G.R. No. 61744. June 25, 1984
MUNICIPALITY OF SAN MIGUEL, BULACAN, PETITIONER, VS. HONORABLE OSCAR C. FERNANDEZ, IN HIS CAPACITY AS THE PRESIDING JUDGE, BRANCH IV, BALIUAG, BULACAN, THE PROVINCIAL SHERIFF O…
RELOVA, J.:
vs. Municipal Government of San Miguel, Bulacan, et al.”, the then Court
of First Instance of Bulacan, on April 28, 1978, rendered judgment
holding herein petitioner municipality liable to private respondents, as
follows:
“WHEREFORE, premises considered, judgment is hereby rendered in
favor of the plaintiffs and against the defendant Municipal Government
of San Miguel, Bulacan, represented by Mayor Mar Marcelo G. Aure and its
Municipal Treasurer:“1. ordering the partial revocation of the Deed of Donation
signed by the deceased Carlos Imperio in favor of the Municipality of
San Miguel, Bulacan, dated October 27, 1947 insofar as Lots Nos. 1, 2,
3, 4 and 5, Block 11 of Subdivision Plan Psd-20831 are concerned, with
an aggregate total area of 4,646 square meters, which lots are among
those covered and described under TCT No. T-1831 of the Register of
Deeds of Bulacan in the name of the Municipal Government of San Miguel,
Bulacan;“2. ordering the defendant to execute the corresponding Deed of
Reconveyance over the aforementioned five lots in favor of the
plaintiffs in the proportion of the undivided one-half (1/2) share in
the name of plaintiffs Margarita D. Vda. de Imperio, Adoracion, Rodolfo,
Conrado, Ernesto, Alfredo, Carlos, Jr. and Juan, all surnamed Imperio,
and the remaining undivided one-half (1/2) share in favor of
plaintiff-spouses Marcelo E. Pineda and Lucila Pongco;“3. ordering the defendant municipality to pay to the
plaintiffs in the proportion mentioned in the immediately preceding
paragraph the sum of P64,440.00 corresponding to the rentals it has
collected from the occupants for their use and occupation of the
premises from 1970 up to and including 1975, plus interest thereon at
the legal rate from January 1970 until fully paid;“4. ordering the restoration of ownership and possession over
the five lots in question in favor of the plaintiffs in the same
proportion aformentioned;“5. ordering the defendant to pay the plaintiffs the sum of P3,000.00 for attorney’s fees; and to pay the cost of suit.
“The counterclaim of the defendant is hereby ordered dismissed for lack of evidence presented to substantiate the same.
“SO ORDERED.” (pp. 11-12, Rollo)
The foregoing judgment became final when herein petitioner’s appeal was
dismissed due to its failure to file the record on appeal on time. The
dismissal was affirmed by the then Court of Appeals in CA-G.R. No.
SP-12118 and by this Court in G.R. No. 59938. Thereafter, herein private
respondents moved for issuance of a writ of execution for the
satisfaction of the judgment. Respondent judge, on July 27, 1982, issued
an order, to wit:
“Considering that an entry of judgment had already been made on June 14, 1982 in G.R. No. L-59938 and;
“Considering further that there is no opposition to plaintiffs’ motion for execution dated July 23, 1982,
“Let a writ of execution be so issued, as prayed for in the aforestated motion.” (p. 10, Rollo)
Petitioner, on July 30, 1982, filed a Motion to Quash the writ of
execution on the ground that the municipality’s property or funds are
all public funds exempt from execution. The said motion to quash was,
however, denied by the respondent judge in an order dated August 23,
1982 and the alias writ of execution stands in full force and effect.
