Case Summary (G.R. No. 221220)
Discovery of Overpayment and Demand for Reconciliation
In September 2004 the borrowers suspected overpayment. An October request prompted Metrobank’s Summary on Application of Payments (SAP) covering December 29, 1999 to September 2004, showing an ₱8,344,185.55 balance. Hiring accountant Michael Palisoc, respondents demonstrated payments of ₱32,648,374.60 versus Metrobank’s recorded ₱20,507,855.05—an unaccounted ₱12,140,519.55. After deducting the restructured balance, Palisoc found a ₱3,540,519.55 overpayment. He further identified delayed postings, unissued receipts, unrecorded dación payments and unacknowledged checks.
RTC Proceedings and Ruling
Respondents filed a complaint for accounting on May 4, 2005. Metrobank answered, asserting proper accounting, production of accessible documents, estoppel by latest promissory note, and counterclaiming for damages. On September 21, 2012 the RTC ordered Metrobank to:
a. render a complete, detailed accounting of payments from 1993–2004;
b. furnish all promissory notes and loan documents for the same period;
c. dismissed Metrobank’s counterclaim.
The RTC held that the bank’s records‐holding policy could not excuse nonproduction and that estoppel did not bar accounting.
Court of Appeals Decision
On February 23, 2015 the CA affirmed:
• Banks owe a fiduciary duty to maintain accurate records and furnish account statements.
• Metrobank’s submissions were lacking in detail and displayed discrepancies.
• Five-year retention policy under AMLA could not render production “physically impossible.”
• Estoppel did not relieve the duty to account.
The CA remanded for proper accounting and reception of evidence to determine actual indebtedness.
Issues on Review
- Whether Metrobank must render a full, detailed accounting of respondents’ payments.
- Whether Metrobank must produce all pertinent loan documents.
Metrobank argued it had already rendered a true, complete accounting; production of pre-1999 documents was impossible under its five-year retention policy per AMLA and bank regulations; respondents bore the burden to prove full payment; and they were estopped by subsequent acknowledgments.
Jurisdictional and Factual Review
Under Rule 45, the Supreme Court’s review is limited to errors of law. The necessity of detailed accounting and document sufficiency are factual questions, properly resolved by the RTC and CA after evidence appraisal. Metrobank failed to demonstrate any absence of basis for those factual findings.
Fiduciary Duty and Highest Degree of Diligence
Pursuant to the Constitution’s recognition of banking’s public interest and RA 8791 Section 2, banks must observe the highest standards of integrity, accuracy, promptness and meticulous care. Pre-2000 jurisprudence (Simex Intl. v. CA, 1990; Far East Bank v. Tentmakers, 2012; Landbank v. Oañate, 2014; Phil. Banking Corp. v. CA, 2004) already imposed this duty. Metrobank’s incomplete records, delayed postings and discrepancies underscored its breach of fiduciary obligations.
Record-Retention Policy vs. Legal Duty
Metrobank’s invocation of AMLA and bank regulations on five-year record-keeping pertains to anti-money-laundering compliance, not private loan accounting. Moreover, Metrobank’s own filings showed production of documents as old as 1993–1998, undermining its impossibility claim. The fiducia
...continue readingCase Syllabus (G.R. No. 221220)
Antecedents
- From 1993 to 1998, respondents Carmelita C. Cruz and Vilma Low Tay obtained aggregate loans of ₱40,600,000.00 from Metrobank, secured by promissory notes.
- In March 1999, they availed of additional loans and requested a statement of account; by letter dated May 17, 1999, Metrobank informed them that as of March 26, 1999, they owed ₱1,130,444.31.
- Over time, the loans were restructured and respondents signed blank promissory notes in bulk as part of loan modifications.
- Between 1999 and 2004, respondents remitted cash and check payments; Cruz recorded amounts and check numbers on yellow sheets and obtained bank employees’ signatures acknowledging receipt.
Discovery of Overpayment and Demand for Reconciliation
- In September 2004, respondents reviewed their records and suspected they had overpaid.
- October 2004: requested a new statement of account; Metrobank sent a Summary on Application of Payments (SAP) covering December 29, 1999 to September 2004, indicating an outstanding obligation of ₱8,344,185.55.
- Respondents engaged accountant Michael G. Palisoc to audit payments, promissory notes, original receipts, and cleared checks.
- Palisoc found respondents paid a total of ₱32,648,374.60 but Metrobank recorded only ₱20,507,855.05, leaving ₱12,140,519.55 unaccounted for. Subtraction of a restructured balance (₱8,600,000.00) yielded an overpayment of ₱3,540,519.55 as of September 21, 2004.
- He observed questionable bank practices: delayed recording of payments (inflating interest), failure to account for an earlier dación en pago, unissued receipts for lump-sum payments, and unrecorded checks received.
- Respondents repeatedly demanded full reconciliation and refund; Metrobank failed to comply and insisted on payment of ₱8,344,188.55.
Complaint for Accounting and Counterclaim
- May 4, 2005: respondents filed a complaint for accounting before the Regional Trial Court (RTC), praying for production of all loan documents and reimbursement of excess payment, with damages.
- June 10, 2005: Metrobank answered, denying material allegations, asserting it had provided a concise accounting and loan documents (except those beyond its holding period), and invoking estoppel—respondents acknowledged indebtedness in the latest promissory note. Metrobank counterclaimed for moral and exemplary damages and attorney’s fees.
RTC Decision
- September 21, 2012: RTC rendered judgment ordering Metrobank to:
- Render a complete and detailed accounting of payments from