City warned of public funds garnishment

CEBU, Philippines - The Commission on Audit (COA) 7 reminded and warned Cebu City officials of their responsibility to protect government funds against garnishment of the city government’s bank deposits in compliance with the writ of execution issued by the court to satisfy the claims of the Rallos heirs.

COA maintains the same position adopted by Mayor Michael Rama and the city’s lawyers that the garnishment of the city government’s bank deposits for the Rallos heirs based on a writ of execution violates certain laws and provisions.

“Under Administrative Circular No. 10-2000 issued by the Supreme Court, it was clearly stated that the prosecution, enforcement or satisfaction of state liability must be pursued in accordance with the rules and procedures laid down in Presidential Decree No. 1445, otherwise known as the Government Auditing Code of the Philippines, wherein it is provided that all money claims against the government must first be filed with the Commission on Audit,” said COA-7 Director Delfin Aguilar.

Aguilar said that then Supreme Court Justice Hilario Davide, Jr. issued the said circular to enjoin all judges of lower courts to observe utmost caution, prudence and judiciousness in the issuance of writs of execution to satisfy money judgments against government agencies and local government units.

Aguilar said that based on the SC issuance and rulings in various cases against garnishment of public funds or property, his office is of the view that the issuance of writ of execution for the satisfaction of the money judgment against the City of Cebu may be considered beyond the powers of the court.

COA cited previous cases like that of the City of Caloocan versus Allarde, which was cited in the case of Municipality of Hagonoy, Bulacan versus Hon. Semeon Dumdum, et al, where it was held that “where the suability of the state is conceded and by which liability is ascertained judicially, the state is at liberty to determine for itself whether to satisfy the judgment or not. Execution may not issue upon such judgment because statutes waiving non-suability do not authorize the seizure or property to satisfy judgments recovered from the action.”

COA said the Rallos case is considered a money claim, thus, it is within the original jurisdiction of the Commission Proper (CP) of the COA and which shall be filed directly with the Commission Secretary.

“Inasmuch as the subject of your query is not within the jurisdiction of this office, we suggest that the claimants be advised to submit their claims with the Commission Proper in accordance with Section 2, Rule VIII of the Revised Rules of Procedures,” Aguilar said.

The claimant for money must file a petition to the CP. Upon receipt of the petition, the Commission Secretary shall issue an Order requiring respondent to answer the petition within 15 days from receipt.

The response of the Commission Secretary must point out insufficiencies or inaccuracies in the petitioner’s statement of facts and issues and the reasons why the petition should be denied or dismissed or granted.

Rama immediately furnished all the city’s depository banks of the copy of COA’s opinion and advised them to observe “extraordinary care in the custody of funds in the light of the requirement of the law.”

Rama sent communication to Philippine Veterans Bank Manager Nicanos Valles, Land bank of the Philippine Cebu –Plaza Independencia Branch Head Dexter Ruiz, Philippine Postal Savings Bank Senior Manager Ricardo Cordova and Banco de Oro-Cebu F. Gonzales Manager Albert Chu. (FREEMAN)