KAREN SALVACION,minor thru Federico Salvacion and Evelina Salvacion vs Central Bank of

the Philippines, China Banking and Greg Bartelli y Northcott, August 21, 1997, GR no 94723

ok
FACTS:
Greg Bartelli y Northcott, an American tourist, was arrested and detained at Makati Municipal
Jail after illegally detaining and raping three times each day a 12 year old girl, Karen Salvacion.
Police recovered from him dollar checks and dollar accounts in the China Banking Corp. The
day when there was a scheduled hearing for Bartellis petition for bail, the latter escaped from
the jail.
The Deputy Sheriff of Makati served a Notice of Garnishment on China Banking Corporation for
the foreign accounts being handled by Bartelli. But Bartelli and China Banking Corp refused and
the latter invoked Sec. 113 of Central Bank Circular No. 960 which exempts dollar deposit of
Bartelli from attachment, garnishment, or any other order or process of any court, legislative
body, or any administrative body.

ISSUE: Whether the Section 113 of Central Bank Circular No. 960 and Section 8 of Republic
Act No. 6426, otherwise known as the Foreign Currency Deposit Act be made applicable to a
foreign transient?

RULING: NO. The provisions of Republic Act No. 6426, are inapplicable to this case because of
its peculiar circumstances. China Banking Corp and Bartelli are hereby required to comply with
the writ of execution issued in the civil case and to release to petitioners the dollar deposit of
Bartelli in such amount that would satisfy the judgment.
One of the reasons for exempting foreign currency deposits from attachment, garnishment is to
assure speedy growth of foreign currency deposit and offshore banking system in the Philippines.
but this only properly channel to loans and investments. In the case at bar, Bartelli is mere
transient who is not expected to maintain deposit in the bank for long. Hence, Bartellis dollar
deposit is not entitled to the protection of Sec. 113.

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Phil. Commercial & Industrial Bank vs Court of Appeals, January 28, 1991, GR No. 84526
FACTS: This is a case from an action filed with the NLRC by a group of laborers who obtained a
favorable judgment for the payment of backwages against the private respondent Marinduque
Mining and Industrial Corporation. The said Commission issued a writ of execution direction a
Deputy Sheriff to enforce judgment. When he went to the private respondent, nothing happened
so he subsequently prepared on his own a Notice of Garnishment.
When the house lawyer of the corporation asked PCIB to withhold any release of deposit, PCIB
issued a managers check and was encashed by the Sheriff the next day.
Private Respondent filed a complaint against PCIB alleging that the formers current deposit was
levied, garnished, and with undue haste unlawfully allowed to be withdrawn.
ISSUE: Whether or not the petitioners violated RA 1405, otherwise known as the Secrecy of
Bank Deposits Act, when they allowed the sheriff to garnish the deposit of Marinduque Mining
Corporation?
RULING: NO. The SC first ruled that the release of the deposit by the bank was not done in
undue and indecent haste. The immediate release of the funds by the petitioner bank was on the
strength of the notice of garnishment and writ of execution, whose issuance, absent any patent
defect, enjoys the presumption of regularity.
Since there is no evidence that the petitioners themselves divulged the information that the
private respondent had an account with the petitioner bank and it is undisputed that the said
account was properly the object of the notice of garnishment and writ of execution carried out by
the deputy sheriff, a duly authorized officer of the court, cannot therefore hold the petitioners
liable under RA 1405.

ok
Lourdes T Marquez VS Hon. Aniano Desierto, June 27, 2001, GR No. 140001
FACTS:
Petitioner Marquez received an order from the Ombudsman Aniano Desierto to produce several
bank documents for purposes of inspection relative to various accounts maintained at Union
Bank.
The basis of the Ombudsman in ordering an in camera inspection of the accounts was a
trail of managers checks (MCs) purchased by one George Trivinio, a respondent in
OMB-0-97-0411, pending with the office of the Ombudsman.
The petition was intended to clear the rights and duties of petitioner. Thus, petitioner sought a
declaration of her rights from the court due to clear conflict bet. RA No. 6770, and RA No. 1405
ISSUE: Whether the order of the Ombudsman to have an in camera inspection of the questions
accounts is allowed as an exception to the secrecy of bank deposit act?
RULING: No. The court ruled that before an in camera inspection may be allowed there must be
a pending case before a court of competent jurisdiction. Further, the account must be clearly
indentified. In the case at bar, there is yet no pending litigation before any court of competent
authority. What is existing is an investigation by the Office of the Ombudsman. Zones of privacy
are recognized and protected in our laws.

