108 OG No. 27, 3244 (July 2, 2012)
As between a bank and its depositor, where the
bank's negligence is the proximate cause of the loss and the depositor
is guilty of contributory negligence, the greater proportion of the loss
shall be borne by the bank.
This Petition for Review on
Certiorari seeks to reverse and set aside the Court of Appeal's January 31, 2006 Decision
[1] in CA-G.R. CV No. 81349, which modified the January 30, 2004 Decision
[2] of the Regional Trial Court of Manila City, Branch 46 in Civil Case No. 97-84010, and the June 26, 2006 Resolution
[3] denying petitioner's motion for reconsideration.
Factual AntecedentsThe antecedents are aptly summarized by the appellate court:
In
its complaint, it is alleged that [respondent F.F. Cruz & Co.,
Inc.] (hereinafter FFCCI) opened savings/current or so-called combo
account No. 0219-830-146 and dollar savings account No. 0219-0502-458-6
with [petitioner Philippine National Bank] (hereinafter PNB) at its
Timog Avenue Branch. Its President Felipe Cruz (or Felipe) and
Secretary-Treasurer Angelita A. Cruz (or Angelita) were the named
signatories for the said accounts.
The said signatories on
separate but coeval dates left for and returned from the Unites States
of America, Felipe on March 18, 1995 until June 10, 1995 while Angelita
followed him on March 29, 1995 and returned ahead on May 9, 1995.
While
they were thus out of the country, applications for cashier's and
manager's [checks] bearing Felipe's [signature] were presented to and
both approved by the PNB. The first was on March 27, 1995 for
P9,950,000.00 payable to a certain Gene B. Sangalang and the other one
was on April 24, 1995 for P3,260,500.31 payable to one Paul Bautista.
The amounts of these checks were then debited by the PNB against the
combo account of [FFCCI].
When Angelita returned to the country,
she had occasion to examine the PNB statements of account of [FFCCI] for
the months of February to August 1995 and she noticed the deductions of
P9,950,000.00 and P3,260,500.31. Claiming that these were unauthorized
and fraudulently made, [FFCCI] requested PNB to credit back and restore
to its account the value of the checks. PNB refused, and thus
constrained [FFCCI] filed the instant suit for damages against the PNB
and its own accountant Aurea Caparas (or Caparas).
In its
traverse, PNB averred lack of cause of action. It alleged that it
exercised due diligence in handling the account of [FFCCI]. The
applications for manager's check have passed through the standard bank
procedures and it was only after finding no infirmity that these were
given due course. In fact, it was no less than Caparas, the accountant
of [FFCCI], who confirmed the regularity of the transaction. The delay
of [FFCCI] in picking up and going over the bank statements was the
proximate cause of its self-proclaimed injury. Had [FFCCI] been
conscientious in this regard, the alleged chicanery would have been
detected early on and Caparas effectively prevented from absconding with
its millions. It prayed for the dismissal of the complaint. [4]
Regional Trial Court's RulingThe
trial court ruled that F.F. Cruz and Company, Inc. ( FFCCI) was guilty
of negligence in clothing Aurea Caparas (Caparas) with authority to make
decisions on and dispositions of its account which paved the way for
the fraudulent transactions perpetrated by Caparas; that, in practice,
FFCCI waived the two-signature requirement in transactions involving the
subject combo account so much so that Philippine National Bank (PNB)
could not be faulted for honoring the applications for manager's check
even if only the signature of Felipe Cruz appeared thereon; and that
FFCCI was negligent in not immediately informing PNB of the fraud.
On
the other hand, the trial court found that PNB was, likewise, negligent
in not calling or personally verifying from the authorized signatories
the legitimacy of the subject withdrawals considering that they were in
huge amounts. For this reason, PNB had the last clear chance to prevent
the unauthorized debits from FFCCI's combo account. Thus, PNB should
bear the whole loss -
WHEREFORE, judgment is hereby
rendered ordering defendant [PNB] to pay plaintiff [FFCCI]
P13,210,500.31 representing the amounts debited against plaintiff's
account, with interest at the legal rate computed from the filing of the
complaint plus costs of suit.
