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[ G.R. No. 198237, October 08, 2018 ]




Through this petition for review on certiorari[1] under Rule 45 of the Rules of Court, petitioner Bank of the Philippine Islands (BPI) seeks to annul the Decision[2] dated February 28, 2011 of the Court of Appeals (CA) in CA-G.R. CV No. 93752 which reversed and set aside the Resolutions dated April 14, 2009 and June 26, 2009 of the Regional Trial Court (RTC) of Makati City, Branch 61.

In its assailed Decision, the CA found BPI liable to its depositor, respondent Land Investors and Development Corporation for breach of fiduciary duty.

Antecedent Facts

Between the years 1995 and 1999, respondent maintained savings and current accounts with the Pamplona, Las Piñas Branch of Far East Bank & Trust Company (FEBTC). FEBTC later on merged with BPI.[3] In its transactions with the bank, respondent authorized any two of its Ruth Fariñas (Fariñas), Orlando Dela Peña (Dela Peña) and Juanito Collas (Collas) as bank signatories. Dela Peña was respondent's President.[4]

Sometime in 2001, Dela Peña was convicted for estafa and was consequently dismissed from employment. It was also around this time that respondent discovered that Dela Peña, acting in alleged conspiracy or taking advantage of the gross negligence of BPI, succeeded in unlawfully withdrawing various amounts from respondent's deposit accounts. Respondent alleged that BPI was negligent and violated its fiduciary duties when it allowed the withdrawals in the total amount of P3,652,095.01 on the basis of Dela Peña's lone signature or thru the forged signatures of his co­signatories.[5] Despite demand, BPI failed to heed respondent's claims which prompted the latter to file the complaint a quo for sum of money and damages against BPI and Dela Peña.[6]

BPI initially moved to dismiss the complaint on the ground that respondent's claims covering the withdrawals prior to September 30, 1998 have already prescribed. The RTC denied the motion to dismiss and reasoned that the period of prescription is reckoned from the discovery of the fraud, or from 2001.[7] This led BPI to file its answer, raising the defenses of lack of cause of action, prescription, and laches.[8] On the other hand, Dela Peña failed to file his answer and was consequently declared in default.[9]

During the preliminary conference, respondent moved for the production of documents to compel BPI to produce the originals of the signature cards and withdrawal slips marked as Exhibits "A", "A-1", "B", "B-1", "G", "G-1" and "H" to "H-28." Instead of producing the originals, BPI admitted said exhibits, except for Exhibits "A" and "B-1", and stipulated that Exhibits "G" to "H-28" were obtained by respondent from the microfilm copies of BPI.[10]

Trial on the merits ensued until respondent filed its formal offer of exhibits, which included the following:
1. Signature cards (Exhibits "A", "A-1", "B" and "B-1") with petitioner that show the names and specimen signatures of the authorized signatories of respondent;

2. Respondent's Board Resolution (Exhibit "C") showing the authority of the signatories in "any two" capacity;

3. Counterchecks taken from the bank's checkbook which allowed Dela Peña to make encashments on the basis of Dela Peña's lone signature (Exhibits "D" to "D-2" and "E") and checks that bear the lone signature of Dela Peña (Exhibit "F" to "F-6");

4. Withdrawal slips bearing Dela Peña's lone signature (Exhibits "G" to "G-1"); withdrawal slips bearing Dela Pena's lone signature and in some cases, together with the forged signature of Fariñas (Exhibits "H" to "H-28"); checks bearing the signatures of Dela Peña with the forged signatures of Fariñas (Exhibits "I" to "I-80"); and

5. Sample signatures of Fariñas (Exhibits "Q" to "Q-17"); NBI Comparison Charts showing the sample and questioned signatures of Fariñas (Exhibits "S" to "S-12" and "T" to "T-17"); and the NBI Report with the conclusion that the questioned and standard/sample signatures of Fariñas were not written by one and the same person (Exhibit "R").[11]
Respondent's exhibits were all admitted by the court a quo.[12]