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CHINA BANKING CORPORATION VS Hon. Wenceslao Ortega, January 31, 1973, L-34964
FACTS: Vicente Acaban filed a complaint in the court against B&B Corpotation and Marino
Baustista for the collection of a sum of money. To satisfy judgment, the plaintiff sought the
garnishment of the bank deposit of the defendant Corporation with the China Banking
Corporation. Accordingly, a notice of garnishment was issued by the Deputy
Sheriff of the trial court and served on said bank through its cashier, Tan Kim
Liong. Liong was ordered to inform the Court whether or not the defendant
Corporation has a deposit in the CBC, and if there is any deposit, to hold the
same intact and not allow any withdrawal until further order from the Court.
CBC and Liong refuse to comply with a court process garnishing the bank
deposit of a judgment debtor by invoking the provisions of Republic Act No.
1405 ( Secrecy of Bank Deposits Act) which allegedly prohibits the disclosure
of any information concerning to bank deposits.
ISSUE: Whether or not a banking institution may validly refuse to comply with
a court processes garnishing the bank deposit of a judgment debtor, by
invoking the provisions of Republic Act No. 1405.
RULING: No.The lower court did not order an examination or inquiry into the deposit of the
corporation. It merely required the manager to inform the court whether the corporation had a
deposit only for the puspose of the garnishment issued by it. Indeed there is no real
inquiry in such a case, and the existence of the deposit is disclosed the
disclosure is purely incidental to the execution process.

REYES VS COURT OF APPEALS, AUGUST 12, 2001, GR NO. 118492

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FACTS: In view of 20th Asian Racing Conference to be held in Sydney, Australia, PRCI sent four
delegates to the said conference: Petitioner Gregorio Reyes sent Godofredo Reyes to apply for
foreign exchange demand draft in Australian dollars. Mr Yasis attended Godofredo who at first
denied the application for the reason the respondent did not have an Australian dollar account in
any bank in Sydney. Yasis informed Godofredo of rounabout way of effecting the requested
remittance.
However, upon due presentment of the foreign exchange demand draft, the same was
dishonored, with the notice of dishonor stating that there is No account held with
Westpac. Meanwhile, Wespac-New York sent a cable to respondent bank informing the
latter that its dollar account in the sum of AU$ 1,610.00 was debited. In response to
PRCIs complaint about the dishonor of the said foreign exchange demand draft,
respondent bank informed Westpac-Sydney of the issuance of the said demand draft,
drawn against the Wespac-Sydney and informing the latter to be reimbursed from the
respondent banks dollar account in Westpac-New York. The respondent bank on the
same day likewise informed Wespac-New York requesting the latter to honor the
reimbursement claim of Wespac-Sydney. Upon its second presentment for payment, the
demand draft was again dishonored by Westpac-Sydney for the same reason, that is,
that the respondent bank has no deposit dollar account with the drawee WespacSydney. Gregorio Reyes and Consuelo Puyat-Reyes arrived in Sydney on a separate
date and both were humiliated and embarrassed in the presence of international
audience after being denied registration of the conference secretariat since the foreign
exchange draft was dishonored. Petitioners were only able to attend the conference
after promising to pay in cash instead which they fulfilled
ISSUE: Whether or not respondent bank is liable for damages due to the dishonor of the
foreign exchange demand drafts.
RULING: no. the facts show that respondent bank did not cause an erroneous transmittal. The
evidence also shows that the respondent bank exercised that degree of diligence expected of an
ordinary prudent person. In the case at bar, it does not involve the handling of petitioners
deposit. The relationship involved is that of a buyer and seller. Furthermore, respondent bank did
everything to prevent the dishonor of the foreign exchange demand draft. In view of all
foregoing, the dishonor of the subject foreign exchange demand draft is not attributable to the
respondent bank.

