The Supreme Court’s decision in In-House Financial Audit, Conducted in the Books of Accounts of Khalil B. Dipatuan underscores the critical duty of clerks of court to ensure the prompt and proper handling of court funds. The Court found Khalil B. Dipatuan, Clerk of Court VI of the Regional Trial Court of Malabang, Lanao del Sur, administratively liable for simple neglect of duty for failing to remit his collections on time and for depositing personal postdated checks into the court’s Fiduciary Fund account. This case highlights that even over-remittance does not excuse delays in the remittance of judiciary collections, emphasizing the importance of strict adherence to regulations for maintaining the integrity of the judiciary.

Clerk of Court on Trial: Was Delaying Deposits a Breach of Trust?

This administrative case originated from an in-house financial audit conducted by the Office of the Court Administrator (OCA) on the books of account of Khalil B. Dipatuan, Clerk of Court VI of the Regional Trial Court of Malabang, Lanao del Sur, following the expiration of his appointment. The audit, covering the period from January 1, 2002, to October 31, 2003, revealed discrepancies in the handling of judiciary funds. While Dipatuan did not incur any financial accountability, the OCA discovered that he frequently failed to deposit his collections on time, resulting in over-remittances, a practice that violated established regulations. Furthermore, Dipatuan deposited his personal postdated checks into the court’s Fiduciary Fund account, enabling him to withdraw funds before the checks’ maturity dates, a practice akin to cashing personal checks from court collections.

The OCA’s report highlighted Dipatuan’s violations of key provisions designed to ensure the proper management of court funds. These included Section 21 of the New Government Accounting System (NGAS), which mandates that “all collecting officers shall deposit intact all their collections… with the Authorized Government Depository Bank (AGDB) daily or not later than the next banking day.” He also violated Administrative Circular No. 3-2000, which outlines the procedures for depositing collections for the Judiciary Development Fund (JDF). This circular requires that “daily collections for the Judiciary Development Fund in the 1st and 2nd level courts shall be deposited everyday… or if depositing daily is not possible, deposits for the Fund shall be at the end of every month, provided, however, that whenever collections for the Fund reach P500.00, the same shall be deposited immediately even before the period above indicated.” Dipatuan’s practice of depositing postdated checks also ran afoul of Administrative Circular No. 3-2000, which explicitly states that “Collections shall not be used for encashment of personal checks, salary checks, etc.”

Based on these findings, the OCA recommended that the report be docketed as a regular administrative complaint against Dipatuan and that he be fined P5,000.00 for his violations. The Supreme Court agreed with the OCA’s findings and recommendations, emphasizing the critical role of clerks of court in the administration of justice. As the Court noted, clerks of court “perform vital functions in the prompt and sound administration of justice. Their office is the core of adjudicative and administrative orders, processes and concerns. They perform delicate functions as designated custodians of the court’s funds, revenues, records, properties and premises.”

The Supreme Court underscored the importance of adhering to guidelines for the proper administration of court funds. Supreme Court Administrative Circular No. 5-93 provides these guidelines, mandating that all fiduciary collections shall be deposited immediately by the Clerk of Court concerned, upon receipt thereof, with an authorized government depository bank. The circular further stipulates that collections for the Judiciary Development Fund (JDF) shall be deposited every day with the local or nearest branch of the Land Bank of the Philippines (LBP). If daily deposits are not feasible, deposits must be made every second and third Friday, and at the end of each month. Moreover, any collection reaching P500 must be deposited immediately, even before the scheduled deposit days. The Court reiterated that it is the duty of clerks of court to perform their responsibilities faithfully and to comply fully with circulars on the deposit of collections, as they are not authorized to keep those funds in their custody.

The Court addressed the issue of over-remittance in this case. Even though Dipatuan over-remitted his collections, this did not absolve him of administrative liability. The delay in remitting collections constitutes neglect of duty, as the Court has previously held. Furthermore, the failure to remit judiciary collections on time deprives the court of interest that could be earned if the amounts were deposited in a bank promptly. While the Civil Service Rules prescribe a suspension for one month and one day to six months for the first offense of simple neglect of duty, and dismissal for the second offense, the Court took into consideration the fact that Dipatuan had retired from the service and that this was his first infraction.

FAQs

What was the key issue in this case?	The key issue was whether Khalil B. Dipatuan, as Clerk of Court, was administratively liable for failing to remit collections on time and for depositing personal postdated checks into the court’s Fiduciary Fund account.
What is the New Government Accounting System (NGAS)?	The NGAS is a set of rules and regulations governing how government funds should be handled; Section 21 requires collecting officers to deposit collections with an authorized government depository bank daily or no later than the next banking day.
What does Administrative Circular No. 3-2000 say about depositing Judiciary Development Fund (JDF) collections?	It states that daily JDF collections should be deposited every day, or at the end of every month, with immediate deposit required when collections reach P500.00.
Why was depositing personal checks into the Fiduciary Fund a violation?	Depositing personal checks and withdrawing funds before their maturity date is akin to cashing personal checks from court collections, which is prohibited under Administrative Circular No. 3-2000.
What is Supreme Court Administrative Circular No. 5-93?	This circular provides guidelines for all Clerks of Court concerning the proper administration of court funds, mandating immediate deposit of fiduciary collections with an authorized government depository bank.
What constitutes neglect of duty in handling court funds?	Neglect of duty includes any delay in the remittances of collections, even if the funds are eventually fully remitted.
What penalty did the Clerk of Court receive?	Given that it was his first infraction and he had retired, the Court imposed a fine of P5,000.00 to be deducted from his terminal leave pay.
Why is the prompt remittance of court funds so important?	Prompt remittance ensures the integrity of the judiciary, prevents financial losses due to delays, and allows the court to earn interest on the deposited amounts.

In conclusion, the Supreme Court’s decision in this case reinforces the high standards of accountability expected from clerks of court in managing judiciary funds. It clarifies that strict compliance with regulations, including the timely remittance of collections, is essential to maintaining the integrity of the judicial system. The imposition of a fine, even in light of over-remittance, underscores the Court’s commitment to upholding these standards and preventing any potential misuse or mismanagement of public funds.

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Disclaimer: This analysis is provided for informational purposes only and does not constitute legal advice. For specific legal guidance tailored to your situation, please consult with a qualified attorney.
Source: In-House Financial Audit, Conducted in the Books of Accounts of Khalil B. Dipatuan, A.M. NO. P-06-2121, June 26, 2008