G.R. Nos. 181562-63 and 181583-84; October 2, 2009
SPOUSES CIRIACO and ARMINDA ORTEGA, Petitioners, vs. CITY OF CEBU, Respondent. [Consolidated with] CITY OF CEBU, Petitioner, vs. SPOUSES CIRIACO and ARMINDA ORTEGA, Respondents.

FACTS

Spouses Ciriaco and Arminda Ortega owned a parcel of land in Cebu City. After winning an ejectment case against squatters occupying half of the lot, the City of Cebu enacted Ordinance No. 1519 to expropriate that occupied portion for a socialized housing program. The ordinance appropriated ₱3,284,400.00 for the purchase. The City filed an expropriation complaint. The Regional Trial Court (RTC) fixed just compensation at ₱31,416,000.00, a decision which became final and executory due to the City’s failure to appeal on time.
The RTC subsequently issued a writ of execution. It then granted the Spouses Ortega’s motion to garnish the specific fund (Account No. 101-8918-334) identified in Ordinance No. 1519, which was deposited with the Philippine Postal Bank. The City filed an Omnibus Motion to stay execution, modify the judgment, and withdraw from the expropriation, arguing the price was too high for its program. The RTC denied this. The City also moved to quash the garnishment, contending the garnished bank account was not the specific fund from the ordinance and that government funds are exempt from execution.

ISSUE

The core issues were: (1) whether the City could withdraw from the expropriation or modify the final judgment on just compensation; and (2) whether the garnishment of the City’s bank deposit with the Philippine Postal Bank was valid.

RULING

The Supreme Court denied both petitions and affirmed the Court of Appeals. On the first issue, the Court held that the City could not withdraw from the expropriation nor modify the judgment. The right to withdraw is lost once the order of expropriation becomes final, especially after the property owner is deprived of possession. More critically, the RTC’s judgment fixing just compensation had attained finality due to the City’s failure to perfect a timely appeal. A final judgment can no longer be altered, as it becomes the law of the case between the parties. The City’s claim that the compensation was too expensive for its beneficiaries was irrelevant and did not justify modifying a final and executory decision.
On the second issue, the Court ruled the garnishment was invalid. While a specific fund duly appropriated by ordinance for a particular purpose, like the payment of just compensation in this case, may be subject to garnishment, the City’s account with the Philippine Postal Bank was not that specific fund. The garnished account was a general fund appropriated for other purposes. Government funds are generally immune from execution on grounds of public policy, unless there is a corresponding appropriation. Here, the fund specified in Ordinance No. 1519 did not actually exist in the bank, as certified. Therefore, the RTC had no authority to garnish the City’s other, unrelated bank deposits to satisfy the judgment.