Philippine Education Co. Inc. v. Soriano [G.R. No. L-22405. une !0" #$%#& FACTS Enrique Montinola sought to purchase from the Manila Post Office ten (10) mone or!ers each paa"le to E#P# E#P# Montinola# Montinola# After the postal teller ha! ma!e out o ut mone or!ers$ Montinola offere! to pa for them %ith a pri&ate chec's %ere not generall accepte! in pament of mone or!ers$ the teller a!&ise! him to see the Chief of the Mone Or!er i&ision$ "ut instea! of !oing so$ Montinola manage! to lea&e "uil!ing %ith his o%n chec' an! the ten(10) mone or!ers %ithout the 'no%le!ge of the teller# pon !isco&er of the !isappearance of the unpai! mone or!ers$ an urgent message %as sent to all postmasters$ an! the follo%ing !a notice %as li'e%ise ser&e! upon all "an's$ instructing them not to pa anone of the mone or!ers aforesai! if presente! for pament# The *an' of America America recei&e! a cop of sai! notice three !as later# +t !e"ite! appellant,s appellant,s account %ith the same amount an! ga&e it a!&ice thereof " means of a !e"it memo# +SSE -hether or not postal mone or!ers are negotia"le instruments# ./+ O# Postal mone or!ers are not negotia"le instruments# Our postal statutes %ere patterne! after statutes in force in the nite! States# For this reason$ ours are generall construe! in accor!ance %ith the construction gi&en in the nite! States to their o%n postal statutes$ in the a"sence of an special reason 2ustifing a !eparture !eparture from this polic or practice# practice# The %eight %eight of authorit in the nite! States States is that postal mone or!ers are not negotia"le instruments$ the reason "ehin! this rule "eing that$ in esta"lishing an! operating a postal mone or!er sstem$ the go&ernment is not engaging in commercial transactions "ut merel e3ercises a go&ernmental po%er for the pu"lic "enefit#+t is to "e note! in this connection that some of the restrictions impose! upon mone or!ers " postal la%s an! regulations are inconsistent %ith the character of negotia"le instruments# For instance$ such la%s an! regulations usuall pro&i!e for not more than one en!orsement4 pament of mone or!ers ma "e %ithhel! un!er a &ariet of circumstances#
Calte' Inc. v. Court o( )ppeal* [G.R. No. $%%5!. )u+u*t #0" #$$2& FACTS On &arious !ates$ Securit *an' an! Trust Compan (S*TC)$ through its Sucat *ranch issue! 560 certificates of time !eposit (CT) in fa&or of one Angel !ela Cru7 %ho later lost them# ate of Maturit FE*# 58$ 196: FE* 55$ 1 965$ 19;;;; This is to Certif that * E A . E . has !eposite! in this *an' the sum of PESOS< FO. T=OSA O/>$ SEC.+T> *A? SCAT OFF+CE P:$000@ 00 CTS Pesos$ Philippine Currenc$ repaa"le to sai! !epositor 81 !as# after !ate$ upon presentation an! surren!er of this certificate$ %ith interest at the rate of 1B per cent per annum# (Sg!# +llegi"le) Calte3 (Phils#) +nc# %ent to the S*TCSucat "ranch an! presente! for &erification the CTs !eclare! lost " Angel !ela Cru7 alleging that the same %ere !eli&ere! to herein plaintiff Das securit for purchases ma!e %ith Calte3 Philippines$ +nc# " sai! !epositor# S*TC re2ecte! Calte3,s !eman! an! claim# Calte3 sue! S*TC "ut case %as !ismisse! rationali7ing rationali7ing that CT,s are nonnegotia"le instruments#
+SSE -hether or not Certificate of Time eposit (CT) is a negotia"le instrument# ./+ >ES# The CTs in question un!ou"te!l meet the requirements of the la% for negotia"ilit un!er Section 1 of the egotia"le +nstruments /a%# The accepte! rule is that the negotia"ilit or nonnegotia"ilit of an instrument is !etermine! from the %riting$ %riting$ that is$ from the face of the instrument itself# +n the construction of a "ill or note$ the intention of the parties is to control$ if it can "e legall ascertaine!# =ere$ if it %as reall the intention of respon!ent "an' to pa the amount to Angel !e la Cru7 onl$ it coul! ha&e %ith facilit so e3presse! that fact in clear an! categorical terms in the !ocuments$ instea! of ha&ing the %or! D*EA.E. D*EA.E. stampe! on the space pro&i!e! for the name of the !epositor in each CT# -hile the %riting ma "e rea! in the light of surroun!ing circumstances in o r!er to more perfectl un!erstan! the intent an! meaning of the parties$ et as the ha&e constitute! the %riting to "e the onl out%ar! an! &isi"le e3pression of their meaning$ no other %or!s are to "e a!!e! to it or su"stitute! in its stea!# Metropolitan *an' an! Trust Co# &# Court of Appeals G#.# o# 666BB# Fe"ruar 16$ 1991H 5: MA. FACTS Iarious Iarious treasur %arrants !ra%n " the Philippine Fish Mar'eting Authorit %ere su"sequentl in!orse! " ol!en Sa&ings# Petitioner allo%e! ol!en Sa&ings to %ith!ra% thrice from uncleare! treasur %arrants as the former %as e3asperate! o&er persistent inquiries of the latter after one %ee'# -arrants %ere later !ishonore! " the *ureau of Treasur# Treasur# +SSE (a) -hether or not treasur %arrants are negotia"le instruments# (") -hether or not p etitioner,s negligence %oul! "ar them for reco&er# ./+ (a) O# The in!ication of fun! as the source of the pament to "e ma!e on the treasur %arrants ma'es the or!er or promise to pa Dnot uncon!itional an! the %arrants themsel&es nonnegotia"le# Metro"an' cannot conten! that " in!orsing the %arrants in general$ ol!en Sa&ings assume! that the %ere Dgenuine an! in all respects %hat the purport to "e$ in accor!ance %ith Section BB of the egotia"le +nstruments /a%# The The simple reason is that this la% is not applica"le to the nonnegotia"le treasur %arrants# (") >ES# Metro"an' %as in!ee! negligent in gi&ing ol!en Sa&ings the impression that the treasur %arrants ha! "een cleare! an! that$ consequentl$ it %as safe to allo% ome7 to %ith!ra% the procee!s thereof from his account %ith it# - ithout such assurance$ ol!en Sa&ings %oul! not ha&e allo%e! the %ith!ra%als4 %ith such assurance$ there %as no reason not to allo% the %ith!ra%al# =o%e&er$ %ith!ra%als %ith!ra%als release! after the notice of the !ishonor ma "e !e"ite! ! e"ite! as it %ill result to un2ust enrichment#
Ses"reJo &# Court of Appeals G#.# o# 695K5# Ma 5:$ 1998H 5:
MA. FACTS Petitioner .aul Ses"reJo ma!e a mone mar'et placement in the amount of P800$000#00 %ith the Philippine n!er%riters Finance Corporation (DPhilfinance)# The latter issue! a Certificate of Confirmation of Sale D%ithout recourse from elta Motors Corporation Promissor ote$ a Certificate of securities in!icating the sale to petitioner$ %ith the notation that the sai! securit %as in custo!ianship of Pilipinas *an'$ an!post!ate! chec's paa"le %ith petitioner as paee$ Philfinance as !ra%er# Petitioner approache! pri&ate respon!ent Pilipinas *an' an! han!e! h er a !eman! letter informing the "an' that his placement %ith Philfinance ha! remaine! unpai! an! outstan!ing$ an! that he in effect %as as'ing for the phsical !eli&er of the un!erling promissor note# Pilipinas !i! not !eli&er the ote$ nor an certificate of participation in respect thereof$ to petitioner# +SSES (a) -hether or not Pilipinas *an' is lia"le for its action# (")-hether or not nonnegotia"le instruments are transferra"le# ./+ (1) >ES# Pri&ate respon!ent Pilipinas "an' is lia"le for !amages plus legal interest thereon " arising out of its "reach of !ut# * failing to !eli&er the ote to the petitioner as !epositor"eneficiar of the thing !eposite!$ Pilipinas effecti&el an! unla%full !epri&e! petitioner of the ote !eposite! %ith it# -hether or not Pilipinas itself "enefitte! from such con&ersion or unla%ful !epri&ation inflicte! upon petitioner$ is of no moment for present purposes#+n the case at "ar$ the custo!ian!epositar "an' Pilipinas refuse! to !eli&er the securit !eposite! %ith it %hen petitioner first !eman!e! phsical !eli&er thereof# +nstea! of compling %ith the !eman! of the petitioner$ Pilipinas purporte! to require an! a%ait the instructions of Philfinance$ in o"&ious contra&ention of its un!erta'ing un!er the C. to effect phsical !eli&er of the ote upon receipt of D%ritten instructions from petitioner Ses"reJo# (5) >ES# A nonnegotia"le instrument ma$ o"&iousl$ not "e negotiate!4 "ut it ma "e assigne! or transferre!$ a"sent an e3press prohi"ition against assignment or transfer %ritten in the face of the instrument# +t is important to "ear in min! that the negotiation of a negotia"le instrument must "e !istinguishe! from the assignment or transfer of an instrument %hether that "e negotia"le or non negotia"le# Onl an instrument qualifing as a negotia"le instrument un!er the rele&ant statute ma "e negotiate! either " in!orsement thereof couple! %ith !eli&er$ or " !eli&er alone %here the negotia"le instrument is in "earer form# A negotia"le instrument ma$ ho%e&er$ instea! of "eing negotiate!$ also "e assigne! or transferre!# The legal consequences of negotiation as !istinguishe! from assignment of a negotia"le instrument are$ of course$ !ifferent#
