Simex International vs. CA - G.R. No.

88013, March 19, 1990

A bank may be held liable for damages by reason of its unjustified
dishonor of a check, which caused damage to its clients credit
standing. The bank must record every single transaction accurately,
down to the last centavo, and as promptly as possible. This has to be
done if the account is to reflect at any given time the amount of
money the depositor can dispose of as he sees fit, confident that the
bank will deliver it as and to whomever he directs. The bank is a
fiduciary of the depositors money.
Facts:
Simex International is a private corporation engaged in the
exportation of food products. It buys these products from various local
suppliers and then sells them abroad to the Middle East and the
United States. Most of its exports are purchased by the petitioner on
credit. Simex was a depositor of the Far East Savings Bank and
maintained a checking account in its branch in Cubao, Quezon City
which issued several checks against its deposit but was surprised to
learn later that they had been dishonored for insufficient funds. As a
consequence, several suppliers sent a letter of demand to the
petitioner, threatening prosecution if the dishonored check issued to it
was not made good and also withheld delivery of the order made by
the petitioner. One supplier also cancelled the petitioners credit line
and demanded that future payments be made by it in cash or certified
check. The petitioner complained to the respondent bank.
Investigation disclosed that the sum of P100,000.00 deposited by the
petitioner on May 25, 1981, had not been credited to it. The error was
rectified only a month after, and the dishonored checks were paid
after they were re-deposited. The petitioner then filed a complaint in
the then Court of First Instance of Rizal against the bank for its gross
and wanton negligence.

embarrassment if not also financial loss and perhaps even civil and
criminal litigation.
Article 2205 of the Civil Code provides that actual or compensatory
damages may be received (2) for injury to the plaintiff s business
standing or commercial credit. There is no question that the
petitioner did sustain actual injury as a result of the dishonored
checks and that the existence of the loss having been established
absolute certainty as to its amount is not required. 7 Such injury
should bolster all the more the demand of the petitioner for moral
damages and justifies the examination by this Court of the validity
and reasonableness of the said claim.
Consolidated Bank and Trust Co. vs. CA - G.R. No. 138569,
September 11, 2003
L.C. Diaz and Company (LC Diaz), an accounting firm, has a savings
account with Consolidated Bank and Trust Corporation (now called
Solidbank Corporation).
On August 14, 1991, the firms messenger, a certain Ismael Calapre,
deposited an amount with the bank but due to a long line and the fact
that he still needs to deposit a certain amount in another bank, the
messenger left the firms passbook with a teller of Solidbank. But
when the messenger returned, the passbook is already missing.
Apparently, the teller returned the passbook to someone else.
On August 15, 1991, LC Diaz made a formal request ordering
Solidbank not to honor any transaction concerning their account with
them until the firm is able to acquire a new passbook. It appears
however that in the afternoon of August 14, 1991, the amount of
P300,000.00 was already withdrawn from the firms account.

Issue: Whether or not the bank can be held liable for negligence by
reason of its unjustified dishonor of a check

LC Diaz demanded Solidbank to refund the said amount which the

bank refused. LC Diaz then sued Solidbank.

Held:
The depositor expects the bank to treat his account with the
utmost fidelity whether such account consists only of a few hundred
pesos or of millions. The bank must record every single transaction
accurately, down to the last centavo, and as promptly as possible.
This has to be done if the account is to reflect at any given time the
amount of money the depositor can dispose of as he sees fit,
confident that the bank will deliver it as and to whomever he directs.
A blunder on the part of the bank, such as the dishonour of a check
without good reason, can cause the depositor not a little

In its defense, Solidbank contends that under their banking rules, they
are authorized to honor withdrawals if presented with the passbook;
that when the P300k was withdrawn, the passbook was presented.
Further, the withdrawer presented a withdrawal slip which bore the
signatures of the representatives of LC Diaz.
The RTC ruled in favor of Solidbank. It found LC Diaz to be negligent in
handling its passbook. The loss of the P300k was not the result of
Solidbanks negligence.