IT IS SO ORDERED. [5]
Court of Appeal's RulingOn January 31, 2006, the CA rendered the assailed Decision affirming with modification the Decision of the trial court,
viz:
WHEREFORE, the appealed Decision is AFFIRMED with the MODIFICATION that
[PNB] shall pay [FFCCI] only 60% of the actual damages awarded by the
trial court while the remaining 40% shall be borne by [FFCCI].
SO ORDERED. [6]
The
appellate court ruled that PNB was negligent in not properly verifying
the genuineness of the signatures appearing on the two applications for
manager's check as evidenced by the lack of the signature of the bank
verifier thereon. Had this procedure been followed, the forgery would
have been detected.
Nonetheless, the appellate court found FFCCI
guilty of contributory negligence because it clothed its
accountant/bookkeeper Caparas with apparent authority to transact
business with PNB. In addition, FFCCI failed to timely examine its
monthly statement of account and report the discrepancy to PNB within a
reasonable period of time to prevent or recover the loss. FFCCI's
contributory negligence, thus, mitigated the bank's liability. Pursuant
to the rulings in
Philippine Bank of Commerce v. Court of Appeals [7] and
The Consolidated Bank & Trust Corporation v. Court of Appeals, [8] the appellate court allocated the damages on a 60-40 ratio with the bigger share to be borne by PNB.
From this decision, both FFCCI and PNB sought review before this Court.
On August 17, 2006, FFCCI filed its petition for review on
certiorari which was docketed as G.R. No. 173278.
[9] On March 7, 2007, the Court issued a Resolution
[10] denying said petition. On June 13, 2007, the Court issued another Resolution
[11]
denying FFCCI's motion for reconsideration. In denying the aforesaid
petition, the Court ruled that FFCCI essentially raises questions of
fact which are, as a rule, not reviewable under a Rule 45 petition; that
FFCCI failed to show that its case fell within the established
exceptions to this rule; and that FFCCI was guilty of contributory
negligence. Thus, the appellate court correctly mitigated PNB's
liability.
On July 13, 2006, PNB filed its petition for review on
certiorari which is the subject matter of this case.
Issue
Whether the Court of Appeals seriously erred when it found PNB guilty of negligence.
[12]Our Ruling
We affirm the ruling of the CA.
PNB is guilty of negligence.Preliminarily, in G.R. No. 173278, we resolved with finality
[13] that FFCCI is guilty of contributory negligence, thus, making it partly liable for the loss (
i.e.,
as to 40% thereof) arising from the unauthorized withdrawal of
P13,210,500.31 from its combo account. The case before us is, thus,
limited to PNB's alleged negligence in the subject transactions which
the appellate court found to be the proximate cause of the loss, thus,
making it liable for the greater part of the loss (
i.e., as to 60% thereof) pursuant to our rulings in
Philippine Bank of Commerce v. Court of Appeals [14] and
The Consolidated Bank & Trust Corporation v. Court of Appeals.
[15]PNB
contends that it was not negligent in verifying the genuineness of the
signatures appearing on the subject applications for manager's check. It
claims that it followed the standard operating procedure in the
verification process and that four bank officers examined the signatures
and found the same to be similar with those found in the signature
cards of FFCCI's authorized signatories on file with the bank.
PNB
raises factual issues which are generally not proper for review under a
Rule 45 petition. While there are exceptions to this rule, we find none
applicable to the present case. As correctly found by the appellate
court, PNB failed to make the proper verification because the
applications for the manager's check do not bear the signature of the
bank verifier. PNB concedes the absence
[16]
of the subject signature but argues that the same was the result of
inadvertence. It posits that the testimonies of Geronimo Gallego
(Gallego), then the branch manager of PNB Timog Branch, and Stella San
Diego (San Diego), then branch cashier, suffice to establish that the
signature verification process was duly followed.
We are not persuaded.
First, oral testimony is not as reliable as documentary evidence.
