G.R. No. 247924

G.R. No. 247924, November 16, 2021,
♦ Decision, Lazaro-Javier, [J]
♦ Separate Concurring Opinion, Perlas-Bernabe, [J]
♦ Concurring and Dissenting Opinion, Leonen, [J]
♦ Concurring and Dissenting Opinion, Caguioa, [J]

POWER SECTOR ASSETS AND LIABILITIES MANAGEMENT (PSALM) CORPORATION, REPRESENTED BY IRENE JOY BESIDO-GARCIA, IN HER CAPACITY AS PRESIDENT AND CHIEF EXECUTIVE OFFICER OF PSALM, AND IN BEHALF OF THE CONCERNED AND AFFECTED OFFICERS AND EMPLOYEES OF PSALM, PETITIONER, VS. COMMISSION ON AUDIT, RESPONDENT.

By Letters1 dated May 9, 2011, the Power Sector Assets and Liabilities Management (PSALM) Corporation requested the respective concurrences of the Commission on Audit (COA) and the Office of the Government Corporate Counsel (OGCC) to the engagement of Mr. John T. K. Yeap (Mr. Yeap) and Atty. Michael B. Tantoco (Atty. Tantoco) as its legal advisors on the privatization of the generation assets and Independent Power Producer (IPP) contracts of the National Power Corporation (NPC). The proposed engagement was for a period of six (6) months subject to the following terms:

The letters also stated that: a) the legal services to be provided by these consultants shall not involve handling of cases and representation in court as the same pertain to the OGCC; and b) the engagement of these consultants is necessary to the implementation of PSALM's mandate to privatize under Republic Act No. 9136 (RA 9136) or the Electric Power Industry Reform Act (EPIRA) of 2001.

PSALM further asked that action on its request be released on or before May 30, 2011 as the hiring of the legal advisors was urgently needed.

COA received PSALM's letter request twice: on May 11, 2011,2 through the resident auditor of COA-PSALM, and on May 13, 2011, through the Office of the COA-Corporate Government Sector (CGS) Cluster B. About the same time, OGCC, too, received PSALM's letter request.

Under Contract Review No. 161 dated May 31, 2011, series of 2011, OGCC found the "contracts to be generally in order and the same may be given due course." It noted that the proposed contracts were substantially similar to those contracts previously submitted for its review. Consequently, the OGCC approved the proposed contracts of engagement and forwarded its concurrence to PSALM.

As for COA, nothing was heard from it on or before May 30, 2011, the date requested by PSALM for COA to take action on its letter request for concurrence. Even then, PSALM waited for another forty-one (41) days but COA still did not respond.

As it was, COA's response was not forthcoming. Nineteen (19) days (from May 13, 2011 to May 30, 2011) initially expired. Then, there was that deafening silence over ninety-one (91) more days (from May 30, 2011 until August 29, 2011). The pit stop stood still for a total of one hundred ten (110) days. It was only then that PSALM finally decided to stop waiting and proceeded with the engagement of Atty. Tantoco and Mr. Yeap effective August 29, 2011. Their contracts were to commence on August 29, 2011.3

Meantime, PSALM's request for concurrence remained unacted upon4 for another three (3) years.

Only on November 6, 2014 did the COA Legal Services Sector-Office of the General Counsel finally dispose of the request through its Legal Retainer Review (LRR) No. 2014-174 of even date.5

The COA Legal Services Sector-Office of the General Counsel denied the request because: a) PSALM engaged the consultants, sans COA's prior approval in violation of Memorandum Circular No. 9 dated August 27, 1998 and COA Circular No. 98-002 dated June 9, 1998; and b) under COA Decision No. 2014-136 dated July 18, 2014, a similar request involving the same legal advisors who were engaged sometime in 2010 was also denied for the same reason, albeit, PSALM has yet an unresolved motion for reconsideration thereof.

Back to LRR No. 2014-174,6 PSALM, too, pursued its motion for reconsideration. It argued that the immediate engagement of the legal advisors was necessary to avert any further delay in the implementation of its privatization projects. COA's concurrence to the engagement of the legal consultants was not even required since these services did not involve court appearances but were merely advisory in nature.

