SECOND DIVISION

[ G.R. No. 208976, February 22, 2016 ]

RESOLUTION
LEONEN, J.:
This resolves the following motions and manifestation filed before this court: 1) Motion for Reconsideration[1] dated
December 22, 2014 filed by counsel for respondent Leovigildo Delos Reyes, Jr. (Delos Reyes) assailing this court's
Resolution[2] dated October 13, 2014; and 2) Manifestation and Motion for Clarification[3] dated February 26, 2015 filed
by counsel for the Philippine Charity Sweepstakes Office (PCSO).

In the Resolution dated October 13, 2014, we granted the Petition for Review on Certiorari[4] assailing the Court of
Appeals Decision[5] dated March 1, 2013 and Resolution[6] dated August 29, 2013, and consequently dismissed Delos
Reyes from service.[7] The dispositive portion of our Resolution reads:
WHEREFORE, the petition is GRANTED. The Court of Appeals' decision dated March 1, 2013 and resolution dated
August 29, 2013 are REVERSED and SET ASIDE. The Office of the Ombudsman's decision dated June 10, 2006
and order dated November 15, 2007 are REINSTATED. Respondent Leovigildo Delos Reyes, Jr. is DISMISSED from
service, which includes the accessory penalties of cancellation of eligibility, forfeiture of leave credits and retirement
benefits, and disqualification for re-employment in the government service.

SO ORDERED.[8]
The facts of this case, as summarized in our October 13, 2014 Resolution, are:
To generate more funds in line with its mandate, the Philippine Charity Sweepstakes Office (PCSO) maintains On-
line Lottery Terminals in its main office and in provincial district offices. The Marketing and Online Division of PCSO's
Central Operations Department (COD) manages the terminals in the main office under Agency Number 14-5005-1.
Respondent Leovigildo Delos Reyes, Jr. (Delos Reyes) served as the COD Division Chief.

On June 13, 2001, PCSO auditors submitted a consolidated report based on a surprise audit conducted on June 5,
2001. The auditors found that the cash and cash items under Delos Reyes' control were in order. However, the
auditors recommended that the lotto proceeds be deposited in a bank the next working day instead of Delos Reyes
keeping the lotto sales and proceeds in a safe inside his office.

On June 5, 2002, COD Manager Josefina Lao instructed OIC-Division Chief of the Liaison and Accounts
Management Division Teresa Nucup (Nucup) to conduct an account validation and verification to reconcile accounts
due to substantial outstanding balances as of May 31, 2002. On August 16, 2002, Nucup reported that Agency No.
14-5005-1 had unremitted collections in the amount of P428,349.00 from May 21, 2001 to June 3, 2001. The amount
was subsequently reduced to P387,879.00 excluding penalties.

Nucup also found that "there was a deliberate delay in the submission of the periodic sales report; that the partial
remittance of total sales were made to cover previous collections; and that the unremitted collections were attributed
to Cesar Lara, Cynthia Roldan, Catalino Alexandre Galang, Jr., who were all employed by [PCSO] as Lottery
Operations Assistants II, and Elizabeth Driz, the Assistant Division Chief."

After conducting its own investigation, the PCSO Legal Department recommended filing formal charges against Delos
Reyes and Elizabeth Driz (Driz) for dishonesty and gross neglect of duty. The PCSO Legal Department found that the
Lottery Operations Assistants turned over the lotto proceeds and lotto ticket sales reports to Delos Reyes as the
Division Chief. In case of his absence, the proceeds and reports were turned over to Driz. Driz would then deposit the
proceeds in the bank. If both Delos Reyes and Driz were absent, the proceeds would be placed in the vault under
Delos Reyes' control and deposited the next banking day.

On May 14, 2003, formal charges were filed against Delos Reyes and Driz, with the cases docketed as Administrative
Case Nos. 03-01 and 03-02, respectively. Delos Reyes and Driz were preventively suspended for 90 days.

On June 8, 2004, PCSO filed an affidavit-complaint with the Office of the Ombudsman. Delos Reyes and Driz were
criminally charged with malversation of public funds or property under Article 217 of the Revised Penal Code, and
administratively charged with dishonesty and gross neglect of duty under Section 46(b)(l) and (3) of Book V of
Executive Order No. 292.
After the submission of the parties' pleadings, the Office of the Ombudsman rendered the decision dated June 10,
2006 in OMB-C-A-04-0309-G finding Delos Reyes and Driz guilty of grave misconduct and gross neglect of duty, and
ordering their dismissal from service. The dispositive portion of the decision reads:
WHEREFORE, premises considered, respondents, Leovigildo T. Delos Reyes, Jr. and Elizabeth G. Driz, are found
guilty for Grave Misconduct and Gross Neglect of Duty, and are thus imposed the penalty of DISMISSAL from the
service, including all the accessory penalties of, cancellation of eligibility, forfeiture of leave credits and retirement
benefits, and disqualification for reemployment in the government service.