On appeal, the Court of Appeals reversed the decision of the RTC. The
CA used the rules on quasi-delict (Article 2176 of the Civil Code).
ISSUE: Whether or not the relations between Solidbank and LC Diaz,
the depositor, is governed by quasi-delict in determining the liability
of Solidbank.
HELD: No. Solidbank is liable for the loss of the P300k but its liability
is grounded on culpa contractual.
The contract between the bank and its depositor is governed by the
provisions of the Civil Code on simple loan (Article 1980, Civil Code).
There is a debtor-creditor relationship between the bank and its
depositor. The bank is the debtor and the depositor is the creditor.
The depositor lends the bank money and the bank agrees to pay the
depositor on demand. The savings deposit agreement between the
bank and the depositor is the contract that determines the rights and
obligations of the parties.
Under their contract, it is the duty of LC Diaz to secure its passbook.
However, this duty is also applicable to Solidbank when it gains
possession of said passbook which it did when the messenger left it to
the banks possession through the banks teller. The act of the teller
returning the passbook to someone else other than Calapre, the firms
authorized messenger, is a clear breach of contract. Such negligence
binds the bank under the principle of respondeat superior or
command responsibility.
No contract of trust between bank and depositor

However, the fiduciary nature of a bank-depositor relationship does

not convert the contract between the bank and its depositors from a
simple loan to a trust agreement, whether express or implied. Failure
by the bank to pay the depositor is failure to pay a simple loan, and
not a breach of trust.
In short, the General Banking Act simply imposes on the bank a higher
standard of integrity and performance in complying with its
obligations under the contract of simple loan, beyond those required
of non-bank debtors under a similar contract of simple loan. The
General Banking Law in no way modified Article 1980 of the Civil
Code.
Metrobank vs. Cabilzo - G.R. No. 154469, December 6, 2006
FACTS:
Cablizo maintained an account with petitioner. It drew a check
payable to cash payable to a certain Marquez, for the latters sales
commission. The check was subsequently deposited in Westmont
bank and the latter submitted it with Metrobank for clearing. The
check was cleared.
Thereafter, the banks representative asked Cablizo if he issued a
check for P91,000. The answer was in the negative. This prompted
Cablizo to call Metrobank and ask for the recrediting of P90,000
but petitioner failed to recredit the amount prompting Cablizo to file
an action against it.
HELD:

The Supreme Court emphasized that the contractual relation between

the bank and the depositor is that of a simple loan. This is despite the
wording of Section 2 of Republic Act 8791 (The General Banking Law
of 2000) which states that the State recognizes the fiduciary nature
of banking that requires high standards of integrity and performance.
That the bank is under obligation to treat the accounts of its
depositors with meticulous care, always having in mind the fiduciary
nature of their relationship.

An alteration is said to be material if it alters the effect of the

instrument. It means an unauthorized change in the instrument that
purports to modify in any respect the obligation of a party or an
unauthorized addition of words or numbers or other change to an
incomplete instrument relating to the obligation of the party.
In
other words, a material alteration is one which changes the items
which are required to be stated under Section 1 of the NIL.

This fiduciary relationship means that the banks obligation to observe

high standards of integrity and performance is deemed written into
every deposit agreement between a bank and its depositor. The
fiduciary nature of banking requires banks to assume a degree of
diligence higher than that of a good father of a family.

The check in issue was materially altered when its amount was
increased from P1000 to P91000. Cablizo was not the one who
authorized or made such increase.
There is no showing that he
was negligent in exercising what was due in a prudent man which
could have otherwise prevented the loss.
Cablizo was never
remiss in the preparation and issuance of the check.

The doctrine of equitable estoppel is inapplicable against Cablizo.

This doctrine states that when one of the two innocent person, each
guiltiness of an intentional or moral wrong, must suffer a loss, it must
be borne by the one whose erroneous conduct, either by omission or
commission, was the cause of the injury.
Negligence is never
presumed.

The above fraudulent transactions of Laurel was made possible

through BPI tellers failure to retrieve the duplicate original copies of
the deposit slips from the former, every time they ask for cancellation
or reversal of the deposit or payment transaction.

Metrobank was actually the one remiss in its duties.

The CA
took into consideration that the alterations were actually visible in
the eye and yet the bank allowed someone not acquainted with the
examination of checks to do the same.
Furthermore, it cannot
rely on the indorsement of Westmont Bank of the check. It should
have exercised meticulous care in handling the affairs of its clients
especially if the clients money is involved.