By Decision No. 2017-2157 dated July 6, 2017, COA denied the motion for reconsideration on the ground that its prior concurrence to the contracts of services was an indispensable requirement under COA Circular Nos. 86-255 and 95-011. Contrary to PSALM's position, the same also covered advisory services. Citing Polloso v. Gangan,8 it denied payment for services rendered based on quantum meruit and ruled that the officers who approved and implemented the contract should themselves pay for the services.

PSALM's motion for reconsideration was denied under Resolution-Decision No. 2019-0049 dated January 30, 2019.

PSALM now seeks affirmative relief via Rule 65 in relation to Rule 64 of the Rules of Court. It argues that the hiring of the legal advisors was exempt from the coverage of COA Circular Nos. 86-255 and 95-011. For their services allegedly did not involve court appearances but pertained only to providing advice on PSALM's privatization projects. Their highly technical expertise was especially needed on the matters of international public bidding of energy generation, IPP contracts, and other internal business transactions of PSALM to bolster investors' confidence in the Philippine energy sector. To delay the engagement of these experts due to lack of COA's concurrence would have seriously hampered PSALM's privatization projects.

The PSALM officers who authorized payment for the services of the consultants all acted in good faith and only in the pursuit of PSALM's legitimate project as mandated by the EPIRA. They did not derive any personal benefit from the engagement. The payment was solely for the benefit of the public in general as around 70% of the generation assets were already privatized through the services rendered by the consultants.

On the basis of quantum meruit, the consultants purportedly need not return the payment they received for services they had already rendered, leading to the successful completion of their respective projects.10

For its part, the Office of the Solicitor General (OSG),11 through Associate Solicitor General Gilbert U. Medrano and Senior State Solicitor Sharon E. Millan-Decano,12 counters that while, by way of exception, government-owned and/or controlled corporations like PSALM are allowed to hire the services of private lawyers, the required concurrences of both the OGCC and COA are mandatory. Citing Oñate v. COA,13 the OSG posits that this requirement must be complied with regardless of whether the legal services to be performed involve an actual legal controversy. In any event, PSALM is estopped from denying that it was already apprised of the need to obtain COA's concurrence as early as March 2010. This, according to the OSG, belies PSALM's claim that awaiting COA's concurrence could delay its privatization projects.

The OSG also objects to the claim of good faith by the approving PSALM officers. Their supposed blatant disregard of the concurrence requirement, not to mention their notice of the previous LRR on the same subject, is inconsistent with good faith. Thus, they are personally liable for payment of the consultants' fees. Too, pursuant to Polloso v. Gangan,14 PSALM's invocation of quantum meruit is unavailing.

In compliance with the Court's Resolution dated December 9, 2020, COA submitted its Memorandum15 dated May 7, 2021. Essentially, COA posits that -

The requirement to secure COA's prior written concurrence to every engagement of private counsel by a government office is an instance of pre-audit.

COA's own definition of pre-audit is exactly what its written concurrence is all about:

COA distinguishes the written concurrence from a pre-audit simply because there is yet no specific payment or disbursement being made to the lawyer. This, however, is a distinction without any difference. This supposed difference does not distinguish a pre-audit from a written concurrence. It is a minute detail in the overall goal, process, and scheme of a pre-audit.

More important, as above-quoted, a pre-audit is done to identify suspicious transactions on their face so as to avoid the embarrassment and embezzlement or wastage of public funds before implementation and disbursement. This precisely is what the written concurrence is also meant to achieve.

Thus, in No. 7 of its Memorandum, COA admits that the primary purpose of the review for a written concurrence is the determination of the reasonableness of the legal fees of the lawyer and the assurance of consistency in legal policies and practices of State agencies that transcend the parochial interests of individual State agencies and promote the greater good of public interest.

Quite clearly, written concurrence involves a review that encompasses both the processes and goals of a pre-audit. Hence, it is essentially a pre-audit.

Nonetheless, whether a written concurrence amounts to a pre-audit, which we say it is, COA has the mandate to determine whether to require pre-audit or post-audit. This is a constitutional mandate. As held in Dela Llana v. Commission on Audit:17

Here and now, we find no reason to overturn COA's discretion to require pre-audit in the form of a written concurrence to obtaining outside legal services. The rationale for this requirement has been accepted and settled in jurisprudence.18 We uphold the soundness of this reasoning and the same is reiterated here.

