FIRST DIVISION

BANK OF THE PHILIPPINE ISLANDS, Petitioner V. LAND INVESTORS AND DEVELOPERS

CORPORATION, Respondent G.R. No. 198237 OCTOBER 8, 2018
TIJAM, J.

NATURE OF THE CASE:

Petition for Review on Certiorari under Rule 45 of the Rules of Court which seeks to annul the Decision
of the Court of Appeals (CA), which reversed and set aside the Resolutions of the Regional Trial Court
(RTC).

FACTS:
Respondent maintained savings and deposit accounts with Bank of the Philippine Islands (BPI) between
the years 1995-1999. In its transactions with the bank, Respondent authorized any two of Farinas, Dela
Peňa (DLP), and Collas as bank signatories. DLP was Respondent’s President.

In 2001, DLP was convicted of estafa and was dismissed from employment. Respondent discovered that
DLP, succeeded in unlawfully withdrawing from Respondent’s deposit accounts. Respondent also alleged
that BPI was negligent and violated its fiduciary duties when it the withdrawals on the basis of DLP’s
lone signature and through the forged signature of his co-signatories. Despite demand, BPI failed to heed
Respondent’s claims which prompted the latter to file a Complaint for Sum of Money and Damages
against BPI and DLP.

RTC dismissed the case against BPI and declared DLP in default and was ordered to pay Respondent for
the unauthorized withdrawals, damages and cost of suit. Respondent filed a Motion for Reconsideration,
but having been denied, it appealed to the CA.

The CA reversed and set aside the Resolution of the RTC arguing that failure to demonstrate the
conspiracy between DLP and BPI would not necessarily exculpate BPI form liability if there was
evidence to show that the latter violated its fiduciary duty to respondent. A negligent bank is liable
regardless of any allegation of conspiracy. The CA further ruled that BPI should be held solidarily liable
with DLP for actual damages plus interest. BPI filed its Motion for Reconsideration but was denied,
hence this petition.

ISSUE:
Whether or not BPI and DLP could be held solidarily liable for actual damages plus interest? -- (NO)

RULING:

BPI’s liability proceeds from a breach of contract. Under Article 1980 of the Civil Code, “fixed,
savings and current deposits of money in banks x x x shall be governed by the provisions concerning
simple loans.” By the contract of Loan or Mutuum, one party delivers money to another upon the
condition that the same amount shall be paid.
It is basic that those who, in the performance of their obligations, are guilty of negligence, and those who
in any manner contravene the tenor thereof, are liable for damages. When BPI allowed DLP to make
unauthorized withdrawals, it failed to comply with its obligation to secure said accounts by allowing only
those withdrawals authorized by respondent. In so doing, BPI violated the terms of its contract of loan
with Respondent and should be held liable in this regard.

Dela Peňa’s liability arises from the commission of the crime of estafa. Dela Peňa had in fact been
charged and convicted of estafa. Thus, respondent’s action to recover actual damages against Dela Peňa
was deemed instituted with the criminal action, unless waived, reserved or previously instituted. There is
no indication that such reservation had been done by Respondent. As such, to hold Dela Peňa solidarily
liable for damages in this case may result in double recovery which is proscribed. In any case it is
clear that the civil liability upon which Dela Peňa was being held liable by the CA is totally distinct
and separate from the source of BPI’s liability. Thus BPI and Dela Peňa’s respective liabilities cannot
be deemed joint and solidary.