Firestone Tire &s# CA Firestone Tire @ ru""er Co# &s# Court of Appeals . o# 11858B March K$ 5001 Luisum"ing$ #< Facts< For2asArca Enterprise Compan is maintaining a special sa&ings account %ith /u7on e&elopment *an'$ the latter authori7e! an! allo%e! %ith!ra%als of fun!s though the me!ium of special %ith!ra%al slips# These are supplie! " Fo2asArca# Fo2asArca purchase! on cre!it %ith FirestoneTire @ .u""er Compan$ in pament Fo2asArca !eli&ere! a B special %ith!ra%al slips# +n turn$ these %ere !eposite! " the Firsestone to its "an' account in Citi"an'# -ith this$ reling on such confi!ence an! "elief Firestone e3ten!e! to Fo2asArca other purchase on cre!it of its pro!ucts "ut se&eral %ith!ra%al slips %ere !ishonore! an! not pai!# As a consequence$ Citi"an' !e"ite! the plaintiff,s account
representing the aggregate amount of the t%o !ishonore! special %ith!ra%al slips# Fo2asArca a&erre! that the pecuniar losses it suffere! are a cause! " an! !irectl attri"utes to !efen!ant,s gross negligence as a result Fo2asArca file! a complaint# +ssue< -hether or not the acceptance an! pament of the special %ith!ra%al slips %ithout the presentation of the !epositor,s pass"oo' there" gi&ing the impression that it is a negotia"le instrument li'e a chec'# =el!< o# -ith!ra%al slips in question %ere non negotia"le instrument# =ence$ the rules go&erning the gi&ing imme!iate notice of !ishonor of negotia"le instrument !o not appl# The essence of negotia"ilit %hich characteri7es a negotia"le paper as a cre!it instrument lies in its free!om to circulate freel as a su"stitute for mone# The %ith!ra%al slips in question lac'e! this character#
Ang Te' /ian &# Court of Appeals G#.# o# /5K1B# Septem"er 5K$ 19K0H 50 AP. FACTS Petitioner !re% a chec' paa"le to the or!er of Dcash 'no%ing that he ha! no fun!s# =e !eli&ere! it in e3change of mone# Petitioner %as foun! guilt of estafa$ "ut petitioner argue! that the chec' ha! not "een in!orse! " him$ hence$ he shoul! not "e hel! guilt thereof# +SSE -hether or not in!orsement is necessar to negotiate a chec' paa"le to the or!er of Dcash# ./+ O# +n!orsement is no longer necessar# n!er the egotia"le +nstruments /a% (Sec# 9 G!H)$ a chec' !ra%n paa"le to the or!er of Dcash is a chec' paa"le to "earer$ an! the "an' ma pa it to the person presenting it for pament %ithout the !ra%er,s in!orsement# *eing a "earer instrument$ negotiation ma "e !one " mere !eli&er of the instrument#
#.# o# /59:85 August B$ 19K /essons Applica"le< Forger (egotia"le +nstruments /a%) FACTS< aiAlai Corp# !eposite! 10 chec's %ith *P+# The chec's %ere from .amire7$ a sales agent of the +nter+slan! as %ere all paa"le to +nter+slan! as Ser&ice$ +nc# or or!er# +nter+slan! as !isco&ere! that all the in!orsements ma!e on the chec's purporte!l " its cashiers %ere forgeries# *P+ !e"ite! aiAlaiNs current account an! for%ar!e! to it the chec's containing the forge! in!orsements +SSE< - *P+ ha! the right to !e"it#
=E/< >ES# =a&ing in!orse! the chec's to *P+$ aiAlai is !eeme! to ha&e gi&en the %arrant prescri"e! in Section BB of the +/ that e&er single one of those chec's is genuine an! in all respects %hat it purports to "e# The !epositor of a chec' as in!orser %arrants that it is genuine an! in all respects %hat it purports to "e# ai Alai Corporation negligent in accepting the chec's %ithout question from Antonio .amire7 not%ithstan!ing that the paee %as the +nter+slan! as Ser&ices$ +nc# an! it !i! not appear that he %as authori7e! to in!orse it#
Philippine *an' of Commerce &# Aruego G#.# os# /5K68B8#anuar 81$ 1961H FACTS efen!antappellant Aruego signe! &arious "ills of e3change %hich %as negotiate! an! later !ishonore!# Appellee "an' aggrie&e!$ sue! Aruego#
+SSE -hether or not !efen!ant ma effecti&el put up the !efense that he %as 2ust an agent of the compan issuing the "ills of e3change#
./+ Section 50 of the egotia"le +nstruments /a% pro&i!es that D-here the instrument contains or a person a!!s to his signature %or!s in!icating that he signs for or on "ehalf of a principal or in a representati&e capacit$ he is not lia"le on the instrument if he %as !ul authori7e!4 "ut the mere a!!ition of %or!s !escri"ing him as an agent or as filing a representati&e character$ %ithout !isclosing his principal$ !oes not e3empt him from personal lia"ilit#
EIE/OPMET *A? OF .+QA/ &s# S+MA -E+$ ET A/# #.# o# 6K:19 March 9$ 1998 complete un!eli&ere! FACTS< .espon!ent Sima -ei e3ecute! an! !eli&ere! to petitioner *an' a promissor note engaging to pa the petitioner *an' or or!er the amount of P1$650$000#00# Sima -ei su"sequentl issue! t%o crosse! chec's paa"le to petitioner *an' !ra%n against China *an'ing Corporation in full settlement of the !ra%erNs account e&i!ence! " the promissor note# These t%o chec's ho%e&er %ere not !eli&ere! to the petitionerpaee or to an of its authori7e! representati&es "ut instea! came into the possession of respon!ent /ee ?ian =uat$ %ho !eposite! the chec's %ithout the petitionerpaeeNs in!orsement to the account of respon!ent Plastic Corporation %ith Pro!ucers *an'# +nspite of the fact that the chec's %ere crosse! an! paa"le to petitioner *an' an! "ore no in!orsement of the latter$ the *ranch Manager of Pro!ucers *an' authori7e! the acceptance of the chec's for !eposit an! cre!ite! them to the account of sai! Plastic Corporation# +SSE< -hether petitioner *an' has a cause of action against Sima -ei for the un!eli&ere! chec's#
./+< o# A negotia"le instrument must "e !eli&ere! to the paee in or!er to e&i!ence its e3istence as a "in!ing contract# Section 1B of the +/ pro&i!es that e&er contract on a negotia"le instrument is incomplete an! re&oca"le until !eli&er of the instrument for the purpose of gi&ing effect thereto# Thus$ the paee of a negotia"le instrument acquires no interest %ith respect thereto until its !eli&er to him# -ithout the initial !eli&er of the instrument from the !ra%er to the paee$ there can "e no lia"ilit on the instrument# Petitioner ho%e&er has a right of action against Sima -ei for the "alance !ue on the promissor note# #.# O# 106:
.epu"lic *an' &# E"ra!a G#.# o# /:09B# ul 81$ 19KH 80 / FACTS Treasur of the Philippines issue! a chec' paa"le to MA.T+ /O.EQO %ho %as alrea! !ea! that time# Signature forge!$ the chec' %as in!orse! to .AMO /O.EQO$ then to E/+A OM+EQ$ then to appellant$ %here it %as encashe! %ith the plaintiffappellee !ra%ee "an'#
+SSE -hether or not the !ra%ee "an' can reco&er from the one %ho encashe! a chec' %ith forge! signature of paee#
./+ >ES# efen!antappellant$ upon recei&ing the chec' in question from omingue7$ %as !ut"oun! to ascertain %hether the chec' in question %as genuine "efore presenting it to plaintiff *an' for pament# =er failure to !o so ma'es her lia"le for the loss an! the plaintiff *an' ma reco&er from her the mone she recei&e! for the chec'# As reasone! out a"o&e$ ha! she performe! the !ut of ascertaining the genuineness of the chec'$ in all pro"a"ilit the forger %oul! ha&e "een !etecte! an! the frau! !efeate!# Metropolitan -ater%or's an! Se%erage Sstem &# Court of Appeals G#.# o# /B59:8# ul 1:$ 196BH 80 / FACTS T%ent three (58) Dpersonali7e! chec's ! ra%n " petitioner %ere pai! " respon!ent "an' an! !e"ite! against petitioner after the %ere !eposite! in collection "an's#
+SSE -hether or not petitioner is "arre! from setting up the !efense of forger on the groun! of gross negligence#
./+ >ES# .espon!ent !ra%ee *an' for not ha&ing !etecte! the frau!ulent encashment of the chec's "ecause the printing of the petitioner,s personali7e! chec's %as not !one un!er the super&ision an! control of the *an'# There is no e&i!ence on recor! in!icating that "ecause of this pri&ate printing the petitioner furnishe! the respon!ent *an' %ith samples of chec's$ pens$ an! in's or too' other precautionar measures %ith the P* to safeguar! its interests#
*anco !e Oro Sa&ings an! Mortgage *an' &# Equita"le *an'ing Corp# G#.# o# :91# anuar 50$ 1966H 5: MA. FACTS Equita"le *an' !re% si3 crosse! manager,s chec' paa"le to certain mem"er esta"lishments of Iisa Car!# Su"sequentl$ the chec's %ere !eposite! %ith *anco e Oro (*O) to the cre!it of its !epositor# Follo%ing normal proce!ures an! after stamping at the "ac' of the chec's the usual en!orsements$*Osent the chec's for clearing through the Philippine Clearing =ouse Corporation (PC=C)# Accor!ingl$ Equita"le *an'ing pai! the chec's4 its clearing account %as !e"ite! for the &alue of the chec's an! *O,s clearing account %as cre!ite! for the same amount# Thereafter$ Equita"le *an'ing !isco&ere! that the en!orsements appearing at the "ac' of the chec's an! purporting to "e that of the paees %ere forge! an!or unauthori7e! or other%ise "elong to persons other than the paees#Equita"le *an'ing presente! the chec's !irectl to *O for the purpose of claiming reim"ursement from the latter# =o%e&er$ *O refuse! to accept such !irect presentation an! to reim"urse Equita"le *an'ing for the &alue of the chec's# +SSES (a) -hether or not *O is estoppe! from claiming that chec's un!er consi!eration are nonnegotia"le instruments# (") -hether or not *O can escape lia"ilit " reasons of forger# (c) -hether or not onl negotia"le chec's are %ithin the 2uris!iction of PC=C#