[17]
Second, PNB's own witness, San Diego, testified that in the
verification process, the principal duty to determine the genuineness of
the signature devolved upon the account analyst.
[18]
However, PNB did not present the account analyst to explain his or her
failure to sign the box for signature and balance verification of the
subject applications for manager's check, thus, casting doubt as to
whether he or she did indeed verify the signatures thereon. Third, we
cannot fault the appellate court for not giving weight to the
testimonies of Gallego and San Diego considering that the latter are
naturally interested in exculpating themselves from any liability
arising from the failure to detect the forgeries in the subject
transactions. Fourth, Gallego admitted that PNB's employees received
training on detecting forgeries from the National Bureau of
Investigation.
[19] However,
Emmanuel Guzman, then NBI senior document examiner, testified, as an
expert witness, that the forged signatures in the subject applications
for manager's check contained noticeable and significant differences
from the genuine signatures of FFCCI's authorized signatories and that
the forgeries should have been detected or observed by a trained
signature verifier of any bank.
[20]Given
the foregoing, we find no reversible error in the findings of the
appellate court that PNB was negligent in the handling of FFCCI's combo
account, specifically, with respect to PNB's failure to detect the
forgeries in the subject applications for manager's check which could
have prevented the loss. As we have often ruled, the banking business
is impressed with public trust.
[21]
A higher degree of diligence is imposed on banks relative to the
handling of their affairs than that of an ordinary business enterprise.
[22]
Thus, the degree of responsibility, care and trustworthiness expected
of their officials and employees is far greater than those of ordinary
officers and employees in other enterprises.
[23] In the case at bar, PNB failed to meet the high standard of diligence required by the circumstances to prevent the fraud. In
Philippine Bank of Commerce v. Court of Appeals [24] and
The Consolidated Bank & Trust Corporation v. Court of Appeals, [25]
where the bank's negligence is the proximate cause of the loss and the
depositor is guilty of contributory negligence, we allocated the damages
between the bank and the depositor on a 60-40 ratio. We apply the same
ruling in this case considering that, as shown above, PNB's negligence
is the proximate cause of the loss while the issue as to FFCCI's
contributory negligence has been settled with finality in G.R. No.
173278. Thus, the appellate court properly adjudged PNB to bear the
greater part of the loss consistent with these rulings.
WHEREFORE, the petition is
DENIED. The January 31, 2006 Decision and June 26, 2006 Resolution of the Court of Appeals in CA-G.R. CV No. 81349 are
AFFIRMED. Costs against petitioner.
SO ORDERED.
Corona, C.J., (Chairperson), Leonardo-De Castro, Bersamin, and
Villarama, Jr., JJ., concur.
[1] Rollo (G.R.
No. 173259), pp. 46-54; penned by Associate Justice Roberto A. Barrios
and concurred in by Associate Justices Mario L. GuariƱa III and Santiago
Javier Ranada.
[2] Id.
at 57-70; penned by Judge Artemio S. Tipon.
[3] Id. at 55-56.
[4] Id. at 46-48.
[5] Id. at 69.
[6] Id. at 53.
[7] 336 Phil. 667 (1997).
[8] 457 Phil. 688 (2003).
[9] Rollo (G.R. No. 173278), pp. 9-46.
[10] Id. at 119-123.
[11] Id. at 154.
[12] Rollo (G.R. No. 173259) p. 164.
[13]
The March 7, 2007 Resolution became final and executory on August 29,
2007 as per entry of judgment [id. at 158 (G.R. No. 173278)].
[14] Supra note 7.
[15] Supra note 8.
[16] TSN, November 27, 2001, p. 40.
[17] Abella v. Court of Appeals, 327 Phil. 270, 276 (1996).
[18] TSN, June 20, 2002, pp. 14-15, 18-19.
[19] TSN, November 27, 2001, p. 62.
[20] TSN, November 19, 1999, p. 5.
[21] United Coconut Planters Bank v. Basco, 480 Phil. 803, 819 (2004).
[22] Id.
[23] Id.
[24] Supra note 7 at 683.
[25] Supra note 8 at 712-713.