PRODUCERS BANK OF THE PHILIPPINES VS NLRC, GR NO 118069, NOVEMBER 16,

1998 ok

FACTS: petitioner was placed by the Central Bank under a conservator for the purpose of
protecting its assets. When the petitioner sought the implementation of laws regarding the
retirement plan, and uniform allowance, the acting conservator of the petitioner expressed
objection resulting in an impasse bet petitioner bank and private respondent union. The deadlock
continued for at least six months and private respondent filed a case for unfair labor practice and
flagrant violation of CBA provisions.
ISSUE: whether the appointed conservator is allowed to repudiate perfected transactions of the
bank and to disallow implementation of CBA provisions?
RULING: No. Central bank law gives vast and far-reaching powers to the conservator, it must be
pointed out that such powers must be related to the assets of the bank, management and viability.
Such power cannot extend to the post-facto repudiation of perfected transactions, otherwise they
would infringe against non-impairment clause. Conservator merely takes places of the banks
board of director. Hence, what the said board cannot do, the conservator cannot do either.
Furthermore, it is obvious that conservator had no authority to disallow the implementation of
CBA provision considering that the ideals of social justice and protection of labor are guaranteed
by Labor cdode and also by the fundamental law of the land.

MANUEL M SERRANO VS CENTRAL BANK OF THE PHILIPPINES, FEBRUARY 14,

1980, L-30511ok
FACTS: Petitioner seeks the establishment of joint and solidary liability against the respondent
central bank of the Philippines and overseas bank of manila to return the time deposits made by
petitioner, on the ground that central bank failed in its duty to exercise strict supervision over
respondent overseas bank to protect its depositors and general public.
Serrano had 350k worth of time deposits in Overseas Bank of Manila. He made a series of
encashment but none of those was successful. He files a case against Overseas Bank and he
included central bank so that the latter may also be liable.

ISSUE: whether the Central bank is liable

RULING: No. there is no shown clear abuse of discretion by the Central bank in its exercise of
supervision over the other respondent overseas bank of Manila, if there was, petitioner here is
not the proper party to raise the question, but the Overseas Bank. Banks are in the nature of
irregular deposits. They are really loans because they earn interests, and are all to be covered by
the law on loans. In reality, the depositor is the creditor while the bank is the debtor. Failure of
the respondent bank to honor the time deposit is failure to pay its obligation as a debtor.

SIMEX INTERNATIONAL MANILA INC VS COURT OF APPEALS, MARCH 19, 1990, GR

NO 88013 ok

CRUZ, J:
FACTS:
Simex International Manila Inc. was a depositor of the Traders Royal Bank, the respondent
bank, and maintained a checking account. It deposited the amount of 100, 000, increasing its
balance to 190, 380.74. Subsequently, the petitioner issued several checks against its deposit but
was surprised that they had been dishonored for insufficient funds. Petitioner complained and
discovered that the last deposit had not been credited and was error was rectified only after a
month.
ISSUE: Whether the respondent bank is guilty of negligence which warrants SIMEX
reparation for damages.
RULING: Yes. It is not enough that the records have been rectified because it should not have
been committed in the first place. Moral damages are not awarded to penalize the defendant but
to compensate the plaintiff for the injuries he may have suffered. The petitioner suffered injury
because of the prs negligence that caused the dishonor of checks issued by it. In every case, the
depositor expects the bank to treat his account with utmost fidelity, whether such account
consists only of a few or millions. Furthermore, it is obvious that the respondent bank remiss in
that duty and violated the fiduciary nature of their relationship.
What is especially deplorable is that, having been informed of its error in not crediting
the deposit in question to the petitioner, the respondent bank did not immediately
correct it but did so only one week later or twenty-three days after the deposit was
made. It bears repeating that the recorddoes not contain any satisfactory explanation of
why the error was made in the first place and why it was not corrected immediately after
its discovery. Such ineptness comes under the concept of the wanton manner
contemplated in the Civil Code that calls for the imposition of exemplary damages.