./+ (a) >ES# *O ha&ing stampe! its guarantee of Dall prior en!orsements an!or lac' of en!orsements is no% estoppe! from claiming that the chec's un!er consi!eration are not negotia"le instruments# The chec's %ere accepte! for !eposit " the petitioner stamping thereon its guarantee$ in or!er that it can clear the sai! chec's %ith the respon!ent "an'# * such !eli"erate an! positi&e attitu!e of the petitioner it has for all legal intents an! purposes treate! the sai! chee's as negotia"le instruments an! accor!ingl assume! the %arrant of the en!orser %hen it stampe! its guarantee of prior en!orsements at the "ac' of the chec's# +t le! the sai! respon!ent to "elie&e that it %as acting as en!orser of the chec's an! on the strength of this guarantee sai! respon!ent cleare! the chec's in question an! cre!ite! the account of the petitioner# Petitioner is no% "arre! from ta'ing an opposite posture " claiming that the !ispute! chec's are not negotia"le instrument#
(") O# A commercial "an' cannot escape the lia"ilit of an en!orser of a chec' an! %hich ma turn out to "e a forge! en!orsement# -hene&er an "an' treats the signature at the "ac' of the chec's as en!orsements an! thus logicall guarantees the same as such there can "e no !ou"t sai! "an' has consi!ere! the chec's as negotia"le#The collecting "an' or last en!orser generall suffers the loss "ecause it has the !ut to ascertain the genuineness of all prior en!orsements consi!ering that the act of presenting the chec' for pament to the !ra%ee is an assertion that the part ma'ing the presentment has !one its !ut to ascertain the genuineness of the en!orsements# (c) O# PC=C,s 2uris!iction is not limite! to negotia"le chec's onl# The term chec' as use! in the sai! Articles of +ncorporation of PC=C can onl connote chec's in general use in commercial an! "usiness acti&ities# Thus$ no !istinction# "i le3 non !istinguit$ nec nos !istinguere !e"emus# Chec's are use! "et%een "an's an! "an'ers an! their customers$ an! are ! esigne! to facilitate "an'ing operations# +t is of the essence to "e paa"le on !eman!$ "ecause the contract "et%een the "an'er an! the customer is that the mone is nee!e! on !eman!# empesa% &# Court of Appeals G#.# o# 955::# Fe"ruar 9$ 1998H 80 / FACTS Petitioner argues that respon!ent !ra%ee *an' shoul! not ha&e honore! the chec's "ecause the %ere Dcrosse! chec's#
+SSE -hether or not the issuance of Dcrosse! chec's is restricti&e in!orsement#
./+ O# The are not the same# +n restricti&e in!orsement$ the prohi"ition to transfer or negotiate must "e %ritten in e3press %or!s at the "ac' of the instrument$ so that an su"sequent part ma "e fore%arne! that ceases to "e negotia"le# Crosse! chec's$ on the other han!$ is !one " !ra%ing t%o parallel lines across the face of the chec' to mean that it cannot "e presente! for pament in cash$ "ut can onl "e !eposite! in paee,s account# Crossing of chec's !o not ipso facto cause the cessation of its negotia"le character#
Associate! *an' &# Court of Appeals G#.# o# 10865 #.# o# 10B15# anuar 81$ 199BH 80 / FACTS .espon!ent Pro&ince of Tarlac allo%e! a retire! hospital cashier to recei&e chec's for the paee hospital for a perio! three ears an! in not properl ascertaining %h the retire! hospital cashier %as collecting chec's for the paee hospital in a!!ition to the hospital,s real cashier# Associate! *an'$ as collecting "an'$ recei&e! an! in!orse! the sai! chec's#
+SSE -hether or not the D!octrine of comparati&e negligence appl#
./+ >ES# The Court fin!s as reasona"le$ the proportionate sharing of fift percent R fift percent (K0K0)# .espon!ent Pro&ince contri"ute! to the loss an! shall "e lia"le to the P* for fift (K0)$ Pro&ince of Tarlac can onl reco&er fift percent (K0) from P*# Associate! *an'$ shall "e lia"le to P* for fift (K0)# +t is lia"le on its %arranties as in!orser of the chec's %hich %ere !eposite! to it# egotia"le +nstruments Case igest< Metro"an' I# FC* (1965)
#.# o# /KK09 o&em"er 19$ 1965 /essons Applica"le< Alteration (egotia"le +nstruments /a%) FACTS< August 5K$ 19B:< Chec' !ate! ul 6$ 19B: for PK0$000#00$ paa"le to CAS=$ !ra%n " oaquin Cunanan @ Compan on First ational Cit *an' (FC*) %as !eposite! %ith Metropolitan *an' an! Trust Compan (Metro *an') " Sal&a!or Sales# Earlier that !a$ Sales ha! opene! a current account %ith Metro *an' !epositing PK00#00 in cash Metro *an' imme!iatel sent the cash chec' to the Clearing =ouse of the Central *an' %ith the follo%ing %or!s stampe! at the "ac' of the chec'< Metropolitan *an' an! Trust Compan Cleare! (illegi"le) office All prior en!orsements an!or /ac' of en!orsements uarantee!# The chec' %as cleare! the same !a# Pri&ate respon!ent pai! petitioner through clearing the amount of PK0$000#00$ an! Sales %as cre!ite! %ith the sai! amount in his !eposit %ith Metro *an'# August 5B$ 19B:< Sales ma!e his 1st %ith!ra%al of P:60#00 from his current account August 56$ 19B:< he %ith!re% P85$100#00 August 81$ 19B:< he %ith!re% the "alance of P1$950 an! close! his account %ith Metro *an' Septem"er 8$ 19B:< FC* returne! cancelle! Chec' to !ra%er oaquin Cunanan @ Compan$ together %ith the monthl statement of the companNs account %ith FC*# notifie! FC* that the chec' ha! "een altere! actual amount of PK0#00 %as raise! to PK0$000#00 name of the paee$ Manila Polo Clu"$ %as superimpose! the %or! CAS=# Septem"er 10$ 19B:< FC* %rote Metro *an' as'ing for reim"ursement une 59$ 19BK< FC* file! for reco&er
CA affirme! Trial Court< Metro *an' to reim"urse FC*
+SSE< - Metro"an' shoul! reims"urse FC* for the altere! amount as in!orser =E/< O# FC* lia"le# n!er the proce!ure prescri"e!$ the !ra%ee "an' recei&ing the chec' for clearing from the Central *an' Clearing =ouse must return the chec' to the collecting "an' %ithin the 5:hour perio! if the chec' is !efecti&e for an reason# FC* faile! to !o so in!orsement must "e rea! together %ith the 5:hour regulation on clearing =ouse Operations of the Central *an' Metro *an' can not "e hel! lia"le for the pament of the altere! chec'# Moreo&er$ FC* !i! not !en the allegation of Metro *an' that "efore it allo%e! the %ith!ra%al of the "alance of P1$950#00 " Sal&a!or Sales$ Metro *an' %ithhel! pament an! first &erifie!$ through its Assistant Cashier Fe!erico $ the regularit an! genuineness of the chec' !eposit from Marcelo Mirasol$ epartment Officer of FC*$ "ecause its (Metro *an') attention %as calle! " the fast mo&ement of the account .epu"lic *an' &s# CA .epu"lic *an' &s# Court of Appeals . o# :55K April 55$ 1991 rino R Aquino$ #< Facts< San Miguel Corporation !re% a !i&i!en! chec' %orth P5:0 on its account in First ational Cit *an' in fa&or of # .o"erto elga!o$ a stoc' hol!er# The amount on its face %as frau!ulentl an! %ithout authorit of the !ra%er$ altere! " increasing it from P5:0 to P9$ 5:0# The chec' %as in!orse! an! !eposite! " elga!o to his account %ith .epu"lic "an'# .epu"lic en!orse! the chec' to FC* an! presente! + for pament through the Central *an' Clearing =ouse# FC* pai! P9$ 5:0 to the .epu"lic through the Central *an' Clearing =ouse# SMC notifie! FC* of trhe material alteration in the chec' in question# FC* informe! .epu"lic %ith regar! to the alteration nan! forger of the en!orsement of elga!o# * the$ elga!o ha! alrea! %ith!ra%n his account from the repu"lic# FC* !eman!e! that .epu"lic refun! the P9$ 5:0# Trial court ren!ere! 2u!gment in fa&or of FC* an! it %as affirme! " the Court of Appeals# +ssue< -hether .epu"lic$ as the collecting "an'$ is protecte!$ " 5:hour clearing house rule$ foun! in C* circular o# 9$ as amen!e!$ from lia"ilit to refun! the amount pai! " FC*$ as !ra%ee of the SMC !i&i!en! chec'# =el!< o# The 5:hour clearing house rule is &ali! rule applica"le to commercial "an's# +t is true that %hen an in!orsement is forge!$ the collecting "an' or last en!orser$ as general rule$ "ears the loss# *ut the unqualifie! en!orsement of the collecting "an' on the chec' shoul! "e rea! together %ith the 5:hour regulation on the clearing house operation# Thus$ %hen the !ra%ee "an' fails to return a forge! or altere! chec' to the collecting "an' is a"sol&e! from lia"ilit# nless an alteration is attri"uta"le to the fault or negligence of the !ra%er himself$ such as %hen he lea&es spaces on the chec' %hich %oul! allo% the frau!ulent insertion of a!!itional numerals in the amount appearing thereon$ the reme! of the !ra%ee "an' that negligentl clears a forge! an!or honor altere! chec' for pament is against the part responsi"le for the forger or alteration$ other%ise$ it "ears the loss# +t ma not charge the amount so pai!
