Bank of the Philippine Islands vs.

Court of
Appeals, et al.
Republic of the Philippines
SUPREME COURT
Manila

FIRST DIVISION

G.R. No. 136202 January 25, 2007

BANK OF THE PHILIPPINE ISLANDS, Petitioner,

vs.
COURT OF APPEALS, ANNABELLE A. SALAZAR, and JULIO R.
TEMPLONUEVO, Respondents

DECISION

AZCUNA, J.:

This is a petition for review under Rule 45 of the Rules of Court seeking the reversal of
the Decision1 dated April 3, 1998, and the Resolution2dated November 9, 1998, of the
Court of Appeals in CA-G.R. CV No. 42241.

The facts3 are as follows:

A.A. Salazar Construction and Engineering Services filed an action for a sum of money
with damages against herein petitioner Bank of the Philippine Islands (BPI) on
December 5, 1991 before Branch 156 of the Regional Trial Court (RTC) of Pasig City. The
complaint was later amended by substituting the name of Annabelle A. Salazar as the
real party in interest in place of A.A. Salazar Construction and Engineering Services.
Private respondent Salazar prayed for the recovery of the amount of Two Hundred
Sixty-Seven Thousand, Seven Hundred Seven Pesos and Seventy Centavos
(P267,707.70) debited by petitioner BPI from her account. She likewise prayed for
damages and attorney’s fees.

Petitioner BPI, in its answer, alleged that on August 31, 1991, Julio R. Templonuevo,
third-party defendant and herein also a private respondent, demanded from the former
payment of the amount of Two Hundred Sixty-Seven Thousand, Six Hundred Ninety-
Two Pesos and Fifty Centavos (P267,692.50) representing the aggregate value of three
(3) checks, which were allegedly payable to him, but which were deposited with the
petitioner bank to private respondent Salazar’s account (Account No. 0203-1187-67)
without his knowledge and corresponding endorsement.
Accepting that Templonuevo’s claim was a valid one, petitioner BPI froze Account No.
0201-0588-48 of A.A. Salazar and Construction and Engineering Services, instead of
Account No. 0203-1187-67 where the checks were deposited, since this account was
already closed by private respondent Salazar or had an insufficient balance.

Private respondent Salazar was advised to settle the matter with Templonuevo but they
did not arrive at any settlement. As it appeared that private respondent Salazar was not
entitled to the funds represented by the checks which were deposited and accepted for
deposit, petitioner BPI decided to debit the amount of P267,707.70 from her Account
No. 0201-0588-48 and the sum of P267,692.50 was paid to Templonuevo by means of a
cashier’s check. The difference between the value of the checks (P267,692.50) and the
amount actually debited from her account (P267,707.70) represented bank charges in
connection with the issuance of a cashier’s check to Templonuevo.

In the answer to the third-party complaint, private respondent Templonuevo admitted

the payment to him of P267,692.50 and argued that said payment was to correct the
malicious deposit made by private respondent Salazar to her private account, and that
petitioner bank’s negligence and tolerance regarding the matter was violative of the
primary and ordinary rules of banking. He likewise contended that the debiting or
taking of the reimbursed amount from the account of private respondent Salazar by
petitioner BPI was a matter exclusively between said parties and may be pursuant to
banking rules and regulations, but did not in any way affect him. The debiting from
another account of private respondent Salazar, considering that her other account was
effectively closed, was not his concern.

After trial, the RTC rendered a decision, the dispositive portion of which reads thus:

WHEREFORE, premises considered, judgment is hereby rendered in favor of the

plaintiff [private respondent Salazar] and against the defendant [petitioner BPI] and
ordering the latter to pay as follows:

1. The amount of P267,707.70 with 12% interest thereon from September 16, 1991
until the said amount is fully paid;

2. The amount of P30,000.00 as and for actual damages;

3. The amount of P50,000.00 as and for moral damages;

4. The amount of P50,000.00 as and for exemplary damages;

5. The amount of P30,000.00 as and for attorney’s fees; and

6. Costs of suit.

The counterclaim is hereby ordered DISMISSED for lack of factual basis.

