CA affirms ruling on Pichay suspension

MANILA, Philippines - The Court of Appeals (CA) has affirmed its earlier ruling that upheld the order of the Ombudsman last May placing former Local Water Utilities Administration (LWUA) chair Prospero Pichay under preventive suspension in connection with the agency’s alleged anomalous P480-million purchase of a troubled thrift bank. In a four-page resolution, the CA’s Second Division dismissed for being moot and academic the motion for reconsideration filed by Pichay, a former Surigao del Sur congressman, in light of his dismissal from government service by Malacañang last July.

“It bears to note that the Office of the Ombudsman has already adjudged petitioner guilty of the administrative charges against him and ordered his dismissal from the service, which decision is immediately executory even pending appeal,” the CA explained in the ruling penned by Associate Justice Estela Perlas-Bernabe who was eventually appointed to the Supreme Court last Sept. 16.

The CA junked Pichay’s arguments that his petition should not be dismissed considering that the order of then acting Ombudsman Orlando Casimiro has not become final and executor.

The CA pointed out that the determination of the propriety of Pichay’s preventive suspension will be “inconsequential” and “not serve any useful purpose.”

Associate Justices Remedios Salazar-Fernando and Elihu Ybaez concurred with the ruling.

In his petition filed before the CA, Pichay alleged that Casimiro committed grave abuse when he signed the preventive suspension order despite the fact that then Ombudsman Merceditas Gutierrez denied the preventive suspension plea twice.

Casimiro placed Pichay under a 6-month preventive suspension without pay for the alleged unlawful investment of P480-million worth of LWUA funds in the Express Savings Bank, Inc. (ESBI), a Laguna-based thrift bank. The suspension order stemmed from a complaint filed by LWUA officials Rustico Tutol, Luis DG. Estrada and Carmen Amores alleging that Pichay and the other respondents “violated the provisions of the General Appropriations Act (GAA) for Fiscal Year 2009, when they unlawfully disbursed LWUA funds by investing the total amount of P480 million in the said bank despite the fact that it has been under rehabilitation by the Bangko Sentral ng Pilipinas (BSP).”

They also alleged that the LWUA Board of Trustees unlawfully authorized the payment in favor of ESBI of the amount of P4 million “for subscription to the increase in the authorized capital stock of said bank.”

The complainants said that the respondents violated BSP Circular No. 309 when they failed to secure prior approval of the Monetary Board on the sale or transfer of shares before the disbursement of P480 million, which resulted in LWUA’s ownership of 20 percent of ESBI’s voting stock.