COA has the exclusive jurisdiction to decide when to require or not to require a prior written concurrence though it is an instance of pre-audit.

Justice Alfredo Benjamin S. Caguioa (Justice Caguioa) perceptively discerns that COA has several times disavowed pre-audit for a number of government activities and transactions, and so he argues that the requirement of a prior written concurrence as a form of pre-audit must have also been lifted already.

The history of COA issuances on pre-audit has seen a back-and-forth in its use of pre-audit in performing its mandate. Thus:

As COA has consistently maintained, however, whenever circumstances warrant, such as where internal control system of a government agency is inadequate, it may reinstitute pre-audit or adopt such other control measures as are necessary and appropriate to protect the funds and property of the government.

Justice Caguioa posits that "... whenever COA believed it necessary to reinstate the pre-audit system, what it did was to issue another circular amending or revoking the withdrawal of pre-audit."20 From this, he concludes that since COA has not issued a circular amending or revoking the withdrawal of pre-audit, then pre-audit and all its forms including the prior written concurrence is still disallowed.

The argument seems sensible but we have to appreciate this issue from COA's exclusive mandate as the government's only auditing firm that draws its power no less from the Constitution. The best interpreter of what its issuances mean as regards the most efficient and effective methods it will be using for auditing government transactions will of course have to be COA itself. This jurisdiction exclusively belongs to COA.

Further, there is no documented practice that has ripened into a legally binding procedure that COA cannot subject specific transactions to pre-audit or that its general rule disallowing pre-audit cannot be subject to exceptions or that these exceptions can be enunciated and published through only one form, i.e., amending another COA Circular.

The fact remains that COA has seen it wise and sound to continue its practice of requiring prior written concurrence to the obtention of private legal services as an exception to the general rule disallowing pre-audit as expressed in COA Circular No. 2011-002. This Circular did not give rise to legally demandable and enforceable expectations from among government agencies to compel COA not to subject them to pre-audit. Notwithstanding this Circular, COA can require pre-audit whenever it deems wise and cautious to do so.

This policy determination on how to accomplish its mandate is beyond the control of this Court, especially when it is exercised in a reasonable manner. The requirement of a prior written concurrence per se is not an unreasonable audit measure. The latter becomes unreasonable and therefore gravely abusive of discretion when, as in this case, COA unreasonably delayed its action on requests for such concurrences and when COA intruded on aspects of the private legal representation that the government agency has the expertise and mandate to solicit such as the necessity for such hiring.

Notably, the declaration which lifted pre-audit does not preclude COA from re-instituting it selectively whenever in its opinion, the internal control system of an agency is inadequate. This is clearly stated in the saving clause which is invariably present in the pertinent issuances of COA including COA Circular No. 2011-002, viz.:

Indubitably, COA never relinquished its authority to conduct pre-audit activities. Hence, COA does not need to issue a separate circular or otherwise amend COA Circular No. 2011-002 in order to "restore" such function. It could simply invoke the saving clause when performing pre-audit in select agencies when warranted.

In fact, COA agreed to the Department of Tourism's request to conduct pre-audit of all its contracts prior to payment.21 But COA did not amend COA Circular No. 2011-002 to achieve this end. This only goes to show that COA's exercise of authority to conduct pre-audit on a certain agency does not call for issuance of an amendment to COA Circular 2011-002.

Indeed, requiring a separate issuance to reinstall pre-audit would be redundant with the saving clause in place. What would be the point of the saving clause if COA Circular No. 2011-002 would have to be amended each time said clause would be invoked? Besides, imposing such requirement would place COA Circular No. 2011-002 under constant flux as agencies would be added and subtracted from its coverage ad infinitum, depending on the needs and capacities of each agency at a particular point in time.

Further, exposing the identity of the concerned agency subject of pre-audit and the reason therefor through a general circular may breed discrimination, bias, and disrespect among and between government agencies. Surely, this could not have been what COA envisioned when it crafted the saving clause and issued COA Circular No. 2011-002.

To remove any lingering doubt, COA recently issued Circular No. 2021-00322 dated July 16, 2021 entitled:

There, COA enumerates the conditions which would allow agencies or Government-Owned and Controlled Corporations (GOCCs) to hire lawyers or legal consultants without its prior written concurrence, thus:

Verily, Contracts of Service or Job Order Contracts pending review by COA and those that may thereafter be executed under the same conditions specified in the new Circular are no longer subject to COA's prior concurrence.

