ARIAS v. SANDIGANBAYAN October 24, 1978- 16 PNB checks, with Serial Nos.
188532 to 188547, with a
G.R. No. 81563 December 19, 1989
De Guzman – Group 6
PETITIONER: Amado C. Arias; and Cresencio D. Data (G.R. No. 82512)
DEFENDANT: The Sandiganbayan
Court: Supreme Court, En Banc
Gutierrez, Jr., J.:
FACTS:
April to October 1978- Mangahan Floodway Project was entrusted to Pasig
Engineering District headed by petitioner, District Engineer Cresencio Data.
 Engr. Data formed a committee to gather and verify documents,
facilitate the acquisition of private lots for the project’s right-of-way.
Among the lots affected was a 19,004 sqm land in Pasig owned by Benjamin
Agleham. The property was originally classified as a “ricefield” valued at P5
per sqm as per Tax Declaration No. 47895 (Feb 27, 1978).
In filing an application for payment, Agleham’s counsel Natividad Gutierrez
submitted a xerox copy of Tax Declaration No. 47895, supposedly certified by
Pasig Treasurer Alfredo Prudencio, describing the property as "residential"
(instead of riceland), and with a fair market value of P2,413,520 or P80 per
sqm (instead of P5 per sqm).
April 20, 1978- Engr. Data and Atty. Gutierrez signed a Deed of Absolute Sale,
prepared by the former’s committee supposedly after its “examination” of
Gutierrez and Agleham’s documents
June 8, 1978- The sale was registered and Transfer Certificate of Title No. T-
12071 was issued in the name of the Government, after Engr. Data sent the
papers to the Bureau of Public Works, who then recommended to the
Assistant Secretary of Public Works the approval of the Deed of Sale.
October 23, 1978- Petitioner Amado C. Arias, in his capacity as the Auditor of
the Pasig Engineering District, pre-audited and approved for payment the
general voucher for Agleham’s land.
total sum of P1,520,320.00 were issued to Gutierrez as payment for
Agleham's 19,004-square-meter lot.
October 1979- Investigation by the Ministry of National Defense on the
supposed gross overpricing of Agleham's property found that the xerox copy
of Tax Declaration No. 47895 submitted by Gutierrez was fake.
 Pasig Treasurer Alfredo Prudencio and Asst. Assessor Pedro Ocol
testified that (1) the tax declaration number in the submitted
document was typewritten, not machine-numbered as in the genuine
tax declaration; (2) the stamp mark of registration was antedated to
Dec 15, 1973 in the fake, instead of the correct date - Feb 27, 1978;
(3) the classification of the property was "residential," instead of
"ricefield," which is its classification in the genuine document; and (4)
the lot was overpriced at P80 per sqm, instead of the appraised value
of only P5 per sqm in the original declaration.
PROCEDURAL HISTORY:
Petitioners Arias and Data, together with other officials, were accused of
violation of Sec. 3(e) of RA 3019 (Anti-Graft and Corrupt Practices Act), for
supposedly affecting undue injury, damage and prejudice to the Government
of the Republic of the Philippines by causing, allowing and/or approving the
illegal and irregular disbursement and expenditure of public funds in favor
and in the name of Benjamin Agleham, in connection with the overpriced land
purchase for the Mangahan Floodway Project.
 Nov 16, 1987- Sandiganbayan rendered a 78-page decision finding
the accused GUILTY beyond reasonable doubt. The penalties were
imprisonment for 3-6 years, perpetual disqualification from public
office and payment of P1,425,300 to the Government.
Arias filed a petition for review of the Sandiganbayan's decision at the
Supreme Court contending that the court's findings that he conspired with
his co-accused and that he was grossly negligent are based on
misapprehension of facts, speculation, surmise, and conjecture.
 Data’s main defense is that the acquisition of the Agleham property
was the work of his formed committee in which he did not take an
active part, and that the price which the Government paid for it was
reasonable.
ISSUE:
1. WON petitioners ARIAS and DATA are guilty as co-conspirators in the
conspiracy to cause injury to the Government through the irregular
disbursement and expenditure of public funds. NO
HOLDING: NO
1. Guilt must be premised on a more knowing, personal, and deliberate
participation of each individual who is charged with others as part of a
conspiracy.
 Department secretary, bureau chief, commission chairman, agency
head, and all chief auditors cannot be guilty of conspiracy simply
because he/she was the last of a long line of officials and employees
who acted upon or affixed their signatures to a transaction.
 There should be other grounds than the mere signature or approval
appearing on a voucher to sustain a conspiracy charge and
conviction.
 It would set a bad precedent if a department head or chief auditor is
suddenly swept into a conspiracy conviction simply because he did
not personally examine every single detail, or painstakingly trace
every step from inception, or investigate the motives of every person
involved in a transaction before affixing his signature as the final
approving authority.
2. Arias Principle: All heads of offices have to rely to a reasonable extent on
their subordinates and on the good faith of those who prepare bids,
purchase supplies, or enter into negotiations.
 While it can be argued that Arias should have probed records and
documents, and questioned persons; or that Data should have
inspected the documents accepted by his committee, it is doubtful if
any auditor or head of a fairly sized office could personally do all
these things in all vouchers presented for his signature. The Court
would be asking for the impossible.
 There are hundreds of document, letters and supporting paper that
routinely pass through the hands of an executive head even of a small
government agencies or commissions. Thus, there has to be some
added reason why he/she should examine a specific document in
such detail.
3. Sandiganbayan’s decision to convict the petitioners of causing undue
injury, damage, and prejudice to the Government because of gross
overpricing is grounded on shaky foundations.
 While the Court is not prepared to say whether P80.00-P500.00 per
sqm of land in Pasig in 1978 would be a fair evaluation, since the
value must be determined in an eminent domain proceeding by a
competent court, it is certain that it cannot be P5.00 per sqm.
 The Court held that the Sandiganbayan erred in assuming that the
P5.00 per sqm value fixed by the assessor in the tax declarations was
the correct market value of the property. As the Court has previously
held in EPZA v Dulay, factors other than the value stated by the
landowner in his tax declaration or fixed by the municipal assessor
must be considered in finding the true value of just compensation.
JUDGMENT:
1. The Sandiganbayan Decision dated November 16, 1987 is SET ASIDE.
2. Petitioners Arias and Data are ACQUITTED on grounds of reasonable
doubt.
DISSENTING OPINION OF GRINO-AQUINO:
Conspiracy of Silence and Inaction: The petitioners kept silent when they
should have asked questions; they looked the other way when they should
have probed deep into the transaction.
 The petitioner's partiality for Agleham/Gutierrez may be inferred
from their having deliberately closed their eyes to the defects and
irregularities of the transaction in his favor and their seeming neglect,
if not deliberate omission, to check, the authenticity of the
documents presented to them for approval.
 Chiefs of offices who should be vigilant to protect the interest of the
State should not accept as gospel truth the certifications of their
subordinates and approve without question million-peso purchases
which should have prompted them to make inquires or verify the
authenticity of the documents presented to them for approval.
 Since partiality is a mental state or predilection, in the absence of
direct evidence, it may be proved by the attendant circumstance
instances.