Rizaldy T. Zshornack and his wife maintained in COMTRUST a dollar savings account and a peso current account. An application for a dollar drat was accomplished by Virgillo Garcia branch manager of COMTRUST payable to a certain Leovigilda Dizon. In the PPLICtion, Garcia indicated that the amount was to be charged to the dolar savings account of the Zshornacks. There wasa no indication of the name of the purchaser of the dollar draft. Comtrust issued a check payable to the order of Dizon. When Zshornack noticed the withdrawal from his account, he demanded an explainaiton from the bank. In its answer, Comtrust claimed that the peso value of the withdrawal was given to Atty. Ernesto Zshornack, brother of Rizaldy. When he encashed with COMTRUST a cashiers check for P8450 issued by the manila banking corporation payable to Ernesto.
Issue: Whether the contract between petitioner and respondent bank is a deposit?
Held: The document which embodies the contract states that the US$3,000.00 was received by the bank for safekeeping. The subsequent acts of the parties also show that the intent of the parties was really for the bank to safely keep the dollars and to return it to Zshornack at a later time. Thus, Zshornack demanded the return of the money on May 10, 1976, or over five months later.
The above arrangement is that contract defined under Article 1962, New Civil Code, which reads:
Art. 1962. A deposit is constituted from the moment a person receives a thing belonging to another, with the obligation of safely keeping it and of returning the same. If the safekeeping of the thing delivered is not the principal purpose of the contract, there is no deposit but some other contract.
On August 25, 1989, FMIC, through its Executive Vice President Antonio Ong, opened current account and deposited METROBANK check no. 898679 of P100 million with BPI Family Bank (BPI FB). Ong made the deposit upon request of his friend, Ador de Asis, a close acquaintance of Jaime Sebastian, then Branch Manager of BPI FB San Francisco del Monte Branch. Sebastian’s aim was to increase the deposit level in his Branch.
BPI FB, through Sebastian, guaranteed the payment of P14,667,687.01 representing17% per annum interest of P100 million deposited by FMIC. The latter, in turn, assured BPI FB that it will maintain its deposit of P100 million for a period of one year on condition that the interest of 17% per annum is paid in advance. This agreement between the parties was reached through their communications in writing. Subsequently, BPI FB paid FMIC 17% interest or P14,667,687.01 upon clearance of the latter’s check deposit.
However, on August 29, 1989, on the basis of an Authority to Debit signed by Ong and Ma. Theresa David, Senior Manager of FMIC, BPI FB transferred P80 million from FMIC’s current account to the savings account of Tevesteco Arrastre – Stevedoring,Inc. FMIC denied having authorized the transfer of its funds to Tevesteco, claiming that the signatures of Ong and David were falsified.
Thereupon, to recover immediately its deposit, FMIC, on September 12, 1989, issued BPI FB check no. 129077 forP86,057,646.72 payable to itself and drawn on its deposit with BPI FB SFDM branch. But upon presentation for payment on September 13, 1989, BPI FB dishonored thecheck as it was “drawn against insufficient funds. Consequently, FMIC filed a complaint against BPI FB.
FMIC filed an Information for estafa against Ong, de Asis, Sebastian and four others. However, the Information was dismissed on the basis of a demurrer to evidence filed by the accused.
1. Was the transaction between FMIC and BPI, a time deposit or an interest-bearing current account which, under existing bank regulations, was an illegal transaction?
2. Is the bank liable for the unauthorized transfer of respondent’s funds to Tevesteco?
1.We hold that the parties did not intend the deposit to be treated as a demanddeposit but rather as an interest-earning time deposit not withdrawable anytime. When respondent FMIC invested its money with petitioner BPI FB, they intended the P100 million as a time deposit, to earn 17% per annum interest and to remain intactuntil its maturity date one year thereafter.
Ordinarily, a time deposit is defined as “one the payment of which cannot legally be required within such a specified number of days.In contrast, demand deposits are “all those liabilities of the Bangko Sentral and of other banks which are denominated in Philippine currency and are subject to payment in legal tender upon demand by the presentation of (depositor’s) checks.
While it may be true that barely one month and seven days from the date of deposit, respondent FMIC demanded the withdrawal of P86,057,646.72 through the issuance of a check payable to itself, the same was made as a result of the fraudulent and unauthorized transfer by petitioner BPI FB of its P80 million deposit to Tevesteco’s savings account. Certainly, such was a normal reaction of respondent as a depositor to petitioner’s failure in its fiduciary duty to treat its account with the highest degree of care.
Under this circumstance, the withdrawal of deposit by respondent FMIC before the one-year maturity date did not change the nature of its time deposit to one of demand deposit. We have held that if a corporation knowingly permits its officer, or any other agent, to perform acts within the scope of an apparent authority, holding him out to the public as possessing power to do those acts, the corporation will, as against any person who has dealt in good faith with the corporation through such agent, be estopped from denying such authority.
Petitioner maintains that respondent should have first inquired whether the deposit of P100 Million and the fixing of the interest rate were pursuant to its (petitioner’s) internal procedures. Petitioner’s stance is a futile attempt to evade an obligation clearly established by the intent of the parties. What transpires in the corporate boardroom is entirely an internal matter. Hence, petitioner may not impute negligence on the part of respondent’s representative in failing to find out the scope of authority of petitioner’s Branch Manager.