The third-party complaint [filed by petitioner] is hereby likewise ordered DISMISSED

for lack of merit.
Third-party defendant’s [i.e., private respondent Templonuevo’s] counterclaim is hereby
likewise DISMISSED for lack of factual basis.

SO ORDERED.4

On appeal, the Court of Appeals (CA) affirmed the decision of the RTC and held that
respondent Salazar was entitled to the proceeds of the three (3) checks notwithstanding
the lack of endorsement thereon by the payee. The CA concluded that Salazar and
Templonuevo had previously agreed that the checks payable to JRT Construction and
Trading5 actually belonged to Salazar and would be deposited to her account, with
petitioner acquiescing to the arrangement.6

Petitioner therefore filed this petition on these grounds:

I.

The Court of Appeals committed reversible error in misinterpreting Section 49 of the

Negotiable Instruments Law and Section 3 (r and s) of Rule 131 of the New Rules on
Evidence.

II.

The Court of Appeals committed reversible error in NOT applying the provisions of
Articles 22, 1278 and 1290 of the Civil Code in favor of BPI.

III.

The Court of Appeals committed a reversible error in holding, based on a

misapprehension of facts, that the account from which BPI debited the amount
of P267,707.70 belonged to a corporation with a separate and distinct personality.

IV.

The Court of Appeals committed a reversible error in holding, based entirely on

speculations, surmises or conjectures, that there was an agreement between SALAZAR
and TEMPLONUEVO that checks payable to TEMPLONUEVO may be deposited by
SALAZAR to her personal account and that BPI was privy to this agreement.

V.

The Court of Appeals committed reversible error in holding, based entirely on

speculation, surmises or conjectures, that SALAZAR suffered great damage and
prejudice and that her business standing was eroded.

VI.

The Court of Appeals erred in affirming instead of reversing the decision of the lower
court against BPI and dismissing SALAZAR’s complaint.
 VII.

The Honorable Court erred in affirming the decision of the lower court dismissing the
third-party complaint of BPI.7
The issues center on the propriety of the deductions made by petitioner from private
respondent Salazar’s account. Stated otherwise, does a collecting bank, over the
objections of its depositor, have the authority to withdraw unilaterally from such
depositor’s account the amount it had previously paid upon certain unendorsed order
instruments deposited by the depositor to another account that she later closed?

Petitioner argues thus:

1. There is no presumption in law that a check payable to order, when found in

the possession of a person who is neither a payee nor the indorsee thereof, has
been lawfully transferred for value. Hence, the CA should not have presumed that
Salazar was a transferee for value within the contemplation of Section 49 of the
Negotiable Instruments Law,8 as the latter applies only to a holder defined under
Section 191of the same.9

2. Salazar failed to adduce sufficient evidence to prove that her possession of the
three checks was lawful despite her allegations that these checks were deposited
pursuant to a prior internal arrangement with Templonuevo and that petitioner
was privy to the arrangement.

3. The CA should have applied the Civil Code provisions on legal compensation
because in deducting the subject amount from Salazar’s account, petitioner was
merely rectifying the undue payment it made upon the checks and exercising its
prerogative to alter or modify an erroneous credit entry in the regular course of
its business.

4. The debit of the amount from the account of A.A. Salazar Construction and
Engineering Services was proper even though the value of the checks had been
originally credited to the personal account of Salazar because A.A. Salazar
Construction and Engineering Services, an unincorporated single proprietorship,
had no separate and distinct personality from Salazar.

5. Assuming the deduction from Salazar’s account was improper, the CA should
not have dismissed petitioner’s third-party complaint against Templonuevo
because the latter would have the legal duty to return to petitioner the proceeds
of the checks which he previously received from it.

6. There was no factual basis for the award of damages to Salazar.

The petition is partly meritorious.

