PRODUCERS BANK OF THE PHILIPPINES VS. CA
When Vives got in touch in Doronilla, the latter issued postdated cheques
Doctrine: A consumable good, like money, though generally the subject of a
simple loan contract (mutuum), may be the subject of a commodatum when
the purpose of the contract is not for the consumption of the good but only
for exhibition.
Summary: Vives helped in the incorporation of Doronilla’s company (Sterella)
upon the agreement that he would be paid back. When the month ended and was
still not given back his money, he demanded money from Doronilla who issued
postdated cheques which were subsequently dishonoured. The trial court ruled in
favour of Vives in the recovery of the money and stated that the transaction was a
commodatum and not of a simple loan, despite the fact that the subject of the
contract was a consumable good. The SC affirmed this decision, reasoning that
the money was only to make Sterella appear that it had enough money.
FACTS:
1. In 1979, respondent Franklin Vives was asked by Angeles Sanchez to help
Arturo Doronilla in incorporating the latter’s business (Sterella) by depositing
PHP 200,000 in the Sterella bank account. Trusting the reassurance that he
would be paid back in a month, Vives issued a cheque in favour of Sterella.
2. Vives’ wife was instructed to accompany Doronilla and Sanchez in opening a
savings account in the Makati branch of Producers Bank of the Philippines.
However, because Doronilla could not make it, he had the Mrs. Vives bring a
letter authorizing Sanchez and her companions in coordination with Rufo
Atienza, the branch manager, to open the Sterela bank account. Mrs. Vives
was then given the passbook for the savings account.
3. Vives later found out that Sterela was no longer located in the address given
to him. Atienza (the bank manager) informed them that part of the money of
the Sterela savings account had been withdrawn by Doronilla with only PHP
90,000 remaining in the account which they could not retrieve because it had
to answer for postdated cheques issued by Doronilla.
4. Moreover, Doronilla apparently opened a current account and authorized the
Bank to debit the amounts from the Sterella savings account to cover fot the
overdrawings of the new current account.
a. Because Doronilla was the sole proprietor of Sterella, he was able to
assign or withdraw money from the savings account.
5.
worth PHP 212,000 in favour ot Vives; however, these were dishonoured,
prompting Vives to file an action for recovery of sum of money.
a. Sanchez (the branch manager) died while the case was pending.
b. The RTC ruled in favour of Vives, sentencing Producers Bank to pay him
PHP 200,000 plus damages.
ISSUE: W/N the transaction between Doronilla and Vives was a simple loan
and not a commodatum – NO, it was a commodatum!
(W/N the bank was liable for the actions of Atienza who connived with Doronilla --
YES)
RULING: No, the transaction was a commodatum.
1. Petitioner contends that it was a simple loan because the elements of the same
were present: a consumable thing was delivered (money) and it was onerous
because Doronilla was made to pay the interest of PHP 12,000.
2. Article 1933 generally implies that when a subject of a contract is a consumable
thing, then the contract would be of a simple loan. However, Article 1936
provides that a consumable good may be the subject of a commodatum when
the purpose of the contract is not for its consumption but only of exhibition.
a. The intent is only to lend a consumable good and have those goods
returned at the end of a period.
b. The intent of the parties shall be controlling in the determination of the
nature of the contract (as well as their contemporaneous and subsequent
acts).
3. The purpose of Vives and Doronilla was to make it appear that Sterella had
sufficient capital for its incorporation, with the promise that the amount shall be
returned in a month.
4. Doronilla’s attempts at paying PHP 200,000 with an additional PHP 12,000 as
interest did not convert the character of the contract because such was not the
intention to begin with.
a. Moreover, the PHP 12,000 “interest” was really the FRUITS of the loan,
which Doronilla had no choice but to return since Article 1355 states that
the bailee of a commodatum acquires only the use of the thing loaned but
not its fruits.
5. Finally, Producers Bank is solidarily liable for the return of the PHP 200,000
even if it was not a principal party to the contract. The nature of the contract has
no bearing on the bank’s liability because Atienza (the bank manager) was
responsible for the loss of Vives’ money and is liable for restitution.
a. Atienza facilitated the commission of the fraud by using his influence as
branch manager.
b. He allowed the withdrawal without a passbook being presented, contract to
the accepted practice (the passbook was with Mrs. Vives).
c. Article 2180 mandates that employers shall be liable for damages caused
by their employers if an employer-employee relationship exists and if the
employee acted within his assigned task when the offence was committed.