The partial lifting of this requirement is obviously meant to avoid unnecessary delay, to address urgent need for legal services, and improve efficiency in government operations.24 Notably, the new Circular affirms the position that prior to its issuance, the requirement of COA's concurrence in the engagement of lawyers and legal consultants was never withdrawn and in fact is beyond the coverage of previous circulars lifting pre-audit. Truly, COA's prior written concurrence has always been the rule. The engagement of lawyers and legal consultant has always been separate and distinct from those activities where pre-audit has been lifted.

Circular No. 2021-003 stresses that the rationale for the concurrence requirement was to ensure the reasonableness of the amount of legal fees to be paid. Such review prior to engagement prevents the possible dissipation of public funds. If agencies were given the free hand to hire lawyers or legal consultants and the fees paid would later on be found exorbitant and excessive but only during post audit, the government will be burdened with running after these private lawyers to recover the fees already paid. This would prove difficult if not downright impossible considering that these private lawyers or legal consultants could be stationed anywhere within or outside the country. Without practical means to compel them to return the amount they received, it would be the agency which engaged their services, the government itself, which would end up shouldering the unwarranted expense. Thus, before it reaches that point, COA should already step in and determine whether such engagement of legal service was reasonable in the first place. Surely, the same rationale underlies the issuance of COA Circular Nos. 86-255 and 95-011.

We clarify though that the contracts of engagement here do not fall within the purview of the new Circular. For one, these contracts are no longer pending review with COA; for another, the amounts involved are way more than the limit or limits specified in the new Circular.

The contracts of engagement are subject to the concurrence requirement under COA Circular Nos. 86-255 and 95-011

PSALM asserts that the hiring of the legal advisors is not subject to the concurrence requirement under COA Circulars Nos. 86-255 and 95-011 because the latter were engaged only to render advisory services on the preparation, drafting, and review of transaction documents pertinent to the privatization of generation assets and IPP contracts, to name a few. These services did not involve representation in judicial or quasi-judicial proceedings.

In Alejandrino v. COA,25 the Court, in no uncertain terms, decreed that while GOCCs, by way of exception, are allowed to hire external lawyers, they should comply with the three (3) indispensable conditions prior to such engagement: (1) a private counsel can only be hired in exceptional cases; (2) the GOCC must first secure the written conformity and acquiescence of the Solicitor General or the Government Corporate Counsel, as the case may be; and (3) COA's written concurrence must also be secured.

In Polloso v. Gangan,26 the Court clarified that the concurrence requirement under COA Circular No. 86-255 should be secured not only prior to the engagement but also for all types of legal services, and not only those involving an actual legal controversy or court litigation:

COA committed grave abuse of discretion
when it acted on PSALM's request for engagement of the legal advisors only after three (3) years following receipt thereof.

In its letter-request for concurrence, PSALM specifically informed COA that the latter's concurrence was needed on or before May 30, 2011 because of the strict timelines imposed under the EPIRA, thus:

Records show that the PSALM-COA resident auditor received the letter-request on May 11, 2011 while the COA-CGS Cluster B, on May 13, 2011.

But when the May 30, 2011 deadline came, only OGCC's concurrence was in sight, COA's was not. Even then, PSALM waited for another ninety-one (91) days or until August 29, 2011 before finally deciding to proceed with the engagement of the legal advisors.

It was only sometime in June 2012 when PSALM finally heard from the COA Legal Services Office. The latter asked for documents pertinent to PSALM's over a year-old request for concurrence. In response, PSALM submitted the required documents through the COA-Cluster 3 Director on September 16, 2013. This COA office then took five (5) more months just to transmit the documents to the COA Legal Services Office. The latter spent another eight (8) months to finally render a decision on PSALM's request.

In all, more than three (3) years had passed before COA rendered its official action through its assailed LRR No. 2014-174 dated November 6, 2014, stating:

COA's inordinate delay is imprinted all over the records. The tables cannot be turned now on PSALM. For PSALM complied with the procedure to secure COA's concurrence, but the latter, for a total of more than three (3) years failed to act.

