Baron v.

David

FACTS:

Silvestra Baron, the plaintiff in the first action, is an aunt of the defendant; while Guillermo Baron, the
plaintiff in the other action; is his uncle.

In the months of March, April, and May, 1920, Silvestra Baron placed a quantity of palay in the
defendant's mill; and this, in connection with some that she took over from Guillermo Baron, amounted
to 1,012 cavans and 24 kilos. During approximately the same period Guillermo Baron placed other 1,865
cavans and 43 kilos of palay in the mill. Those cavans of palay were delivered to Baron with the
understanding that the latter was at liberty to convert it into rice and dispose of it at his pleasure.
However,no compensation has ever been received by Silvestra Baron upon account of the palay
delivered by Guillermo Baron, he has received from the defendant advancements amounting to P2,800;
but apart from this he has not been compensated.

David, on the other hand, contended that he should be relieved from all responsibility because his rice
mill was burned with its content on January 17, 1921. He claimed that the plaintiffs' palay was mixed
with that of others.

Issue:

Whether or not David is bound to account for its value.

RULING: Yes. In view of the nature of the defendant's activities and the way in which the palay was
handled in the defendant's mill, it is quite certain that all of the plaintiffs' palay, which was put in before
June 1, 1920, been milled and disposed of long prior to the fire of January 17, 1921.The proof shows that
when the fire occurred there could not have been more than about 360 cavans of palay in the mill, none
of which by any reasonable probability could have been any part of the palay delivered by the plaintiffs.

The opposing attorneys alleged that in order for the plaintiffs to recover, it is necessary that they should
be able to establish that the plaintiffs' palay was delivered in the character of a sale, and that if, on the
contrary, the defendant should prove that the delivery was made in the character of deposit, the
defendant should be absolved.

But the case does not depend precisely upon this explicit alternative; for even supposing that the palay
may have been delivered in the character of deposit, subject to future sale or withdrawal at plaintiffs'
election, nevertheless if it was understood that the defendant might mill the palay and he has in fact
appropriated it to his own use, he is of course bound to account for its value.

Under article 1768 of the Civil Code, when the depository has permission to make use of the thing
deposited, the contract loses the character of mere deposit and becomes a loan or a commodatum; and
of course, by appropriating the thing, the bailee becomes responsible for its value. In this connection we
wholly reject the defendant's pretense that the palay delivered by the plaintiffs or any part of it was
actually consumed in the fire of January, 1921. Nor is the liability of the defendant in any wise affected
by the circumstance that, by a custom prevailing among rice millers in this country, persons placing
palay with them without special agreement as to price are at liberty to withdraw it later, proper
allowance being made for storage and shrinkage, a thing that is sometimes done, though rarely.
SIA v. CA

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 bank’s
premises, seeped into the safety deposit box leased by the plaintiff and caused, according damage to his
stamps collection. Security Bank rejected the plaintiff’s 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 plaintiff’s
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 bank’s 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.
BPI v. IAC

FACTS:

• The original parties to this case were Zshornack and COMTRUST. In 1980, BPI absorbed
COMTRUST through a corporate merger, and was substituted as party to the case.

• On December 8, 1975, Zshornack entrusted to COMTRUST, thru Garcia, US $3,000.00 cash

popularly known as greenbacks for safekeeping, and that the agreement was embodied in a document.

• Despite demands, the bank refused to return the money. COMTRUST averred that the US$3,000
was credited to Zshornack's peso current account at prevailing conversion rates.

• BPI argues that the contract embodied in the document is the contract of deposit as defined in
Article 1962, NCC, which banks do not enter into. The bank alleges that Garcia exceeded his powers
when he entered into the transaction. Hence, it is claimed, the bank cannot be liable under the contract,
and the obligation is purely personal to Garcia.

ISSUE:

• Whether or not the nature of contract entered into by the parties was a contract of deposit.

HELD:

• The document which embodies the contract states that the US$3,000.00 was received by the
bank for safekeeping. The subsequent acts of the parties also show that the intent of the parties was
really for the bank to safely keep the dollars and to return it to Zshornack at a later time,

• Thus, Zshornack demanded the return of the money.

