Commonwealth Act No. 327, as amended by Section 26 of Presidential Decree No. 1445 - COA has primary jurisdiction over money claims against government agencies and instrumentalities

"Under Commonwealth Act No. 327,25 as amended by Section 26 of
Presidential Decree No. 1445,26 it is the COA which has primary jurisdiction
over money claims against government agencies and instrumentalities.

Section 26. General jurisdiction. The authority and powers of the
Commission shall extend to and comprehend all matters relating to
auditing procedures, systems and controls, the keeping of the general
accounts of the Government, the preservation of vouchers pertaining
thereto for a period of ten years, the examination and inspection of the
books, records, and papers relating to those accounts; and the audit and
settlement of the accounts of all persons respecting funds or property
received or held by them in an accountable capacity, as well as the
examination, audit, and settlement of all debts and claims of any sort
due from or owing to the Government or any of its subdivisions,
agencies and instrumentalities. The said jurisdiction extends to all
government-owned or controlled corporations, including their subsidiaries,
and other self-governing boards, commissions, or agencies of the
Government, and as herein prescribed, including non-governmental
entities subsidized by the government, those funded by donations through
the government, those required to pay levies or government share, and
those for which the government has put up a counterpart fund or those
partly funded by the government. (Emphasis supplied.)

Pursuant to its rule-making authority conferred by the 1987
Constitution27 and existing laws, the COA promulgated the 2009 Revised
Rules of Procedure of the Commission on Audit. Rule II, Section 1
specifically enumerated those matters falling under COA’s exclusive
jurisdiction, which include “[m]oney claims due from or owing to any
government agency.” Rule VIII, Section 1 further provides:

Section 1. Original Jurisdiction - The Commission Proper shall
have original jurisdiction over: a) money claim against the Government;
b) request for concurrence in the hiring of legal retainers by government
agency; c) write off of unliquidated cash advances and dormant accounts
receivable in amounts exceeding one million pesos (P1,000,000.00); d)
request for relief from accountability for loses due to acts of man, i.e.
theft, robbery, arson, etc, in amounts in excess of Five Million pesos
(P5,000,000.00).

In Euro-Med Laboratories Phil., Inc. v. Province of Batangas,28 we
ruled that it is the COA and not the RTC which has primary jurisdiction to
pass upon petitioner’s money claim against respondent local government
unit. Such jurisdiction may not be waived by the parties’ failure to argue the
issue nor active participation in the proceedings. Thus:

This case is one over which the doctrine of primary jurisdiction
clearly held sway for although petitioner’s collection suit for P487,662.80
was within the jurisdiction of the RTC, the circumstances surrounding
petitioner’s claim brought it clearly within the ambit of the COA’s
jurisdiction.

First, petitioner was seeking the enforcement of a claim for a
certain amount of money against a local government unit. This
brought the case within the COA’s domain to pass upon money claims
against the government or any subdivision thereof under Section 26 of
the Government Auditing Code of the Philippines:

The authority and powers of the Commission [on Audit]
shall extend to and comprehend all matters relating to x x x
the examination, audit, and settlement of all debts and
claims of any sort due from or owing to the Government or
any of its subdivisions, agencies, and instrumentalities. x x
x.

The scope of the COA’s authority to take cognizance of claims is
circumscribed, however, by an unbroken line of cases holding statutes of
similar import to mean only liquidated claims, or those determined or
readily determinable from vouchers, invoices, and such other papers
within reach of accounting officers. Petitioner’s claim was for a fixed
amount and although respondent took issue with the accuracy of
petitioner’s summation of its accountabilities, the amount thereof was
readily determinable from the receipts, invoices and other documents.
Thus, the claim was well within the COA’s jurisdiction under the
Government Auditing Code of the Philippines.

Second, petitioner’s money claim was founded on a series of
purchases for the medical supplies of respondent’s public hospitals. Both
parties agreed that these transactions were governed by the Local
Government Code provisions on supply and property management and their
implementing rules and regulations promulgated by the COA pursuant to
Section 383 of said Code. Petitioner’s claim therefore involved compliance
with applicable auditing laws and rules on procurement. Such matters are
not within the usual area of knowledge, experience and expertise of most
judges but within the special competence of COA auditors and accountants.
Thus, it was but proper, out of fidelity to the doctrine of primary
jurisdiction, for the RTC to dismiss petitioner’s complaint.

Petitioner argues, however, that respondent could no longer
question the RTC’s jurisdiction over the matter after it had filed its answer
and participated in the subsequent proceedings. To this, we need only state
that the court may raise the issue of primary jurisdiction sua sponte
and its invocation cannot be waived by the failure of the parties to
argue it as the doctrine exists for the proper distribution of power
between judicial and administrative bodies and not for the
convenience of the parties.29 (Emphasis supplied.)

Respondent’s collection suit being directed against a local government
unit, such money claim should have been first brought to the COA.30
Hence, the RTC should have suspended the proceedings and refer the filing of the claim before the COA. Moreover, petitioner is not estopped from
raising the issue of jurisdiction even after the denial of its notice of appeal
and before the CA."


THE PROVINCE OF AKLAN,
Petitioner,
-versus-
JODY KING CONSTRUCTION 
AND DEVELOPMENT CORP., 

G.R. Nos. 197592 & 202623
NOV 27, 2()13