First, the issue raised by petitioner requires an inquiry into the factual findings made by
the CA. The CA’s conclusion that the deductions from the bank account of A.A. Salazar
Construction and Engineering Services were improper stemmed from its finding that
there was no ineffective payment to Salazar which would call for the exercise of
petitioner’s right to set off against the former’s bank deposits. This finding, in turn, was
drawn from the pleadings of the parties, the evidence adduced during trial and upon the
admissions and stipulations of fact made during the pre-trial, most significantly the
following:

(a) That Salazar previously had in her possession the following checks:

(1) Solid Bank Check No. CB766556 dated January 30, 1990 in the amount
of P57,712.50;

(2) Solid Bank Check No. CB898978 dated July 31, 1990 in the amount
of P55,180.00; and,

(3) Equitable Banking Corporation Check No. 32380638 dated August 28,
1990 for the amount of P154,800.00;

(b) That these checks which had an aggregate amount of P267,692.50 were
payable to the order of JRT Construction and Trading, the name and style under
which Templonuevo does business;

(c) That despite the lack of endorsement of the designated payee upon such
checks, Salazar was able to deposit the checks in her personal savings account
with petitioner and encash the same;

(d) That petitioner accepted and paid the checks on three (3) separate occasions
over a span of eight months in 1990; and

(e) That Templonuevo only protested the purportedly unauthorized encashment

of the checks after the lapse of one year from the date of the last check.10

Petitioner concedes that when it credited the value of the checks to the account of
private respondent Salazar, it made a mistake because it failed to notice the lack of
endorsement thereon by the designated payee. The CA, however, did not lend credence
to this claim and concluded that petitioner’s actions were deliberate, in view of its
admission that the "mistake" was committed three times on three separate occasions,
indicating acquiescence to the internal arrangement between Salazar and Templonuevo.
The CA explained thus:

It was quite apparent that the three checks which appellee Salazar deposited were not
indorsed. Three times she deposited them to her account and three times the amounts
borne by these checks were credited to the same. And in those separate occasions, the
bank did not return the checks to her so that she could have them indorsed. Neither did
the bank question her as to why she was depositing the checks to her account
considering that she was not the payee thereof, thus allowing us to come to the
conclusion that defendant-appellant BPI was fully aware that the proceeds of the three
checks belong to appellee.
For if the bank was not privy to the agreement between Salazar and Templonuevo, it is
most unlikely that appellant BPI (or any bank for that matter) would have accepted the
checks for deposit on three separate times nary any question. Banks are most finicky
over accepting checks for deposit without the corresponding indorsement by their
payee. In fact, they hesitate to accept indorsed checks for deposit if the depositor is not
one they know very well.11

The CA likewise sustained Salazar’s position that she received the checks from
Templonuevo pursuant to an internal arrangement between them, ratiocinating as
follows:

If there was indeed no arrangement between Templonuevo and the plaintiff over the
three questioned checks, it baffles us why it was only on August 31, 1991 or more than a
year after the third and last check was deposited that he demanded for the refund of the
total amount of P267,692.50.

A prudent man knowing that payment is due him would have demanded payment by his
debtor from the moment the same became due and demandable. More so if the sum
involved runs in hundreds of thousand of pesos. By and large, every person, at the very
moment he learns that he was deprived of a thing which rightfully belongs to him, would
have created a big fuss. He would not have waited for a year within which to do so. It is
most inconceivable that Templonuevo did not do this.12

Generally, only questions of law may be raised in an appeal by certiorariunder Rule 45

of the Rules of Court.13 Factual findings of the CA are entitled to great weight and
respect, especially when the CA affirms the factual findings of the trial court. 14 Such
questions on whether certain items of evidence should be accorded probative value or
weight, or rejected as feeble or spurious, or whether or not the proofs on one side or the
other are clear and convincing and adequate to establish a proposition in issue, are
questions of fact. The same holds true for questions on whether or not the body of
proofs presented by a party, weighed and analyzed in relation to contrary evidence
submitted by the adverse party may be said to be strong, clear and convincing, or
whether or not inconsistencies in the body of proofs of a party are of such gravity as to
justify refusing to give said proofs weight - all these are issues of fact which are not
reviewable by the Court.15

