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BASES CONVERSION v. COA

FACTS:

The case involves a petition for certiorari filed by the Bases Conversion and Development Authority (BCDA) seeking to nullify a decision of the Commission on Audit (COA) disallowing the grant of year-end benefits to the Board members and full-time consultants of the BCDA. The BCDA was created by Republic Act No. 7227, and its Board of Directors (Board) was granted the power to determine the organizational structure and adopt a compensation and benefit scheme at least equivalent to that of the Bangko Sentral ng Pilipinas (BSP). In 1996, the Board adopted a new compensation and benefit scheme, which included a P10,000 year-end benefit for all employees. President Fidel Ramos approved this scheme. In 2000, the BSP increased its year-end benefit from P30,000 to P35,000, prompting the Board to increase the year-end benefit of BCDA officials and employees to P30,000. On February 20, 2003, the COA issued a disallowance stating that the grant of year-end benefits to the Board members and full-time consultants was contrary to a Department of Budget and Management circular. The COA affirmed the disallowance, and the BCDA filed a petition seeking the nullification of the COA's decision.

ISSUES:

  1. Whether the Board members and full-time consultants of the BCDA are entitled to the year-end benefit.

  2. Whether the granting of year-end benefit to the Board members and full-time consultants is consistent with Sections 5 and 18, Article II of the Constitution.

  3. Whether the denial of year-end benefit to the Board members and full-time consultants violates Section 1, Article III of the Constitution.

  4. Whether or not there is a clear and unequivocal breach of the Constitution in the grant of year-end benefits to Board members and full-time consultants under RA No. 7227.

  5. Whether or not Congress intended to allow Board members to receive other benefits besides the per diem authorized by law under Section 9 of RA No. 7227.

RULING:

  1. The Board members and full-time consultants of the BCDA are not entitled to the year-end benefit.

  2. The granting of year-end benefit to the Board members and full-time consultants is not consistent with Sections 5 and 18, Article II of the Constitution.

  3. The denial of year-end benefit to the Board members and full-time consultants does not violate Section 1, Article III of the Constitution.

  4. There is no clear and unequivocal breach of the Constitution in the grant of year-end benefits to Board members and full-time consultants under RA No. 7227.

  5. Board members are not entitled to receive other benefits under RA No. 7227.

PRINCIPLES:

  • Presumption of constitutionality of laws enacted by Congress.

  • Burden of proof is on the party claiming the unconstitutionality of a law.

  • Clear and unequivocal breach of the Constitution must be established to justify nullification of a law.

  • The specification of compensation and limitation of the amount of compensation in a statute indicate the intent to limit compensation to what is authorized by law and no other benefits.

  • The express mention of one thing implies the exclusion of others.

  • The Court cannot enlarge the scope of a statute or insert into a statute what Congress omitted.

  • The Court must adopt an interpretation in consonance with the presumed intention of the legislature to give enactments the most reasonable and beneficial construction.

  • The State is not estopped from correcting a public officer's erroneous application of a statute.

  • Unlawful practice, no matter how long, cannot give rise to any vested right.

  • Good faith may exempt an individual from the obligation to refund benefits received unlawfully.