SC: Officials’ salaries can be withheld to pay debt

MANILA, Philippines — The Supreme Court (SC) has declared that salaries of public officials, including local government executives, are not exempt from garnishment under current laws and rules to pay off their debts. 

In a ruling penned by Associate Justice Samuel Gaerlan, the SC’s Third Division affirmed the garnishment of the salary of lawyer Fred Bagbagen, a Baguio City councilor, to pay his P308,000 debt to Anna May Perez. 

Bagbagen was cleared of criminal charges for estafa, but the Regional Trial Court (RTC) still found him civilly liable and ordered him to pay Perez, allowing the garnishment of his salary, which was then withheld by the Philippine Veterans Bank. 

Salary garnishment is a legal process of withholding a portion of a person’s wages to pay off a debt.

Bagbagen attempted to stop the garnishment, arguing that his salaries should not be collected due to public policy reasons, and that these funds were still considered government property until spent.

Both the RTC and the Court of Appeals disagreed with his arguments, holding that once a public official’s salary is deposited in their personal bank account, it is no longer considered government money. 

The SC affirmed this ruling, saying there is no existing law that exempts the salaries of public officials from garnishment. 

Citing Rule 39 of the Rules of Court, the high tribunal said salaries – whether in the public or private sector – can be garnished to settle debts. 

A public servant’s income, once deposited, is no longer considered government property and is subject to the same legal processes as private sector wages.

An exception under the rule protects the wages of manual laborers, with up to four months’ worth of their earnings being exempt from garnishment.

The SC explained that these workers “usually look to the reward of a day’s labor for immediate or present support, and such persons are more in need of the exemption than any other.”

The high court further noted that public officials are held to a higher standard regarding their financial obligations due to “their constitutional role as custodians of public trust.”