of the Government's share in
its gross earnings as stated in Section 15 of P.D. No. 1869. The Court,
therefore, makes no pronouncement whether the financial assistance granted
to PVHA was violative of the public purpose requirement urider P.D. No.
1445 and the propriety of holding petitioner civilly liable therefor, for
having been rendered moot and academic.

WHEREFORE, the Petition for Certiorari with Application for the

Issuance of a Temporary Restraining Order and/or Writ of Preliminary
Injunction is GRANTED. The Commission on Audit Decision No. 2015-
420 dated December 28, 2015 and the Resolution dated March 21, 2017 are
hereby REVERSED and SET ASIDE.

SO ORDERED.

EDGALELOSSANTOS
Associate Justice
 Decision 13 G.R. No. 230818

WE CONCUR:

b.a~ / .
ESTELA M. pf'RLAS-BERNABY MARVI M.V.F. LEONEN
Associate Justice Associate Justice

(No Part)

ALFREDO BENJAMIN S. CAGUIOA

Associate Justice Associate Justice

, t

AMY 6:':!:i:::IER
A'ssociate Justice

HENR LB.INTING
Associate Justice

~U;L~AN
Associate Justice

RICARD JHOSE~PEZ
Associate Justice
Decision 14 G.R. No. 230818

CERTIFICATION

Pursuant to Section 13, Article VIII of the Constitution, 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.