This rule, however, is not absolute and admits of certain exceptions, namely: a) when
the conclusion is a finding grounded entirely on speculations, surmises, or conjectures;
b) when the inference made is manifestly mistaken, absurd, or impossible; c) when
there is a grave abuse of discretion; d) when the judgment is based on a
misapprehension of facts; e) when the findings of fact are conflicting; f) when the CA, in
making its findings, went beyond the issues of the case and the same are contrary to the
admissions of both appellant and appellee; g) when the findings of the CA are contrary
to those of the trial court; h) when the findings of fact are conclusions without citation of
specific evidence on which they are based; i) when the finding of fact of the CA is
premised on the supposed absence of evidence but is contradicted by the evidence on
record; and j) when the CA manifestly overlooked certain relevant facts not disputed by
the parties and which, if properly considered, would justify a different conclusion.16
In the present case, the records do not support the finding made by the CA and the trial
court that a prior arrangement existed between Salazar and Templonuevo regarding the
transfer of ownership of the checks. This fact is crucial as Salazar’s entitlement to the
value of the instruments is based on the assumption that she is a transferee within the
contemplation of Section 49 of the Negotiable Instruments Law.

Section 49 of the Negotiable Instruments Law contemplates a situation whereby the

payee or indorsee delivers a negotiable instrument for value without indorsing it, thus:

Transfer without indorsement; effect of- Where the holder of an instrument payable to
his order transfers it for value without indorsing it, the transfer vests in the transferee
such title as the transferor had therein, and the transferee acquires in addition, the right
to have the indorsement of the transferor. But for the purpose of determining whether
the transferee is a holder in due course, the negotiation takes effect as of the time when
the indorsement is actually made. 17

It bears stressing that the above transaction is an equitable assignment and the
transferee acquires the instrument subject to defenses and equities available among
prior parties. Thus, if the transferor had legal title, the transferee acquires such title and,
in addition, the right to have the indorsement of the transferor and also the right, as
holder of the legal title, to maintain legal action against the maker or acceptor or other
party liable to the transferor. The underlying premise of this provision, however, is that
a valid transfer of ownership of the negotiable instrument in question has taken place.

Transferees in this situation do not enjoy the presumption of ownership in favor of

holders since they are neither payees nor indorsees of such instruments. The weight of
authority is that the mere possession of a negotiable instrument does not in itself
conclusively establish either the right of the possessor to receive payment, or of the right
of one who has made payment to be discharged from liability. Thus, something more
than mere possession by persons who are not payees or indorsers of the instrument is
necessary to authorize payment to them in the absence of any other facts from which the
authority to receive payment may be inferred.18

The CA and the trial court surmised that the subject checks belonged to private
respondent Salazar based on the pre-trial stipulation that Templonuevo incurred a one-
year delay in demanding reimbursement for the proceeds of the same. To the Court’s
mind, however, such period of delay is not of such unreasonable length as to estop
Templonuevo from asserting ownership over the checks especially considering that it
was readily apparent on the face of the instruments19 that these were crossed checks.

In State Investment House v. IAC,20 the Court enumerated the effects of crossing a
check, thus: (1) that the check may not be encashed but only deposited in the bank; (2)
that the check may be negotiated only once - to one who has an account with a bank;
and (3) that the act of crossing the check serves as a warning to the holder that the check
has been issued for a definite purpose so that such holder must inquire if the check has
been received pursuant to that purpose.
Thus, even if the delay in the demand for reimbursement is taken in conjunction with
Salazar’s possession of the checks, it cannot be said that the presumption of ownership
in Templonuevo’s favor as the designated payee therein was sufficiently overcome. This
is consistent with the principle that if instruments payable to named payees or to their
order have not been indorsed in blank, only such payees or their indorsees can be
holders and entitled to receive payment in their own right.21

The presumption under Section 131(s) of the Rules of Court stating that a negotiable
instrument was given for a sufficient consideration will not inure to the benefit of
Salazar because the term "given" does not pertain merely to a transfer of physical
possession of the instrument. The phrase "given or indorsed" in the context of a
negotiable instrument refers to the manner in which such instrument may be
negotiated. Negotiable instruments are negotiated by "transfer to one person or another
in such a manner as to constitute the transferee the holder thereof. If payable to bearer
it is negotiated by delivery. If payable to order it is negotiated by the indorsement
completed by delivery."22The present case involves checks payable to order. Not being
a payee or indorsee of the checks, private respondent Salazar could not be
a holderthereof.