Issue:

Whether BPI is liable

Law:

Section 2, RA 8791

PNB vs. Pike G.R. No. 157845, September 20, 2005

Ruling:

Facts: The petitioner PNB allowed a representative of Defendant (his

talent manager) to withdraw from his dollar account with the use of a
pre-signed withrdawal slip.
Issue: Whether or not the bank is liable
HELD: Yes. PNB was held liable due to the negligence of its employees
in allowing the unauthorized withdrawal. This was shown by the
lackadaisical attitude of its employees in treating Pike's US dollar
account, an act which resulted to the loss of $7,500. Such warrants for
the award of damages. The slips used were in breach of the standard
operating procedure of the bank in the ordinary and usual course of
business.
Even if it is the employees who are negligent, the bank's liability as
the obligor is not merely vicarious but primary since banks are
expected to exercise the degree of diligence in the selection and
supervision of their employees.

Respondent then filed a complaint for damages against petitioner.

Case history:
RTC ruled in favor of respondent. CA affirmed the decision of the trial
court.

Yes.
The court have repeatedly emphasized that the banking industry is
impressed with public interest. Of paramount importance thereto is
the trust and confidence of public in general. Accordingly, the highest
degree of diligence is expected, and high standards of integrity and
performance are required of it. By the nature of its functions, a bank is
under obligation to treat the accounts of its depositors with
meticulous care, always having in mind the fiduciary nature of its
relationship with them.
BPI vs. Casa Montessori - GR No. 149454, May 28, 2004
Facts:

BPI vs. Lifetime Marketing - GR No. 176434, June 25, 2008

CASA Montessori (CASA) filed a complaint for collection with damages

against petitioner bank after it discovered that nine checks had been
encashed by a certain Sonny Santos in the total amount of
P782,000.00. it turned out that the signatures on the checks were
made by the external auditor of CASA.

Facts:

Issue:

A certain Alice Laurel (Laurel) deposited several checks in favor of

respondent. The deposit of these checks were later reversed upon
request by Laurel. In turn, the amount that was supposed to be
credited to respondent was cancelled.

Case history:

Whether the bank is liable

RTC ruled in favor of CASA. However on appeal, the CA apportioned

the loss between BPI and CASA. It took into account CASAs
contributory negligence that resulted in the undetected forgery.

Ruling:
Yes. We have repeatedly emphasized that, since the banking business
is impressed with public interest, of paramount importance thereto is
the trust and confidence of the public in general. Consequently, the
highest degree of diligence is expected, and high standards of
integrity and performance are even required, of it. By the nature of its
functions, a bank is "under obligation to treat the accounts of its
depositors with meticulous care, always having in mind the fiduciary
nature of their relationship."
BPI contends that it has a signature verification procedure, in which
checks are honored only when the signatures therein are verified to
be the same with or similar to the specimen signatures on the
signature cards. Nonetheless, it still failed to detect the eight
instances of forgery. Its negligence consisted in the omission of that
degree of diligence required of a bank. It cannot now feign ignorance,
for very early on we have already ruled that a bank is "bound to know
the signatures of its customers; and if it pays a forged check, it must
be considered as making the payment out of its own funds, and
cannot ordinarily charge the amount so paid to the account of the
depositor whose name was forged." In fact, BPI was the same bank
involved when we issued this ruling seventy years ago
Central Bank vs. Citytrust Banking Corp. - GR No. 141835,
February 4, 2009
Facts:
Respondent filed a complaint for recovery of sum of money with
damages against petitioner which it alleged erred in encashing the
checks and in charging the proceeds thereof to its account, despite
the lack of authority of Cayabyab.
It appears that a certain Flores encashed a check and signed by the
name of Cayabyab. Petitioner then debited the amount against
Citytrust.
Issue:

Whether petitioner is liable

Law:

Section 2, RA 8791; Art. 2179, Civil Code

Case history:

RTC ruled that both parties were negligent and accordingly held them
liable for the loss. CA affirmed the trial courts decision and noted that
while respondent failed to take adequate precautionary measures to
prevent the fraudulent encashment of its checks, petitioner was not
entirely blame-free in light of its failure to verify the signature of
Citytrusts agent authorized to receive payment.
Ruling:
Yes. Petitioners teller Iluminada did not verify Flores signature on the
flimsy excuse that Flores had had previous transactions with it for a
number of years. That circumstance did not excuse the teller from
focusing attention to or at least glancing at Flores as he was signing,
and to satisfy herself that the signature he had just affixed matched
that of his specimen signature. Had she done that, she would have
readily been put on notice that Flores was affixing, not his but a
fictitious signature.
However, Citytrusts failure to timely examine its account, cancel the
checks and notify petitioner of their alleged loss/theft should mitigate
petitioners liability, in accordance with Article 2179 of the Civil Code
which provides that if the plaintiffs negligence was only contributory,
the immediate and proximate cause of the injury being the
defendants lack of due care, the plaintiff may recover damages, but
the courts shall mitigate the damages to be awarded. For had
Citytrust timely discovered the loss/theft and/or subsequent
encashment, their proceeds or part thereof could have been
recovered.
CA Agro Industrial vs. CA G.R. No. 90027, March 3, 1993
Facts:
On July 3, 1979, petitioner (through its President- Sergio Aguirre) and
the Spouses Ramon and Paula Pugao entered into an agreement
whereby the former purchase two parcel of lands from the latter. It
was paid of downpayment while the balance was covered by there
postdated checks. Among the terms and conditions embodied in the
agreement were the titles shall be transferred to the petitioner upon
full payment of the price and the owner's copies of the certificate of
titles shall be deposited in a safety deposit box of any bank. Petitioner
and the Pugaos then rented Safety Deposit box of private respondent
Security Bank and Trust Company.

Thereafter, a certain Margarita Ramos offered to buy from the

petitioner. Mrs Ramos demand the execution of a deed of sale which
necessarily entailed the production of the certificate of titles. In view
thereof, Aguirre, accompanied by the Pugaos, then proceed to the
respondent Bank to open the safety deposit box and get the
certificate of titles. However, when opened in the presence of the
Bank's representative, the box yielded no such certificate. Because of
the delay in the reconstitution of the title, Mrs Ramos withdrew her
earlier offer to purchase.
Hence this petition.
Issue:
Whether or not the contract of rent between a commercial bank and
another party for the use of safety deposit box can be considered alike
to a lessor-lessee relationship.
Ruling:
The petitioner is correct in making the contention that the contract for
the rent of the deposit box is not a ordinary contract of lease as
defined in Article 1643 of the Civil Code. However, the Court do not
really subscribe to its view that the same is a contract of deposit that
is to be strictly governed by the provisions in Civil Code on Deposit;
the contract in the case at bar is a special kind of deposit. It cannot be
characterized as an ordinary contract of lease under Article 1643
because the full and absolute possession and control of the safety
deposit box was not given to the joint renters- the petitioner and the
Pugaos. The guard key of the box remained with the respondent bank;
without this key, neither of the renters could open the box. On the
other hand, the respondent bank could not likewise open the box
without the renter's key. The Court further assailed that the petitioner
is correct in applying American Jurisprudence. Herein, the prevailing
view is that the relation between the a bank renting out safe deposits
boxes and its customer with respect to the contents of the box is that
of a bail or/ and bailee, the bailment being for hire and mutual
benefits. That prevailing rule has been adopted in Section 72 of the
General Banking Act.
Section 72. In addition to the operations specifically authorized
elsewhere in this Act, banking institutions other that building and loan
associations may perform the following services:

(a) Receive in custody funds, document and valuable objects and

rents safety deposits taxes for the safeguard of such effects.
xxx xxx xxx
The bank shall perform the services permitted under subsections (a)
(b) and (c) of this section as depositories or as agents.
Luzon Sia vs. CA G.R. No. 102970, May 13, 1993
Contract of the use of a safety deposit box of a bank is not a deposit
but a lease under Sec 72, A of General Banking Act. Accordingly, it
should have lost no time in notifying the petitioner in order that the
box could have been opened to retrieve the stamps, thus saving the
same from further deterioration and loss. The banks negligence
aggravated the injury or damage to the stamp collection..
Facts:
Plaintiff Luzon Sia rented a safety deposit box of Security
Bank and Trust Co. (Security Bank) at its Binondo Branch wherein he
placed his collection of stamps. The said safety deposit box leased by
the plaintiff was at the bottom or at the lowest level of the safety
deposit boxes of the defendant bank. During the floods that took place
in 1985 and 1986, floodwater entered into the defendant banks
premises, seeped into the safety deposit box leased by the plaintiff
and caused, according damage to his stamps collection. Security Bank
rejected the plaintiffs claim for compensation for his damaged stamps
collection.
Sia, thereafter, instituted an action for damages against the
defendant bank. Security Bank contended that its contract with the
Sia over safety deposit box was one of lease and not of deposit and,
therefore, governed by the lease agreement which should be the
applicable law; the destruction of the plaintiffs stamps collection was
due to a calamity beyond obligation on its part to notify the plaintiff
about the floodwaters that inundated its premises at Binondo branch
which allegedly seeped into the safety deposit box leased to the
plaintiff. The trial court rendered in favor of plaintiff Sia and ordered
Sia to pay damages.
Issue:

Whether or not the Bank is liable for negligence.