• The arrangement is that contract defined under Article 1962, New Civil Code, which reads:

Art. 1962. A deposit is constituted from the moment a person receives a thing

belonging to another, with the obligation of safely keeping it and of returning the same. If the
safekeeping of the thing delivered is not the principal purpose of the contract, there is no deposit but
some other contract.

• But because the subject of the contract here is a foreign exchange, it is covered by Central Bank
Circular No. 20 which requires that, “All receipts of foreign exchange by any resident person, firm,
company or corporation shall be sold to authorized agents of the Central Bank by the recipients within
one business day following the receipt of such foreign exchange.”

• Since the document and the subsequent acts of the parties show that they intended the bank to
safekeep the foreign exchange, and return it later to Zshornack, who alleged in his complaint that he is a
Philippine resident, the parties did not intend to sell the US dollars to the Central Bank within one
business day from receipt. Otherwise, the contract of depositum would never have been entered into at
all.

• In other words, the transaction between Zshornack and the bank was void having been executed
against the provisions of a mandatory law (CB Circ No. 20). Being in pari delicto, the law cannot afford
either of them remedy.
CA Agro Industrial v. CA

FACTS:

• On July 3, 1979, CA Agro Industrial Corp. (through its President, Sergio Aguirre) and the spouses
Ramon and Paula Pugao entered into an agreement whereby CA Agro purchased from Spouses Pugao
two (2) parcels of land for a consideration of P350,625.00.

• Stipulated in a Memorandum of True and Actual Agreement of Sale of Land, the titles to the lots
shall be transferred to the petitioner upon full payment of the purchase price and that the owner's
copies of the certificates of titles, shall be deposited in a safety deposit box of any bank.

• The same could be withdrawn only upon the joint signatures of a representative of the
petitioner and the Pugaos upon full payment of the purchase price.

• Petitioner and the Pugaos then rented Safety Deposit Box No. 1448 of respondent Security Bank
and Trust Company. For this purpose, they signed a contract of lease with the bank. The contract
contains the following conditions:

13. The bank is not a depositary of the contents of the safe and it has neither the possession nor control
of the same.

14. The bank has no interest whatsoever in said contents, except herein expressly provided, and it
assumes absolutely no liability in connection therewith.

• CA Agro and Spouses Pugao were then given each a renter’s keys. The guard key remained with
the bank. The safety deposit box can only be opened using both the renter’s key and guard key.

• Thereafter, a certain Mrs. Margarita Ramos offered to buy from the petitioner the 2 lots. Mrs.
Ramos demanded the execution of deed of sale which entails the copy of the 2 titles. As such, CA Agro
and the Pugaos went to the Bank to get the titles but when they open the safety deposit box, no
certificate can be found.

• Because of the delay in the reconstitution of the title, Mrs. Ramos withdrew her offer to
purchase and as a result, petitioner failed to realize the expected profit.

• Hence, CA Agro filed a complaint for damages. The trial court dismissed the Contract of Lease on
the ground that the bank has no liability. When elevated to the Court of Appeals, the appellate court
affirmed the decision of the RTC.

ISSUE: Whether or not the contract between petitioner and the bank is a contract of deposit

RULING:

• Yes. The Court held that the contract was a special kind of deposit although it is not strictly
govern by the provisions in the Civil Code on deposits.

• It cannot be a contract of lease as the full and absolute possession and control of the safety
deposit box was not given to the joint renters and likewise, it is not purely a deposit as the Bank even
with the guard key cannot open the box without the renter’s key.

• The law which authorizes banking institutions to rent out safety deposit boxes is adopted from
the prevailing rule in the US which is Sec. 72 of the General Banking Act.

• Moreover, the Civil Code provides that the depositary would be liable if, in performing its
obligation, it is found guilty of fraud, negligence, delay or contravention of the tenor of the agreement.

• In the absence of any stipulation prescribing the degree of diligence required, that of a good
father of a family is to be observed. Hence, any stipulation exempting the depositary from any liability
arising from the loss of the thing deposited on account of fraud, negligence or delay would be void for
being contrary to law and public policy.

