Postal Bank tells CH its "hands are tied"

CEBU, Philippines - Officials of the Philippine Postal Savings Bank (PPSB) yesterday said they can no longer allow the Cebu City Government to withdraw its remaining accounts amounting to P124.1 million, giving favorable action to the court’s garnishment order in relation to the Rallos case.

Postal Bank-Cebu branch manager Ricardo Cordova appeared before the Cebu City Council yesterday and explained that although he wants to help the city, his hands are “tied” because the order tagging the city’s deposits effective last June 19, 2012 came from their officials in Manila.

Mayor Michael Rama said the City would be filing a case against the bank officials for not complying with the order issued by the Appellate Court preventing the city’s depository banks from implementing the garnishment order issued by the Regional Trial Court.

Acting on the mayor’s petition, the Court of Appeals had issued a temporary restraining order (TRO) last April 13, 2012, then a writ of preliminary injunction on June 26, 2012 preventing the implementation of the garnishment order of P133 million for the Ralloses.

The heirs of the late Rev. Fr. Vicente Rallos had demanded payment from the City for the 4,654-square meter lot used as public road in Barangay Sambag 2. The city already paid P56 million for said road, the P34.9 million was also garnished from the city’s depository banks while the P21 million was deposited with the court.

The mayor decided not to pay the additional amount demanded by the heirs. Rama found an old document called convenio, which stated that the Rallos family will make a road in their property in Sambag 2 and it will be donated to the city. The document was in 1940.

Upon learning of the outcome of yesterday’s special session at the City Council, Rama said the city lawyers will be preparing the best legal remedy to compel the PPSB to release the city’s P124.1 million deposit.

City Administrator Jose Marie Poblete yesterday asked the City Council, through Councilor Margarita “Margot” Osmeña, to help the executive department in its efforts to compel the bank to lift the tagging of the city’s accounts.

“There’s no problem. We are always ready to help the executive department, but just inform us of any development so we know of how to come in,” Osmeña told Poblete.

Rama sent Postal Bank officials a letter last June 27 informing them that the city would want to close its account with them and the city will withdraw its deposits. This was in reaction to the bank’s letter dated June 19 telling him that the city’s accounts will be tagged or can no longer be withdrawn.

City Treasurer Ofelia Oliva told the City Council that because of the mayor’s order, the City Treasurer’s Office stopped depositing funds with the Postal Bank and instead charged their expenses against its accounts with it.

Oliva said the city’s remaining deposits with the Postal Bank-Cebu branch is P124,164,161.

She said the city has 24 separate accounts with the Postal Bank and according to the bank manager, these accounts cannot be touched unless the tagging will be lifted by their officials in Manila.

According to Oliva, part of the tagged accounts is the P15,481,263 diffferent trust funds that are composed of funds from the national government that is only kept by the city because this is for the medical assistance of indigent families and account for the so-called Pagcor-funds.

Oliva said trust funds can never be garnished because these are intended for certain projects.

The Supreme Court has ordered that garnishment orders issued by lower courts shall be first refered to the Commission on Audit (COA) for further review and if found out that it is legal and the concerned government agency has the funds, it will be the one to ask the local government unit to allocate the needed funds. — /JPM (FREEMAN)