Indeed, the public has the right to rely on the trustworthiness of bank managers and their acts. Obviously, confidence in the banking system, which necessarily includes reliance on bank managers, is vital in the economic life of our society. Significantly, the transaction was actually acknowledged and ratified by petitioner when it paid respondent in advance the interest for one year. Thus, petitioner is estopped from denying that it authorized its Branch Manager to enter into anagreement with respondent’s Executive Vice President concerning the deposit withthe corresponding 17% interest per annum.
2.Yes. We uphold the finding of both lower courts that petitioner failed to exercise that degree of diligence required by the nature of its obligations to its depositors. A bank is under obligation to treat the accounts of its depositors with meticulous care, whether such account consists only of a few hundred pesos or of million of pesos. Here, petitioner cannot claim it exercised such adegree of care required of it and must, therefore, bear the consequence.
Ramon Tan, a businessman from Puerto Princesa, secured a Cashier’s Check from PhilippineCommercial Industrial Bank (PCIBank) to P30,000 payable to his order to avoid carrying cash while enrouteto Manila. He deposited the check in his account in Rizal Commercial Banking Corporation (RCBC) in itsBinondo Branch. RCBC sent the check for clearing to the Central Bank which was returned for having been“missent” or “misrouted.” RCBC debited Tan’s account without informing him. Relying on commonknowledge that a cashier’s check was as good as cash, and a month after depositing the check, he issued twopersonal checks in the name of Go Lak and MS Development Trading Corporation. Both checks bounced dueto “insufficiency of funds.” Tan filed a suit for damages against RCBC.
Issue: Whether a cashier’s check is as good as cash, so as to have funded the two checks subsequently drawn.
Held: An ordinary check is not a mere undertaking to pay an amount of money. There is an element ofcertainty or assurance that it will be paid upon presentation; that is why it is perceived as a convenientsubstitute for currency in commercial and financial transactions. Herein, what is involved is more than anordinary check, but a cashier’s check. A cashier’s check is a primary obligation of the issuing bank andaccepted in advance by its mere issuance. By its very nature, a cashier’s check is a bank’s order to pay what isdrawn upon itself, committing in effect its total resources, integrity and honor beyond the check. Herein,PCIB by issuing the check created an unconditional credit in favor any collecting bank. Reliance on thelayman’s perception that a cashier’s check is as good as cash is not entirely misplaced, as it is rooted inpractice, tradition and principle.
Solidbank vs CA, Central Bank – GR 120010
The Pacific Banking Corporation (PBC) was placed under receivership. A Liquidator was designated for the liquidation process. The Central Bank invited several banks to buy the “assets and the franchise of the various offices of PBC and to assume its liabilities. The Far East Bank and Trust Company (FEBTC) was one of the bidders, and its bid was found to be the most advantageous. PBC and Central Bank on the one hand and FEBTC on the other, signed: (a) Purchase Agreement; and (b) Memorandum of Agreement.
The Solidbank Corporation (a.k.a. the Consolidated Bank and Trust Corporation, hereafter, Solidbank) through its Senior Vice-President/Comptroller Ms. Corazon R. Dayao, filed its claims with the Liquidator of PBC, Mr. Renan V. Santos, namely:
(1) P8,024,007.27 (excluding interests and surcharges) covering eight (8) receivables (computer machines and other accessories connected with their operations and the right to collect rentals therefrom) due from PBC and assigned to Solidbank by the United Pacific Leasing and Finance Corporation, a subsidiary of PBC, which amount due as of totalled P24,158,263.10;
(2) several deposits (proceeds of collection items evidenced by registers of collection items and balances of the current accounts in the various branches of PBC).
Solidbank filed with the liquidation court a Motion for Summary Judgment in connection with the claims aforementioned, citing the following grounds: there is no genuine issue as to any material fact; there is no substantial controversy in the case; and, it is entitled to summary judgment as a matter of law.
FEBTC filed its Comment alleging: FEBTC did not specifically deny the claims of Solidbank in the Motion to Implead; the issues before the liquidation court are not purely legal, but factual, i.e., whether the subject receivables as well as deposit liabilities were included in the Purchase Agreement as among those purchased by FEBTC.
Whether or not the deposit liabilities are included in the Purchase Agreement as among those purchased by FEBTC with Solidbank?
Whether or not summary judgment is proper in the case at bar.
Summary judgment is a procedural device resorted to in order to avoid long drawn out litigations and useless delays. When the pleadings on file show that there are no genuine issues of fact to be tried, the Rules of Court allows a party to obtain immediate relief by way of summary judgment. That is, when the facts are not in dispute, the court is allowed to decide the case summarily by applying the law to the material facts.
In the case at bar, it cannot be said that the foregoing requisites are present. There is a genuine issue, the resolution of which requires the presentation of evidence, i.e., whether or not Solidbank’s claim is included in the purchase agreement as among the properties and items purchased and assumed by FEBTC from Pacific Bank/Central Bank. While the counsel for FEBTC did say that in principle he is not objecting to the motion for summary judgment and “that they will have no objection if the Court will just require the parties to submit affidavit and counter-affidavits in support to their respective contentions,” this should not be taken out of context for in the same manifestation, said counsel clearly expressed that he does not agree that there are no material issues raised in the pleadings.
SC: Solidbank lost. The party who moves for summary judgment has the burden of demonstrating clearly the absence of any genuine issue of fact, or that the issue posed in the complaint is patently unsubstantial so as not to constitute a genuine issue for trial.