• With respect to property deposited in a safe-deposit box by a customer of a safe-deposit

company, the parties, since the relation is a contractual one, may by special contract define their
respective duties or provide for increasing or limiting the liability of the deposit company, provided such
contract is not in violation of law or public policy. Hence, the conditions contained in the contract for
rent executed by the parties are inconsistent with the Bank’s responsibility as depository and they’re
contrary to actual practice.
GUINGONA v. CITY FISCAL OF MANILA

FACTS:

David, together with his sister, invested with the NSLA the sum of P1,145,546.20 on time deposits

covered by Bankers Acceptances and Certificates of Time Deposits and the sum of P13,531.94 on

savings account deposits or a total of P1,159,078.14. It appears further that David, made

investments in the aforesaid bank in the amount of US$75,000.00.

When the aforesaid bank was placed under receivership petitioners Guingona and Martin, upon

the request of David, assumed the obligation of the bank to private respondent David by executing

a joint promissory note in favor of David acknowledging an indebtedness of Pl,336,614.02 and

US$75,000.00. This PN was based on the statement of account prepared by the David. The

amount of indebtedness assumed appears to be bigger than the original claim because of the added

interest and the inclusion of other deposits of David’s sister in the amount of P116,613.20.

Guingona and Martin agreed to divide the said indebtedness, and petitioner Guingona executed

another PN whereby he personally acknowledged an indebtedness of P668,307.01 and

US$37,500.00 in favor of David. The aforesaid PNs were executed as a result of deposits made by

David and his sister Kuhne with the NSLA.

ISSUE:

Whether the transactions between David and NSLA were simple loans and not a contract of

deposit.

HELD:

It must be pointed out that when private respondent David invested his money on nine. and

savings deposits with the aforesaid bank, the contract that was perfected was a contract of simple

loan or mutuum and not a contract of deposit. Thus, Article 1980 of the New Civil Code provides

that:

Article 1980. Fixed, savings, and current deposits of-money in banks and similar

institutions shall be governed by the provisions concerning simple loan.

Hence, the relationship between the private respondent and the Nation Savings and Loan

Association is that of creditor and debtor; consequently, the ownership of the amount deposited

was transmitted to the Bank upon the perfection of the contract and it can make use of the amount

deposited for its banking operations, such as to pay interests on deposits and to pay withdrawals.

While the Bank has the obligation to return the amount deposited, it has, however, no obligation

to return or deliver the same money that was deposited. And, the failure of the Bank to return the

amount deposited will not constitute estafa through misappropriation punishable under Article 315, par.
l(b) of the Revised Penal Code, but it will only give rise to civil liability over which the

public respondents have no- jurisdiction.

DURBAN APARTMENTS CORPORATION, doing business under the name and style of City Garden Hotel v.
PIONEER INSURANCE AND SURETY CORPORATION

FACTS:

On April 30, 2002, Jeffrey See arrived and checked in at the City Garden Hotel in Makati corner Kalayaan
Avenues, Makati City before midnight. The hotel's parking attendant, Vicente Justimbaste, got the key to
See's Suzuki Grand Vitara and parked the said vehicle at the parking area of Equitable PCI Bank along
Makati Avenue, right across the hotel.

At about 1 a.m. the next day, See was awakened in his room by a telephone call from the Hotel Chief
Security Officer who informed him that his Vitara was carnapped while it was parked unattended. See
went to see the Hotel Chief Security Officer and later reported the incident to the Operations Division of
the Makati City Police Anti-Carnapping Unit.

Subsequently, See filed a complaint with the PNP Traffic Management Group in Camp Crame, Quezon
City. He alleged that: (a) no necessary precautions were taken to prevent the carnapping incident from
happening; (b) that Durban Apartments was wanting in due diligence in the selection and supervision of
its employees particularly Justimbaste; and (c) Justimbaste and Durban Apartments failed and refused to
pay his valid, just, and lawful claim despite written demands. Durban Apartment and Justimbaste denied
the allegations.

In the meantime, Pioneer Insurance paid See the sum of P1,163,250.00 representing the cost of the
stolen car. Theareafter, by right of subrogation, Pioneer Insurance filed a complaint for recovery of
damages against Durban Apartments and Justimbaste before the Makati RTC.

