: ALL JUDGES OF LOWER COURTS
: EXERCISE OF UTMOST CAUTION, PRUDENCE AND JUDICIOUSNESS IN THE
OF WRITS OF EXECUTION TO SATISFY MONEY JUDGMENTS AGAINST GOVERNMENT
AND LOCAL GOVERNMENT UNITS.
order to prevent possible circumvention of the rules and procedures of
the Commission on Audit, judges are hereby enjoined to observe utmost
prudence and judiciousness in the issuance of writs of execution to
money judgments against government agencies and local government
should bear in mind that in Commissioner of Public Highways v .San
(31 SCRA 617, 625 ), this Court explicitly stated:
universal rule that where the State gives its consent to be sued by
parties either by general or special law, it may limit claimant's action
'only up to the completion of proceedings anterior to the stage of
and that the power of the Court ends when the judgment is rendered,
government funds and properties may not be seized under writs of
or garnishment to satisfy such judgments, is based on obvious
of public policy. Disbursements of public funds must be covered by the
corresponding appropriation as required by law. The functions and
services rendered by the State cannot be allowed to be paralyzed or
by the diversion of public funds from their legitimate and specific
as appropriated by law.
it is settled jurisprudence that upon determination of State liability,
the prosecution, enforcement or satisfaction thereof must still be
in accordance with the rules and procedures laid down in P. D. No.
otherwise known as the Government Auditing Code of the Philippines
of Agriculture v. NLRC, 227 SCRA 693, 701-02  citing Republic vs.
Villasor, 54 SCRA 84 ). All money claims against the
must first be filed with the Commission on Audit which must act upon it
within sixty days. Rejection of the claim will authorize the claimant
elevate the matter to the Supreme Court on certiorari and, in effect,
the State thereby (P. D. 1445, Sections 49-50).
notwithstanding the rule that government properties are not subject to
levy and execution unless otherwise provided for by statute (Republic
v. Palacio, 23 SCRA 899 ; Commissioner of Public Highways v. San
Diego, supra) or municipal ordinance (Municipality of
v. Court of Appeals, 190 SCRA 206 ), the Court has, in
instances, distinguised between government funds and properties for
use and those not held for public use. Thus, in Viuda de Tan
v. Muncipal Council of Iloilo (49 Phil 52 ), the Court ruled
that "[w]here property of a municipal or other public corporation
sought to be subjected to execution to satisfy judgments recovered
such corporation, the question as to whether such property is leviable
or not is to be determined by the usage and purposes for which it is
The following can be culled from Viuda de Tan Toco v.
Council of Iloilo:
Properties held for public uses - and generally everything held for
purposes - are not subject to levy and sale under execution against
corporation. The same rule applies to funds in the hands of a public
and taxes due to a municipal corporation.
Where a municipal corporation owns in its proprietary capacity, as
from its public or governmental capacity, property not used or used for
a public purpose but for quasi-private purposes, it is the general rule
that such property may be seized and sold under execution against the
held for public purposes is not subject to execution merely because it
is temporarily used for private purposes. If the public use is wholly
such property becomes subject to execution.
Administrative Circular shall take effect immediately and the Court
shall see to it that it is faithfully implemented.
this 25th day of October, 2000 in the City of Manila.