Case Digest (G.R. No. 131673)
Facts:
Ruben Martinez, substituted by his heirs, Mena Constantino Martinez, Wilfrido C. Martinez, Emma M. Nava, and Edna M. Sakhrani, v. Court of Appeals and BPI International Finance, G.R. No. 131673, September 10, 2004, Supreme Court Second Division, Callejo, Sr., J., writing for the Court.The petition arises from a collection suit instituted by BPI International Finance (formerly Ayala Finance Hongkong, Ltd.), a Hong Kong corporation, against Cintas Largas, Ltd. (CLL) (a Hong Kong company), its beneficial owners (Wilfrido C. Martinez, Miguel J. Lacson, Ramon Siy and Ricardo Lopa), Blamar Gonzales, and petitioner Ruben Martinez. BPI had granted CLL a back-to-back letter of credit facility to finance CLL’s molasses purchases for re-export. CLL opened money market placement accounts MMP No. 063 (initial US$390,000) and MMP No. 084 (transferred funds of US$68,768.60) with BPI; the authorized signatory was Wilfrido Martinez. Signature cards for MMP 063 and 084 also bore the signatures of Ruben Martinez and Miguel Lacson, allegedly making them joint account holders. CLL deposited proceeds of its transactions and at times instructed transfers and withdrawals through Wilfrido Martinez and Gonzales.
On October 1980, per telex and telephone instructions from Gonzales and Wilfrido Martinez, BPI transferred US$340,000 to Mar Tierra Corporation’s Foreign Currency Deposit account (FCD SA 18402-7) in the Philippines. BPI posted the remittance as an account receivable of CLL because the money market placements had not matured; when the placements matured BPI failed to charge them and later allowed withdrawals by CLL/Wilfrido Martinez, losing the funds from which it could have obtained reimbursement. Internal reconciliation problems followed and an audit conducted by Jacinto, Belano, Castro & Co. found CLL owed BPI US$340,000.
On June 17, 1983 BPI sued in the Regional Trial Court (RTC), Kalookan City (Civil Case No. C-10811), alleging two alternative causes of action: (1) that the US$340,000 was an advance/remittance made upon express instructions of Gonzales and Wilfrido Martinez for which they and CLL were liable, and that CLL was a paper company whose corporate veil should be pierced to hold beneficial owners liable; and (2) that the US$340,000 was an erroneous overpayment and that Ruben Martinez, Wilfrido Martinez and Lacson were joint account holders of MMP Nos. 063 and 084 and therefore liable to repay. The RTC declared CLL in default, found CLL to be a mere paper company with nominee shareholders, pierced the corporate veil, and rendered judgment ordering all defendants, jointly and severally, to pay BPI US$340,000 (or its Philippine peso equivalent), interest, attorneys’ fees and costs; counterclaims and cross-claims were dismissed for lack of merit....(Subscriber-Only)
Issues:
- Is petitioner Ruben Martinez liable to reimburse BPI International Finance the principal amount of US$340,000?
- Should petitioner Ruben Martinez’s counterclaim have been ...(Subscriber-Only)
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)