It is an exception to the general rule for a payee of an order instrument to transfer the
instrument without indorsement. Precisely because the situation is abnormal, it is but
fair to the maker and to prior holders to require possessors to prove without the aid of
an initial presumption in their favor, that they came into possession by virtue of a
legitimate transaction with the last holder.23 Salazar failed to discharge this burden, and
the return of the check proceeds to Templonuevo was therefore warranted under the
circumstances despite the fact that Templonuevo may not have clearly demonstrated
that he never authorized Salazar to deposit the checks or to encash the same.
Noteworthy also is the fact that petitioner stamped on the back of the checks the words:
"All prior endorsements and/or lack of endorsements guaranteed," thereby making the
assurance that it had ascertained the genuineness of all prior endorsements. Having
assumed the liability of a general indorser, petitioner’s liability to the designated payee
cannot be denied.

Consequently, petitioner, as the collecting bank, had the right to debit Salazar’s account
for the value of the checks it previously credited in her favor. It is of no moment that the
account debited by petitioner was different from the original account to which the
proceeds of the check were credited because both admittedly belonged to Salazar, the
former being the account of the sole proprietorship which had no separate and distinct
personality from her, and the latter being her personal account.

The right of set-off was explained in Associated Bank v. Tan:24

A bank generally has a right of set-off over the deposits therein for the payment of any
withdrawals on the part of a depositor. The right of a collecting bank to debit a client's
account for the value of a dishonored check that has previously been credited has fairly
been established by jurisprudence. To begin with, Article 1980 of the Civil Code provides
that "[f]ixed, savings, and current deposits of money in banks and similar institutions
shall be governed by the provisions concerning simple loan."
Hence, the relationship between banks and depositors has been held to be that of
creditor and debtor. Thus, legal compensation under Article 1278 of the Civil Code may
take place "when all the requisites mentioned in Article 1279 are present," as follows:

(1) That each one of the obligors be bound principally, and that he be at the same
time a principal creditor of the other;

(2) That both debts consist in a sum of money, or if the things due are
consumable, they be of the same kind, and also of the same quality if the latter
has been stated;

(3) That the two debts be due;

(4) That they be liquidated and demandable;

(5) That over neither of them there be any retention or controversy, commenced
by third persons and communicated in due time to the debtor.

While, however, it is conceded that petitioner had the right of set-off over the amount it
paid to Templonuevo against the deposit of Salazar, the issue of whether it acted
judiciously is an entirely different matter.25As businesses affected with public interest,
and because of the nature of their functions, banks are under obligation to treat the
accounts of their depositors with meticulous care, always having in mind the fiduciary
nature of their relationship.26 In this regard, petitioner was clearly remiss in its duty to
private respondent Salazar as its depositor.

To begin with, the irregularity appeared plainly on the face of the checks. Despite the
obvious lack of indorsement thereon, petitioner permitted the encashment of these
checks three times on three separate occasions. This negates petitioner’s claim that it
merely made a mistake in crediting the value of the checks to Salazar’s account and
instead bolsters the conclusion of the CA that petitioner recognized Salazar’s claim of
ownership of checks and acted deliberately in paying the same, contrary to ordinary
banking policy and practice. It must be emphasized that the law imposes a duty of
diligence on the collecting bank to scrutinize checks deposited with it, for the purpose of
determining their genuineness and regularity. The collecting bank, being primarily
engaged in banking, holds itself out to the public as the expert on this field, and the law
thus holds it to a high standard of conduct.27 The taking and collection of a check
without the proper indorsement amount to a conversion of the check by the bank.28

