Marquez, Roi Edward D.

March 10, 2017

JD4203

MEMORANDUM OF FACTS AND LAW

SUMMARY OF INITIAL FACTS GATHERED

1. Juan Dela Cruz, businessman, was a depositor of Makati Bank and maintained a time and checking
account in its branch at Pasig City.

2. On January 28, 2007, Juan Dela Cruz obtained a loan from Pasig branch of Makati Bank worth P 10,
000, 000 secured by a real estate mortgage located at Paranaque city.

3. Pasig branch of Makati Bank informed Juan Dela Cruz that the latter failed to pay the amortization worth
P 180, 000 due on January 28, 2017.

4. Juan Dela Cruz came into the Pasig branch of Makati Bank alleging that he already paid the P 180, 000
to apply to its existing loan.

5. Juan Dela Cruz alleged that on January 30, 2017 Pedro Santos came to his residence at Quezon City
informing the former that his remaining balance from his existing loan was already due on January 28,
2017. Pedro Santo advised that he could personally received that amount of P 180, 000 and make it
appear the payment was made on January 28, 2017 to avoid the penalty.

6. Juan Dela Cruz presented the deposit slip containing the amount of P 180, 000 and it was signed by Juan
Dela Cruz and Pedro Santos but the same was not machine validated.

7. Pedro Santos, resident of San Juan City, was the bank manager of Pasig Branch of Makati Bank.

8. On February 16, 2017, Nicanor Reyes, resident of Paranaque City, replaced the position of Pedro Santos
as a bank manager because the whereabouts of the latter is unknown.

9. According to Pasig branch of Makati Bank, the alleged payment of Juan Dela Cruz to Pedro Santos was
never deposited to the former.

10. The normal treatment of the existing loan of Juan Dela Cruz was automatically debited to its existing
bank accounts in Makati Bank.

11. Nicanor Reyes alleged that the act of Pedro Santos receiving the money from the residence of Juan Dela
Cruz was beyond the standard bank practice. Thus, Pedro Santos was not authorized to personally
receive the deposit from the clients house.

STATEMENT OF ISSUE

1. Whether or not the Makati bank may be held liable when its bank manager Pedro Santos had stolen the
money?

ARGUMENTS

1. The Makati Bank shall not be held liable because the act of Pedro Santos receiving the payment for the
loan in residence of Juan Dela Cruz was outside the scope of his authority.

In Section 2 of Republic Act No. 8791 or General Banking Law of 2000, expressly imposes this
fiduciary duty on banks when it declares that the State recognizes the fiduciary nature of banking that
requires high standards of integrity and performance. 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.

In Philippine Banking Corporation v. Court of Appeals (419 SCRA 487, 2004), a bank is liable for
the wrongful acts of its officers done in the interest of the bank or in their dealings as bank representatives
but not for acts outside the scope of their authority. Therefore, the Makati Bank shall not be held liable
because the act of Pedro Santos receiving the payment for the loan in residence of Juan Dela Cruz was
outside the scope of his authority. it also beyond the standard practice of Makati Bank.