to the account of the !ra%er$ if the latter %as free from "lame$ nor reco&er it from the collecting "an' is the latter ma!e pament after proper clearance from the !ra%ee# PC+* &# CA Facts< This case is compose! of three consoli!ate! petitions in&ol&ing se&eral chec's$ paa"le to the *ureau of +nternal .e&enue$ "ut %as em"e77le! allege!l " a n organi7e! sn!icate# +# # .# os# 151:18 an! 151:9 On Octo"er 19$ 19$ plaintiff For! issue! a Citi"an' chec' amounting to P:$:B$11:#:1 in fa&or of the Commissioner of +nternal .e&enue for the pament of manufacturer,s ta3es# The chec' %as !eposite! %ith !efen!ant +*AA (no% PC+*)$ su"sequentl cleare! the the Central *an'$ an! pai! " Citi"an' to +*AA# The procee!s ne&er reache! *+.$ so plaintiff %as compelle! to ma'e a secon! pament# efen!ant refuse! to reim"urse plaintiff$ an! so the latter file! a complaint# An in&estigation re&eale! that the chec' %as recalle! " o!ofre!o .i&era$ the general le!ger accountant of For!$ an! %as replace! " a manager,s chec'# Allege! mem"ers of a sn!icate !eposite! the t%o manager,s chec's %ith Pacific *an'ing Corporation# For! file! a thir! part complaint against .i&era an! P*C# The case against P*C %as !ismisse!# The case against .i&era %as li'e%ise !ismisse! "ecause summons coul! not "e ser&e!# The trial court hel! Citi"an' an! PC+* 2ointl an! se&erall lia"le to For!$ "ut the Court of Appeals onl hel! PC+* lia"le# ++# # .# o# 156B0: For! !re% t%o chec's in fa&or of the Commissioner of +nternal .e&enue$ amounting to PK$6K1$0B#8 an! PB$811$K91#8# *oth are crosse! chec's paa"le to paee,s account onl# The chec's ne&er reache! *+.$ so plaintiff %as compelle! to ma'e secon! paments# Plaintiff institute! an action for reco&er against PC+* an! Citi"an'# On in&estigation of *+$ the mo!us operan!i %as !isco&ere!# orofre!o .i&era ma!e the chec's "ut instea! of !eli&ering them to *+.$ passe! it to Castro$ %ho %as the manager of PC+* San An!res# Castro opene! a chec'ing account in the name of a fictitious person D.enal!o .ees# Castro !eposite! a %orthless *an' of America chec' %ith the same amount as that issue! " For!# -hile "eing route! to the Central *an' for clearing$ the %orthless chec' %as replace! " the genuine one from For!# The trial court a"sol&e! PC+* an! hel! Citi"an' lia"le$ %hich !ecision %as affirme! in toto " the Court of Appeals# +ssues< (1) -hether there is contri"utor negligence on the part of For! (5) =as petitioner For! the right to reco&er from the collecting "an' (PC+*an') an! the !ra%ee "an' (Citi"an') the &alue of the chec's inten!e! as pament to the Commissioner of +nternal .e&enue =el!< (5) The general rule is that if the master is in2ure! " the negligence of a thir! person an! " the concuring contri"utor negligence of his o%n ser&ant or agent$ the latterNs negligence is impute! to his superior an! %ill !efeat the superiorNs action a gainst the thir! person$ asuming$ of course that the contri"utor negligence %as the pro3imate cause of the in2ur of %hich complaint is ma!e# As !efine!$ pro3imate cause is that %hich$ in the natural an! continuous sequence$ un"ro'en " an efficient$ inter&ening cause pro!uces the in2ur an! %ithout the result %oul! not ha&e occurre!# +t appears that although the emploees of For! initiate! the transactions attri"uta"le to an organi7e! sn!icate$ in our &ie%$ their actions %ere not the pro3imate cause of encashing the chec's paa"le to the C+.# The !egree
of For!Ns negligence$ if an$ coul! not "e characteri7e! as the pro3imate cause of the in2ur to the parties# The mere fact that the forger %as committe! " a !ra%erpaorNs confi!ential emploee or agent$ %ho " &irtue of his position ha! unusual facilities for perpertrating the frau! an! imposing the forge! paper upon the "an'$ !oes notentitle the "an' toshift the loss to the !ra%erpaor$ in the a"sence of some circumstance raising estoppel against the !ra%er# This rule li'e%ise applies to the chec's frau!ulentl negotiate! or !i&erte! " the confi!ential emploees %ho hol! them in their possession# (5) -e ha&e to scrutini7e$ separatel$ PC+*an'Ns share of negligence %hen the sn!icate achie&e! its ultimate agen!a of stealing the procee!s of these chec's# a# # .# os# 151:18 an! 151:9 On recor!$ PC+*an' faile! to &erif the authorit of Mr# .i&era to negotiate the chec's# The neglect of PC+*an' emploees to &erif %hether his letter requesting for the replacement of the Citi"an' Chec' o# S0:6B %as !ul authori7e!$ sho%e! lac' of care an! pru!ence require! in the circumstances# Furthermore$ it %as a!mitte! that PC+*an' is authori7e! to collect the pament of ta3paers in "ehalf of the *+.# As an agent of *+.$ PC+*an' is !ut "oun! to consult its principal regar!ing the un%arrante! instructions gi&en " the paor or its agent# +t is a %ellsettle! rule that the relationship "et%een the paee or hol!er of commercial paper an! the "an' to %hich it is sent for collection is$ in the a"sence of an argreement to the contrar$ that of principal an! agent# A "an' %hich recei&es such paper for collection is the agent of the paee or hol!er# +n!ee!$ the crossing of the chec' %ith the phrase PaeeNs Account Onl$ is a %arning that the chec' shoul! "e !eposite! onl in the account of the C+.# Thus$ it is the !ut of the collecting "an' PC+*an' to ascertain that the chec' "e !eposite! in paeeNs account onl# Therefore$ it is the collecting "an' (PC+*an') %hich is "oun! to scrutini7e the chec' an! to 'no% its !epositors "efore it coul! ma'e the clearing in!orsement all prior in!orsements an!or lac' of in!orsement guarantee!# /astl$ "an'ing "usiness requires that the one %ho first cashes an! negotiates the chec' must ta'e some precautions to learn %hether or not it is genuine# An! if the one cashing the chec' through in!ifference or other circumstance assists the forger in committing the frau!$ he shoul! not "e permitte! to retain the procee!s of the chec' from the !ra%ee %hose sole fault %as that it !i! not !isco&er the forger or the !efect in the title of the person negotiating the instrument "efore paing the chec'# For this reason$ a "an' %hich cashes a chec' !ra%n upon another "an'$ %ithout requiring proof as to the i!entit of persons presenting it$ or ma'ing inquiries %ith regar! to them$ cannot hol! the procee!s against the !ra%ee %hen the procee!s of the chec's %ere after%ar!s !i&erte! to the han!s of a thir! part# +n such cases the !ra%ee "an' has a right to "elie&e that the cashing "an' (or the collecting "an') ha!$ " the usual proper in&estigation$ satisfie! itself of the authenticit of the negotiation of the chec's# Thus$ one %ho encashe! a chec' %hich ha! "een forge! or !i&erte! an! in turn recei&e! pament thereon from the !ra%ee$ is guilt of negligence %hich pro3imatel contri"ute! to the success of the frau! practice! on the !ra%ee "an'# The latter ma reco&er from the hol!er the mone pai! on the chec'# "# # .# o# 156B0: +n this case$ there %as no e&i!ence presente! confirming the conscious participation of PC+*an' in the em"e77lement# As a general rule$ ho%e&er$ a "an'ing corporation is lia"le for the %rongful or tortuous acts an! !eclarations of its officers or agents %ithin the course an! scope of their emploment# A "an' %ill "e hel! lia"le for the negligence of its officers or agents %hen acting %ithin the course an! scope of their emploment# +t ma "e lia"le for the tortuous acts of its officers e&en as regar!s that species of tort of %hich malice is an essential element# +n this case$ %e fin! a situation %here the PC+*an' appears also to "e the &ictim of the scheme hatche! " a sn!icate in %hich its o%n management emploees ha! participate!# *ut in this case$ responsi"ilit for negligence !oes not lie on PC+*an'Ns shoul!ers alone# Citi"an' faile! to notice an! &erif the a"sence of the clearing stamps# For this reason$ Citi"an' ha! in!ee! faile! to perform %hat %as incum"ent upon it$ %hich is to ensure that the amount of the chec's shoul! "e pai! onl to its !esignate! paee# The point is that as a "usiness affecte! %ith pu"lic interest
an! "ecause of the nature of its functions$ the "an' is un!er o"ligation to treat the accounts of its !epositors %ith meticulous care$ al%as ha&ing in min! the fi!uciar nature of their relationship# Thus$ in&o'ing the !octrine of comparati&e negligence$ %e are of the &ie% that "oth PC+*an' an! Citi"an' faile! in their respecti&e o"ligations an! "oth %ere negligent in the selection an! super&ision of their emploees resulting in the encashment of Citi"an' Chec' os# S 10K9 A 1BK06# Thus$ %e are constraine! to hol! them equall lia"le for the loss of the procee!s of sai! chec's issue! " For! in fa&or of the C+.# +lusorio &# Court of Appeals G#.# o# 189180# o&em"er 5$ 5005H 80 / FACTS Petitioner,s secretar %as a"le to encash an! !eposit to her personal account a"out se&enteen (1) chec's !ra%n against the account of petitioner at the respon!ent "an'# Petitioner !isclaims the signatures an! !eman!s "an' to restoration of fun!s#
+SSE -hether or not petitioner is preclu!e! from setting up the forger#