COA has not admitted its fault, much less, provided any real and justifiable reason why after making PSALM wait for over three (3) years, it denied PSALM's request for concurrence. The denial did not even claim that PSALM's engagement of the legal advisors was unnecessary or that the selection of the legal advisors was not in accord with the procurement process or that the fees paid them were excessive or exorbitant.

COA denied written concurrence because PSALM had not obtained such concurrence. This reasoning begs the issue. This is precisely why we cannot adhere to COA's denial of PSALM's request. On this score, COA's basis for the denial, the absence of the concurrence requirement prior to the engagement of the legal advisors, should clearly be excused. COA's unjustified refusal and delay to perform its obligation to review, evaluate, and render its concurrence prevented PSALM from securing the required concurrence. Thus, there was no fault on the part of PSALM as the fault lies with COA.

As pointed out by COA itself, the Commission Proper has original jurisdiction over requests for concurrence in the hiring of legal retainers by government agencies. Pursuant to Section 3 of Rule VIII of the 2009 Revised Rules of Procedure of the COA (RRPC), however, COA has delegated to the General Counsel the authority to evaluate and issue the corresponding concurrence or denial whose decisions are deemed those of the Commission itself.30

Here, we reckon with the singular period of sixty (60) days within which COA ought to resolve any case brought before it.31

Based on these provisions, COA is mandated not only by law but by its own procedural rules to evaluate a request for concurrence of retainer contract of private lawyers specifically within sixty (60) days from submission of the request for concurrence. We, nonetheless, recognize that the period within which COA has to complete its pre-audit for the prior written concurrence is a policy determination over which we have no jurisdiction to review unless done with grave abuse of discretion, as in this case.

Here, COA took a whopping four hundred four (404) days from receipt of the request to make an initial evaluation thereof, and thereafter, to request additional documents from PSALM. From the latter's submission of the documents, COA used up another four hundred sixteen (416) days before it finally issued a resolution of denial, citing as ground its lack of prior concurrence which, as shown, was the end result of its own inordinate delay or inaction.

In its Memorandum, COA admits that it could not and does not always observe the sixty (60)-day period under PD 1445 and the 2009 Revised Rules of Procedure in view of the sheer volume of requests it receives every year given the number of clientele it serves, which is just one of the many functions it performs. It also receives an influx of various requests for money claims, relief of accountability, and appeals.

But we do not find COA's delayed action on the subject request to be reasonable and justified. We also reject COA's reasoning as a justification for delays in other situations. For if we simply accept this reasoning and justify any other delays in past and future cases, either pending or soon to be initiated with this Court, nothing will prevent this faux pas from occurring over and over again. For this reason, we now have to intervene by reasonable measures that the law itself has imposed as will be more lengthily discussed below.

COA's inordinate delay on PSALM's request for concurrence amounted to grave abuse of discretion as it violates PSALM's right to a speedy disposition of its case under Section 16, Article III of the Constitution viz.:

This constitutional right is not limited to the accused in criminal proceedings but extends to all parties in all cases, be it civil or administrative in nature, as well as all proceedings, either judicial or quasi-judicial. In this accord, any party to a case may demand expeditious action from all officials who are tasked with the administration of justice.

In Navarro v. Commission on Audit,32 the Court En Banc ruled that COA was guilty of inordinate delay when it took more than seven (7) years from the issuance of the Audit Observation Memorandum to render a decision, viz.:

Indeed, the evasion of a positive duty, virtual refusal to discharge a duty enjoined by law or performing an act tainted with caprice or despotism equates to grave abuse of discretion, amounting to excess or lack of jurisdiction.33

In another vein, the purpose of requiring the concurrences of COA and GOCC is to curtail the unauthorized and unnecessary disbursement of public funds to private lawyers for services rendered to the government, which is in line with COA's constitutional mandate to promulgate accounting and auditing rules and regulations, including those for the prevention and disallowance of irregular, unnecessary, excessive, extravagant, or unconscionable expenditures or uses of government funds and properties.34

Here, COA has not presented any valid reason for denying its concurrence, albeit it was too late in the day, other than the supposed lapse on the part of PSALM to secure its concurrence. There was no ruling on the merits; COA did not determine the necessity of hiring an external counsel and the reasonableness of the proposed rates based on the novelty or difficulty of the case and the extent of the engagement when it issued its denial. In other words, there was no finding that PSALM's payment to Mr. John T. K. Yeap and Atty. Michael B. Tantoco for their services constituted irregular, unnecessary, excessive, extravagant, or unconscionable expenditures or uses of government funds and properties.