For its part, BPI filed a demurrer to evidence on the ground that respondent has shown no right to relief with respect to: (a) Exhibits H, H-1 up to H-28 representing various withdrawal slips bearing the allegedly forged signature of Fariñas because no evidence whatsoever was adduced to prove the alleged forgery of Fariñas' signatures in these exhibits; (b) Exhibits D, D-1, D-2, F, F-1, F-2, F-3, F-4, F-5, F-6, G and G-1 representing counterchecks, checks, withdrawal slips because these exhibits were not identified by any of respondent's witnesses as required by Section 20, Rule 132 of the Rules of Court; (c) Exhibits I-1 to Exhibits I-12 representing various checks with the alleged forged signature of Fariñas which were examined by NBI Document Examiner because it was not proved that the alleged sample or specimen signatures used for comparison were indeed genuine signatures of Fariñas; (d) Exhibits I to I-80 representing various checks with the allegedly forged signature of Fariñas because no corroborative evidence was adduced to prove the alleged forgeries; (e) claims covering allegedly unauthorized withdrawals prior to September 30, 1998 because these claims are barred by prescription; (f) the entirety of its claims because its loss or damage is attributable to its own fault or negligence.[13]

The RTC granted BPI's demurrer to evidence, reasoning thus:
"In a nutshell, the grievance of [respondent] against BPI is that the latter, through the 'deliberate malfeasance' or 'gross negligence' of its 'Pamplona Branch personnel,' conspired with the herein defendant [Dela Peña] in defrauding the former the total sum of Three Million Six Hundred Fifty-Two Thousand Ninety[-]Five Pesos and One Centavo (P3,652,095.01).

Necessarily, the herein [respondent] should prove by strong and convincing evidence that the defendant [BPI] colluded with Mr. Dela Peña and that BPI failed to exercise the diligence higher than that of a good father of a family in dealing with [respondent's] account with it.

The testimonial and documentary pieces of evidence of the herein [respondent] are so barren when it comes to its allegation of connivance between BPI and Mr. Dela Peña. This Court has perused the record apropos over and over again but it could not find any proof of conspiracy between Mr. Dela Peña and BPI adduced by [respondent]. It would seem that [respondent] may have forgotten about this particular allegation of it against BPI. Hence, on this score alone, the demurrer to evidence extant of BPI has no merit.

Withal, the evidence presented by the [respondent] herein is also very inadequate to establish gross negligence on the part of defendant [BPI].[14]
Resultantly, the RTC disposed:
WHEREFORE, premises duly considered, the instant "Demurrer to Evidence" of the herein defendant [BPI] is hereby GRANTED.

Congruently with Section 1, Rule 33 of the Revised Rules of Court, the case extant is hereby DISMISSED apropos herein defendant [BPI] on the ground that upon the facts and the law the. [respondent] herein has shown no right to relief.

Vis-a-vis herein defendant [Dela Peña], who was declared in default by the Court via its fiat on 30 November 2004, in accordance with Section 3, Rule 10 of the Revised Rules of Court, he is hereby ORDERED to pay the herein [respondent] the following sums, to wit:

1. Three Million Six Hundred Fifty-Two Thousand Ninety[-]Five Pesos and One Centavo (P3,652,095.01), plus legal interest counted from the date of each unauthorized withdrawal until the entire amount is fully paid as and for actual damages;

2. Five Hundred Thousand Pesos (P500,000.00) as and by way of moral damages;

3. Two Hundred Thousand Pesos ([P]200,000.00) as and by way of exemplary damages;

4. One Hundred Thousand Pesos (P100,000.00) as and for attorney's fees; and

5. The costs of suit.

Serve copies of this Resolution to the plaintiff herein and herein defendant bank and to their respective counsel of record, including the defaulted defendant at his given address on record.

Respondent's motion for reconsideration having been denied, it appealed to the CA.

