Case Summary (G.R. No. 47542)
Factual Background of the Telegraphic Transfer
Turner instructed Chinatrust-Ayala Branch to remit US$430.00 (plus US$30.00 fee) to “Min Travel/Esmat Azmy” at Citibank-Cairo. The funds passed through Union Bank of California and Citibank-New York. A discrepancy notice arrived on September 17, 2004, citing a beneficiary-name mismatch.
Procedural History and Decisions Below
– MTC (Jan. 15, 2006): Dismissed Turner’s complaint for lack of merit; found that Chinatrust had duly credited funds to the beneficiary.
– RTC (Jan. 29, 2007): Reversed MTC, finding petitioner negligent for not promptly refunding Turner or clarifying with Citibank-Cairo, and awarded refund plus moral, exemplary damages, and attorney’s fees.
– CA (Dec. 14, 2009; Mar. 2, 2010): Denied Chinatrust’s petition for review and motion for reconsideration, affirming the RTC verdict.
Arguments of Petitioner and Respondent
Petitioner argued it performed its obligation by effecting the transfer and later relaying Citibank-Cairo’s confirmation. It contended that negligence claims and damages were neither alleged nor proved at trial. Turner maintained that factual findings below should stand and denied admitting that his beneficiary had already received the funds.
Unauthorized Negligence Ruling and Violation of Due Process
The SC emphasized that courts cannot raise or decide unpleaded issues. Petitioner was deprived of the opportunity to rebut negligence claims that were never tried. Basic due-process and fair-play principles bar a reviewing court from deciding matters not presented in the trial court.
Proper Scope of Cause of Action and Pleadings
Turner’s complaint alleged breach of contract based on an e-transfer that allegedly failed to reach the beneficiary. He sought refund and damages for non-remittance. Nowhere did he claim negligence in post-transfer customer service or delay in responses.
Preliminary Conference and Summary Procedure
Under the Revised Rules on Summary Procedure, parties limited their evidentiary submissions to issues defined at the preliminary conference—namely, whether the transfer was properly credited. No opportunity existed for either side to litigate an entirely new negligence theory.
Error of RTC and CA on Negligence
By adjudicating petitioner’s post-transfer conduct as negligent, the RTC and CA exceeded the pleadings’ scope. Their rulings on delay and customer inquiries amounted to remedies not prayed for and issues not litigated at the MTC.
Insufficiency of Evidence on Petitioner’s Negligence
Even assuming the issue had been raised, the SC found no proof of negligence. Chinatrust promptly relayed Citibank-Cairo’s notices, sought clarifications, and reacted upon receiving the October 28, 2004 telex confirming the credit. Turner’s own affidavits and admissions showed he knew of the successful transfer as early as September 22, 2004.
Nature of Telegraphic Transfer and Extinguishment of Obligation
A telegraphic transfer contract is executory only until the funds are credited to the beneficiary bank. On September 15, 2004, Citibank-Cairo credited U
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Facts of the Case
- On September 13, 2004, respondent Philip Turner instructed Chinatrust-Ayala Branch to telegraphically transfer US$430.00 (plus a US$30.00 service fee) to “MIN TRAVEL/ESMAT AZMY” at Citibank-Cairo, Egypt, as partial payment for an 11-day tour.
- Chinatrust routed the transfer through Union Bank of California to Citibank-New York, then to Citibank-Cairo.
- On September 17, 2004, Chinatrust received a telex from Citibank-Cairo stating the beneficiary name did not match its records (“discrepancy notice”) and relayed this to Turner on September 20, 2004.
- Turner contacted his travel agency, learned that Esmat Azmy admitted receipt, but later cancelled the tour due to his wife’s illness and sought a refund from Chinatrust.
- Chinatrust explained funds could not be withdrawn without Citibank-Cairo’s consent and invited Turner to secure a written denial from his agency. Turner did not submit such certification.
- On October 28, 2004, Citibank-Cairo confirmed by Swift telex that it had credited US$430.00 to “Min Travel” as early as September 15, 2004; Chinatrust informed Turner the next day.
- Turner nonetheless filed a complaint on March 7, 2005 before the Metropolitan Trial Court (MTC) of Makati City seeking refund of P24,129.88 and damages.
Procedural History
- January 15, 2006: MTC, Branch 61, dismissed Turner’s complaint for lack of merit, finding Chinatrust proved it had remitted and credited the funds.
- January 29, 2007: Regional Trial Court (RTC), Branch 137, reversed and set aside the MTC, ordered Chinatrust to restore P24,129.88 and P1,683.48 plus P20,000.00 moral damages, P10,000.00 exemplary damages, and P5,000.00 attorney’s fees.
- June 4, 2007: RTC denied Chinatrust’s motion for reconsideration.
- July 4, 2007: Chinatrust filed a Petition for Review und