TEODORO BANAS VS ASIA PACIFIC FINANCE CORPORATION, G.R. No. 128703,

October 18, 2000

BELLOSILLO, J: okkk

FACTS: Teodoro Baas executed a Promissory Note in favor of C. G. Dizon

Construction whereby for value received he promised to pay to the order of C. G. Dizon
Construction the sum ofP390,000.00 in installments. Later, C. G. Dizon Construction
endorsed with recourse the Promissory Note to ASIA PACIFIC, and to secure payment
executed a Deed of Chattel Mortgage covering three heavy equipment. Moreover,
Cenen Dizon executed a Continuing Undertaking wherein he bound himself to pay the
obligation jointly and severally with C. G. Dizon Construction. In compliance with the
provision of PN,paid a total of 130, 000.
Of the three bulldozer crawler tractors, only two were actually turned over by defendants
which units were subsequently foreclosed by ASIA PACIFIC to satisfy the obligation.
The two bulldozers were sold both to ASIA PACIFIC as the highest bidder.
Petitioners insist that ASIA PACIFIC was organized as an investment house which could
not engage in the lending of funds obtained from the public through receipt of deposits.
The disputed Promissory Note, Deed of Chattel Mortgage and Continuing Undertaking
were not intended to be valid and binding on the parties as they were merely devices to
conceal their real intention which was to enter into a contract of loan in violation of
banking laws.
ISSUE: whether the disputed transaction between petitioners and ASIA PACIFIC
violated banking laws, hence null and void.

RULING: No. Clearly the transaction bet petitioners and reposndent was one involving
not a loan but purchase of receivables at a discount, within the purview of investing,
reinvesting or trading which is an investment company like ASIA PACIFIC, is

authorized to perform, hence it does not constitute a violation of General Banking Act.
But here, the funds supposedly lent to petitioners have not been shown to have been
obtained from the public by way of deposits, hence, the inapplicability of banking laws.
Wherefore, the assailed decision of the Court of Appeals was affirmed.

Union Bank of the Philippines v. CA, 321 SCRA 563 (1999) ok

FACTS:
- A check in the amount of One Million Pesos (P1,000,000.00) was drawn against Account No. 011101854-8 with Allied Bank payable to the order of one Jose Ch. Alvarez. The payee
deposited the check with Union Bank who credited the P1,000,000.00 to the account of Mr.
Alvarez. Petitioner sent the check for clearing through the Philippine Clearing House
Corporation (PCHC). When the check was presented for payment, a clearing
discrepancy was committed by Union Banks clearing staff when
theamount of One Million Pesos (P1,000,000.00) was erroneously underencoded to One Thousand Pesos(P1,000.00) only.Union Bank only discovered the underencoding almost a year later.-Thus, Union Bank notified Allied Bank of the discrepancy by
way of a charge slip for Nine Hundred Ninety-NineThousand Pesos (P999,000.00) for
automatic debiting against the account of Allied Bank.
-The latter, however, refused to accept the charge slip since [the] transaction was
completed per petitioners original instruction and clients account is now insufficiently funded.Subsequently, Union Bank filed a complaint against Allied Bank before the PCHC Arbitration
Committee (Arbicom),alleging that Allied Bank should have informed it of the under coding pursuant
to the Section 25 of PCHC handbook which states that: The receiving bank should inform the erring
bank about the under coding of the amount not later than 10 am of the following clearing day
ISSUE:
-Whether or not the case falls under any exceptions allowed by the Secrecy of Bank Deposit Act.
HELD:
- No. A collecting bank which sued the drawee bank to recover the
deficiency between the amount credited to the account of the depositor
and the amount obtained from the drawee bank because the latter had
erroneously undercoded the amount of the check it presented for clearing from

P1M to P1,000 is not entitled to examine theaccount of the drawer of the check,
because the money in the account of the drawer is not the subject matter of the litigation.
The collecting bank was only fishing for information so it could determine the
culpability of the drawee bank and the amounts of damages it could recover from the
latter. It does not seek the recovery of the very money contained in the deposit. The
subject matter of the dispute may be the amount of P999,000 that the ollecting
bankseeks from the drawee bank as a result of the latters alleged failure to inform the former
of the discrepancy ; but it isnot the P999,000 deposited in the drawers account. By the terms
of RA 1405, the money deposited itself should be the subject matter of the litigation.

okkkk
Intengan v. Court of Appeals, 377 SCRA 63 (2002)
FACTS:
-Citibank filed a complaint for violation of section 31 in relation to section 144 of the
Corporation Code against two(2) of its officers, Dante L. Santos and Marilou
Genuino for allegedly managing and causing existing bankclients/depositors to
divert their money from Citibank to products offered by other companies that were
commandinghigher rate of yields.-This was done by transferring bank clients monies
to Torrance Development Corporation and Global PacificCorporation, two companies in
which they have financial interests, who in turn placed the monies of the bank clientsin securities,
shares of stock and other certificates.-Out of these transactions, they both derived substantial
financial gains.-When these anomalous/ highly irregular activities were discovered Citibank filed a
complaint for violation of Sec. 31of the Corporation Code against Santos and Genuino.-Documents
were presented to substantiate the case, which included documents pertaining to US dollar deposits
of Intengan, Neri and Brawner.
Issue:
Whether or not Respondents are liable for violation of Secrecy of Bank Deposits Act, RA 1405.

