Case Digest (G.R. No. 146918)
Facts:
Citibank, N.A. v. Spouses Luis and Carmelita Cabamongan et al., G.R. No. 146918, April 16, 2007, Supreme Court First Division, Austria‑Martinez, J., writing for the Court.On August 16, 1993, Spouses Luis and Carmelita Cabamongan opened a joint foreign‑currency time deposit (Ref. No. 60‑22214372) with Citibank, N.A., Makati branch, in the amount of US$55,216.69 for 182 days at an agreed rate of 2.5625% per annum. On November 10, 1993, a woman claiming to be Carmelita Cabamongan went to the Makati branch and, after presenting various identification cards (including a passport) and with the assistance of Account Officer Yeye San Pedro, executed forms to pre‑terminate the time deposit. Because the original certificate of deposit was not surrendered, bank practice required a notarized release and waiver, yet the person received the proceeds despite the release not having been notarized that day. The withdrawal transaction reportedly lasted some 40 minutes.
After the withdrawal, San Pedro found an ID left behind and contacted the Cabamongan spouses’ listed address; they learned that Carmelita was in California and that their Baldwin Park, California residence had been burglarized months earlier, during which passports, deposit certificates and IDs were lost. The spouses notified Citibank by overseas calls and later by counsel demanded payment (letter dated September 16, 1994). Citibank refused (letter dated November 28, 1994), insisting proper identification and verification had been made.
The spouses filed suit on January 27, 1995 in the Regional Trial Court (RTC), Makati, for specific performance with damages (Civil Case No. 95‑163). At trial the spouses and a PNP Crime Laboratory Documents Examiner, Florenda G. Negre, testified that the questioned signature was a forgery; Citibank presented San Pedro and Cris Cabalatungan (VP in charge of Security) who testified that bank procedures were observed. On July 1, 1997, the RTC found for the spouses, ordering Citibank to pay the principal (US$55,216.69 or its peso equivalent) with interest, moral damages, attorney’s fees and costs. After a motion to partially reconsider, the RTC, on November 19, 1997, amended its judgment to increase moral, exemplary, attorney’s fees and litigation expense awards.
Citibank appealed to the Court of Appeals (CA), docketed CA‑G.R. CV No. 59033. On January 26, 2001, the CA affirmed the RTC’s finding of bank negligence but modified the awards: it set legal interest to run from extrajudicial demand (September 16, 1994), reduced moral damages, and deleted exemplary damages and litigation expenses. On motion for partial reconsideration, the CA on July 30, 2001 adjusted the interest computation schedule and reduced moral damages further to P50,000.
Both parties sought further review: the spouses’ petition (G.R. No. 149234) was denied (Resolution, October 17, 2001); Citibank’s petition (G.R. No. 146918) was given due course (Res...(Pro-only)
Issues:
- Did the Court of Appeals gravely abuse its discretion in affirming the RTC’s finding that Citibank was negligent in releasing the deposit to an impostor?
- Were the awards of moral (and related) damages proper given the circumstances of the bank’s conduct?
- From what date and at what rate should legal interest on the principal be computed?
- Was the RTC’s award of...(Pro-only)
Ruling:
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Ratio:
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Doctrine:
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