Facts
Arnel Tabije, designated Special Collection Officer (SCO) at the Bureau of Customs, stopped reporting for work; petitioner, as Chief of the Cash Collection Division, then audited Tabije's accounts and reported that he had failed to deposit collections of Php425,555.53 and had not turned over the auction fund passbook. The Commission on Audit's Notice of Charge held Tabije, District Collector Atty. Gatchalian, and petitioner liable for the unremitted amount. On appeal, the COA National Government Sector Cluster A Director excluded both Atty. Gatchalian and petitioner from liability, but on automatic review the COA disapproved the exclusion only as to petitioner, reasoning that as Chief of the Cash Division he should have monitored Tabije and reminded him to comply with deposit rules, and referred the matter to the Ombudsman. Petitioner's motion for reconsideration was denied, and while his certiorari petition was pending before this Court, Tabije fully settled the Php425,555.53 through an official receipt and a Notice of Settlement of Suspension/Disallowance/Charge.
Issue
Whether the COA gravely abused its discretion in holding petitioner solidarily liable for his subordinate's unremitted collections absent a showing of bad faith, malice, or gross negligence.
Ruling
Yes. Under Section 38, Chapter 9, Book I of the Administrative Code of 1987, a superior officer is not civilly liable for a subordinate's wrongful acts absent a clear showing of bad faith, malice, or gross negligence, and civil liability arises "only upon a showing" of such fault, per Madera v. Commission on Audit. Gross negligence, per Sabio v. Sandiganbayan, is negligence characterized by want of even slight care, acting or omitting to act willfully and intentionally with conscious indifference to consequences, and, per Office of the Ombudsman v. De Leon, occurs only where the breach of duty is flagrant and palpable. Here the COA found petitioner merely negligent, never characterizing it as gross, and the Court held that "Gross negligence cannot be automatically inferred from mere speculation that a subordinate's failure to remit collections resulted from his superior's failure to monitor his transactions and remind him to comply with the relevant rules and regulations." Petitioner's actual duties did not include monitoring each collection officer's daily deposits, and he in fact triggered the investigation by reporting Tabije's unauthorized absences, auditing his collections, and demanding settlement. The Court also held the case was not mooted by Tabije's subsequent settlement, since the COA's separate Ombudsman referral remained a live controversy. The petition was GRANTED, and the COA's Decision and Resolution were REVERSED AND SET ASIDE insofar as they held petitioner civilly liable under the Notice of Charge.