HELD:

-No. A case for violation of Republic Act No. 6426 should have been the proper case
brought against private respondents. Private respondents Lim and Reyes admitted that they had
disclosed details of petitioners dollar deposits without the latters written permission.
It does not matter if that such disclosure was necessary to establish Citibanks case
against Dante L. Santos and Marilou Genuino. Lims act of disclosing details
of petitioners bank records regarding their foreign currency deposits, with the authority of Reyes,
would appear to belong to that species of criminal acts punishable by special laws, called
malum prohibitum.
-Ordinarily, the dismissal of the instant petition would have been without prejudice to the filing of the
proper chargesagainst private respondents. The matter would have ended here were it not for the
intervention of time, specificallythe lapse thereof. So as not to unduly prolong the settlement
of the case, we are constrained to rule on a materialissue even though it was not raised by
the parties. We refer to the issue of prescription.-The filing of the complaint or information in
the case at bar for alleged violation of Republic Act No. 1405 did nothave the effect
of tolling the prescriptive period. For it is the filing of the complaint or information
corresponding tothe correct offense which produces that effect.-It may well be argued that the
foregoing disquisition would leave petitioners with no remedy in law. We point
out,however, that the confidentiality of foreign currency deposits mandated by Republic
Act No. 6426, as amended byPresidential Decree No. 1246, came into effect
as far back as 1977.
Hence, ignorance thereof cannot be pretended.On one hand, the existence of laws is a matter
of mandatory judicial notice; on the other,
ignorantia legis nonexcusat.
Even during the pendency of this appeal, nothing prevented the petitioners from filing a complaint
chargingthe correct offense against private respondents. This was not done, as everyone involved
was content to submit thecase on the basis of an alleged violation of Republic Act
No. 1405 (Bank Secrecy Law), however, incorrectly invoked.
ROQUE VS PEOPLE, GR NO. 138954, NOVEMBER 25 2004 okkk
FACTS:
An information dated dec 3 1990, the petitioner was charged with qualified theft in the RTC of
Pampanga. Asuncion Galang Roque was employed as teller at the BABSLA from 1979 until
terminated in 1990. In the morning she gets the money from the treasurer and the do a cash count
which is reflected on the tellers daily report, at 3pm she prepares and submits an abstract of
payment. As a teller, she received deposits and payments, deposits of checks and payments of
loans. Depositors cannot withdraw before 3pm.
One Antonio Salazar is a member/depositor of BABSLA. He was made to sign two ledgers when he
opened his savings account. Nov 16 1989, Salazar made deposit of 2000, however, he did not make
any withdrawal nor did he authorize anyone to do the same on that date. After hearing the news
about missing funds of BABSLA, he went to BABSLA to withdraw 40,000 but was informed that his
balance was insufficient. He was not allowed to withdraw. He said that the signature appearing on the
withdrawal slip was not his signature.
ISSUE: whether qualified theft may be committed when the personal property is in the lawful
possession of the accused prior to the commission of the alleged felony?

RULING: NO. This court ruled that the crime committed was theft and not estafa since the delivery of
the personal property did not have the effect of transferring the juridical possession, thus such
possession remained to the owner, and the act of disposal with gainful intent and lack of owners
consent constituted the crime of theft. But the accused Asuncion Roque cannot be convicted on the
lack of one requisites that is the taking of personal property. Hence, a person found in possession of
a thing taken creates a presumption to certain circumstances. It gives rise to the presumption that the
accused is the taker of the stolen property. In the presumption availed by the lower courts the
property found in the possession of the accused, which is the withdrawal slip, is not stolen property.
Furthermore, the presumption that was made was not that petitioner stole anything, but rather that
petitioner was the maker of the withdrawal slip.