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    U.P. v. Dizon

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    Madelinia
    1) The University of the Philippines (UP) entered into a construction contract with Stern Builders Corporation but failed to pay the third billing, prompting Stern Builders to sue UP to collect. 2) The sheriff then served notices of garnishment on UP's bank accounts. UP contested the garnishment. 3) The Supreme Court ruled that UP's funds, being government funds for public purposes, are not subject to garnishment like private funds as UP performs government functions as a chartered institution.

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    U.P. v. Dizon

    Uploaded by

    Madelinia
    184 views2 pages
    1) The University of the Philippines (UP) entered into a construction contract with Stern Builders Corporation but failed to pay the third billing, prompting Stern Builders to sue UP to collect. 2) The sheriff then served notices of garnishment on UP's bank accounts. UP contested the garnishment. 3) The Supreme Court ruled that UP's funds, being government funds for public purposes, are not subject to garnishment like private funds as UP performs government functions as a chartered institution.

    Original Description:

    Constitutional Law I

    Original Title

    1375. U.P. v. Dizon

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    1) The University of the Philippines (UP) entered into a construction contract with Stern Builders Corporation but failed to pay the third billing, prompting Stern Builders to sue UP to collect. 2) The sheriff then served notices of garnishment on UP's bank accounts. UP contested the garnishment. 3) The Supreme Court ruled that UP's funds, being government funds for public purposes, are not subject to garnishment like private funds as UP performs government functions as a chartered institution.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    184 views2 pages

    U.P. v. Dizon

    Uploaded by

    Madelinia
    1) The University of the Philippines (UP) entered into a construction contract with Stern Builders Corporation but failed to pay the third billing, prompting Stern Builders to sue UP to collect. 2) The sheriff then served notices of garnishment on UP's bank accounts. UP contested the garnishment. 3) The Supreme Court ruled that UP's funds, being government funds for public purposes, are not subject to garnishment like private funds as UP performs government functions as a chartered institution.

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    1375. U.P. v.

    Dizon 679 SCRA 54 [2012]


    FACTS:
    The University of the Philippines (UP) entered into a General Construction
    Agreement with respondent Stern Builders Corporation (Stern Builders) for the
    construction of the extension building and the renovation of the College of Arts
    and Sciences Building in the campus of the University of Los Baos (UPLB). In the
    course of the implementation of the contract, Stern Builders submitted three
    progress billings corresponding to the work accomplished, but the UP paid only
    two of the billings. The third billing was not paid due to its disallowance by the
    Commission on Audit (COA). Despite the lifting of the disallowance, the UP failed
    to pay the billing, prompting Stern Builders to sue the UP and officials to collect
    the unpaid billing and to recover various damages.
    Meanwhile, the sheriff served notices of garnishment on the UPs depository
    banks namely Land Bank of the Philippines (Buendia Branch) and the
    Development Bank of the Philippines (Commonwealth Branch). The UP assailed
    said garnishment of funds. Stern Builders and dela Cruz, meanwhile, again sought
    the release of the garnished funds.
    ISSUE:
    Whether or not the funds of UP are subject to garnishment?
    HELD:
    Despite its establishment as a body corporate, the UP remains to be a
    chartered institution performing a legitimate government function. The UP is a
    government instrumentality, performing the States constitutional mandate of
    promoting quality and accessible education. As a government instrumentality, the
    UP administers special funds sourced from the fees and income enumerated
    under the Act No. 1870 and Section 1 of Executive Order No. 714, and from the
    yearly appropriations, to achieve the purposes laid down by Section 2 of Act 1870,
    as expanded in Republic Act No. 9500. All the funds going into the possession of
    the UP, including any interest accruing from the deposit of such funds in any
    banking institution, constitute a special trust fund the disbursement of which
    should always be aligned with the UPs mission and purpose, and should always
    be subject to auditing by the COA.
    The funds of the UP are government funds that are public in character. They
    include the income accruing from the use of real property ceded to the UP that
    may be spent only for the attainment of its institutional objectives. Hence, the
    funds subject of this action could not be validly made the subject of writ
    of execution or garnishment. The adverse judgment rendered against the UP
    in a suit to which it had impliedly consented was not immediately enforceable by
    execution against the UP, because suitability of the State does not
    Source: http://ustlawreview.org/

    necessarily mean its liability.

    Source: http://ustlawreview.org/

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