During the pre-trial conference on November 28, 2003, counsel for Pioneer Insurance was present. The
counsel of Durban Apartments and Justimbaste was absent, instead, a certain Atty. Nestor Mejia
appeared for Durban Apartments and Justimbaste, but did NOT file their pre-trial brief. As a result, the
RTC allowed Pioneer Insurance to present its evidence ex parte before the Branch Clerk of Court.

RTC: Durban Apartments is ordered to pay the sum of P1,163,250.00 with legal interest thereon from
July 22, 2003 until the obligation is fully paid and attorneys fees and litigation expenses amounting to
P120,000.00.

CA: RTC affirmed in toto. Hence, the instant petition.

ISSUE:

1. Whether the RTC erred in allowing Pioneer Insurance to present evidence ex-parte on account
of the failure of the counsel of Durban Apartments and Justimbaste to file a pre-trial brief. – NO.
2. Whether the RTC and CA erred in holding Durban Apartments liable for the loss of See's vehicle.
– NO.

RULING:

Petition denied. CA ruling affirmed.

1. Durban Apartments was in default for failure to appear at the pre-trial conference and to file a
pre-trial brief. Therefore, the RTC correctly allowed Pioner Insurance to present evidence ex-
parte.

Appearance of parties and their counsel at the pre-trial conference, along with the filing of a
corresponding pre-trial brief, is mandatory, nay, their duty pursuant to Sections 4 and 6 of Rule 18 of the
ROC.

In the present case, the absence of the counsel of Durban Apartments is inexcusable because it does not
fall within the two exceptions for a valid non-appearance; there was neither (a) a valid excuse nor (b)
appearance of a representative on behalf of a party who is fully authorized in writing to enter into an
amicable settlement, to submit to alternative modes of dispute resolution, and to enter into stipulations
or admissions of facts and documents..

2. Despite the fact that Durban Apartments was not able to present evidence during the trial, this
did NOT automatically result in a judgment in favor of Pioneer Insurance. In fact, Pioneer was
still obliged to substantiate the allegations in its complaint.
· In this case, Pioneer Insurance substantiated the allegations in its complaint that a contract of
necessary deposit existed between the insured See and Durban Apartments.

· From the facts found by the lower courts, the insured See deposited his vehicle for safekeeping
with Durban Apartments, through the latter's employee, Justimbaste. In turn, Justimbaste issued a claim
stub to See. Thus, the contract of deposit was perfected from See's delivery, when he handed over to
Justimbaste the keys to his vehicle, which Justimbaste received with the obligation of safely keeping and
returning it.

· Article 1962, in relation to Article 1998, of the Civil Code defines a contract of deposit and a
necessary deposit made by persons in hotels or inns.

· Art. 1962. A deposit is constituted from the moment a person receives a thing belonging to
another, with the obligation of safely keeping it and returning the same. If the safekeeping of the thing
delivered is not the principal purpose of the contract, there is no deposit but some other contract.

· Art. 1998. The deposit of effects made by travelers in hotels or inns shall also be regarded as
necessary. The keepers of hotels or inns shall be responsible for them as depositaries, provided that
notice was given to them, or to their employees, of the effects brought by the guests and that, on the
part of the latter, they take the precautions which said hotel-keepers or their substitutes advised
relative to the care and vigilance of their effects.

· Given the facts established in court, Durban Apartments is liable for the loss of See’s vehicle.
TRIPLE-V vs. FILIPINO MERCHANTS

FACTS:

Mary Jo-Anne De Asis dined at Petitioner’s Kamayan Restaurant at 15 West Avenue, Quezon City. De
Asis was using a Mitsubishi Galant Super Saloon Model 1995, assigned to her by her employer Crispa
Textile Inc. (Crispa). She availed of the valet parking ticket on the restaurant and entrusted her car key to
petitioner’s valet counter. A corresponding parking was issued as receipt of the car. Few minutes later,
Madridano noticed that the car was not in its parking slot and its key no longer in the box where valet
attendants usually keep the keys. The car was never recovered.

Crispa filed a claim against its insurer, the respondent Filipino Merchants Insurance Company, Inc.
(FMICI). Having indemnified in the amount of P669,500 for the loss of the subject vehicle. FMICI as
subrogee to Crispa’s rights, filed with RTC for damages against Triple-V Food Services.