The complaint for Dishonesty filed against the respondent is however Dismissed for insufficiency of evidence.

The Honorable Rosario Uriarte, Chairman and General Manager of the Philippine Charity Sweepstakes Office, is
hereby directed to implement immediately this decision pursuant to Memorandum Circular No. 01, Series of 2006.

SO ORDERED.
Delos Reyes' partial motion for reconsideration was denied on November 15, 2007. He then filed before the Court of
Appeals a petition for certiorari docketed as CA-G.R. SP No. 117683 under Rule 65 of the Rules of Court.

On March 1, 2013, the Court of Appeals granted the petition and reversed and set aside the Office of the
Ombudsman's decision and resolution, thus:
WHEREFORE, the petition is GRANTED and the assailed June 10, 2006 Decision and November 15, 2007 Order,
finding petitioner Leovigildo T. Delos Reyes, Jr. guilty of grave misconduct and gross neglect of duty,
are REVERSED and SET ASIDE. The Philippine Charity Sweepstakes Office (PCSO) is ordered
to REINSTATE petitioner as Chief of the Marketing and On-Line Division, Central Operations Department (COD) of
the PCSO, with full backwages, retirement benefits and emoluments, and without diminution as to his seniority rights
from the time of his dismissal from office until his reinstatement.

SO ORDERED.
....

The Office of the Ombudsman and PCSO filed their respective motions for reconsideration. These were denied by
the Court of Appeals in its resolution dated August 29, 2013.[9]
On October 13, 2014, this court rendered its Resolution.

Delos Reyes filed his Motion for Reconsideration[10] assailing this court's findings in the October 13, 2014 Resolution.
Meanwhile, PCSO filed a Manifestation and Motion for Clarification[11] dated February 26, 2015.

On April 22, 2015, this court required the parties to comment on PCSO's Manifestation and Motion.[12] We also
required the Office of the Ombudsman to file a comment on Delos Reyes' Motion for Reconsideration within 10 days
from notice.[13] We noted the parties' separate Comments in our Resolutions dated July 15, 2015[14] and August 24,
2015.[15]

In his Motion for Reconsideration, Delos Reyes prays that the court reconsider its ruling based on the following
grounds: first, there is no substantial evidence to warrant the finding that he is guilty of grave misconduct and gross
neglect of duty;[16] and second, the Court of Appeals was correct "in allowing the petition for certiorari in the interest of
substantial justice."[17]

As to the first ground, Delos Reyes argues that the Office of the Ombudsman committed gross misapprehension of
facts as it was Elizabeth Driz (Driz), the Assistant Division Chief, who misappropriated the lotto sales proceeds
through lapping of funds.[18] It was Driz who had the control and custody of the proceeds.[19] Delos Reyes argues that
"while it is true that [his] 'duty was to monitor, check, and reconcile reports and daily remittances of lotto sales
submitted by the tellers assigned at the Main Office (where the subject unremitted collections originated) and San
Marcelino Outlets,' it is likewise true that after [he] had monitored, checked, and reconciled reports and daily
remittances of lotto sales submitted by the tellers, the sales proceeds were turned over to [Driz] for subsequent
deposit to the bank[.]"[20] The lapping of funds occurred "after [he] had already reconciled the cash reportsf.]"[21]

Moreover, the duty of detecting the discrepancies as to the lotto sales proceeds fell beyond the responsibilities of
Delos Reyes as PCSO's Chief of the Marketing and On-line Division of the Central Operations Department.[22] The
duty of checking the deposit of the lotto proceeds belonged to the Liaison and Accounts Management Division of the
PCSO, particularly when "there were no clear-cut rules or internal control measures implemented by PCSO ... for
remittance for outlets maintained by PCSO [in the] Head Office"[23] at that time. "[I]f there is no duty then there can be
no neglect of duty, much less gross neglect of duty."[24]
Similarly, Delos Reyes did not intentionally nor deliberately violate any rule or law since he did not have any duty to
verify the deposits made by Driz.[25] Delos Reyes merely observed the ordinary parameters of his position.
[26]
 Therefore, no grave misconduct can be attributed to Delos Reyes.[27] On the contrary, substantial evidence
available on record points to his innocence.[28]

