Title
China Banking Corporation vs. Padilla
Case
G.R. No. 143490
Decision Date
Feb 2, 2007
Depositor sued bank for unauthorized account deductions; bank sought to implicate terminated manager. Courts upheld procedural rules, denied third-party complaint, affirmed corporate liability.
indemnity
subrogation
contribution

Case Summary (G.R. No. 143490)

Factual Background

Private respondent Padilla maintained Checking Account No. 164-001371-5 with petitioner's Tuguegarao branch. Padilla alleged erroneous deductions and wrongful payments in her complaint, including specific items totaling P168,425.00 on April 1, 1997, an alleged loss of P62,000.00 on China Bank Check No. 47050, debiting of P20,000.00 for PVB-Tuguegarao Check No. 6969, and unspecified debits aggregating P4,540,000.00 on various dates. Petitioner audited the account and concluded that, if Padilla's allegations were true, the conduct was imputable to its branch manager, Emelina T. Quitan, who had exceeded her authority and violated internal policies. The bank charged Quitan with acting without authority, allowing unauthorized overdrafts totaling P1,475,731.43, honoring insufficiently funded checks, granting unauthorized facilities, permitting prohibited fund transfers, and defying superiors. Petitioner terminated Quitan’s services on November 13, 1998 and sought leave to file a third-party complaint against her in the pending civil action, alleging claims for indemnity, subrogation and contribution.

Trial Court Proceedings

Padilla’s complaint was docketed as Civil Case No. 97-3020 and raffled to Branch 136 of the RTC, Makati City. Petitioner moved for leave to file a third-party complaint against Quitan. In its Order of August 17, 1999, the trial court denied the motion on the ground that a corporation acts through its employees and is responsible for their acts within the discharge of their functions, and that inclusion of Quitan was improper because petitioner’s claims against her should be pursued in another forum. The trial court denied petitioner’s motion for reconsideration.

Petition to the Court of Appeals

Petitioner filed a petition for certiorari in the Court of Appeals, docketed CA-G.R. SP No. 55795, challenging the trial court’s denial of leave to implead Quitan. In its Resolution dated January 26, 2000, the CA denied due course to and dismissed the petition under Section 3, Rule 46 for failure to attach certified true copies of the judgments, orders, resolutions, rulings and material portions of the record relied upon. The CA observed that, except for certain orders of the trial court, the petition’s annexes were plain photocopies and that other referred documents were not appended.

Petitioner’s Motion for Reconsideration in the CA

Petitioner moved for reconsideration before the CA, explaining that the omission resulted from honest mistake and excusable negligence, and asserting that it had subsequently attached certified true copies to the motion. The CA, in its Resolution of June 2, 2000, denied reconsideration on the ground that petitioner’s subsequent compliance, without a compelling reason for the initial failure, did not warrant relief from dismissal.

Issues Presented

Petitioner raised two issues: (I) whether the CA erred in refusing to reconsider its dismissal and to reinstate the petition despite petitioner’s compliance with Section 3, Rule 46 after filing; and (II) whether the trial court committed grave abuse of discretion in denying petitioner’s motion for leave to file a third-party complaint.

Legal Standards Applied

The Court applied Section 3, Rule 46, 1997 Rules of Civil Procedure, which requires that a petition for certiorari be accompanied by a duplicate original or certified true copy of the judgment, order, resolution, or ruling subject thereof and such material portions of the record as are referred to therein, and provides that failure to comply shall be sufficient ground for dismissal. The Court reiterated jurisprudence that excusable negligence or oversight by counsel is not lightly tolerated when rules prescribe exacting requirements, citing Sea Power Shipping Enterprises, Inc. v. Court of Appeals, et al. and the principle that rules may be relaxed only when rigidity would defeat equity and substantial justice, citing Lustana v. Jimena-Lazo. The Court also applied Section 11, Rule 6, 1997 Rules of Civil Procedure, which authorizes a defending party, with leave of court, to file a third-party complaint for contribution, indemnity, subrogation or other relief, and emphasized that allowance of such impleader rests within the trial court’s discretion. The Court relied on precedents including Firestore Tire and Rubber Company of the Philippines v. Tempongco and Tayao v. Mendoza to show that a defendant has no vested right to implead a third party.

The Court’s Ruling

The Supreme Court denied the petition for review and affirmed the challenged CA Resolutions in CA-G.R. SP No. 55795. The Court ordered costs against petitioner.

Reasoning of the Court

The Court held that dismissal under Section 3, Rule 46 was proper because petitioner failed to attach certified true copies of the dispositive orders and other pertinent pleadings to its petition, and the rule expressly makes such failure sufficient ground for dismissal. The Court found petitioner’s claim of honest mistake and excusable negligence insufficient to excuse noncompliance, observing that counsel’s oversight has been repeatedly rejected as a justification for disregarding procedural requirements. The Court further determi

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