Ruling of the CA

While agreeing with the RTC that respondent failed to demonstrate that indeed Dela Peña conspired with BPI, the CA nevertheless held that the non-existence of conspiracy would not necessarily exculpate BPI from liability if there is evidence to show that the latter violated its fiduciary duty to respondent. In other words, the CA ruled that a negligent bank is liable regardless of any allegation of conspiracy.[16]

In finding BPI to be negligent, the CA factually found that it allowed withdrawals from respondent's accounts with just the signature of Dela Peña, despite respondent's instruction that the signatures of "any two" of its authorized signatories are required to effect payment of funds. The lone signature of Dela Peña for which BPI allowed withdrawals are to be found on three counterchecks (Exhibits "D" to "D-2"), seven checks (Exhibits "F" to "F-6") and two withdrawal slips (Exhibits "G" and "G-1"). Disregarding BPI's defense that these exhibits were not properly identified or authenticated as required by Section 20, Rule 132 of the Rules of Court, the CA ruled that BPI's failure to specifically deny under oath said exhibits resulted to an implied admission of their genuineness and due execution pursuant to Section 8, Rule 8 of the Rules of Court.[17]

As regards the other withdrawal slips (Exhibits "H" to "H-28") and checks (Exhibits "I" to "I-80"), the CA found that these carried forged signatures of Fariñas. According to the CA, the fact of forgery was proven not only by Fariñas' testimony but also by the presentation of her standard signatures and by the testimony of a handwriting expert.[18] The CA held that the differences between the questioned signatures appearing on the withdrawal slips and checks and Fariñas' standard signatures are readily apparent. Moreover, the CA found that these exhibits were in fact properly identified by Fariñas and admitted by BPI to have been sourced from its own microfilm copies.[19]

The CA, thus, held that the evidence sufficiency established that BPI breached its fiduciary duty when it honored the subject withdrawals with only Dela Peña's signature in violation of the "any two" authorized signatories requirement. The CA also found that BPI failed to exercise extraordinary diligence in scrutinizing the checks.

These findings led the CA to conclude that the RTC committed reversible error in granting BPI's demurrer to evidence. Instead, the CA ruled that BPI should be held solidarily liable with Dela Peña for actual losses plus 12% legal interest from the date of each unauthorized withdrawal.

In disposal, the CA held:
WHEREFORE, above premises considered, the instant appeal is GRANTED. The Resolutions of the RTC of Makati City, Branch 61 dated 14 April 2009 and 26 June 2009, respectively, are REVERSED and SET ASIDE.

Defendant-appellee BPI and defendant [Dela Peña], who was declared in default, are solidarily liable to [respondent]. Defendant­ appellee and defendant [Dela Peña] are ORDERED to pay (1) actual damages in the amount of P3,652,095.01 plus 12% legal interest from the date of each unauthorized withdrawal until the entire amount is fully paid and (2) P100,000.00 as attorney's fees in favor of [respondent].

BPI's motion for reconsideration was similarly denied by the CA in its Resolution[21] dated August 12, 2011.

Hence, this petition.


BPI argues that the CA erred in applying the rule on actionable documents to extend probative value to respondents' Exhibits D, F, and G and its sub-markings considering that BPI was not a party nor a signatory to said counterchecks, checks and withdrawal slips.

Also, BPI questions the CA's finding that Fariñas' signatures as appearing on the Exhibits "H" to "H-28" and Exhibits "I" to "I-80" were forged. According to BPI, the bare claim that Fariñas' signatures were forged is not sufficient pursuant to the Court's ruling in Sps. Salonga v. Sps. Concepcion.[22] Admitting for the sake of argument that the signatures were forged, BPI claims that respondent is guilty of negligence which precludes it from setting up forgery or want of authority.

BPI also disputes the imposition of interest and the award of attorney's fees in the absence of evident bad faith.

Ruling of the Court

The assailed CA decision is affirmed but with the modification that: (1) Dela Peña should not be held solidarily liable with BPI considering that their specific liabilities are anchored on two separate sources of obligations; and (2) the rate and reckoning period of the interest imposed.

Time and again, the Court has stressed that only questions of law should be raised in petitions for review under Rule 45 of the Rules of Court. The Court does not entertain questions of fact given that factual findings of the appellate court are final, binding, or conclusive on the parties and on this Court.[23] The assessment of the probative value of the evidence presented and of whether the lower courts' appreciation of the evidence is correct are questions of fact[24] which the Court does not address in a Rule 45 petition.

