- Petitioner
- Hon. Tomas R. Osmeña
- Respondent
- Commission On Audit
- Citation
- G.R. No. 98355
- Court
- Supreme Court
- Division
- Second Division
- Ponente
- Nocon, J.
- Decided
- March 2, 1994
Summary
Mayor Tomas Osmeña challenged the Commission on Audit's (COA) decision declaring void a construction contract for a Cebu City abattoir project. The contract worth P8,368,920.00 exceeded the appropriated funds of P5,419,180.00, violating P.D. 1445 requirements. After COA voided the contract, Osmeña entered a compromise agreement to pay the contractor P1,500,000.00, which COA also declared void. The Supreme Court dismissed Osmeña's petition, upholding COA's constitutional authority to audit government expenditures and declare contracts void when they exceed appropriated funds. The Court ruled that both the original contract and compromise agreement were void ab initio, making the expenditure Osmeña's personal liability. This case establishes the mandatory nature of fund appropriation requirements for government contracts and COA's authority to enforce compliance.