NATIVIDAD GEMPESAW vs.

CA and PHILIPPINE BANK OF

COMMUNICATIONS
G.R. No. 92244, February 9, 1993
CAMPOS, JR., J.

Facts:
Petitioner, Gempesaw, issued 82 checks, prepared by her bookkeeper,
in favor of several supplies. Most of the checks for amounts in excess of
actual obligations as shown in their corresponding invoices. After the lapse of
more than 2 years, Gempesaw discovered the fraudulent manipulations of
her bookkeeper. It was also learned that the indorsements of the payee were
forged, and the checks were brought to the chief accountant of respondent
bank (PBC), who deposited them in the accounts of Alfredo Romero and
Benito Lam. Gempesaw demanded that the bank to credit the amount
charged due the checks. The bank refused. Hence, the present action.
Issue: Who shall bear the loss resulting from the forged indorsements?
Held:
Both Gempesaw and PNC should bear the loss as the former was
negligent and the latter was unable to detect the fraud.
As a rule, a drawee bank who has paid a check on which an
indorsement has been forged cannot charge the drawer’s account for said
check except where the drawer is guilty of such negligence which causes the
bank to honor such checks. Gempesaw’s negligence by not exercising steps
that a careful and prudent businessman would take in circumstances to
discover discrepancies in her account was the proximate cause of her loss,
and under Section 23 of the Negotiable Instruments Law. Hence, she is
precluded from using forgery as a defense.
In light of any case not provided for in the Act that is to be governed by
the provisions of existing legislation, pursuant to Section 196 of the
Negotiable Instruments Law, the bank may be held liable for damages in
accordance with Article 1170 of the Civil Code. The drawee bank, in its
failure to discover the fraud committed by its employee and in contravention
banking rules in allowing a chief accountant to deposit the checks bearing
second indorsements, was adjudged liable to share the loss with Gempesaw
on a 50:50 ratio.