In any event, PSALM cannot be faulted when it proceeded to engage the services of the legal advisors even without COA's concurrence. For sure, PSALM could not have ended up in serious breach of its mandate to privatize.

As correctly asserted by PSALM, the transfer of IPP contracts, for which the expertise of the legal advisors was sought, was the only unfulfilled condition under Section 31 of the EPIRA which decreed that the implementation of open access and retail competition should take place within three (3) years from approval of the EPIRA in 2001.35 Notably, when PSALM sought COA's concurrence in 2011, PSALM was already in delay in the implementation of the law. It was even 2% short of the 70% EPIRA threshold requirement.36 PSALM, was therefore, left with no feasible choice but to do a judgment call in accordance with its best lights possible by proceeding with the engagement of the legal advisors on the preparation, drafting, and review of transaction documents relative to the privatization of generation assets and IPP contracts, among others.

The selection and appointment of IPP Administrators to manage the NPC contracted energy output was the first of its kind especially in our jurisdiction where NPC had, for so long a time, the monopoly of the generation sector. Hence, there was the real need to engage those highly technical and legal advisors equipped with international experience. Without them, the full implementation of the EPIRA would not have been possible.

True, in Alejandrino v. COA,37 Almadovar v. Pulido-Tan,38 Phividec Industrial Authority v. Capitol Steel Corporation,39 and Oñate v. COA,40 we declared as unauthorized the hiring of private lawyers without the prior concurrence of OGCC or COA. But the circumstances in those cases and here are substantially different. While in those cases, the government agencies totally ignored the concurrence requirement when they hired the private lawyers, here, PSALM sought COA's concurrence long before the actual engagement of the legal advisors, and it was COA's inordinate delay or inaction that led to the absence of its concurrence to this eventual engagement.

To reiterate, PSALM sought the concurrences of both the OGCC and COA way before it actually engaged the services of the legal advisors. Only the OGCC promptly acted and gave its concurrence. Even after more than sixty (60) days from receipt of PSALM's request, and another ninety-one (91) days, COA's concurrence never came in sight. PSALM was, therefore, painted into a corner to do a judgment call to avert any further delay in the implementation of the EPIRA within the mandated three (3)-year deadline. The purpose was two pronged: to ensure a regime of fair and free competition in the power sector, and to achieve the quality, reliability, security, and affordability of electric power supply.41 For pursuing this greater government objective despite COA's inordinate inaction or delay, PSALM should not be faulted.

The PSALM officers who approved the legal advisors' contracts should not be held personally liable for payment of the latter's fees.

It is a matter of record that the legal advisors here had satisfactorily completed and rendered their services under the contract of engagement for the benefit of the government. They had no obligation to return what had been paid them. They are rightfully entitled to receive the legal fees they had fully worked for. Justice and equity dictate that they receive the corresponding compensation on the basis of their actual and existing rights under their respective contracts of engagement. From the moment of perfection of the contract, the parties are bound not only to the fulfillment of what has been expressly stipulated but also to all the consequences which, according to their nature, may be in keeping with good faith, usage, and law. The contract has the force of law between the parties and they are expected to abide in good faith by their respective contractual commitments.42

The approving and implementing PSALM officers should not be held personally liable for payment of the professional fees owing to the legal advisors. The latter's expertise and services substantially contributed to boosting the government's privatization of 70% of our generation assets with the end in view of improving the quality of power supply in the entire country.

We have ruled that a public official may be liable in his personal capacity for whatever damage he may have caused by his act done with malice and in bad faith or beyond the scope of his authority or jurisdiction.43 Given the situation obtaining here, however, no bad faith or malice could be attributed to the concerned PSALM officers who prioritized the best interest of the government when they pursued the engagement of the legal advisors. They were solely motivated by the desire to accomplish the EPIRA mandate and achieve the greater good for the government. Thus, personal liability should not attach to them.44

Bad faith entails a dishonest purpose or a moral obliquity and conscious doing of a wrong, a breach of a sworn duty through some motive or intent or ill will and partakes of fraud.45 Here, no such bad faith can be imputed to PSALM officers who allowed the processing of contracts and payment to the legal advisors.

