Case Digest (G.R. No. 132403)
Facts:
- The case involves two consolidated petitions: G.R. No. 132403 by Hi-Cement Corporation and G.R. No. 132419 by E.T. Henry & Co. and spouses Enrique and Lilia Tan against the Insular Bank of Asia and America (now Equitable-PCI Bank).
- In 1979, the respondent bank granted E.T. Henry a credit facility for purchasing short-term receivables, allowing encashment of postdated checks from clients, including Hi-Cement.
- In February 1981, 20 postdated checks from Hi-Cement, marked "deposit to payee's account only," were dishonored, along with checks from Riverside Mills Corporation and Kanebo Cosmetics Philippines, Inc.
- The bank filed a complaint against E.T. Henry, the spouses Tan, and the other corporations for damages due to the dishonored checks.
- The trial court ruled in favor of the bank, ordering all parties to pay the face value of the checks and other loan obligations.
- Hi-Cement and E.T. Henry appealed, but the Court of Appeals affirmed the trial court's ruling.
Issue:
- (Unlock)
Ruling:
- Hi-Cement was authorized to issue the checks through its general manager and treasurer.
- The respondent bank was not a holder in due course.
- Hi-Cement could not be held solidarily liable for the checks of Riverside and Kanebo.
- The application of the doctrine of piercing the veil of corporate entity was deemed erroneous.
- The foreclosu...(Unlock)
Ratio:
- The Supreme Court determined that Hi-Cement's general manager and treasurer had the authority to issue the postdated checks.
- The bank was not a holder in due course because the crossed checks had restrictions, and the bank's acceptance indicated gross negligence.
- Hi-Cement was not liable for ...continue reading
Case Digest (G.R. No. 132403)
Facts:
The case involves two consolidated petitions: G.R. No. 132403 filed by Hi-Cement Corporation and G.R. No. 132419 filed by E.T. Henry & Co. and spouses Enrique and Lilia Tan against the Insular Bank of Asia and America, which later became the Philippine Commercial International Bank and now Equitable-PCI Bank. The events leading to the case began in 1979 when the respondent bank granted E.T. Henry a credit facility for the purchase of short-term receivables, allowing E.T. Henry to encash postdated checks from its clients, including Hi-Cement, Riverside Mills Corporation, and Kanebo Cosmetics Philippines, Inc. In February 1981, 20 postdated checks from Hi-Cement, which were crossed and restricted to "deposit to payee's account only," were dishonored, along with checks from Riverside and Kanebo. The respondent bank subsequently filed a complaint for a sum of money against E.T. Henry, the spouses Tan, and the other corporations involved, claiming damages due to the dishonored checks. The trial court ruled in favor of the bank, ordering all parties to pay the face value of the checks along with other loan obligations. Hi-Cement and E.T. Henry appealed the decision to the Court of Appeals, which affirmed the trial court's ruling.
Issue:
- Was Hi-Cement authorized to issue the postdated crossed checks in favor of E.T. Henry?
- Was the respondent bank a holder in due course of the dishonored checks?
- Can Hi-Cement be held solidarily liable for the f...