./+ >ES# Petitioner,s failure to e3amine his "an' statements appears as the pro3imate cause of his o%n !amage# Pro3imate cause is that cause$ %hich$ in natural an! continuous sequence$ un"ro'en " an efficient inter&ening cause$ pro!uces the in2ur$ an! %ithout %hich the result %oul! not ha&e occurre!# +n the present case$ the fact of forger %as not esta"lishe! %ith certaint$ ha&ing compare! the signature in the chec's from the specimen signatures on recor! an! satisfie! themsel&es that it %as petitioner,s# Samsung Construction Compan Phils# &# Far East *an' a n! Trust Compan G#.# o# 15901K# August 18$ 500:H 80 / FACTS A chec' %ith forge! signature paa"le to cash %as !ra%n against petitioner,s account# Petitioner !eman!s cre!it of the amount !e"ite! " encashment#
+SSE -hether or not petitioner ma reco&er from the !ra%ee "an'#
./+ >ES# The !ra%er %hose signature %as forge! ma still reco&er from the "an' as long as he or she is not preclu!e! from setting up the !efense of forger# =ere$ the !ra%er$ Samsung Construction$ is not
preclu!e! " negligence from setting up the forger# The general rule shoul! appl# Consequentl$ if a "an' pas a forge! chec'$ it must "e consi!ere! as pa ing out of its fun!s an! cannot charge the amount so pai! to the account of the !epositor# A "an' is lia"le$ irrespecti&e of its goo! faith$ in paing a forge! chec'# Philippine ational *an' &# Court of Appeals G#.# o# 10K06# April 5K$ 199BH 80 / FACTS Petitioner returne! the chec' to P*Com an! !e"ite! P*Com,s account for the amount co&ere! " the chec'$ the reason "eing that there %as a Dmaterial alteration of the chec' num"er#
+SSE -hether or not there is Dmaterial alteration on the chec'#
./+ O# An alteration is sai! to "e material if it alters the effect of the instrument# +t means an unauthori7e! change in an instrument that purports to mo!if in an respect the o"ligation of a part or an unauthori7e! a!!ition of %or!s or num"ers or other change to an incomplete instrument relating to the o"ligation of a part# =ere$ the alteration of chec' num"er !oes not affect its negotia"ilit contemplate! in Section 1 of the egotia"le +nstruments /a%# #.# o# /16:K April 5$ 19B /essons Applica"le< Consi!eration an! Accommo!ation Part (egotia"le +nstruments) FACTS< March 56$ 19:9< Iictor Se&illa$ Oscar Iarona an! Simeon Sa!aa e3ecute!$ 2ointl an! se&erall$ in fa&or of the *P+$ or its or!er$ a promissor note for P1K$000#00 %ith interest at 6 per annum$ paa"le on !eman!# The P1K$000#00 procee!s %as recei&e! " Oscar Iarona alone# Iictor Se&illa an! Simeon Sa!aa signe! the promissor note as coma'ers onl as a fa&or to Oscar Iarona# une 1K$ 19K0< outstan!ing "alance is P:$6K0#00# o pament thereafter ma!e# Oct 1B 19K5< "an' collecte! from Sa!aa total of PK$:1B#15(% int) Iarona faile! to reim"urse Sa!aa !espite repeate! !eman!s# I Iictor Se&illa !ie! Francisco Se&illa %as name! a!ministrator# Sa!aa file! a cre!itorNs claim for the a"o&e sum of PK$:B#15$ plus attornes fees in the sum of P1$K00#00 The a!ministrator resiste! the claim upon the a&erment that the !ecease! Iictor Se&illa !i! not recei&e an amount as consi!eration for the promissor note$ "ut signe! it o nl as suret for Oscar Iarona une K$ 19K< Trial court or!er the a!ministrator to pa CA re&erse!# +SSE< - Sa!aa can claim against the estate of Se&illa as coaccomo!ation part %hen Ierona as principal !e"tor is not et insol&ent =E/< O# Affirme! Iarona is "oun! " the o"ligation to reim"urse Sa!aa
soli!ar accommo!ation ma'er %ho ma!e pament has the right to contri"ution$ from his co accommo!ation ma'er$ in the a"sence of agreement to the contrar "et%een them$ an! su"2ect to con!itions impose! " la% requisites "efore one accommo!ation ma'er can see' reim"ursement from a coaccommo!ation ma'er# A.T# 508# -hen there are t%o or more guarantors of the same !e"tor an! for the same !e"t$ the one among them %ho has pai! ma !eman! of each of the others the share %hich is proportionall o%ing from him# +f an of the guarantors shoul! "e insol&ent$ his share shall "e "orne " the others$ inclu!ing the paer$ in the same proportion# (1) A 2oint an! se&eral accommo!ation ma'er of a negotia"le promissor note ma !eman! from the principal !e"tor reim"ursement for the amount that he pai! to the paee4 (5) a 2oint an! se&eral accommo!ation ma'er %ho pas on the sai! promissor note ma !irectl !eman! reim"ursement from his coaccommo!ation ma'er %ithout first !irecting his action against the principal !e"tor pro&i!e! that (a) he ma!e the pament " &irtue of a 2u!icial !eman!$ or no 2u!icial !eman! 2ust &oluntaril (") a principal !e"tor is insol&ent# Iarona is not insol&ent Crisologoose &# Court of Appeals G#.# o# 60K99# Septem"er 1K$ 1969H 80 / FACTS Petitioner a&ers that the accommo!ation part in this case is Mo&er Enterprises$ +nc# an! not p ri&ate respon!ent %ho merel signe! the chec' in question in a representati&e capacit$ that is$ as &ice presi!ent of sai! corporation$ hence he is not lia"le thereon un!er the egotia"le +nstruments /a%#
+SSE -hether or not petitioner is not lia"le on the groun! that he is simpl acting as an agent of a corporation#
./+ O# An accommo!ation part is lia"le on the instrument to a hol!er for &alue$ although such hol!er at the time of ta'ing the instrument 'ne% him to "e onl an accommo!ation part$ !oes not inclu!e nor appl to corporations %hich are accommo!ation parties# This is "ecause the issue or in!orsement of negotia"le paper " a corporation %ithout consi!eration an! for the accommo!ation of another is ultra &ires# Stelco Mar'eting Corporation &# Court of Appeals G#.# o# 9B1B0# une 1$ 1995H 80 / FACTS Petitioner STE/CO claime! it %as a hol!er in !ue course an! for &alue of a chec' that ha! "een !eposite! an! !ishonore!# STE/CO came into possession of it in some %a$ an! %as a"le$ se&eral ears after the !ishonor of the chec'#
+SSE
-hether or not STE/CO ma "e consi!ere! a hol!er of the chec' for &alue#
./+ O# +t is clear from the rele&ant circumstances that STE/CO cannot "e !eeme! a hol!er of the chec' for &alue# +t !oes not meet t%o of the essential requisites prescri"e! " the statute# +t !i! not "ecome Dthe hol!er of it "efore it %as o&er!ue$ an! %ithout notice that it ha! "een pre&iousl !ishonore!$ an! it !i! not ta'e the chec' Din goo! faith an! for &alue# Tra&elOn &s CA Tra&elOn$ +nc# &s Court of Appeals #.# o# /KB1B9 une 5B$ 1995 accommo!ation part FACTS< Petitioner Tra&elOn +nc# is a tra&el agenc from %hich Arturo Miran!a procure! tic'ets on "ehalf of airline passengers an! !eri&e! commissions therefrom# Miran!a %as sue! " petitioner to collect on the si3 post!ate! chec's he issue! %hich %ere all !ishonore! " the !ra%ee "an's# Miran!a$ ho%e&er$ claime! that he ha! alrea! full pai! an! e&en o&erpai! his o"ligations an! that refun!s %ere in fact !ue to him# =e argue! that he ha! issue! the post!ate! chec's not for the purpose of encashment to pa his in!e"te!ness "ut for purposes of accommo!ation$ as he ha! in the past accor!e! similar fa&ors to petitioner# Petitioner ho%e&er urges that the post!ate! chec's are per se e&i!ence of lia"ilit on the part of pri&ate respon!ent an! further argues that e&en assuming that the chec's %ere for accommo!ation$ pri&ate respon!ent is still lia"le thereun!er consi!ering that petitioner is a hol!er for &alue# +SSE< -hether Miran!a is lia"le on the post!ate! chec's he issue! e&en assuming that sai! chec's %ere issue! for accommo!ation onl# ./+< There %as no accommo!ation transaction in the case at "ar# +n accommo!ation transactions recogni7e! " the egotia"le +nstruments /a%$ an accommo!ating part len!s his cre!it to the accommo!ate! part$ " issuing or in!orsing a chec' %hich is hel! " a paee or in!orsee as a hol!er in !ue course$ %ho ga&e full &alue therefor to the accommo!ate! part# The latter$ in other %or!s$ recei&es or reali7es full &alue %hich the accommo!ate! part then must repa to the accommo!ating part# *ut the accommo!ating part is "oun! on the chec' to the h ol!er in !ue course %ho is necessaril a thir! part an! is not the accommo!ate! part# +n the case at "ar$ Tra&elOn %as paee of all si3 (B) chec's$ it presente! these chec's for pament at the !ra%ee "an' "ut the chec's "ounce!# Tra&elOn o"&iousl %as not an accommo!ate! part4 it reali7e! no &alue on the chec's %hich "ounce!# Miran!a must "e hel! lia"le on the chec's in&ol&e! as petitioner is entitle! to the "enefit of the statutor presumption that it %as a hol!er in !ue course an! that the chec's %ere supporte! " &alua"le consi!eration# e Ocampo &# atchalian G#.# o# /1K15B# o&em"er 80$ 19B1H 80 / FACTS Appellant atchalian !re% chec' %orth PB00 %hich %as recei&e! " plaintiffappellee in Iicente .# !e Ocampo @ Co# (I.O @ Co#) pament of in!e"te!ness of certain Matil!e on7ales# Plaintiffappellee e&en ga&e a change of P1K6#5K to on7ales#
+SSE -hether or not I.O @ Co#,s !efense of goo! faith is tena"le#