As stated, Circular No. 2021-003 provides the conditions46 when to exempt agencies and GOCCs from COA's prior concurrence for engagement of lawyers and legal consultants. If any of these conditions are not met, COA's prior concurrence shall be required. When so required, the Court lays down the following remedial measures which COA may adopt to prevent precedents of denial of concurrence due to inordinate delay or inaction:

Following the period of sixty (60) days prescribed under Section 49 of Presidential Decree No. 1445 and Section 4, Rule X of COA's 2009 Revised Rules of Procedure, the Court reiterates that government agencies needing to hire private counsel locally or abroad for any form of legal services must submit to COA their respective requests for concurrence not later than sixty (60) calendar days prior to the estimated date of engagement or retainer, attaching thereto the written conformity or acquiescence of the OGCC. This procedure will apply when the engagement of lawyer and legal consultant would not fall in the requirements where COA's concurrence is exempted.

The request shall already include all the details and documents necessary to evaluate the planned engagement or retainer - the amount of compensation, the reasonableness of the compensation, the reasons for choosing the legal contractors, the undertakings or terms of reference of the legal contractors, the availability or non-availability of others in the relevant field, assurance of consistency in legal policies and practices among the instrumentalities of the State and certitude and predictability in matters of legal import, among others.

From submission of the request, COA has sixty (60) calendar days from the date of its receipt of the request to either deny or affirm the request. In case of a denial, the reasons therefor should be indicated.

Should the period of sixty (60) calendar days expire, sans any action from COA, the request is deemed approved.

In exceptional cases, COA may allow a government agency or GOCC to seek the concurrence of COA less than sixty (60) calendar days prior to the planned engagement or retainer. The government agency should state specific reasons to justify its exceptional request on the matter.

The foregoing guidelines apply as well when the conformity or acquiescence is to come from the OSG.

To recapitulate, COA regulations require first the conformity of the OGCC or the OSG prior to COA's concurrence. This sequencing of the requisite approvals must only signify that the prior determination or assertion by the OGCC or the OSG pertaining, among others, to the amount of compensation, the reasonableness of the compensation, the reasons for choosing the legal contractors, the undertakings or terms of reference of the legal contractors, the availability or non-availability of others in the relevant field, assurance of consistency in legal policies and practices among the instrumentalities of the State and certitude and predictability in matters of legal import, in other words, the necessity and/or expediency of the hiring of providers of legal services - is entitled to, and accorded great respect by, COA itself as the final concurring agency.

What this respect essentially means is that the OSG or the OGCC need not be correct in its determination and assertion but need only be reasonable. This, in turn must reflect that the reasoning paths of the OSG or the OGCC are content-wise justifiable (i.e., whether the decision of the OSG or the OGCC to hire a private counsel falls within a defensible range of possible acceptable outcomes) and as a matter of form, transparent and intelligible. For COA's affirmative action, it may consider the following factors:

Indisputably, the OSG and the OGCC are the primary government agencies which deal with and know these matters by heart. The same are within their expertise and mandate, hence, within their primary jurisdiction.47 So long as the government agency and the OSG or the OGCC are able to justify the hiring and to articulate the reason or reasons for doing so in a transparent and intelligible manner, it is presumed that their conformity or acquiescence to the engagement is reasonable.

To repeat, the foregoing guidelines are not black-letter law but are matters of best practice or factors that underlie an analysis on the present subject. In any event, the Court is holding on the commitment of COA that is currently "formulating more policy issuances on the written concurrence to avoid unnecessary delay in the hiring of a private lawyer, and to improve efficiency in government operations."

ACCORDINGLY, the petition is GRANTED. COA Decision No. 2017-215 dated July 6, 2017 and Resolution-Decision No. 2019-004 dated

The Commission on Audit is directed to allow payment to Mr. John T. K. Yeap and Atty. Michael B. Tantoco of the total compensation due them.

Gesmundo, C.J., Hernando, Carandang, Inting, Zalameda, Gaerlan, Rosario, J. Lopez, and Dimaampao, JJ., concur.

Perlas-Bernabe, J., While on official leave, I left my vote and submitted a Separate Concurring Opinion in this case.1a⍵⍴h!1