In any case, assuming arguendo that Delos Reyes could be faulted for the acts of Driz, the penalty of dismissal from
service is too harsh.[29] Delos Reyes' failure to verify the deposits should, at most, constitute simple neglect of duty.[30]

As to the second ground, Delos Reyes argues that the Court of Appeals was correct in giving due course to the
Petition for Certiorari assailing the Decision and Order of the Office of the Ombudsman.[31] Technical rules are mere
tools to facilitate the administration of the justice system, and the relaxation of rules is necessary when its strict and
rigid application would only serve to hinder achieving substantial justice.[32] The case deserves a liberal interpretation
of the rules since PCSO, "the very institution that initiated this case, sought to exculpate [Delos Reyes] from the
administrative charges filed against him[.]"[33]

On petitioner's part, the Office of the Solicitor General argues that Delos Reyes' arguments are mere "reiteration of
the arguments in his Comment dated March 10, 2014[.]"[34] The Office of the Solicitor General adds that Delos Reyes'
Motion is a pro-forma motion that should be dismissed outright considering that the issues it raised have already
been considered by this court in resolving the case.[35]

Moreover, the Office of the Solicitor General argues that there was no grave abuse of discretion in this case.[36] There
was substantial evidence to support the Office of the Ombudsman's finding of gross misconduct and gross neglect of
duty on Delos Reyes' part.[37] The "[findings of fact [of] the Office of the Ombudsman[,] when supported by substantial
evidence[,] are conclusive."[38]

Lastly, the Office of the Solicitor General argues that the Court of Appeals should not have entertained Delos Reyes'
Petition for Certiorari as there was an adequate remedy available to him under Rule 43 of the Rules of Court.[39]

We deny the Motion for Reconsideration with finality. The issues raised in the Motion were already passed upon in
our Resolution dated October 13, 2014.

Respondent Leovigildo Delos Reyes, Jr. relies heavily on PCSO's Comment[40] before the Court of Appeals and on
PCSO's statements that support his innocence of the administrative charges.[41] However, he forgets the settled rule
that "[findings of fact by the Office of the Ombudsman[,] when supported by substantial evidence] are
conclusive."[42] As we found in our October 13, 2014 Resolution, respondent failed to show arbitrariness on the part of
the Office of the Ombudsman to warrant judicial intervention.[43] Hence, our ruling in the earlier Resolution affirming
the Office of the Ombudsman's findings, which states:
It is undisputed that as Chief of the Marketing and On-Line Division of the COD, respondent was accountable for the
vault and the lotto proceeds placed inside it. As the Division Chief, respondent had the duty to monitor, check, and
reconcile the reports of the daily lotto proceeds. It is true that it was not his job to personally deposit the lotto
proceeds with the bank, as this fell under Driz's responsibility. However, it was incumbent upon respondent to ensure
that the lotto proceeds deposited in the bank correspond to the reports submitted to him and that the proceeds are
deposited promptly.

Despite such duty, respondent willfully ignored the auditor's recommendations for prompt deposit of the
lotto sales proceeds. He disregarded his duty of overseeing the deposit of the proceeds and wholly relied on
Driz's representations. Respondent's act constitutes gross neglect of duty.

Similarly, records show that petitioner adduced substantial evidence to show how respondent flagrantly
disregarded the rules and acted with a willful intent to violate the law, thus, amounting to grave misconduct.
The Office of the Ombudsman's investigation revealed that all of the daily lotto remittances went through the
hands of respondent It also found that respondent's authorization and/or approval was required before Driz
could deposit the daily lotto proceeds. Driz's alleged manipulation of the bank deposit slips and lapping of
funds could not have been missed by respondent had he performed his duties. Respondent could have
easily discovered the lapping of funds if he had checked the deposit records with Driz vis-a-vis the reports
and lotto sales proceeds he had allegedly reconciled upon turn-over of the tellers to him. [44] (Emphasis
supplied)
As acknowledged by respondent,[45] to be administratively liable for neglect of duty, the duty need not be expressly
included in the respondent's job description.[46] Gross neglect of duty is "characterized by the want of even slight care,
acting or omitting to act in a situation where there is a duty to act, not inadvertently but willfully and intentionally, with
a conscious indifference to consequences, insofar as other persons may be affected."[47] This omission of care is that
which even "inattentive and thoughtless men never fail to give to their own property."[48] "In cases involving public
officials, gross negligence occurs when a breach of duty is flagrant and palpable."[49]

In Land Bank of the Philippines v. San Juan, Jr.,[50] we found the respondent guilty of gross neglect of duty and
ordered his dismissal from the service for failing to ensure that his subordinates followed the correct office protocols:
[51]