While it is true that there are certain recognized exceptions[25] to the rule that factual findings of the [CA] are binding on the Court, such as when its findings are contrary to that of the trial court, as in this case, this alone does not automatically warrant a review of the appellate court's factual findings.[26] The binding nature of the factual findings of the CA was explained in Pascual v. Burgos, et al.,[27] as follows:
[T]he doctrine that the findings of fact made by the Court of Appeals, being conclusive in nature, are binding on this Court, applies even if the Court of Appeals was in disagreement with the lower court as to the weight of evidence with a consequent reversal of its findings of fact, so long as the findings of the Court of Appeals are borne out by the record or based on substantial evidence. x x x.[28] (Citation omitted)
As such, "only a showing, on the face of the record, of gross or extraordinary misperception or manifest bias in the Appellate Court's reading of the evidence will justify this Court's intervention by way of assuming a function usually within the former's exclusive province."[29] The instant petition demonstrates no such exceptional circumstance.

On the contrary, we find that the findings of the CA that BPI allowed several withdrawals despite the fact that the checks and withdrawal slips used bore the lone signature of Dela Peña and/or with the forged signatures of Fariñas, in opposition to respondent's "two authorized signatory" resolution, are amply supported by the record.

BPI argues that these checks and withdrawal slips are inadmissible essentially because (1) these are private documents which were not properly authenticated, and that (2) there was no satisfactory evidence presented to prove the alleged forgery. Both arguments fail to convince.

A private document requires authentication in the manner allowed by law or the Rules of Court before it may be received in evidence. However, authentication of a private document is not required when:
(a) the document is an ancient one under Section 21, Rule 132 of the Rules of Court; (b) the genuineness and authenticity of an actionable document have not been specifically denied under oath by the adverse party; (c) the genuineness and authenticity of the document have been admitted; or (d) the document is not being offered as genuine.[30] (Citations omitted)
To begin with, the Court notes that the trial court had admitted all of respondent's exhibits to which BPI raised no further objections. The admissibility of respondent's pieces of evidence should no longer be further litigated. It also appears that BPI admitted and stipulated on the genuineness and due execution of the questioned checks and withdrawal slips during the preliminary conference and further admitted that these checks and withdrawal slips were obtained from the microfilm copies of BPI. It was further alleged and admitted that these very same checks and withdrawal slips were honored by BPI.[31] Thus, the foregoing judicial admissions dispense with the ordinarily required proof that the checks and withdrawal slips were authentic.

As regards BPI's contention that there was no evidence presented to prove that Fariñas' signatures on the subject checks and withdrawal slips were forged, the CA correctly observed that Fariñas herself categorically denied signing the said instruments and identified her genuine signatures. Corroborating Fariñas' testimony was that of a handwriting expert who also presented her report and comparison charts to prove that the signatures appearing on the checks and the withdrawal slips were not genuine signatures of Fariñas. Considering these other pieces of evidence, there is no reason to apply the Court's pronouncement in Salonga that a bare claim of forgery is insufficient.

At any rate, the CA itself found that there were significant variances" between Fariñas' standard signatures as appearing on her valid identification cards and the signatures appearing on the questioned withdrawal slips and checks.[32] We observe that the matter herein involved is not highly technical as to preclude the appellate court from examining the signatures and thereafter ruling on whether or not they are indeed forgeries.[33] Thus, we find no reason to deviate from the CA's factual findings.

Nevertheless, Dela Peña cannot be held solidarily liable with BPI as held by the CA.

To emphasize, BPI's liability proceeds from a breach of contract. Under Article 1980 of the Civil Code, "fixed, savings, and current deposits of money in banks x x x shall be governed by the provisions concerning simple loan[s]." By the contract of loan or mutuum, one party delivers money to another upon the condition that the same amount shall be paid.[34]

To recall, respondent was defrauded by several withdrawals from its deposit accounts being allowed by BPI solely on the basis of Dela Peña's signature despite specific instructions that withdrawals be done only upon the signatures of any two of respondent's authorized signatories, and additional withdrawals being allowed on the basis of the forged signatures of respondent's other authorized signatory. It is basic that those who, in the performance of their obligations, are guilty of negligence, and those who in any manner contravene the tenor thereof, are liable for damages.[35] When BPI allowed Dela Peña to make unauthorized withdrawals, it failed to comply with its obligation to secure said accounts by allowing only those withdrawals authorized by respondent. In so doing, BPI violated the terms of its contract of loan with respondent and should be held liable in this regard.

