Case Summary (G.R. No. 138569)
Parties
Petitioner: Solidbank Corporation, a Philippine domestic banking corporation.
Respondent: L.C. Diaz and Company, CPAs, depositor of Savings Account No. S/A 200-16872-6.
Key Dates
• March 1976 – L.C. Diaz opened its savings account with Solidbank.
• August 14, 1991 – Original deposit and loss of passbook; later same day deposit of P200,000 check and unauthorized withdrawal of ₱300,000.
• August 15, 1991 – L.C. Diaz formally notified Solidbank to stop transactions.
• August 25, 1992 – L.C. Diaz filed civil complaint.
• December 28, 1994 – Trial court dismissed complaint.
• October 27, 1998 – Court of Appeals reversed and awarded damages.
• May 11, 1999 – CA denied reconsideration, deleted exemplary damages and attorney’s fees.
• September 11, 2003 – Supreme Court decision.
Applicable Law
1987 Philippine Constitution (fiduciary duty of banks); Civil Code provisions on simple loan (Articles 1953, 1980), negligence (Article 1172), quasi-delict (Article 2176), exemplary damages (Article 2231), attorney’s fees (Article 2208), and mitigation of damages (Article 2197); Republic Act No. 8791’s recognition of the fiduciary nature of banking (applied by analogy).
Facts
On August 14, 1991, L.C. Diaz’s cashier prepared two deposits (₱990 cash, ₱50 checks) and left the passbook with Teller No. 6. The teller lost the passbook, later handing it to an unknown person who presented it with a withdrawal slip for ₱300,000 bearing genuine specimen signatures. A separate P200,000 deposit was made that same day. The impostor first deposited a bounced ₱90,000 PBC check to deflect suspicion before withdrawing ₱300,000. L.C. Diaz’s notice to stop transactions was received only after the unauthorized withdrawal.
Trial Court Decision
The trial court applied the contractual rules on savings accounts, presuming ownership by passbook possession and concluding Solidbank exercised due care in verifying signatures. It found L.C. Diaz negligent for failing to keep the passbook under “lock and key” and for not following its own precautionary procedures for large withdrawals. The complaint was dismissed; Solidbank awarded ₱30,000 attorney’s fees on its counterclaim.
Court of Appeals Decision
The CA treated the case as a quasi‐delict, holding Solidbank negligent for failing to verify the withdrawal by calling the depositor and for inadequate employee supervision. It applied the “last clear chance” doctrine and awarded ₱300,000 plus 12% interest, ₱20,000 exemplary damages, attorney’s fees, litigation expenses, and costs, dismissing Solidbank’s counterclaim. On reconsideration, exemplary damages, attorney’s fees, expenses, and costs were deleted.
Issues on Review
- Whether Solidbank had a duty to telephone the depositor before allowing a large withdrawal.
- Whether the “last clear chance” doctrine applies.
- Whether L.C. Diaz’s negligence bars or mitigates recovery.
- Whether damages should be apportioned under Article 2197.
Supreme Court Analysis
The Court held that the bank‐depositor relationship is contractual (simple loan) with a fiduciary character under the 1987 Constitution and prevailing jurisprudence, requiring banks to observe “high standards of integrity and performance” beyond the diligence of a “good father of a family” (Civil Code Article 1172). Absent an agreement to the contrary, Solidbank had no duty to telephone the depositor before withdrawals.
Breach of Contractual Obligation and
...continue readingCase Syllabus (G.R. No. 138569)
Facts
- Solidbank Corporation (formerly The Consolidated Bank and Trust Corporation) is a Philippine domestic banking corporation.
- L.C. Diaz and Company, CPA’s (“L.C. Diaz”) is a professional accounting partnership that opened Savings Account No. S/A 200-16872-6 with Solidbank in March 1976.
- On August 14, 1991, L.C. Diaz’s cashier, Mercedes Macaraya, prepared deposit slips for ₱990 in cash and ₱50 in checks, and sent messenger Ismael Calapre with the passbook to Solidbank Teller No. 6.
- Calapre left the passbook with the teller to expedite transactions and later learned it had been given to an unidentified person.
- Macaraya returned with Calapre to make a ₱200,000 check deposit; Teller No. 6 again could not locate the passbook and handed over a previous deposit slip dated August 14, 1991 for a PBC check of ₱90,000 (an account long closed).
- On August 15, 1991, L.C. Diaz’s CEO, Luis C. Diaz, notified Solidbank to stop any transactions on the account; the same day they discovered an unauthorized withdrawal of ₱300,000 bearing forged signatures of authorized signatories and received by one Noel Tamayo.
- L.C. Diaz filed criminal charges for estafa against messenger Emerano Ilagan and Roscon Verdazola; the case was dismissed on August 4, 1992.
- On August 24, 1992, L.C. Diaz demanded return of the ₱300,000 from Solidbank; refusal led to a civil complaint filed August 25, 1992 before the Regional Trial Court (RTC) of Manila, Branch 8.
- RTC rendered judgment on December 28, 1994 dismissing the complaint and awarding Solidbank ₱30,000 as attorney’s fees.
- L.C. Diaz appealed to the Court of Appeals (CA), which on October 27, 1998 reversed the RTC decision, awarding L.C. Diaz ₱300,000 plus interest, exemplary damages, attorney’s fees and litigation expenses; on May 11, 1999 the CA denied reconsideration but deleted exemplary damages, attorney’s fees, expenses and costs.
Issue
- Whether Solidbank is liable for the ₱300,000 unauthorized withdrawal given:
• absence of agreement requiring teller to call up depositor for large withdrawals;
• the teller’s alleged duty under the doctrine of last clear cha