Municipality of San Miguel, Bulacan vs. Fernandez

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 of Bulacan, MARGARITA D. VDA. DE IMPERIO, ADORACION IMPERIO, RODOLFO IMPERIO, CONRADO IMPERIO, ERNESTO IMPERIO, ALFREDO IMPERIO, CARLOS IMPERIO, JR., JUAN IMPERIO and SPOUSES MARCELO PINEDA and LUCILA PONGCO, respondents.

G.R. No. L-61744
June 25, 1984

FACTS:

In Civil Case No. 604-B, the then CFI of Bulacan rendered judgment holding herein petitioner municipality liable to respondents Imperio, et al. When the judgment became final, respondent judge issued a writ of execution to satisfy the same. Petitioner municipality filed a motion to quash the writ on the ground that the municipality‘s property or funds are public exempt from execution. The motion was denied. The respondent judge issued another order requiring both the municipal and provincial treasurer to comply with the money judgment. When the treasurers failed to do so, respondent judge issued an order for their arrest and that they will be released upon compliance, hence the present petition.

ISSUE:

Whether the funds of the municipality in the hands of the Provincial and Municipal Treasurers of Bulacan and San Miguel, respectively are public funds which are exempt from execution?

HELD:

YES.

Municipal funds in possession of municipal and provincial treasurers are public funds exempt from execution. The reason for those was explained in the case of Municipality of Paoay vs. Manaois ‗that are held in trust for the people intended and used for the accomplices 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 instance destroy said purpose. 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 PD 447, known as the Decree on Local Fiscal Administration, provides in section 3 (a) that ―no money shall be paid out of the treasury except in pursuance of a lawful appropriation or other specific statutory authority. 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 any ordinance to this effect.