Held: Contract of the use of a safety deposit box of a bank is not a

deposit but a lease. Section 72 of the General Banking Act [R.A. 337,
as amended] pertinently provides: In addition to the operations
specifically authorized elsewhere in this Act, banking institutions other
than building and loan associations may perform the following

services (a) Receive in custody funds, documents, and valuable

objects, and rent safety deposit boxes for the safequarding of such
effects.
As correctly held by the trial court, Security Bank was guilty of
negligence. The banks negligence aggravated the injury or damage
to the stamp collection. SBTC was aware of the floods of 1985 and
1986; it also knew that the floodwaters inundated the room where the
safe deposit box was located. In view thereof, it should have lost no
time in notifying the petitioner in order that the box could have been
opened to retrieve the stamps, thus saving the same from further
deterioration and loss. In this respect, it failed to exercise the
reasonable care and prudence expected of a good father of a family,
thereby becoming a party to the aggravation of the injury or loss.
Accordingly, the aforementioned fourth characteristic of a fortuitous
event is absent. Article 1170 of the Civil Code, which reads Those
who in the performance of their obligation are guilty of fraud,
negligence, or delay, and those who in any manner contravene the
tenor thereof, are liable for damages is applicable. Hence, the
petition was granted.
The provisions contended by Security Bank in the lease agreement
which are meant to exempt SBTC from any liability for damage, loss or
destruction of the contents of the safety deposit box which may arise
from its own agents fraud, negligence or delay must be stricken down
for being contrary to law and public policy.
Allied Bank vs. Lim Sio Wan - GR No. 133179, March 27, 2008
Facts:
Respondent filed a complaint against petitioner to recover the
proceeds of her first money market placement. Allied avers that
respondent instructed the bank to preterminate the placement and
deposit the proceeds thereof to Metrobank.
Issue:

Whether petitioner is liable

Law:

Arts. 1953, 1980 of the Civil Code

Case history:

Yes. The court ruled in a line of cases that a bank deposit is in the
nature of a simple loan or mutuum.
Notes:
A money market is a market dealing in standardized short-term credit
instruments where lenders and borrowers do not deal directly with
each other but through a middle man or dealer in open market. In a
money market transaction, the investor is a lender who loans his
money to a borrower through a middleman or dealer.
Associated Bank vs. Tan - GR No. 156940, December 14, 2004
Facts:
Respondent filed a complaint against petitioner after the latter
reversed the deposit of a check issued in respondents favor. It
averred that it has all the right to debit the account by reason of the
dishonor of the check was deposited by the respondent which was
withdrawn by him prior to its clearing.
Issue: Whether petitioner has the right to debit the account of its
client for a check deposit which was dishonored by the drawee bank.
Law:
Case history:
The trial court ruled in favor of respondent and ordered the bank to
pay the former. In making said ruling, it was shown that [respondent]
was not officially informed about the debiting of the P101,000.00
[from] his existing balance and that the BANK merely allowed the
[respondent] to use the fund prior to clearing merely for
accommodation because the BANK considered him as one of its
valued clients. The trial court ruled that the bank manager was
negligent in handling the particular checking account of the
[respondent] stating that such lapses caused all the inconveniences to
the [respondent].
CA affirmed the trial courts decision. It ruled that the bank should not
have authorized the withdrawal of the value of the deposited check
prior to its clearing.

RTC ruled in favor of respondent. CA, on appeal, ordered both

petitioner and Metrobank to pay plaintiff.

Ruling:

Ruling:

Yes. But the case ultimately revolves around the issue of whether the
bank properly exercised its right to setoff.