On September 13, 1982, respondent judge issued an order which in part, states:
“It is clear and evident from the foregoing that defendant has
more than enough funds to meet its judgment obligation. Municipal
Treasurer Miguel C. Roura of San Miguel, Bulacan and Provincial
Treasurer of Bulacan Agustin O. Talavera are therefor hereby ordered to
comply with the money judgment rendered by Judge Agustin C. Bagasao
against said municipality. In like manner, the municipal authorities of
San Miguel, Bulacan are likewise ordered to desist from plaintiffs’
legal possession of the property already returned to plaintiffs by
virtue of the alias writ of execution.“Finally, defendants are hereby given an inextendible period of
ten (10) days from receipt of a copy of this order by the Office of the
Provincial Fiscal of Bulacan within which to submit their written
compliance.” (p. 24, Rollo)
When the treasurers (provincial and municipal) failed to comply with the
order of September 13, 1982, respondent judge issued an order for their
arrest and that they will be released only upon compliance thereof.
Hence, the present petition on the issue whether the funds of the
Municipality of San Miguel, Bulacan, in the hands of the provincial and
municipal treasurers of Bulacan and San Miguel, respectively, are public
funds which are exempt from execution for the satisfaction of the money
judgment in Civil Case No. 604-B.
Well settled is the rule that public funds are not subject to levy and
execution. The reason for this was explained in the case of Municipality
of Paoay vs. Manaois, 86. Phil. 629 “that they are held in trust for
the people, intended and used for the accomplishment of the purposes for
which municipal corporations are created, and that to subject said
properties and public funds to execution would materially impede, even
defeat and in some instances destroy said purpose.” And, in Tantoco vs.
Municipal Council of Iloilo, 49 Phil. 52, it was held that “it is the
settled doctrine of the law that not only the public property but also
the taxes and public revenues of such corporations cannot be seized
under execution against them, either in the treasury or when in transit
to it. Judgments rendered for taxes, and the proceeds of such judgments
in the hands of officers of the law, are not subject to execution unless
so declared by statute.” Thus, it is clear that all the funds of
petitioner municipality in the possession of the Municipal Treasurer of
San Miguel, as well as those in the possession of the Provincial
Treasurer of Bulacan, are also public funds and as such they are exempt
from execution.
Besides, Presidential Decree No. 477, known as “The Decree on Local Fiscal Administration”, Section 2 (a), provides:
“SEC. 2. Fundamental Principles. – Local government
financial affairs, transactions, and operations shall be governed by the
fundamental principles set forth hereunder:“(a) No money shall be paid out of the treasury except in
pursuance of a lawful appropriation or other specific statutory
authority.x x x x x x x x x”
Otherwise stated, there must be a corresponding appropriation in the
form of an ordinance duly passed by the Sangguniang Bayan before any
money of the municipality may be paid out. In the case at bar, it has
not been shown that the Sangguniang Bayan has passed an ordinance to
this effect.
Furthermore, Section 15, Rule 39 of the New Rules of Court, outlines the procedure for the enforcement of money judgment:
“(a) By levying on all the property of the debtor, whether real
or personal, not otherwise exempt from execution, or only on such part
of the property as is sufficient to satisfy the judgment and accruing
cost, if he has more than sufficient property for the purpose;“(b) By selling the property levied upon;
“(c) By paying the judgment-creditor so much of the proceeds as will satisfy the judgment and accruing costs; and
“(d) By delivering to the judgment-debtor the excess, if any, unless otherwise directed by judgment or order of the court.”
The foregoing has not been followed in the case at bar.
ACCORDINGLY, the petition is granted and the order of respondent judge,
dated July 27, 1982, granting issuance of a writ of execution; the alias
writ of execution, dated July 27, 1982; and the order of respondent
judge, dated September 13, 1982, directing the Provincial Treasurer of
Bulacan and the Municipal Treasurer of San Miguel, Bulacan to comply
with the money judgments, are SET ASIDE; and respondents are hereby
enjoined from implementing the writ of execution.
SO ORDERED.
Teehankee, (Chairman), Melencio-Herrera, Plana, Gutierrez, Jr., and De la Fuente, JJ., concur.