./+ O# The irregularit is e&i!ent# As hol!er,s title %as !efecti&e or suspicious$ it cannot "e state! that the paee acquire! the chec' %ithout 'no%le!ge of sai! !efect in hol!er,s title$ an! for this reason the presumption that it is a hol!er in !ue course or that it acquire! the instrument in goo! faith !oes not e3ist# An! ha&ing presente! no e&i!ence that it acquire! the chec' in goo! faith$ it (paee) cannot "e consi!ere! as a hol!er in !ue course# Mesina &# +nterme!iate Appellate Court G#.# o# 01:K# o&em"er 18$ 196BH 80 / FACTS Petitioner "ecame the hol!er of the cashier,s chec' as en!orse! " Ale3an!er /im %ho stole the chec'# =e refuse! to sa ho% an! %h it %as passe! to him# +SSE -hether or not petitioner is a hol!er in !ue course#
./+ O# Petitioner faile! to su"stantiate his claim that he is a hol!er in !ue course an! for consi!eration or &alue as sho%n " the esta"lishe! facts of the case# =e ha! therefore notice of the !efect of his title o&er the chec' from the start# The hol!er of a cashier,s chec' %ho is not a hol!er in !ue course cannot enforce such chec' against the issuing "an' %hich !ishonors the same# Metropol (*acolo!) Financing an! +n&estment Corp &# Sam"o' Motors Compan G#.# o# /89B:1# Fe"ruar 56$ 1968H 80 / FACTS Appellant Sam"o' a!!e! the %or!s D%ith recourse in the in!orsement of a note# =e argue! that the note contemplates a qualifie! in!orsement#
+SSE -hether or not the contention of Sam"o' is meritorious#
./+ O# D.ecourse means resort to a person %ho is secon!aril lia"le after the !efault of the person %ho is primaril lia"le# Appellant$ " in!orsing the note D%ith recourse !oes not ma'e itself a qualifie! in!orser "ut a general in!orser %ho is secon!aril lia"le# The effect of such in!orsement is that the note %as in!orse! %ithout qualification# A person %ho in!orses %ithout qualification engages that on !ue presentment$ the note shall "e accepte! or pai!$ or "oth as the case ma "e$ an! that if it "e !ishonore!$ he %ill pa the amount thereof to the hol!er# Sapiera &s CA Sapiera &s Court of Appeals G#.# o# 15695# Septem"er 1:$ 1999H FACTS< Petitioner .eme!ios Sapiera$ a sarisari store o%ner$ %as issue! " one Arturo !e u7man chec's as pament for purchases he ma!e at her store# She use! sai! chec's to pa for certain items she purchase! from the grocer store of .amon Sua# These chec's %ere signe! at the "ac' " petitioner# -hen presente! for pament the chec's %ere !ishonore! "ecause the !ra%er,s account %as alrea! close!# Sua informe! Arturo !e u7man an! petitioner a"out the !ishonor "ut "oth faile! to pa the &alue of the chec's# Petitioner %as acquitte! in the charge of estafa file! against her "ut she %as foun! lia"le for the &alue of the chec's# +SSE< -hether petitioner is lia"le for the &alue of the chec's e&en if she signe! the su"2ect chec's onl for the i!entification of the signature of Arturo !e u7man# ./+< Petitioner is lia"le for the &alue of the chec's# As she (petitioner) signe! the su"2ect chec's on the re&erse si!e %ithout an in!ication as to ho% she shoul! "e "oun! there"$ she is !eeme! to "e an unqualifie! in!orser thereof# E&er in!orser %ho in!orses %ithout qualification$ %arrants to all su"sequent hol!ers in !ue course that$ on !ue presentment$ it shall "e accepte! or pai! or "oth$ accor!ing to its tenor$ an! that if it "e !ishonore! an! the necessar procee!ings on !ishonor "e !ul ta'en$ he %ill pa the amount thereof to the hol!er or to an su"sequent in!orser %ho ma "e compelle! to pa it# Pru!ential *an' &s +AC P.ET+A/ *A? &s# +TE.ME+ATE APPE//ATE CO.T #.# o# :66B ecem"er 6$ 1995$ 51B scra 5K presentment for pament FACTS< Philippine .aon Mills$ +nc# entere! into a contract %ith issho Co#$ /t!# of apan for the importation of te3tile machineries un!er a fi&eear !eferre! pament plan# To effect pament for sai! machineries$ Philippine .aon Mills opene! a commercial letter of cre!it %ith the Pru!ential *an' an! Trust Compan in fa&or of issho# Against this letter of cre!it$ !rafts %ere !ra%n an! issue! " issho$ %hich %ere all pai! " the Pru!ential *an' through its correspon!ent in apan# T%o of these !rafts %ere accepte! " Philippine .aon Mills %hile the others %ere not# Petitioner institute! an action for the reco&er of the sum of mone it pai! to issho as Philippine .aon Mills %as not a"le to pa its o"ligations arising from the letter of cre!it# .espon!ent court rule! that %ith regar! to the ten !rafts %hich %ere not presente! an! accepte!$ no &ali! !eman! for pament can "e ma!e# Petitioner ho%e&er claims that the !rafts %ere sight !rafts %hich !i! not require p resentment for acceptance to Philippine .aon# +SSE<
-hether presentment for acceptance of the !rafts %as in!ispensa"le to ma'e Philippine .aon lia"le thereon# ./+< +n the case at "ar$ the !ra%ee %as necessaril the herein petitioner# +t %as to the latter that the !rafts %ere presente! for pament# There %as in fact no nee! for acceptance as the issue! !rafts are sight !rafts# Presentment for acceptance is necessar onl in the cases e3pressl pro&i!e! for in Section 1:8 of the egotia"le +nstruments /a% (+/)# The sai! section pro&i!es that presentment for acceptance must "e ma!e< (a) -here the "ill is paa"le after sight$ or in an other case$ %here presentment for acceptance is necessar in or!er to fi3 the maturit of the instrument4 or (") -here the "ill e3pressl stipulates that it shall "e presente! for acceptance4 or (c) -here the "ill is !ra%n paa"le else%here than at the resi!ence or place of "usiness of the !ra%ee# +n no other case is presentment for acceptance necessar in or!er to ren!er an part to the "ill lia"le# O"&iousl then$ sight !rafts !o not require presentment for acceptance# #.# o# 116K# une 5K$ 5001 /+S S# -O$ Petitioner$ &s# CO.T OF APPEA/S an! PEOP/E OF T=E P=+/+PP+ES$ .espon!ents# .ESO/T+O L+SM*+$ #< PET+T+OE. /uis S# -ong$ through counsel$ see's reconsi!eration of ou r !ecision on this case promulgate! on Fe"ruar 5$ 5001# +n that !ecision$ follo%ing polic gui!elines set forth in AC o# 155000$ %e !elete! the penalt of imprisonment impose! on him "elo%# *ut %e or!ere! him to pa fines of PB$K0#00$ P15$650#00 an! P11$000#00 respecti&el correspon!ing to t%ice the face &alue of three chec's in&ol&e! in Criminal Cases os# C*150K$ 150K6$ an! 150KK4 as %ell as ci&il in!emnit in the amount of P16$05K#00$ in connection %ith his con&iction for &iolation of the *ouncing Chec's /a% (*P *lg# 55)# +n his motion for reconsi!eration no% "efore us$ he a&ers$ inter alia$ that the amount of ci&il in!emnit impose! is erroneous# =e states that< The error in the statement of the amount of ci&il in!emnit is quite o"&iousl cause! " the ina!&ertent a!!ition of the three chec's issue! " petitioner %hich %ere the su"2ect of another case %here he ha! long ago "een acquitte!# This acquittal is !ul note! " this =onora"le Court in footnote K of page 8 of its ecision# The error$ though the pro!uct of ina!&ertence$ is error nonetheless# An! it must "e correcte!$ %ith all !ue respect# (Motion for .econsi!eration$ p# 5#) F++ his motion for reconsi!eration meritorious "ut onl %ith respect to the praer for recomputation of ci&il in!emnit to "e impose!$ %e no% set the amount thereof to onl P1K$56K#00$ %hich is the correct sum of the face &alue of the three chec's in&ol&e! in the p resent case# ACCO.+/>$ the !ispositi&e portion of our ecision in this case is here" amen!e! to rea! as follo%s< -=E.EFO.E$ the petition is E+E# Petitioner /uis S# -ong is foun! lia"le for &iolation of *atas Pam"ansa *lg# 55 "ut the penalt impose! on him is here" MO+F+E so that the sentence of imprisonment is !elete!# Petitioner is O.E.E to pa a F+E of (1) PB$K0#00$ equi&alent to ! ou"le the
amount of the chec' in&ol&e! in Criminal Case o# C*150K$ (5) P15$650#00$ equi&alent to !ou"le the amount of the chec' in&ol&e! in Criminal Case o# C*150K6$ an! (8) P11$000#00$ equi&alent to !ou"le the amount of the chec' in&ol&e! in Criminal Case o# C*150KK$ %ith su"si!iar imprisonment in case of insol&enc to pa the aforesai! fines# Finall$ as ci&il in!emnit$ petitioner is also or!ere! to pa to /P+ the face &alue of sai! chec's totaling P1K$56K#00 %ith legal interest thereon from the time of filing the criminal charges in court$ as %ell as to pa the costs# +TE.AT+OA/ CO.PO.ATE *A? I# SPS# ECO #.# o#1:19B6 Fe"ruar 15$ 5001 Facts< Spouses ueco o"taine! a loan from petitioner +nternational Corporate *an' (no% nion *an' of Philippines) to purchase a car# .espon!ent spouses e3ecute! a p romissor note in consi!eration$ %hich %ere paa"le in monthl installment an! chattel mortgage o&er the car# The spouses ho%e&er$ !efaulte! pament# The car %as !etaine! " the "an'# -hen r# ueco !eli&ere! the manger,s chec' of P1K0$000$ the car %as not release! "ecause of his refusal to sign the oint Motion to ismiss (M)# The "an' insiste! that the M is a stan!ar! operating proce!ure to effect a compromise an! to preclu!e future filing of claims or suits for !amages# ueco spouses file! an action against the "an' for frau!$ failing to inform them regar!ing M !uring the meeting @ for not releasing the car if the !o not sign the sai! motion# +ssue< -hether or not +nternational Corporate *an' %as guilt of frau!