ISSUE:

(1) WON or not petitioner is a depositary of the vehicle

(2) WON the petitioner was negligent in its duties as depositary

(3) WON there was a valid subrogation of rights between Crispa and FMICI

HELD:

(1) Yes. Petitioner is a depositary of the of the car. In a contract of deposit, a person receives an object
to another with the obligation of safely keeping it and returning the same. A deposit may be constituted
even without any consideration. It is not necessary that the depositary receives a fee before it becomes
obligated to keep the item entrusted for safekeeping and to return it later to the depositor.

(2)Yes. Having entrusted the subject car to petitioner’s valet attendant, customer De Asis, like all of its
customers, fully expects the security of her car while at the premises/designated parking areas and its
safe return at the end of her visit the the restaurant.

(3) Yes. There is an insurance policy which FMICI issued to Crispa that contains, “Among other things,
the following item: “Insured Estimate of Value Scheduled Vehicle - P800,000”. On the coverage includes
a comprehensive insurance of the vehicle in case of damage or loss. Besides, Crispa paid a premium of
P10,304 to cover theft. This is clearly shown in the breakdown premiums in the same policy. Thus,
having indemnified CRSIPA for the stolen car, FMICI was properly subrogated to Crispa’s rights against
petitioner, pursuant to Article 2207 of the NCC
PEOPLE v. PUIG

Facts:

Respondents were conspiring, confederating, and helping one another, with grave abuse of confidence,
being the Cashier and Bookkeeper of the Rural Bank of Pototan, Inc., Pototan, Iloilo, without the
knowledge and/or consent of the management of the Bank and with intent of gain, did then and there
willfully, unlawfully and feloniously take, steal and carry away the sum of P15,000.00, Philippine
Currency, to the damage and prejudice of the said bank in the aforesaid amount.

However, the trial court did not find the existence of probable cause because (1) the element of ‘taking
without the consent of the owners’ was missing on the ground that it is the depositors-clients, and not
the Bank, which filed the complaint in these cases, who are the owners of the money allegedly taken by
respondents and hence, are the real parties-in-interest; and (2) the Informations are bereft of the
phrase alleging "dependence, guardianship or vigilance between the respondents and the offended
party that would have created a high degree of confidence between them which the respondents could
have abused.".

Issue:

Whether or not the 112 informations for qualified theft sufficiently allege the element of taking without
the consent of the owner, and the qualifying circumstance of grave abuse of confidence.

Held:

Yes.

The dismissal by the RTC of the criminal cases was allegedly due to insufficiency of the Informations and,
therefore, because of this defect, there is no basis for the existence of probable cause which will justify
the issuance of the warrant of arrest. Petitioner assails the dismissal contending that the Informations
for Qualified Theft sufficiently state facts which constitute (a) the qualifying circumstance of grave abuse
of confidence; and (b) the element of taking, with intent to gain and without the consent of the owner,
which is the Bank.

The RTC Judge based his conclusion that there was no probable cause simply on the insufficiency of the
allegations in the Informations concerning the facts constitutive of the elements of the offense charged.

The relationship between banks and depositors has been held to be that of creditor and debtor. Articles
1953 and 1980 of the New Civil Code, as appropriately pointed out by petitioner, provide as follows:

Article 1953. A person who receives a loan of money or any other fungible thing acquires the ownership
thereof, and is bound to pay to the creditor an equal amount of the same kind and quality.

Article 1980. Fixed, savings, and current deposits of money in banks and similar institutions shall be
governed by the provisions concerning loan.

In a long line of cases involving Qualified Theft, this Court has firmly established the nature of possession
by the Bank of the money deposits therein, and the duties being performed by its employees who have
custody of the money or have come into possession of it. The Court has consistently considered the
allegations in the Information that such employees acted with grave abuse of confidence, to the damage
and prejudice of the Bank, without particularly referring to it as owner of the money deposits, as
sufficient to make out a case of Qualified Theft.
EJERCITO v. SANDIGANBAYAN

Facts:

In lieu of the Criminal Case “People v. Estrada” for plunder, the Special Prosecution Panel filed before
the Sandiganbayan a request for issuance of Subpoena Duces Tecum directing the President of Export
and Industry Bank or his/her authorized representative to produce documents namely, Trust Account
and Savings Account belonging to petitioner and statement of accounts of one named “Jose Velarde”
and to testify thereon during the hearings. Sandiganbayan granted both requests and subpoenas were
accordingly issued. Sandiganbayan also granted and issued subpoenas prayed for by the Prosecution
Panel in another later date. Petitioner now assisted by his counsel filed two separate motions to quash
the two subpoenas issued. Sandiganbayan denied both motions and the consequent motions for
reconsideration of petitioner.