The respondent further argues that the duties of opening and processing the bank's accounts fell on the shoulders of
Ramirez and Amparo and were not part of his specific duties and responsibilities as Acting LBP Manager; thus, he
should not be made accountable. We cannot, however, accept this excuse. As Acting LBP Manager, the respondent
had the primary duty to see to it that his employees faithfully observe bank procedures. Whether or not the opening
and processing of accounts were part of his job description or not was of no moment because the respondent held a
position that exercised control and supervision over his employees.[52] (Emphasis supplied)
Misconduct is the "transgression of some established and definite rule of action, more particularly, unlawful behavior
or gross negligence by a public officer. The misconduct is grave if it involves any of the additional elements of
corruption, willful intent to violate the law or disregard of established rules, which must be proved by substantial
evidence."[53] Respondent committed grave misconduct when he intentionally disregarded the Commission on Audit's
Memorandum recommending the immediate deposit of the lotto proceeds with the bank. At the risk of being
repetitive, respondent, as Chief of the Marketing and On-Line Division of the Central Operations Department, had the
duty to ensure that the deposit of the lotto sales proceeds were in order.

We also reiterate our ruling that liberal application of the rules cannot be invoked to justify a flagrant disregard of the
rules of procedure.[54] Appeals of decisions of the Office of the Ombudsman in administrative disciplinary cases
should be appealed to the Court of Appeals under Rule 43 of the Rules of Court.[55] It is only when there is grave
abuse of discretion on the part of the Office of the Ombudsman that this court will entertain review of the assailed
ruling or order.[56] The rules and jurisprudence require the dismissal of the petition before the Court of Appeals.

We now resolve the Manifestation and Motion for Clarification dated February 26, 2015 filed by PCSO.

PCSO seeks clarification as to the specific consequences of respondent's dismissal from the service in light of
PCSO's payment of his back salaries. PCSO alleges that:
4. While the petitioner filed the present petition before the Court, the PCSO acting in good faith according
to the CA rulings, reinstated the respondent effective 10 October 2013 pursuant to Board Resolution No.
260, S. 2013 and Special Order No. 2013-179.

5. Based on the Assumption of Duties and Responsibilities issued by Atty. Roman C. Torres, Manager,
PCSO Security Printing and Production Department, the respondent reported for work on 11 November
2013. Further, the PCSO Accounting and Budget Department computed his salaries and other benefits
covering the period from 8 November 2008 to 30 November 2013. He was correspondingly paid his back
salaries as shown from the Disbursement Voucher and Check No. 0000211427 issued in his name in
the amount [of] Four Million Four Hundred Fifty One Thousand Eight Hundred Ninety Three And
13/100 Pesos (Php4,451,893.13).

6. However, with the present Resolution, the PCSO has a duty to raise before this Court PCSO's actions
and the matter of the respondent's entitlement to back salaries, which was not passed upon in its ruling.
PCSO respectfully seeks clarification of this Court's Resolution to establish the respondent's entitlement
to back salaries despite his dismissal from service and the reversal of the CA rulings ordering the award
of back salaries.[57] (Emphasis in the original, citations omitted)
In its Comment[58] on the PCSO's Manifestation and Motion for Clarification, the Office of the Solicitor General argues
that PCSO had no legal basis to reinstate respondent and award him his salaries.[59] "The [D]ecision of the
Ombudsman should have been implemented pending respondent's appeal to the Court of Appeals and the Supreme
Court[,]"[60] as an appeal does "not stop the decision from being executory."[61] This is even more so in this case, as
respondent availed himself of the wrong remedy before the Court of Appeals.

As to respondent's entitlement to back salaries, the Office of the Solicitor General argues that the general rule is that
public officials who do not render any service are not entitled to compensation.[62] Back salaries are awarded only if
the public official is exonerated of the charge or his or her dismissal is found to be illegal.[63]

In his Comment[64] on PCSO's Manifestation and Motion for Clarification, respondent argues that PCSO paid his
backwages in good faith and under PCSO's findings that he was innocent of the charges.[65] According to respondent:
In sum, when PCSO paid the backwages of [D]elos Reyes, it did so under the directive of the Court of Appeals which
reversed the decision of the Office of the Ombudsman. PCSO had acted in utter good faith. On the other hand, Delos
Reyes when he accepted the payment of backwages, he was also doing it in good faith because by virtue of the
reversal of the decision of the Office of the Ombudsman, he was able to prove his innocence from the administrative
charges against him. It was a welcome and much needed break for him and his family, which for seven (7) years had
been deprived of his salary and became dependent on the generosity of his wife[.][66]
PCSO invokes this court's ruling in Civil Service Commission v. Cruz[67] in claiming that respondent was not entitled to
back salaries as he was found guilty of the administrative charges.[68]