On the other hand, Dela Peña's liability arises from the commission of the crime of estafa. Dela Peña had in fact been charged and convicted of estafa. Thus, respondent's action to recover actual damages against Dela Peña was deemed instituted with the criminal action, unless waived, reserved or previously instituted.[36] There is no indication that such reservation had been done by respondent. As such, to hold Dela Peña solidarily liable for damages in this case may result in double recovery which is proscribed.[37] In any case, it is clear that the civil liability upon which Dela Peña was being held liable by the CA is totally distinct and separate from the source of BPI's liability. Thus, BPI and Dela Peña's respective liabilities cannot be deemed joint and solidary.

The computation of the rate of interest likewise needs modification. In Nacar v. Gallery Frames, et al.,[38] the Court modified the guidelines regarding the manner of computing legal interest as follows:
To recapitulate and for future guidance, the guidelines laid down in the case of Eastern Shipping Lines are accordingly modified to embody BSP-MB Circular No. 799, as follows:

I. When an obligation, regardless of its source, i.e., law, contracts, quasi-contracts, delicts or quasi-delicts is breached, the contravenor can be held liable for damages. The provisions under Title XVIII on "Damages" of the Civil Code govern in determining the measure of recoverable damages.

II. With regard particularly to an award of interest in the concept of actual and compensatory damages, the rate of interest, as well as the accrual thereof, is imposed, as follows:
  1. When the obligation is breached, and it consists in the payment of a sum of money, i.e., a loan or forbearance of money, the interest due should be that which may have been stipulated in writing. Furthermore, the interest due shall itself earn legal interest from the time it is judicially demanded. In the absence of stipulation, the rate of interest shall be 6% per annum to be computed from default, i.e., from judicial or extrajudicial demand under and subject to the provisions of Article 1169 of the Civil Code.

  2. When an obligation, not constituting a loan or forbearance of money, is breached, an interest on the amount of damages awarded may be imposed at the discretion of the court at the rate of 6% per annum. No interest, however, shall be adjudged on unliquidated claims or damages, except when or until the demand can be established with reasonable certainty. Accordingly, where the demand is established with reasonable certainty, the interest shall begin to run from the time the claim is made judicially or extrajudicially (Art. 1169, Civil Code), but when such certainty cannot be so reasonably established at the time the demand is made, the interest shall begin to run only from the date the judgment of the court is made (at which time the quantification of damages may be deemed to have been reasonably ascertained). The actual base for the computation of legal interest shall, in any case, be on the amount finally adjudged.[39] (Emphasis ours and italics in the original)
Nacar also instructs that the new rate is to be applied prospectively, or from July 1, 2013. Applying the foregoing guidelines to the instant case, the amount of P3,652,095.01 shall earn interest at the rate of 12% per annum from September 16, 2002, or the date when judicial demand was made, until June 30, 2013 and 6% per annum from July 1, 2013 until satisfaction thereof.

Finally, there is no reason to disturb the award of attorney's fees where the court deems it just and equitable that attorney's fees and expenses of litigation should be recovered.[40]

WHEREFORE, the petition is PARTLY GRANTED. The Decision dated February 28, 2011 of the Court of Appeals in CA-G.R. CV No. 93752 is AFFIRMED with MODIFICATION. Petitioner Bank of the Philippine Islands is held liable to pay respondent Land Investors and Developers Corporation actual damages in the amount of P3,652,095.01 with interest at the rate of twelve percent (12%) per annum from September 16, 2002, or the date when judicial demand was made, until June 30, 2013 and six percent (6%) per annum from July 1, 2013 until satisfaction of this Decision and attorney's fees in the amount of P100,000.00.


Leonardo-De Castro, C. J., (Chairperson), Del Castillo,** and Caguioa,*** JJ., concur.
Bersamin,* J., on official business.

* On official travel.