It is undisputed -- nay, even admitted -- that purportedly as an act of

accommodation to a valued client, petitioner allowed the withdrawal
of the face value of the deposited check prior to its clearing. That act
certainly disregarded the clearance requirement of the banking
system. Such a practice is unusual, because a check is not legal
tender or money; and its value can properly be transferred to a
depositors account only after the check has been cleared by the
drawee bank.
BPI Family Bank vs. Franco GR No. 123498, November 23,
2007
Facts: Franco opened 3 accounts with BPI with the total amount of
P2,000,000.00. The said amount used to open these accounts is
traceable to a check issued by Tevesteco. The funding for the
P2,000,000.00 check was part of the P80,000,000.00 debited by BPI
from FMICs account (with a deposit of P100,000,000.00) and credited
to Tevestecos account pursuant to an Authority to Debit which was
allegedly forged as claimed by FMIC.
Tevesteco effected several withdrawals already from its account
amounting to P37,455,410.54 including the P2,000,000.00 paid to
Franco.
Franco issued two checks which were dishonoured upon presentment
for payment due to garnishment of his account filed by BPI.
BPI claimed that it had a better right to the amounts which consisted
of part of the money allegedly fraudulently withdrawn from it by
Tevesteco and ending up in Francos account. BPI urges us that the
legal consequence of FMICs forgery claim is that the money
transferred by BPI to Tevesteco is its own, and considering that it was
able to recover possession of the same when the money was
redeposited by Franco, it had the right to set up its ownership thereon
and freeze Francos accounts.
Issue: WON the bank has a better right to the deposits in Francos
account.
Held: No. Significantly, while Article 559 permits an owner who has
lost or has been unlawfully deprived of a movable to recover the exact
same thing from the current possessor, BPI simply claims ownership of
the equivalent amount of money, i.e., the value thereof, which it had
mistakenly debited from FMICs account and credited to Tevestecos,
and subsequently traced to Francos account.

Money bears no earmarks of peculiar ownership, and this

characteristic is all the more manifest in the instant case which
involves money in a banking transaction gone awry. Its primary
function is to pass from hand to hand as a medium of exchange,
without other evidence of its title. Money, which had been passed
through various transactions in the general course of banking
business, even if of traceable origin, is no exception.
BPI vs. Suarez G.R. No. 167750, March 15, 2010
Facts:
1. Reynaldo Suarez is a lawyer who used to maintain both savings and
current account with petitioner in its Ermita branch. Sometime in
1997, respondent had a client who wanted to buy several parcels of
land in Tagaytay but the latter did not want to deal directly with the
owners of said land.
2. Suarez and his client entered into an agreement where the former
will be the one to purchase the lands. Both likewise agreed that the
client would deposit money in Suarez' BPI account and thereafter, he
would issue the checks for the sellers.
3. The client deposited a check with BPI branch. Aware that a check
has 3-days clearing time, Suarez' assistant called the bank which
confirmed that the said amount had been credited to his account on
that same day. Relying on this confirmation, Suarez issued five (5)
checks in the name of the sellers. Unfortunately, all checks were
dishonored due to insufficient funds. A penalty amounting P57,000
was also debited from his account. The checks were dishonored
despite the assurance by RCBC, the drawee bank that the amount has
been debited from the account of the drawee.
4. On top of this, the bank noted on the checks 'DAIF' (drawn against
insufficient fund) and not 'DAUD''
(drawn against uncollected
deposit). The bank offered to reverse the penalty but denied Suarez
claim for damages. Suarez rejected this offer hence the case filed for
damages.
5. The lower court ruled in favor of Suarez and awarded actual, moral,
and exemplary damages. BPI appealed but the Court of Appeals
affirmed the lower court ruling. The CA ruled that the bank was
negligent in handling the accounts of the respondent hence the
latter's entitlement to damages. Hence this petition.

Issue: Whether or not petitioner bank is liable for its negligence in

handling the respondent's account
1. No, BPI was not negligent because it was justified in dishonoring the
checks for lack of sufficient funds in Suarez account. There was no
sufficient evidence to prove that BPI conclusively confirmed the sameday crediting of the amount of the check to Suarez account. While BPI
has the discretion to disregard the 3-day clearing policy, Suarez failed
to prove his entitlement to such privilege.
2. The award of actual damages is without basis since BPI is justified
in dishonoring the checks for being drawn against uncollected deposit,
hence BPI can rightfully impose the said penalty charges against
Suarez' account.

3. The award of moral damages has no basis because Suarez failed to

prove that his claimed injury was proximately caused by the
erroneous marking of the 'DAIF' on the checks.
4. Suarez is however entitled to nominal damages due to BPI's failure
to exercise the diligence required as the bank's business is deemed to
be affected with public interest. The bank must at all times maintain a
high level of meticulousness and should guard against injury
attributableto negligence or bad faith on its part. Suarez therefore has
the right to expect a high level of care and and diligence from BPI.