Summary: De la Victoria vs. Burgos (GR 111190, 27 June 1995)

De la Victoria vs. Burgos
[GR 111190, 27 June 1995]
First Division, Bellosillo (J): 2 concur, 1 concurs in separate opinion to which 1 joined

Facts: Raul H. Sesbreno filed a complaint for damages against Assistant City Fiscal Bienvenido N. Mabanto, Jr., et al. before the Regional Trial Court of Cebu City. After trial Judgment was rendered ordering Mabanto, et al. to pay P11,000.00 to Sesbreno. The decision having become final and executory, on motion of the latter, the trial court ordered its execution. This order was questioned by Mabanto, et al. before the Court of Appeals. However, on 15 January 1992 a writ of execution was issued. On 4 February 1992 a notice of garnishment was served on Loreto D. de la Victoria as City Fiscal of Mandaue City where Mabanto, Jr., was then detailed. The Notice directed De la Victoria not to disburse, transfer, release or convey to any other person except to the deputy sheriff concerned the salary checks, monies, or cash due or belonging to Mabanto, Jr., under penalty of law. On 10 March 1992 Sesbreno filed a motion before the trial court for examination of the garnishees. On 25 May 1992 the petition pending before the Court of Appeals was dismissed. Thus the trial court, finding no more legal obstacle to act on the motion for examination of the garnishees, directed De la Victoria on 4 November 1992 to submit his report showing the amount of the garnished salaries of Mabanto, Jr., within 15 days from receipt taking into consideration the provisions of Sec. 12, pars. (f) and (i), Rule 39 of the Rules of Court. On 24 November 1992 Sesbreno filed a motion to require De la Victoria to explain why he should not be cited in contempt of court for failing to comply with the order of 4 November 1992. On the other hand, on 19 January 1993 De la Victoria moved to quash the notice of garnishment claiming that he was not in possession of any money, funds, credit, property or anything of value belonging to Mabanto, Jr., until delivered to him. He further claimed that, as such, they were still public funds which could not be subject to garnishment. On 9 March 1993 the trial court denied both motions and ordered De la Victoria to immediately comply with its order of 4 November 1992. It opined that the checks of Mabanto, Jr., had already been released through De la Victoria by the Department of Justice duly signed by the officer concerned; that upon service of the writ of garnishment, De la Victoria as custodian of the checks was under obligation to hold them for the judgment creditor; that De la Victoria became a virtual party to, or a forced intervenor in, the case and the trial court hereby acquired jurisdiction to bind him to its orders and processes with a view to the complete satisfaction of the judgment; and that additionally there was no sufficient reason for De la Victoria to hold the checks because they were no longer government funds and presumably delivered to the payee, conformably with the last sentence of Section 16 of the Negotiable Instruments Law. With regard to the contempt charge, the trial court was not morally convinced of De la Victoria's guilt. On 20 April 1993 the motion for reconsideration was denied. De la Victoria filed the petition.

Issue: Whether a check still in the hands of the maker or its duly authorized representative is owned by the payee before physical delivery to the latter.

Held: Garnishment is considered as a species of attachment for reaching credits belonging to the Judgment debtor owing to him from a stranger to the litigation. As Assistant City Fiscal, the source of the salary of Mabanto, Jr., is public funds. He receives his compensation in the form of checks from the Department of Justice through De la Victoria as City Fiscal of Mandaue City and head of office. Under Section 16 of the Negotiable Instruments Law, every contract on a negotiable instrument is incomplete and revocable until delivery of the instrument for the purpose of giving effect thereto. As ordinarily understood, delivery means the transfer of the possession of the instrument by the maker or the drawer with intent to transfer title to the payee and recognize him as the holder thereof. Inasmuch as said checks had not yet been delivered to Mabanto, Jr., they did not belong to him and still had the character of public funds. As held in Tiro v. Hontanosas, "the salary check of a government officer or employee such a s a teacher does not belong to him before it is physically delivered to him. Until that time the check belongs to the government. Accordingly, before there is actual delivery of the check, the payee has no power over it; he cannot assign it without the consent of the Government." As a necessary consequence of being public fund, the checks may not be garnished to satisfy the judgment. The rationale behind this doctrine is obvious consideration of public policy. The Court succinctly stated in Commissioner of Public Highways v. San Diego that "the functions and public services rendered by the State cannot be allowed to be paralyzed or disrupted by the diversion of public funds from their legitimate and specific objects, as appropriated by law." The trial court exceeded its jurisdiction in issuing the notice of garnishment concerning the salary checks of Mabanto, Jr., in the possession of De la Victoria.

	This work is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 License.