This court in Bangalisan v. Court of Appeals[69] ruled that payment of back salaries during the period of suspension of
a civil service member who is subsequently ordered reinstated is allowed if "[1] he [or she] is found innocent of the
charges which caused the suspension and [2] when the suspension is unjustified."[70] The two conditions must be
complied with to entitle the reinstated employee payment of back salaries. "[I]n case the penalty is suspension or
removal, the respondent shall be considered as having been under preventive suspension during the pendency of the
appeal"[71] if his or her appeal is meritorious.

PCSO claims that the amount of back salaries given to respondent covers the period of November 8, 2008 to
November 30, 2013.[72] The Decision of the Office of the Ombudsman dismissing respondent from the service was
rendered on June 10, 2006.[73] The Office of the Ombudsman denied the Motion for Reconsideration on November
15, 2007.[74] Respondent should have been dismissed from the service as early as 2006 following the immediately
executory nature of the Office of the Ombudsman's Decision.[75]

In Yarcia v. City of Baguio,[76] the Civil Service Commissioner found the petitioner administratively liable for dishonesty
and was ordered dismissed from the service.[77] The Decision was immediately executory pending appeal to the Civil
Service Board of Appeals.[78] The Board did not exonerate the petitioner, but it imposed a fine equivalent to six (6)
months' pay.[79] Undaunted, the petitioner asked for payment of his back salaries for the period covering his
separation up to his reinstatement.[80] This court, citing Villamor, et al. v. Hon. Lacson, et al.,[81] held that:
"[I]t will be noted also that the modified decision did not exonerate the petitioners. And if We take into account the fact
that they did not work during the period for which they are now claiming salaries, there can be no legal or equitable
basis to order the payment of their salaries. The general proposition is that a public official is not entitled to any
compensation if he has not rendered any service. As you work, so shall you earn. And even if We consider the
punishment as suspension, before a public official or employee is entitled to payment of salaries withheld, it should
be shown that the suspension was unjustified or that the employee was innocent of the charges preferred against
him. (F. B. Reyes vs. J. Hernandez, 71 Phil. 397), which is not the case in the instant proceedings."

. . . Here, the Civil Service Board of Appeals, in affirming the guilt of plaintiff but modifying the penalty of dismissal
from the service to a fine equivalent to six (6) months' pay similarly connoted that although dismissal would be the
proper penalty, it considered plaintiff's separation from work for the period covered of almost three years plus a six
months fine as sufficient punishment. But the appeals board's modified decision did not exonerate the plaintiff nor did
it affect the validity of his dismissal or separation from work pending appeal, as ordered by the Civil Service
Commissioner. Such separation from work pending his appeal remained valid and effective until it was set aside and
modified with the imposition of the lesser penalty, by the appeals board.[82] (Emphasis supplied)
Unlike the Office of the Ombudsman's Decision, however, the Court of Appeals Decision and Resolution reinstating
respondent in his position and ordering the payment of back salaries and other benefits were not immediately
executory, and were subject to appeal to this court via Rule 45 of the Rules of Court.

PCSO's reinstatement of the respondent is without any basis.

Moreover, in our Resolution dated October 13, 2014, we reversed the Court of Appeals Decision and Resolution and
reinstated the Office of the Ombudsman's Decision and Order, which dismissed respondent from service. We
categorically found respondent guilty of the administrative charges. Thus, it is clear that respondent cannot be
considered as reinstated to his position in PCSO and entitled to back salaries during the relevant periods.

It is settled that public officers are entitled to payment of salaries only if they render service.[83] "As he [or she] works,
he [or she] shall earn. Since [respondent] did not work during the period for which [he is] now claiming salaries, there
can be no legal or equitable basis to order the payment of such salaries."[84] Respondent did not perform any work
during the period of November 8, 2008 to November 10, 2013.[85] The amount he received from PCSO minus the
days he reported for work in November 2013 should be returned.

WHEREFORE, the Motion for Reconsideration is DENIED with FINALITY. The Resolution dated October 13, 2014
is AFFIRMED with MODIFICATION in that respondent Leovigildo Delos Reyes is not entitled to payment of back
salaries and is hereby ordered to return any amount received as back salaries and benefits covering the period of
November 8, 2008 to November 10, 2013 from the Philippine Charity Sweepstakes Office.

SO ORDERED.