Emelie Marie T. Diez JD- II
Credit Transactions Atty. Stephen L. Yu Mon!"!##-$#!##pm Mon!"!## -$#!##pm%% Thu! &!##-$#!##pm
Case Digest: Pantaleon vs American Express Bank (2010) Facts:
AME' is a corporation en(a(ed in pro)idin( credit ser)ices throu(h the operation o* a char(e card system. +antaleon ,as a cardholder since $&"#. +antaleon his ,i*e dau(hter and son ,ent on a (uided European tour and suse/uently arri)ed in Amsterdam. 0hile in Coster Diamond 1ouse his ,i*e ,anted to purchase some diamond pieces amountin( to 2$3 "45. +antaleon presented his credit card ,hich ,as s,iped. 1e ,as then as6ed to si(n the char(e slip ,hich ,as electronically trans*erred to AME'7s Amsterdam o**ice. 1o,e)er Coster ,as not ale to recei)e appro)al *rom AME' *or the purchase so +antaleon as6ed the cler6 to cancel the sale. The store mana(er con)inced +antaleon to ,ait *or a *e, minutes and suse/uently told +antaleon that AME' ,as as6in( *or an6 re*erences and +antaleon responded y (i)in( names o* his +hil. depository an6s. Still it ,as not appro)ed. 8ut Coster decided to release the items e)en ,ithout AME'7s appro)al since the tour couldn7t (o on ,ithout them. In all it too6 AME' a total o* 9" minutes to appro)e +antaleon7s purchase and to transmit the appro)al to the :e,elry store. This ,as *ollo,ed y t,o similar incidents ,hen the *amily then had another trip to the ;S. They also e
and said that AME' ,as (uilty o* mora sol)endi or detor7s de*ault. AME' AME' as detor had h ad an oli(ation as the credit pro)ider to act on +antaleon7s purchase re/uests ,hether to appro)e or disappro)e them ,ith ?timely dispatch.? 1ence this motion *or reconsideration. Issue: 0@ AME' AME' is liale *or reach o* its contractual oli(ations and is liale *or dama(es. Ruling:
o AME' is not liale *or reach o* contractual oli(ation ,ith +antaleon and is not liale *or dama(es. The Court had the occasion to present the nature o* credit card transactions ,hich in)ol)es three 3% contracts. a% the sales contract et,een the credit card holder and the merchant> % the loan a(reement et,een the credit card issuer and holder> and c% the promise to pay et,een the credit card issuer and the merchant.
+hilippine :urisdiction (enerally adheres to the Bray rulin( reco(nizin( the relationship et,een the credit card issuer and holder as a contractual one that is (o)erned y the terms and conditions *ound in the card memership a(reement. A card memership a(reement is a contract o* adhesion. 0ith re(ard to AME'7s oli(ations +antaleon assumes that since his credit card has no pre-set spendin( limit AME' has to appro)e all char(e re/uests. 1o,e)er the Court said that there is *irst a need to distin(uish a relationship et,een credit card issuer-holder to a creditor-detor relationship. In an issuerholder relationship it relates merely to an a(reement pro)idin( *or credit *acility to the holder. @n the other hand in a creditor-detor relationship it in)ol)es the actual credit on loan a(reement in)ol)in( three contracts. 0hen cardholders use their cards to pay they merely o**er to enter into loan a(reements ,ith the company. It is only a*ter the appro)al do the parties enter into indin( loan contracts in 6eepin( ,ith CC $3$&.This is supported in the reser)ation *ound in the card memership a(reement ,hich clearly states that AME' ?reser)es the ri(ht to deny authorization *or any re/uested Char(e.? Thus since AME' has no oli(ation to appro)e purchase re/uests +antaleon can7t claim that AME' de*aulted. In this case there is no demandale oli(ation. 8e*ore the credit card issuer accepts this o**er no oli(ation relatin( to the loan a(reement e