Case Digest (G.R. No. 226771)
Facts:
Norsk Hydro (Philippines), Inc. and Norteam Seatransport Services v. Premiere Development Bank, Bank of the Philippine Islands, Citibank, N.A., Skyrider Brokerage International, Inc. and Marivic‑Jong Briones, G.R. No. 226771, September 16, 2020, First Division, Reyes, J., Jr., writing for the Court.Petitioners Norsk Hydro (Philippines), Inc. (later identified in the record as Yara Fertilizers (Philippines), Inc.) and Norteam Seatransport Services sued respondents Premiere Development Bank (later Security Bank Corporation), Bank of the Philippine Islands (BPI), Citibank, N.A., Skyrider Brokerage International, Inc., and Marivic‑Jong Briones in a Complaint for Sum of Money and Damages with an Application for Writ of Preliminary Attachment filed on October 9, 2003. Petitioners alleged that 19 crossed manager’s checks transmitted to Skyrider Brokerage for payment of customs duties were not remitted to the Bureau of Customs, resulting in conversion and loss.
The Regional Trial Court (RTC), Branch 148, Makati City, rendered a Decision on April 14, 2010 (penalized by Judge Oscar B. Pimentel), holding various respondents jointly and severally liable: P26,176,006.06 covering eighteen BPI manager’s checks (plus interest) and P1,907,784.00 covering a Citibank manager’s check (plus interest); it also awarded moral and exemplary damages, attorney’s fees and costs, and recognized BPI’s and Citibank’s right to seek reimbursement from Premiere/Security Bank. Premiere Bank’s counterclaim was dismissed.
The Court of Appeals affirmed on November 20, 2014, upholding findings of gross negligence and conversion. Respondents filed a Rule 45 petition before the Supreme Court on January 27, 2015; the Supreme Court denied the petition by Resolution on March 16, 2015 for failure to show reversible error, and an Entry of Judgment was issued May 26, 2015, making the April 14, 2010 Decision final and executory.
On September 18, 2015 petitioners moved for execution of the RTC decision. Petitioners argued the award of actual damages constituted a forbearance of money and thus merited 12% per annum (compounded annually) from extrajudicial demand to 30 June 2013 and 6% thereafter per BSP Circular No. 799‑13; respondents (Security Bank) countered that only 6% per annum simple interest from finality (May 26, 2015) should apply and that compounding was unwarranted.
The RTC, by Order of February 19, 2016, granted execution and computed the unpaid obligation as P1,328,263.07 as of November 30, 2015, with 6% per annum interest from that date until full payment. On motion for reconsideration the RTC, by Order of August 5, 2016, partially granted relief, finding the last extrajudicial demand was sent June 25, 2003, recomputing interest and, after c...(Pro-only)
Issues:
- Did the Court a quo commit grave and reversible error by treating the obligation as arising from fraud or negligence (not from a loan or forbearance) and imposing legal interest at 6% per annum instead of 12% per annum for the period from extrajudicial demand until the BSP rate change?
- Did the Court a quo err in refusing to compound the interest annually on the interest that accrued (i.e., should interest have been compounded)?
- Should the costs of suit a...(Pro-only)
Ruling:
- (Pro-only)
Ratio:
- (Pro-only)
Doctrine:
- (Pro-only)