The Province of Aklan vs.

Jody King Construction and Development

Corp.
GR Nos. 197592 & 20262
November 27, 2013
FACTS:

On January 12, 1998, The Province of Aklan (petitioner) and Jody King
Construction (respondent) entered into a contract for the design and
construction of the Caticlan Jetty Port and Terminal in Malay, Aklan.

The total project costs P38,900,000.00

In the course of the construction, petitioner issued change orders for

additional works.

On January 5, 2001, another contract was entered for the construction of

Passenger Terminal Building.

On October 22, 2001, respondent demanded for the payment of the whole
amount including the variation orders which petitioner allegedly failed to
settle.

On July 13, 2006, respondent sued petitioner in the RTC Marikina for the
collection of the said amounts.

RTC then issued a writ of preliminary attachment on August 17, 2006.

However, petitioner DENIED any unpaid balance and interest due to

respondent.

Petitioner asserted that the sums being claimed were not indicated in the
change orders as approved by the Office of the Provincial Governor and that
respondent has made a letter dated June 10, 2003 absolving petitioner from
any liability regarding the Passenger terminal.

However, RTC rendered the decision on August 14, 2009 in favor of Jody King
Construction and ordered the Province of Aklan to pay the amounts specified.

Petitioner filed a Motion for reconsideration but was denied.

RTC now issued a writ of execution ordering the Sheriff to demand immediate
payment from petitioner.

Sheriff then served notices of garnishment on LBP, PNB and DBP for the
satisfaction of the judgment debt from the accounts of petitioner

The banks however refused to give due course to the court order citing the
provisions of statutes, circulars on the determination of govt monetary
liabilities, their enforcement and satisfaction.

Petitioner then filed in the CA for certiorari with application for TRO and
preliminary injunction assailing the Writ of Execution dismissed (found RTC
no grave abuse of discretion for the issuance of Writ of Execution and that the
matter of execution was rendered moot by respondents filing of a petition
before the COA)

Notice of appeal denied, MR also denied

Petitioner then filed another petition for Certiorari questioning the orders
denying due course to its Notice of Appeal - dismissed
Reasons for dismissal:
1. Failure to provide valid justification for its failure to file a timely MR
2. CA held that petitioner is estopped from invoking the
Doctrine of Primary Jurisdiction as it only raised the issue of
COAs primary jurisdiction after its notice of appeal was denied
and a writ of execution was issued against it

ISSUES:
1. Whether or not petitioner is estopped from raising the issue of jurisdiction
2. Whether or not the issuance of the Writ of Execution is void
HELD:
1. No. The petitioner is not estopped from raising the issue of jurisdiction. COA
has the primary jurisdiction over the respondents money claims. The
doctrine of primary jurisdiction holds that if a case is such that its
determination requires the expertise, specialized training and
knowledge of the proper administrative bodies, relief must first be
obtained in an administrative proceeding before a remedy is
supplied by the courts even if the matter may well be within their
proper jurisdiction. In such a case, the court in which the claim is
sought to be enforced may suspend the judicial process pending
referral of such issues to the administrative body for its view or, if
the parties would not be unfairly disadvantaged, dismiss the case
without prejudice
Respondents collection suit being directed against a local government unit,
such money claim should have been first brought to the COA. Hence, the RTC
should have suspended the proceedings and refer the filing of the claim
before the COA. Moreover, petitioner is not estopped from raising the issue of
jurisdiction even after the denial of its notice of appeal and before the CA.
2. Yes. The writ of execution issued in violation of COAs primary jurisdiction is
VOID.
All the proceedings of the court in violation of the doctrine and all orders and
decisions rendered thereby are null and void.

 Since a judgment rendered by a body or tribunal that has no jurisdiction over

the subject matter of the case is no judgment at all, it cannot be the source
of any right or the creator of any obligation.
All acts pursuant to it and all claims emanating from it have no legal effect
and the void judgment can never be final and any writ of execution based on
it is likewise void.
Clearly, the CA erred in ruling that the RTC committed no grave abuse of
discretion when it ordered the execution of its judgment against petitioner
and garnishment of the latters funds.