Issues:

(1) Whether or not the trust accounts of petitioner are covered by the term “deposits” as used in R.A.
No. 1405

(2) Whether or not plunder is neither bribery nor dereliction of duty not exempted from protection of
R.A. No. 1405

(3) Whether or not the unlawful examination of bank accounts shall render the evidence obtained
therefrom inadmissible in evidence.

Ruling:

(1) YES. An examination of the law shows that the term “deposits” used therein is to be understood
broadly and not limited only to accounts which give rise to a creditor-debtor relationship between the
depositor and the bank.

The policy behind the law is laid down in Section 1. If the money deposited under an account may be
used by banks for authorized loans to third persons, then such account, regardless of whether it creates
a creditor-debtor relationship between the depositor and the bank, falls under the category of accounts
which the law precisely seeks to protect for the purpose of boosting the economic development of the
country.

Trust Account No. 858 is, without doubt, one such account. The Trust Agreement between petitioner
and Urban Bank provides that the trust account covers “deposit, placement or investment of funds” by
Urban Bank for and in behalf of petitioner. The money deposited under Trust Account No. 858, was,
therefore, intended not merely to remain with the bank but to be invested by it elsewhere. To hold that
this type of account is not protected by R.A. 1405 would encourage private hoarding of funds that could
otherwise be invested by banks in other ventures, contrary to the policy behind the law.

Section 2 of the same law in fact even more clearly shows that the term “deposits” was intended to be
understood broadly. The phrase “of whatever nature” proscribes any restrictive interpretation of
“deposits.” Moreover, it is clear from the immediately quoted provision that, generally, the law applies
not only to money which is deposited but also to those which are invested. This further shows that the
law was not intended to apply only to “deposits” in the strict sense of the word. Otherwise, there would
have been no need to add the phrase “or invested.”

Clearly, therefore, R.A. 1405 is broad enough to cover Trust Account No. 858.

(2) NO. Cases of unexplained wealth are similar to cases of bribery or dereliction of duty and no reason
is seen why these two classes of cases cannot be excepted from the rule making bank deposits
confidential. The policy as to one cannot be different from the policy as to the other. This policy
expresses the notion that a public office is a public trust and any person who enters upon its discharge
does so with the full knowledge that his life, so far as relevant to his duty, is open to public scrutiny.

The crime of bribery and the overt acts constitutive of plunder are crimes committed by public officers,
and in either case the noble idea that “a public office is a public trust and any person who enters upon
its discharge does so with the full knowledge that his life, so far as relevant to his duty, is open to public
scrutiny” applies with equal force.
Plunder being thus analogous to bribery, the exception to R.A. 1405 applicable in cases of bribery must
also apply to cases of plunder.

(3) NO. Petitioner’s attempt to make the exclusionary rule applicable to the instant case fails. R.A. 1405,
it bears noting, nowhere provides that an unlawful examination of bank accounts shall render the
evidence obtained therefrom inadmissible in evidence. Section 5 of R.A. 1405 only states that “[a]ny
violation of this law will subject the offender upon conviction, to an imprisonment of not more than five
years or a fine of not more than twenty thousand pesos or both, in the discretion of the court.”

Even assuming arguendo, however, that the exclusionary rule applies in principle to cases involving R.A.
1405, the Court finds no reason to apply the same in this particular case. Clearly, the “fruit of the
poisonous tree” doctrine presupposes a violation of law. If there was no violation of R.A. 1405 in the
instant case, then there would be no “poisonous tree” to begin with, and, thus, no reason to apply the
doctrine.
MAKATI SHANGHAI-LA HOTEL v. HARPER

FACTS:

Christian Harper came into Manila for a business trip representing ALSTOM Power Norway AS.

