Palace to SC: You’ve done it too, not once but twice

We did it in good faith, and you’ve done it, too, twice.

This, in a nutshell, was how Malacañang appealed the Supreme Court’s ruling that struck down the Disbursement Acceleration Program (DAP), laying down in a 52-page motion for reconsideration what President Benigno Aquino III essentially spelled out to the public in his defiant speech on Monday.

Filed late afternoon on Friday, the reversal plea sought to dismiss for lack of merit nine petitions that the court favored in its July 1 decision, which found that President Aquino had usurped Congress’ exclusive power of the purse and that Budget Secretary Florencio Abad may have knowingly circumvented the country’s appropriations rules in designing and enforcing the DAP.

Voting 13-0, the Supreme Court ruled that Malacañang violated the Constitution in undertaking cross-border transfers, or realigning savings into projects outside the executive branch and allocating savings to projects outside the approved national budget without certification from the national treasury.

But the Palace argued that the DAP, was implemented without malice.

“The President and his alter egos, in implementing a decidedly successful program, deserve to be afforded the traditional constitutional presumptions that apply to most other forms of public actions, especially the presumption of good faith,” Malacañang said in its motion for reconsideration.

“Respondents strongly object to any suggestion that bad faith attended the formulation of the DAP, made years before the Court’s unprecedented decision in these cases. With all due respect, the Honorable Court’s decision redefines existing administrative practice and potentially assigns malice post facto (after the fact),” the Palace said.

No collusion with Congress

Malacañang also protested the view that Mr. Aquino overstepped his powers in implementing the DAP, as several justices had expressed in separate opinions on the decision.

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“We strongly object to the notion that the President colluded with Congress, or that he undermined the Congress’ power of the purse and that Congress allowed its prerogatives to be undermined. The constitutional requirement of an annual exercise between the two political branches simply reflects the fact that the political departments, not the judiciary, are those in charge of running the government and managing the economy,” Malacañang said.

The DAP, it said, was implemented to stimulate public spending that had been slowed down by its own efforts to “plug leakages” in a system inherited from the previous administration, when there was “the prevalence of questionable and poorly designed programs and projects” and “huge agency lump-sum funds [that] were susceptible to abuse and which created implementation bottlenecks through zero-based budgeting and other tools.”

Affirm these

The Palace asked the Supreme Court to affirm the following:

Withdrawn obligated allotments and unreleased appropriations under the DAP are savings.

Cross-border transfers under the DAP are constitutional.

The President augmented items with appropriation cover under the DAP.

The use of the Unprogrammed Fund under the DAP complied with the conditions provided in the relevant General Appropriations Acts (GAAs).

Regardless of the nullification of certain acts and practices under the DAP and/or National Budget Circular No. 541, the operative fact doctrine does not operate to impute bad faith to authors, proponents and implementers who continue to enjoy the presumption of innocence and regularity in the performance of official functions and duties.

Gives public funds without dictation

The Constitution, Malacañang said, does not bar the President from realigning the executive branch’s savings to other departments, as long as the recipient decides how to use the augmentation.

“In such a case, the President merely gives the other department access to public funds but he cannot dictate how they shall be applied by that department, whose fiscal autonomy is guaranteed by the Constitution,” the Palace said.

Malacañang cited instances where the President provided the Commission on Audit (COA) and the House of Representatives additional funds out of Palace savings upon their request, but the agencies themselves decided how to use the extra allocations.

As Mr. Aquino said in his speech on Monday night, the practice of moving savings across agencies had been done before, even by the Supreme Court itself.

You, too, Your Honors

The Palace cited at least two instances—as the President vaguely referenced in his speech—when the Supreme Court took such an action.

It reminded the justices of that time in July 2012, when the Supreme Court earmarked its savings of P1.865 billion to augment the Department of Justice’s P100-million budget for the Manila Hall of Justice. Malacañang pointed out that the DOJ “is within the executive department.”

In March 2013, the Supreme Court also asked the Department of Budget and Management (DBM) to move this P100-million budget to the judiciary, this time for the construction of the Malabon Hall of Justice, a project not funded under the 2012 or 2013 national budget.

Last year’s request, the Palace said, was withdrawn through a letter by Chief Justice Maria Lourdes Sereno some nine months later, on Dec. 23, 2013, when petitions against the DAP were filed.

“These two instances show both cross-border transfers on the part of the Supreme Court—(a) the augmentation of an item in the executive from funds in the judiciary; and (b) the “transfer” of funds from the executive to the Supreme Court, whether or not for purposes of augmentation,” Malacañang said.

Doctrine of operative fact

The Palace also argued that the doctrine of operative fact, a legal doctrine the Supreme Court cited in its ruling implying how the DAP’s sponsors could be held accountable for the program, “has nothing to do with the potential liability of persons who acted pursuant to a then-constitutional statute, order or practice.”

In its decision, the Supreme Court said that the doctrine, which upholds the effects of an unconstitutional law prior to its nullification, could only apply to projects and activities conducted under the DAP in good faith.

The court said the principle may not be invoked by the law’s “authors, proponents and implementers, unless there are concrete findings of good faith in their favor by the proper tribunals determining their criminal, civil, administrative and other liabilities.”

Malacañang disagreed: “They are presumed to have acted in good faith and the court cannot load the dice, so to speak, by disabling possible defenses in potential suits against so-called authors, proponents and implementers. The mere nullification of an act has no bearing on individual liability precisely because the doctrine primarily seeks to ensure that acts performed prior to nullification are still deemed valid on the theory that judicial nullification is a contingent or unforeseen event.”

‘Not justiciable’

The Palace also asserted that the legal action against the DAP was “not justiciable” in the first place, as petitioners have “neither been injured nor threatened with injury as a result of [the] DAP.”

“Just because people have ‘incompatible perspectives’ on a constitutional question does not mean they have a justiciable controversy that any of them can ask the court to decide when, in such a case, all that is necessary is to stage a public debate and ask the board of judges to decide,” the Palace said.

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