He was convicted of murder and robbery by a Riyadh court in 2010.
The family of the victim refused to sign an affidavit of forgiveness that would have spared Zapanta the death penalty unless it was paid 48 million pesos ($1 million), setting a two-week deadline earlier this month for payment.
The execution was carried out after Zapanta's family and the Philippine government managed to raise only 23 million pesos ($488,000), said Philippine Department of Foreign Affairs spokesman Charles Jose.
Since I believe it should be the victim (or, in this case, the heirs to the victim) that should set damages, I believe it can be justified on libertarian grounds---both the beheading and the demand for a payment to stop the beheading.
I emailed Dr. Walter Block to get his take and it was pretty much in line with mine:
Yes, assuming this guy was really guilty of murder. I think that the murderer stole the life of his victim, and owes a life (actually two lives, but that's another matter). To whom does the murderer owe a life? To the victim. If we had a machine that could take the life out of the murderer, and install it into the dead victim, so that the latter comes out of this machine alive, and the murderer comes out of it dead, we would be justified in imposing this machine on the murderer. However, we don't have this machine, yet. So, now, to whom does the murderer owe a life? To the victim's heirs (assuming that the murder victim did not leave explicit instructions to them as to how they should act upon his demise). So, the heirs may forgive the murderer. Or, they may execute him. Or, they may demand money from him, and if he pays, let him go free, or, if he doesn't pay, then execute him.