He checked in at the Shangri-La and accommodated in room 1428.

He was supposed to check-out on November 6, 1999; however, he was murdered inside his room.

It was discovered when a routine verification call from his credit card company called his residence in
Norway.

It was said that a Caucasian Male, purchased a P320,000 worth of Cartier watch using the credit cards of
Harper.

The saleslady Anna Liza Lumba (Lumba) ask the passport of the customer upon the suggestion of the
credit card representative to put the credit cards on hold.

Sensing trouble, the customer hurriedly left and left 3 credits cards and passport behind.

The family in Norway was about to call Christian to inform about the attempt to use his AMex. But, upon
calling, nobody is answering inside his room.

His family requested the Deputy Manager, Raymond Alarcon, to check on Harper’s room, and the
security personnel were shocked to discover his lifeless body inside his room.

Col. Rodrigo de Guzman (de Guzman) investigated the murder. He found several bottles of wine and
cigarette inside the room. Harper and his visitors drunk so much that time.

The police investigation commenced. The team of PO3 Mendoza and SPO4 Hizon arrived.

They entered into Harper’s room and together with de Guzman, Alarcon, Holazo (EA Assistant Manager),
Rosales (Execustive Housekeeper), and Imperial (security personnel).

Mendoza saw that the victim’s eyes and mouth had electrical packaging tapes, and the hands and feet
were tied with a rope.

PO3 viewed the CCTV and it was found that Harper entered into his room and had been followed into a
room by a woman. A Caucasian male entered Harper’s room. The woman left at around 5:30AM while to
Caucasian male left at around 5:46AM.

SPO1 Ramoncito Jr. Ocampo interviewed Lumba, and she confirmed that the male in the CCTV was the
one who attempted to purchase Cartier’s watch had been the person whose picture was on the passport
issued under the name of Christian Harper.

Sr. Inspector Danilo Javier reflected that the police investigation showed that Harper’s Passport, credit
cards, laptop and cash had been missing from the crime scene. And he learned that the Caucasian male
attempted to use Harper’s credit cards in purchasing the watch.

RTC Ruling:

Found the hotel to be remiss in its duties and thus liable for the death of Christian Harper.

Ruling of CA:

Affirmed the ruling of the RTC.

ISSUE/S:

Whether or not the plaintiffs-appellees were able to prove with competent evidence the affirmative
allegations in the complaint that they are the widow and son of Mr. Christian Harper.

Whether or not the appellees were able to prove with competent evidence that affirmative allegations
in the complaint that there was negligence on part of the appellant and its said negligence was the
proximate cause of the death of Mr. Christian Harper.
RULING/S:

First Issue. In this case, several documents, like birth certificates of Harper and respondent Jonathan
Harper, the marriage certificate of Harper and Ellen Johanne Harper, and the probate court certificate,
all of which were presumably as public documents under the laws of Norway. Such documentary
evidence sufficed to competently established the relationship and filiation under the standards of Rules
of Court.

Second Issue. Petitioner was liable due to its own negligence. The Court agrees with the CA that
petitioner failed to provide the basic and adequate security measures expected of a five-star hotel; and
that its omission was the proximate cause of Harper’s death. The testimony of Col. De Guzman revealed
that the management practice prior to the murder of Harper had been to deploy only one security or
roving guard for every three or four floors of the building; that such ratio had not been enough
considering the L-shape configuration of the hotel that rendered the hallways not visible from one or
the other end; and that he had recommended to management to post a guard for each floor, but his
recommendation had been disapproved because the hotel “was not doing well” at that particular time.
Probably realizing that his testimony had weakened petitioner’s position in the case, Col. De Guzman
soon clarified on cross-examination that petitioner had seen no need at the time of the incident to
augment the number of guards due to the hotel being then only half-booked. Petitioner would thereby
have the Court believe that Col. De Guzman’s initial recommendation had been rebuffed due to the
hotel being only half-booked; that there had been no urgency to adopt a one-guard-per-floor policy
because security had been adequate at that time; and that he actually meant by his statement that “the
hotel was not doing well” that the hotel was only half-booked.

The hotel business is filled with public interest. Catering to the public, hotelkeepers are bound to
provide not only lodging for their guests but also security to the persons and belongings of their guests.
The twin duty constitutes the essence of the business.