# .uling< o# Frau! has "een !efine! as the !eli"erate intention to cause !amage or pre2u!ice# +t is the &oluntar e3ecution of a %rongful act$ or a %illful omission$ 'no%ing an! inten!ing the effects %hich naturall an! necessaril arise from such act or omission# The frau! referre! to in Article 110 of the Ci&il Co!e is the !eli"erate an! intentional e&asion of the normal fulfillment of o"ligation# The court fails to see ho% the act of the petitioner "an' in requiring the respon!ent to sign the 2oint motion to !ismiss coul! constitute as frau!# The 2oint motion to !ismiss cannot in an %a ha&e pre2u!ice! r# ueco# The motion to !ismiss %as in fact also for the "enefit of r# ueco$ as the case file! " p etitioner against it "efore the lo%er court %oul! "e !ismisse! %ith pre2u!ice# The 2oint motion to !ismiss %as "ut a natural consequence of the compromise agreement an! simpl state! that r# ueco ha! full settle! his o"ligation$ hence$ the !ismissal of the case# Petitioner,s act of requiring r# ueco to sign the 2oint motion to !ismiss cannot "e sai! to "e a !eli"erate attempt on the part of petitioner to renege on the compromise agreement of the p arties# State +n&estment =ouse +nc# &s# CA State +n&estment =ouse +nc# &s# CA . o# 1011B8 anuar 11$ 1998 *ellosillo$ #< Facts< ora Moulic issue! to Cora7on Iictoriano$ as securit for pieces of 2e%eller to "e sol! on commission$ t%o post!ate! chec's in the amount of fift thousan! each# Thereafter$ Iictoriano negotiate! the chec's to State +n&estment =ouse$ +nc# -hen Moulic faile! to sell the 2e%ellr$ she returne! it to Iictoriano "efore the maturit of the chec's# =o%e&er$ the chec's cannot "e retrie&e! as the ha&e "een negotiate!# *efore the maturit !ate Moulic %ith!re% her fun!s from the "an' contesting that she incurre! no o"ligation on the chec's "ecause the 2e%eller %as ne&er sol! an! the chec's are negotiate! %ithout her 'no%le!ge an! consent# pon presentment of for pament$ the chec's %ere !ishonoure! for insufficienc of fun!s# +ssues<
1# -hether or not State +n&estment =ouse inc# %as a hol!er of the chec' in !ue course 5# -hether or not Moulic can set up against the petitioner the !efense that there %as failure or a"sence of consi!eration
=el!< >es$ Section K5 of the +/ pro&i!es %hat constitutes a hol!er in !ue course# The e&i!ence sho%s that< on the faces of the post !ate! chec's %ere complete an! regular4 that State +n&estment =ouse +nc# "ought the chec's from Iictoriano "efore the !ue !ates4 that it %as ta'en in goo! faith an! for &alue4 an! there %as no 'no%le!ge %ith regar! that the chec's %ere issue! as securit an! not for &alue# A prima facie presumption e3ists that a hol!er of a negotia"le instrument is a hol!er in !ue course# Moulic faile! to pro&e the contrar# o$ Moulic can onl in&o'e this !efense against the petitioner if it %as a pri& to the purpose for %hich the %ere issue! an! therefore is not a hol!er in !ue course# o$ Section 119 of +/ pro&i!es ho% an instruments "e !ischarge!# Moulic can onl in&o'e paragraphs c an! ! as possi"le groun!s for the !ischarge of the instruments# Since Moulic faile! to get "ac' the possession of the chec's as pro&i!e! " paragraph c$ intentional cancellation of instrument is impossi"le# As pro&i!e! " paragraph !$ the acts %hich %ill !ischarge a simple contract of pament of mone %ill !ischarge the instrument# Correlating Article 1581 of the Ci&il Co!e %hich enumerates the mo!es of e3tinguishing o"ligation$ none of those mo!es outline! therein is applica"le in the instant case# Thus$ Moulic ma not unilaterall !ischarge herself from her lia"ilit " mere e3pe!ienc of %ith!ra%ing her fun!s from the !ra%ee "an'# She is thus lia"le as she has no legal "asis to e3cuse herself from lia"ilit on her chec' to a hol!er in !ue course# Moreo&er$ the fact that the petitioner faile! to gi&e notice of !ishonor is of no moment# The nee! for such notice is not a"solute4 there are e3ceptions pro&i!e! " Sec 11: of +/# *ataan Cigar an! Cigarette Factor$ +nc# &# Court of Appeals G#.# o# 980:6# March 8$ 199:H 80 / FACTS Petitioner *CCF+ issue! crosse! chec's to eorge ?ing in consi!eration of to"acco "ales$ %hich the latter sol! to respon!ent S+=+ in a !iscounte! price# eorge ?ing faile! to !eli&er the consi!eration# *CCF+ or!ere! to stop pament# S+=+ faile! to encash the crosse! chec's#
+SSE -hether or not respon!ent S+=+ here ha&e sho%n legal a"sence of goo! faith#
./+ >ES# +n failing to inquire a"out crosse! chec's$ the hol!er S+=+ is !eclare! guilt of gross negligence amounting to legal a"sence of goo! faith$ contrar to Sec# K5(c) of the egotia"le +nstruments /a%$ an! as such the consensus of authorit is to the effect that the hol!er of the chec' is not a hol!er in !ue course# Cittrust &s# +AC Cittrust "an'ing Corp#$ &s# +nterme!iate Appellate Court
. o# 6:561 Ma 5$ 199: Iitug$ < Facts< Emme =errero$ "usiness%oman$ ma!e regular !eposits %ith Cittrust *an'ing Corp# at its *urgoa "ranch in Calam"a$ /aguna# She !eposite! the amount of P81$ K00 in or!er to ampl co&er B post!ate! chec's she issue!# All chec's %ere !ishonore! !ue to insufficienc of fun!s upon the p resentment for encashment# Cittrust "an'ing Corp# asserte! that it %as !ue to =errero,s fault that her chec's %ere !ishonore!$ for he inaccuratel %rote his account num"er in the !eposit slip# .TC !ismisse! the complaint for lac' of merit# CA re&erse! the !ecision of .TC# +ssue< -hether or not Cittrust "an'ing Corp# has the !ut to honor chec's issue! " Emme =errero !espite the failure to accuratel stating the account num"er resulting to insufficienc of fun!s for the chec'# =el!< >es$ e&en it is true that there %as error on the account num"er state! in the !eposit slip$ its is$ ho%e&er$ in!icate! the name of DEmme =errero# This is controlling in !etermining in %hose account the !eposit is ma!e or shoul! "e poste!# This is so "ecause it is not li'el to commit an error in one,s name than merel reling on num"ers %hich are !ifficult to remem"er# um"ers are for the con&enience of the "an' "ut %as ne&er inten!e! to !isregar! the real name of its !epositors# The "an' is engage! in "usiness impresse! %ith pu"lic trust$ an! it is its !ut to protect in return its clients an! !epositors %ho transact "usiness %ith it# +t shoul! not "e a matter of the "an' alone recei&ing !eposits$ len!ing out mone an! collecting interests# +t is also its o"ligation to see to it that all fun!s in&este! %ith it are properl accounte! for an! !ul poste! in its le!gers# #.# o# 150K9: une 10$ 199FACTS
then$ that although acquire! !uring AlfonsoNs marriage to Eteria$ the onethir!portion of the propert shoul! "e regar!e! as AlfonsoNs o%n e3clusi&el$ as amatter of la% pursuant to Article 1:6 of the Ci&il Co!e %hich pro&i!es that< Art#1:6# The follo%ing shall "e the e3clusi&e propert of each spouse< (5) That %hicheach acquires$ !uring the mathe rriage$ " lucrati&e titleThe Court hel! thatEteria %as faile! to pro&e$ that the lot %as acquire! " her an! her hus"an! %iththeir fun!s# either %as her allegation that the house %as constructe! %ith theloan she an! her hus"an! o"taine! !ul su"stantiate!# From %hom the loan %aso"taine! %as not e&en re&eale!# Thus$ the one R thir! portion of the su"2ect lan!cannot "e partitione! "et%een Eteria an! Alfonso since it !oes not "elong to thecon2ugal partnership#
G#.# o# 18081:# Septem"er 55$ 1996H A+E TA$ petitioner$ &s# CO.T OF APPEA/S an! */OOM*E..> EUPO.T MAFACT.+$ +C#$ respon!ents# EC+S+O PAA+*A$ #< *efore a trial court$ a motion for reconsi!eration that !oes not contain the requisite notice of hearing !oes not toll the running of the perio! of appeal# +t is a mere scrap of paper %hich the trial court an! the opposite part ma ignore# The Case Petitioner see's to set asi!e the August 55$ 199 ecision of the Court of AppealsG1H in CA. SP o# :8598$ the !ispositi&e portion of %hich rea!s
On appeal$ the .egional Trial Court (.TC) of Manila$ *ranch 5$ in its ecision !ate! ul 16$ 199B$ affirme! the aforementione! MTC ecision thus< -=E.EFO.E$ fin!ing no cogent reasons to !istur" the 2oint !ecision !ate! Fe"ruar 1$ 199B of the Metropolitan Trial Court of Manila$ *ranch 1$ the Court sustains an! affirms in toto the sai! !ecision# .espon!ent Court relate! the inci!ents that ensue!$ as follo%s
respon!ents Motion for Entr of u!gment# /i'e%ise$ the present case !iffers from Tamargo$ %herein the application of the aforesai! man!ator pro&isions %as suspen!e!# The Court !i! so in or!er to gi&e su"stantial 2ustice to the petitioner an! in &ie% of the nature of the issues raise! %hich %ere foun! to "e highl meritorious# =ence$ this petition#G15H The +ssue +n her Memoran!um$G18H petitioner presents a fairl accurate statement of the main issue to "e resol&e!< G1:H -hether 333 the omission GthroughH ina!&ertence of a notice of hearing of a motion for reconsi!eration file! %ith the trial court 333 is a fatal !efect %hich !i! not stop the running of the perio! to appealG$H thus ren!ering the assaile! !ecision final Gan!H e3ecutor# The Courts .uling The petition is !e&oi! of merit# Sole +ssue< Omission of otice of =earing Fatal Petitioner a!mits the categorical an! man!ator character of the !irecti&es in Sections : an! K of .ule 1K of the .ules of Court$ %hich rea!
