Facts:

In the case G.R. No. 198237, Bank of the Philippine Islands (BPI) is the petitioner, while Land Investors and Developers Corporation serves as the respondent. This dispute arises from a series of events that transpired between 1995 and 1999 when Land Investors maintained savings and current accounts with the Pamplona, Las Piñas Branch of the Far East Bank & Trust Company (FEBTC), which was later merged into BPI. Authorized signatories for these accounts were three individuals: Ruth Fariñas, Orlando Dela Peña (the President), and Juanito Collas. The trouble began in 2001 when Dela Peña was convicted of estafa, which led to his dismissal from the company. Around the same time, the respondent discovered that Dela Peña had engaged in fraudulent withdrawals amounting to ₱3,652,095.01 from its accounts. These withdrawals were either executed with Dela Peña's signature alone or included forged signatures from other signatories. After BPI failed to respond to its demand for reim

...

Facts:

Parties and Account Background

• Petitioner Bank of the Philippine Islands (BPI) and respondent Land Investors and Developers Corporation are the principal parties.
• Respondent maintained savings and current accounts originally with Far East Bank & Trust Company (FEBTC) through its Pamplona, Las Piñas Branch, which later merged with BPI.

Authorized Signatories and Banking Arrangement

• Respondent authorized any two of its designated signatories—Ruth FariAas, Orlando Dela PeAa, and Juanito Collas—to transact on its accounts.
• Dela PeAa, acting as respondent’s President, was one of the authorized signatories.

Unlawful Transactions and Discovery of Fraud

• Between 1995 and 1999, routine transactions were conducted under the normal operational arrangements of the bank.
• In or around 2001, following the conviction of Dela PeAa for estafa and his subsequent dismissal, respondent discovered unauthorized withdrawals amounting to P3,652,095.01.
• These withdrawals were effected either solely with Dela PeAa’s signature or accompanied by allegedly forged signatures of FariAas.

Initiation of Litigation and Pleadings

• Respondent filed a complaint for sum of money and damages against BPI and Dela PeAa.
• BPI moved to dismiss a portion of the complaint on the ground that claims for withdrawals made prior to September 30, 1998, were time-barred by prescription.
• The Regional Trial Court (RTC) denied the motion, reasoning that the prescription period should be reckoned from the discovery of the fraud in 2001.
• BPI subsequently asserted defenses including lack of cause of action, prescription, and laches, while Dela PeAa was declared in default after failing to answer.

Presentation of Evidence and Admissions

• Respondent introduced comprehensive exhibits including signature cards, a Board Resolution authorizing “any two” signatory transactions, counterchecks, checks, withdrawal slips, and documents purported to show forged signatures, along with expert handwriting analysis reports.
• During the preliminary conference, BPI produced or admitted to the authenticity of most exhibits (notably, those marked from “G” to “H-28”), except for a few specific ones (Exhibits “A” and “B-1”).
• The admissions made by BPI regarding the origin of these documents (such as obtaining them from microfilm copies) became pivotal in the subsequent evidentiary determinations.

Trial Court and Court of Appeals Proceedings

• The RTC granted BPI’s demurrer to evidence on the ground that respondent failed to produce strong evidence of a conspiracy between BPI and Dela PeAa, while still holding Dela PeAa liable for estafa.
• On appeal, the Court of Appeals (CA) found that even in the absence of proof of conspiracy, BPI’s negligence in allowing withdrawals based solely on Dela PeAa’s lone signature (contrary to respondent’s “any two” signatory requirement) rendered the bank liable.
• The CA ruled that the evidence—which included properly admitted documents and expert testimony—demonstrated that certain checks and withdrawal slips carried forged signatures of FariAas.
• Accordingly, the CA reversed and set aside the RTC’s decision dismissing claims against BPI, holding BPI and Dela PeAa solidarily liable for the unauthorized withdrawals, awarding actual damages and attorney’s fees, with interest computed from the date of judicial demand.

Petition for Review and BPI’s Arguments

• BPI filed a petition for review on certiorari under Rule 45, challenging the CA’s evidentiary findings and legal conclusions.
• BPI argued that the CA erred in extending probative value to the respondent’s exhibits (notably Exhibits D, F, and G), since BPI was not a party to some of these documents.
• BPI further questioned the sufficiency of the evidence used to establish that FariAas’ signatures were forged, claiming that mere allegations were inadequate.
• Additionally, BPI contended that respondent’s negligence should preclude a proper showing of forgery or authorization defects, and that the imposition of interest and attorney’s fees was unwarranted absent a showing of bad faith.

Issue:

• Whether the Court of Appeals erred in applying the rule on actionable documents to extend probative value to respondent’s exhibits (specifically those marked D, F, and G), given BPI’s non-party status in some of these documents.
• Whether the CA correctly concluded that the signatures of Ruth FariAas on certain withdrawal slips and checks (Exhibits “H” to “H-28” and “I” to “I-80”) were forged, based on the evidence presented and without more rigorous authentication.
• Whether respondent’s alleged negligence, which purportedly contributed to the unauthorized transactions, should bar the claim of forgery or want of authority.
• Whether the imposition and computation of interest, as well as the award of attorney’s fees in the absence of demonstrated bad faith, are supportable under the controlling rules and jurisprudence.
• Whether Dela PeAa should be held solidarily liable with BPI, given that the liabilities arising from breach of fiduciary duty (BPI) and from the criminal act of estafa (Dela PeAa) have distinct legal foundations.

Ruling:

• (Subscriber-Only)

Ratio:

• (Subscriber-Only)

Doctrine:

• (Subscriber-Only)