Applying by analogy Article 2000, Article 2001 and Article 2002 of the Civil Code (all of which concerned
the hotelkeepers’ degree of care and responsibility as to the personal effects of their guests), there is
much greater reason to apply the same if not greater degree of care and responsibility when the lives
and personal safety of their guests are involved. Otherwise, the hotelkeepers would simply stand idly by
as strangers have unrestricted access to all the hotel rooms on the pretense of being visitors of the
guests, without being held liable should anything untoward befall the unwary guests. That would be
absurd, something that no-good law would ever envision.

WHEREFORE, the Court AFFIRMS the judgment of the Court of Appeals; and ORDERS petitioner to pay
the costs of suit
Tan v. CA, G.R. No. 108555, December 20, 1994

FACTS: Tan maintained a current account with respondent RCBC. On March 11, to avoid carrying cash,
he secured a Cashier’s Check from the Philippine Commercial Industrial Bank (PCIB) payable to his order.
He deposited the check in his account with RCBC Binondo on March 15. On the same day, RCBC
erroneously sent the same cashier's check for clearing to the Central Bank which was returned for
having been "missent" or “misrouted." The next day, March 16, RCBC debited the amount covered by
the same cashier's check from the account of the petitioner. Respondent bank at this time had not
informed the petitioner of its action which the latter claims he learned of only 42 days after, specifically
on March 16, when he received the bank's debit memo. Relying on the common knowledge that a
cashier’s check was as good as cash and the fact that the cashier’s check was accepted, petitioner Tan
issued 2 personal checks both dated March 18.

Petitioner, alleging to have suffered humiliation and loss of face in the business sector due to the
bounced checks, filed a complaint against RCBC for damages. He alleged that it was RCBC's responsibility
to call his attention there and then that he had erroneously filled the wrong deposit slip at the time he
deposited the cashier's check with the respondent bank's teller and it was negligence on RCBC' part not
to have done so.

In its defense, RCBC disowning any negligence, put the blame for the "misrouting" on the petitioner for
using the wrong check deposit slip. It insisted that it was petitioner's negligent "misuse" of a local
deposit slip which was the proximate cause of the "misrouting", thus he should bear the consequence.

ISSUE(S): WON the Bank was negligent and thus liable to petitioner.

RULING: YES. The bank is engaged in business impressed with public interests, and it is its duty to
protect in return its many clients and depositors who transact business with it. It should not be a matter
of the bank alone receiving deposits, lending out money and collecting interests. It is also its obligation
to see to it that all funds invested with it are properly accounted for and duly posted in its ledgers. Bank
clients are supposed to rely on the services extended by the bank, including the assurance that their
deposits will be duly credited them as soon as they are made.

As a business affected with public interest and because of the nature of its functions, 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 In this light, the respondent bank cannot exculpate itself from
liability by claiming that its depositor "impliedly instructed" the bank to clear his check with the Central
Bank by filling a local check deposit slip. Bank transactions pass through a succession of bank personnel
whose duty is to check and countercheck transactions for possible errors. In the instant case, the teller
should not have accepted the local deposit slip with the cashier's check that on its face was clearly a
regional check without calling the depositor's attention to the mistake at the very moment this was
presented to her. Depositors do not pretend to be past master of banking technicalities, much more of
clearing procedures. As soon as their deposits are accepted by the bank teller, they wholly repose trust
in the bank personnel's mastery of banking, their and the bank's sworn profession of diligence and
meticulousness in giving irreproachable service. Thus, respondent RCBC had been remiss in the
performance of its duty and obligation to its client, as well as to itself.

Additional Notes:

The teller should not have accepted plaintiff's deposit without correcting the account number on the
deposit slip which, obviously, was erroneous because, as pointed out by defendant, it contained only
seven (7) digits instead of eight (8)

Second, the complete name of plaintiff depositor appears in bold letters on the deposit slip. There could
be no mistaking in her name.

This could have been avoided at the first instance had the teller of defendant bank performed her duties
efficiently and well.

For then she could have readily detected that the account number in the name of Emma E. Herrero was
erroneous and would be rejected by the computer.

Plaintiff's account is a current account which should immediately be posted.