** Designated Acting Working Chairperson per Special Order No. 2605 daterl September 28, 2018.

*** Designated Additional Member per Raffle dated June 20, 2018 vice Associate Justice Francis H. Jardeleza.

[1] Rollo, pp. 7-25.

[2] Penned by Associate Justice Mariflor P. Punzalan, concurred in by Associate Justices Josefina Guevarra-Salonga and Franchito N. Diamante; id. at 30-48.

[3] Id. at 8-9.

[4] Id. at 9.

[5] Id.

[6] Id. at 9 and 55.

[7] Id. at 55-56.

[8] Id. at 32.

[9] Id. at 32-33.

[10] Id. at 56-57.

[11] Id. at 58-59.

[12] Id. at 33.

[13] Id. at 9-10.

[14] Id. at 61.

[15] Id. at 10-11.

[16] Id. at 35-36.

[17] Id. at 38.

[18] Id. at 40-41.

[19] Id. at 43.

[20] Id. at 47-48.

[21] Id. at 50-51.

[22] 507 Phil. 287 (2005).

[23] Pascual v. Burgos, et al., 776 Phil. 167, 182 (2016).

[24] Rep. Of the Phils. v. Ortigas and Co. Ltd. Partnership, 728 Phil. 277, 287-288 (2014).

[25] As those enumerated by this Court in DBP v. Traders Royal Bank, et al., 642 Phil. 547, 556-557 (2010):

(1) when the findings are grounded entirely on speculations, surmises or conjectures; (2) when the inference made is manifestly mistaken, absurd or impossible; (3) when there is grave abuse of discretion; (4) when the judgment is based on a misapprehension of facts; (5) when the findings of fact are conflicting; (6) when in making its findings the Court of Appeals went beyond the issues of the case, or its findings are contrary to the admissions of both the appellant and the appellee; (7) when the findings are contrary to that of the trial court; (8) when the findings are conclusions without citation of specific evidence on which they are based; (9) when the facts set forth in the petition as well as in the petitioners main and reply briefs are not disputed by the respondent; (10) when the findings of fact are premised on the supposed absence of evidence and contradicted by the evidence on record; or (11) when the Court of Appeals manifestly overlooked certain relevant facts not disputed by the parties, which, if properly considered, would justify a different conclusion.

[26] Uniland Resources v. DBP, 277 Phil. 839, 844 (1991).

[27] 776 Phil. 167 (2016).

[28] Id. at 188.

[29] Id.

[30] Patula v. People, 685 Phil. 376, 397-398 (2012).

[31] Rollo, p. 76-78.

[32] Id. at 40.

[33] Equitable Cardnetwork, Inc. v. Capistrano, 681 Phil. 462, 475 (2012).

[34] Article 1933 of the Civil Code provides, in part:

By the contract of loan, one of the parties delivers to another, either something not consumable so that the latter may use the same for a certain time and return it, in which case the contract is called a commodatum; or money or other consumable thing, upon the condition that the same amount of the same kind and quality shall be paid, in which case the contract is simply called a loan or mutuum.

x x x x

Simple loan may be gratuitous or with a stipulation to pay interest.

x x x x

[35] Article 1170 of the Civil Code.

[36] Section 1, Rule 111, Revised Rules of Criminal Procedure.

[37] Articles 2176 and 2177 of the Civil Code provides:

Article 2176. Whoever by act or omission causes damage to another, there being no fault or negligence, is obliged to pay for the damage done. Such fault or negligence, if there is no pre-existing contractual relation between the parties, is called a quasi-delict and is governed by the provisions of this Chapter.

Article 2177. Responsibility for fault or negligence under the preceding article is entirely separate and distinct from the civil liability arising from negligence under the Penal Code. But the plaintiff cannot recover damages twice for the same act or omission of the defendant.

[38] 716 Phil. 267 (2013).

[39] Id. at 281-283.

[40] Article 2208 (11) of the Civil Code.

Art. 2208. In the absence of stipulation, attorney's fees and expenses of litigation, other than judicial costs, cannot be recovered, except:

x x x x

11. In any other case where the court deems it just and equitable that attorney's fees and expenses of litigation should be recovered.

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