FIRST DIVISION

[G.R. No. 171953. October 21, 2015.]

NATIONAL HOUSING AUTHORITY, petitioner, vs. ERNESTO ROXAS, respondent.

Ponente : BERSAMIN, J

The National Housing Authority (NHA), a government-owned and -controlled corporation created
and existing under Presidential Decree No. 757, may sue and be sued. However, no court should issue a writ of
execution upon any monetary judgment rendered against the NHA unless such monetary judgment is first
submitted to and passed upon by the Commission on Audit (COA).

SUMMARY:
Being challenged on appeal by the NHA is the adverse decision promulgated on February 20, 2006,
whereby the Court of Appeals (CA) dismissed the NHA's petition for certiorari brought to nullify the orders issued
in Special Civil Action No. 93-060-MN entitled Ernesto Roxas v. National Housing Authority, et al. by the
Regional Trial Court (RTC), Branch 72, in Malabon City. The first order, dated May 3, 2002, had granted the
motion for the issuance of the writ of execution filed by respondent Ernesto Roxas. The other order, dated
January 6, 2003, had denied the NHA's motion for reconsideration. The NHA had also thereby assailed the writ
of execution consequently issued on February 24, 2003. In its petition for certiorari, the NHA insisted that the
RTC had thereby committed grave abuse of discretion amounting to lack or excess of jurisdiction.

FACTS:

The NHA is charged, among other, with the development of the Dagat-dagatan Development Project
situated in Navotas, Metro Manila.

On December 4, 1985, Roxas applied for commercial lots in the project particularly Lot 9 and Lot 10
in Block 11, Area 3, Phase III A/B, with an area of 176 sqm. To be used for his business of buying and selling
gravel, sand, and cement products.

On December 6, 1985, NHA approved application and issued order of payment for the lots.

On December 27, 1985, NHA issued notice of award for the lots to Roxas at 1,500/sqm. Roxas made
downpayment amounting to P79,200. Relocation/Reblocking survey resulted to renumbering of lots from Lot
9 to Lot 5 and Lot 10 to Lot 6.

NHA conducted final subdivision project survey and caused area of the lots to increase from 176sqm to
320sqm. NHA informed Roxas and approved award of additional 144sqm at 3500/sqm. Roxas appealed to
reduction of price to 1500/sqm. Purchase of additional due to increase must be in accordance with terms
and conditions contained in the order of payment and notice of award issued.

NHA rejected his appeal. Roxas applead to RTC for ACTION OF SPECIFIC PERFORMANCE AND DAMAGES
with issuance of WRIT OF PRELIMINARY INJUNCTION.( A preliminary injunction is an order granted at any stage of an
action or proceeding prior to the judgment or final order, requiring a party to an administrative case or any third person to refrain from
a particular act or acts. It may also require the performance of a particular act or acts, in which case it shall be known as a preliminary
mandatory injunction.)

NHA countered Roxas’ prayer to include increase in lot measure to original contract as it was contrary to
existing rules and regulations. Roxas could not claim more than what had been originally awarded to him.
Right to additional area limited to First Refusal (is a contractual right, but not obligation, to enter into a business transaction
with a person or company before anyone else can. If the entity with the right of first refusal declines to enter into a transaction, the
owner of the asset who offered the right is free to open the bidding up to other interested parties)

On July 15, 1994, RTC rendered the judgment against NHA, declaring the following:

1. Ernesto Roxas legal awardee of Lots 5 and 6 with total area of 320sqm.
2. NHA, thru its Gen. Manager Robert Balao, and Project Manager, Evelyn Ramos, to
execute corresponding Contract to Sell for entire area of Lot 5 and 6 at P1500/sqm under
same terms and conditions in Order of Payment and Notice of Award, deducting any
payments made.
3. NHA to pay P30,000.00 to Roxas for Attorney’s Fee.
Writ of Preliminary Injunction is issued on January 31, 1994 is made permanent.

NHA petitioned for certiorari with CA and was later denied. Roxas filed for Writ of Execution and was granted
by RTC on May 3, 2002. NHA sought for reconsideration and motion was later denied on Jan 6, 2003. On
Feb 24, 2003, RTC issued writ of execution to enforce decision.

To prevent execution, NHA petitioned certiorari in CA, imputing RTC for grave abuse of discretion amounting
to lack or excess of jurisdiction and was dismissed on Feb 20, 2006.

ISSUES:

1. WON NHA is covered in the State’s Immunity from suit?

2. WON money judgment award for Attorney’s Fees must be filed first in COA?

HELD:

1. NO. The Mantle of the State’s Immunity from suit did not extend to NHA despite being a Government-
owned and controlled corporation (GOCC). Under Sec. 6(i) of PD No. 757, which was its charter,
NHA could sue and be sued. Thus, NHA was not immune from suit of Roxas.
2. YES. Settling or paying off secondary relief of P30,000.00, being monetary obligation of NHA, would
not be in the usual course of the activities of NHA under its charter. Pursuant to Sec. 26 of PD No.
1445, Roxas should bring it to COA prior to its enforcement against the NHA.

Section 26. General jurisdiction. — The authority and powers of the

Commission shall extend to and comprehend all matters relating to
auditing procedures, systems and controls, the keeping of the general
accounts of the Government, the preservation of vouchers pertaining
thereto for a period of ten years, the examination and inspection of the
books, records, and papers relating to those accounts; and the audit and
settlement of the accounts of all persons respecting funds or property
received or held by them in an accountable capacity, as well as the
examination, audit, andsettlement of all debts and claims of any sort
due from or owing to the Government or any of its subdivisions,
agencies and instrumentalities. The said jurisdiction extends to
all government-owned or controlled corporations, including their
subsidiaries, and other self-governing boards, commissions, or
agencies of the Government, and as herein prescribed, including
non-governmental entities subsidized by the government, those
funded by donations through the government, those required to
pay levies or government share, and those for which the
government has put up a counterpart fund or those partly funded
by the government. (bold underscoring supplied for emphasis)

Audit jurisdiction of COA extends to all GOCCs, their subsidiaries, and other self-governing boards,
commissions, or agencies of the Government. There is no distinction as to the class of claims. State may limit the
claimant’s action only up to completion of proceedings anterior to stage of execution. Power of the court ends when
judgment in rendered as government funds and property may not be subject to writs of execution or writs of
garnishment to satisfy judgment. Ubi lex non distinguish nec nos distinguere debemos – where the law does not
make any exception, the courts may not exempt something therefrom, unless there is compelling reason to the
contrary.
The rule is based on considerations of public policy. Disbursements of public fund must be covered by
corresponding appropriation as required by law.