motion# A motion %hich !oes not meet the requirements of Section : an! K of .ule 1K of the .ules of Court is consi!ere! a %orthless piece of paper %hich the cler' has no right to recei&e an! the court has no authorit to act upon# Ser&ice of cop of a motion containing notice of the time an! place of hearing of sai! motion is a man!ator requirement an! the failure of the mo&ant to compl %ith sai! requirements ren!ers his motion fatall !efecti&e#G19H +n e% apan Motors$ +nc# &# Perucho$G50H !efen!ant file! a motion for reconsi!eration %hich !i! not contain an notice of hearing# +n a petition for certiorari$ %e affirme! the lo%er court in ruling that a motion for reconsi!eration that !i! not contain a notice of hearing %as a useless scrap of paper# -e hel! further n!er Sections : an! K of .ule 1K of the .ules of Court$ 333 a motion is require! to "e accompanie! " a notice of hearing %hich must "e ser&e! " the applicant on all parties concerne! at least three (8) !as "efore the hearing thereof# Section B of the same rule comman!s that (n)o motion shall "e acte! upon " the Court$ %ithout proof of ser&ice of the notice thereof 333# +t is therefore patent that the motion for reconsi!eration in question is fatall !efecti&e for it !i! not contain an notice of hearing# -e ha&e alrea! consistentl hel! in a num"er of cases that the requirements of Sections :$ K an! B of .ules 1K of the .ules of Court are man!ator an! that failure to compl %ith the same is fatal to mo&ants cause#G51H +n Sem"rano &# .amire7$G55H %e !eclare! that (A) motion %ithout notice of hearing is a mere scrap of paper# +t !oes not toll the running of the perio! of appeal# This requirement of notice of hearing equall applies to a motion for reconsi!eration# -ithout such notice$ the motion is pro forma# An! a pro forma motion for reconsi!eration !oes not suspen! the running of the perio! to appeal# +n +n re Almacen$G58H !efen!ant lost his case in the lo%er court# =is counsel then file! a motion for reconsi!eration "ut !i! not notif the a!&erse counsel of the time an! place of hearing of sai! motion# The Court of Appeals !ismisse! the motion for the reason that the motion for reconsi!eration !ate! ul K$ 19BB !oes not contain a notice of time an! place of hearing thereof an! is$ therefore a useless piece of paper %hich !i! not interrupt the running of the perio! to appeal$ an!$ consequentl$ the appeal %as perfecte! out of time# -hen the case %as "rought to us$ %e remin!e! counsel for the !efen!ant that As a la% practitioner %ho %as a!mitte! to the "ar as far "ac' as 19:1$ Att# Almacen 'ne% or ought to ha&e 'no%n that GforH a motion for reconsi!eration to sta the running of the perio! of appeal$ the mo&ant must not onl ser&e a cop of the motion upon the a!&erse part 3 3 3 "ut also notif the a!&erse part of the time an! place of hearing 3 3 3# Also$ in Manila Suret an! Fi!elit Co#$ +nc# &# *ath Construction an! Compan$G5:H %e rule! The %ritten notice referre! to e&i!entl is that prescri"e! for motions in general " .ule 1K$ Sections : an! K (formerl .ule 5B)$ %hich pro&i!e that such notice shall state the time an! place of hearing an! shall "e ser&e! upon all the parties concerne! at least three !as in a!&ance# An! accor!ing to Section B of the same .ule no motion shall "e acte! upon " the court %ithout proof of such notice# +n!ee!$ it has "een hel! that in such a case the motion is nothing "ut a useless piece of paper# The reason is o"&ious4 unless the mo&ant sets the time an! place of hearing the court %oul! ha&e no %a to !etermine %hether that part agrees to or o"2ects to the motion$ an! if he o"2ects$ to hear him on his o"2ection$ since the .ules themsel&es !o not fi3 an perio! %ithin G%hichH he ma file his repl or opposition#NG5KH +n fine$ the a"o&ecite! cases confirm that the requirements lai! !o%n in Sec# K of .ule 1K of the .ules of Court that the notice shall "e !irecte! to the parties concerne!$ an! shall state the time an! place for the hearing of the motion$ are man!ator# +f not religiousl complie! %ith$ the ren!er the motion pro forma# As such the motion is a useless piece of paper that %ill not toll the running of the prescripti&e perio!# For failing to attach a notice of hearing to the Motion for .econsi!eration$ petitioner proffers the follo%ing e3cuses< (1) her former counsels messenger$ !ue to an honest mista'e$ ina!&ertentl omitte! the fourth page of the motion containing the crucial otice of =earing4 an! (5) "ecause of the pressure of %or'$ her
former counsel %as una"le to follo% up such motion until the !a sai! counsel requeste! the setting of a hearing#G5BH -e are not in the least con&ince!# First$ it is unfair to place the "lame for such omission on the messenger# The "ur!en of preparing a complete plea!ing falls on counsels shoul!ers$ not on the messengers# The counsel is ultimatel responsi"le for the acts or omissions of his agents# =ence$ the messengers con!uct can neither 2ustif the counsels mista'e nor %arrant a !eparture from the man!ate of the aforesai! proce!ural rules# Secon!$ it is incre!i"le that the fourth page containing the otice of =earing %as left "ehin! !ue to honest mista'e# +n fact$ there %as no such page# Petitioners claim is "elie! " the follo%ing pertinent portions of the su"2ect Motion for .econsi!eration
/i"eral construction of this rule has "een allo%e! " this Court in the follo%ing cases< (1) %here a rigi! application %ill result in a manifest failure or miscarriage of 2ustice$G85H especiall if a part successfull sho%s that the allege! !efect in the questione! final an! e3ecutor 2u!gment is not apparent on its face or from the recitals containe! therein4G88H (5) %here the interest of su"stantial 2ustice %ill "e ser&e!4G8:H (8) %here the resolution of the motion is a!!resse! solel to the soun! an! 2u!icious !iscretion of the court4 G8KH an! (:) %here the in2ustice to the a!&erse part is not commensurate %ith the !egree of his thoughtlessness in not compling %ith the proce!ure prescri"e!#G8BH Petitioner has faile! to !emonstrate that the case at "ar falls un!er an of these e3ceptions# Finall$ petitioner claims that she %ill "e !epri&e! of propert %ithout !ue process$ as pri&ate respon!ent has accumulate! P8:6$600 in unpai! rentals an! accrue! interests# -e !isagree# Petitioner can o"tain proper pament of rentals through a motion for e3ecution in the case "elo%# The MTC ma ha&e !ismisse! her e2ectment case$ "ut it !i! not e3culpate pri&ate respon!ent from its lia"ilities# Petitioner is$ therefore$ not "eing !epri&e! of her propert %ithout !ue process# +n!ee!$ there is no miscarriage of 2ustice to spea' of# =a&ing faile! to o"ser&e &er elementar rules of proce!ure %hich are man!ator$ petitioner cause! her o%n pre!icament# To e3culpate her from the compulsor co&erage of such rules is to un!ermine the sta"ilit of the 2u!icial process$ as the "ench an! "ar %ill "e confoun!e! " such irritating uncertainties as %hen to o"e an! %hen to ignore the .ules# -e ha&e to !ra% the line some%here#G8H -=E.EFO.E$ the petition is here" E+E an! the assaile! ecision is AFF+.ME# Costs against the petitioner#
Mron Papa &s A## Ialencia an! Co#$ +nc# March 1K$ 5015 o comments Face"oo'T%itterPinterest/in'e!+nEmail AIE.T+SEMETS
56: SC.A B:8 R Mercantile /a% R egotia"le +nstruments /a% R Consummation of Sale in /ieu of Chec' Pament Mron Papa is the a!ministrator of the estate of Angela *utte# +n 198$ he sol! a portion of sai! estate to Feli3 PeJarroo through A## Ialencia an! Co#$ +nc# PeJarroo ga&e Papa PK$000#00 plus a chec' %orth P:0$000#00# =o%e&er$ Papa %as not a"le to !eli&er the certificate of title to PeJarroo# A litigation ensue! an! ten ears after$ Papa argue! that the sale "et%een him an! PeJarroo %as ne&er consummate! "ecause he !i! not encash the P:0$000#00 chec' an! that the PK$000#00 cash %as merel earnest mone# +SSE< -hether or not Papa is correct# =E/< o# After more than ten (10) ears from the pament in part " cash an! in part " chec'$ the presumption is that the chec' ha! "een encashe!# ranting that Papa ha! ne&er encashe! the chec'$ his failure to !o so for more than ten (10) ears un!ou"te!l resulte! in the impairment of the chec' through his unreasona"le an! une3plaine! !ela# -hile it is true that the !eli&er of a chec' pro!uces the effect of pament onl %hen it is cashe!$ pursuant to Article 15:9 of the Ci&il Co!e$ the rule is other%ise if the !e"tor (PeJarroo) is pre2u!ice! " the cre!itor,s (Papa,s) unreasona"le !ela in presentment# The acceptance of a chec' implies an un!erta'ing of !ue !iligence in presenting it for pament$ an! if he from
%hom it is recei&e! sustains loss " %ant of such !iligence$ it %ill "e hel! to operate as actual pament of the !e"t or o"ligation for %hich it %as gi&en# *an' of the Philippine +slan!s &# Court of Appeals G#.# o# 105868# o&em"er 5B$ 1995H 80 / FACTS Petitioner,s chec's %ere !ra%n an! !eposite! to respon!ent C*C# +t %as !isco&ere! that the signature of paee %as forge!#
+SSE -hether or not a !ra%ee "an' coul! claim reim"ursement from collecting "an' in case of forger#
./+ >ES# *oth "an's %ere negligent in the selection an! super&ision of their emploees resulting in the encashment of the forge! chec's " an impostor# *oth "an's %ere not a"le to o&ercome the presumption of negligence in the selection an! super&ision of their emploees# Consi!ering the comparati&e negligence of the t%o (5) "an's$ court rule! that the !eman!s of su"stantial 2ustice are satisfie! " allocating the loss an! the costs of the ar"itration procee!ing an! the cost of litigation on a B0:0 ratio#