More importantly, however, solely upon the prompting of Templonuevo, and with full
knowledge of the brewing dispute between Salazar and Templonuevo, petitioner debited
the account held in the name of the sole proprietorship of Salazar without even serving
due notice upon her. This ran contrary to petitioner’s assurances to private respondent
Salazar that the account would remain untouched, pending the resolution of the
controversy between her and Templonuevo.29 In this connection, the CA cited the letter
dated September 5, 1991 of Mr. Manuel Ablan, Senior Manager of petitioner bank’s
Pasig/Ortigas branch, to private respondent Salazar informing her that her account had
been frozen, thus:
From the tenor of the letter of Manuel Ablan, it is safe to conclude that Account No.
0201-0588-48 will remain frozen or untouched until herein [Salazar] has settled
matters with Templonuevo. But, in an unexpected move, in less than two weeks (eleven
days to be precise) from the time that letter was written, [petitioner] bank issued a
cashier’s check in the name of Julio R. Templonuevo of the J.R.T. Construction and
Trading for the sum of P267,692.50 (Exhibit "8") and debited said amount from Ms.
Arcilla’s account No. 0201-0588-48 which was supposed to be frozen or controlled.
Such a move by BPI is, to Our minds, a clear case of negligence, if not a fraudulent,
wanton and reckless disregard of the right of its depositor.

The records further bear out the fact that respondent Salazar had issued several checks
drawn against the account of A.A. Salazar Construction and Engineering Services prior
to any notice of deduction being served. The CA sustained private respondent Salazar’s
claim of damages in this regard:

The act of the bank in freezing and later debiting the amount of P267,692.50 from the
account of A.A. Salazar Construction and Engineering Services caused plaintiff-appellee
great damage and prejudice particularly when she had already issued checks drawn
against the said account. As can be expected, the said checks bounced. To prove this,
plaintiff-appellee presented as exhibits photocopies of checks dated September 8, 1991,
October 28, 1991, and November 14, 1991 (Exhibits "D", "E" and "F" respectively)30

These checks, it must be emphasized, were subsequently dishonored, thereby causing

private respondent Salazar undue embarrassment and inflicting damage to her standing
in the business community. Under the circumstances, she was clearly not given the
opportunity to protect her interest when petitioner unilaterally withdrew the above
amount from her account without informing her that it had already done so.

For the above reasons, the Court finds no reason to disturb the award of damages
granted by the CA against petitioner. This whole incident would have been avoided had
petitioner adhered to the standard of diligence expected of one engaged in the banking
business. A depositor has the right to recover reasonable moral damages even if the
bank’s negligence may not have been attended with malice and bad faith, if the former
suffered mental anguish, serious anxiety, embarrassment and humiliation.31 Moral
damages are not meant to enrich a complainant at the expense of defendant. It is only
intended to alleviate the moral suffering she has undergone. The award of exemplary
damages is justified, on the other hand, when the acts of the bank are attended by
malice, bad faith or gross negligence. The award of reasonable attorney’s fees is proper
where exemplary damages are awarded. It is proper where depositors are compelled to
litigate to protect their interest.32

WHEREFORE, the petition is partially GRANTED. The assailed Decision dated April
3, 1998 and Resolution dated April 3, 1998 rendered by the Court of Appeals in CA-G.R.
CV No. 42241 are MODIFIED insofar as it ordered petitioner Bank of the Philippine
Islands to return the amount of Two Hundred Sixty-seven Thousand Seven Hundred
and Seven and 70/100 Pesos (P267,707.70) to respondent Annabelle A. Salazar, which
portion is REVERSED and SET ASIDE. In all other respects, the same
are AFFIRMED.
No costs.

SO ORDERED.

ADOLFO S. AZCUNA
Associate Justice

WE CONCUR:

REYNATO S. PUNO
Chairperson
Chief Justice

ANGELINA SANDOVAL-GUTIERREZ RENATO C. CORONA

Associate Justice Asscociate Justice

CANCIO C. GARCIA
Associate Justice

CERTIFICATION

Pursuant to Section 13, Article VIII of the Constitution, it is hereby certified that the
conclusions in the above Decision had been reached in consultation before the case was
assigned to the writer of the opinion of the Court’s Division.

REYNATO S. PUNO
Chief Justice

Footnotes
1 CA Rollo, pp. 100-116.
2 Rollo, p. 57.
3 CA Rollo, pp. 100-105.
4 Records, pp. 323-324.
5Private respondent Templonuevo admitted that he was doing business under
the name and style, "JRT

Construction and Trading." See Records, p.179.

6 Rollo, p. 106.
7Id. at 12-13.
8Infra note 17.
9Sec.191. Definition and meaning of terms. - In this Act, unless the contract
otherwise requires:

xxx

"Holder" means the payee or indorsee of a bill or note who is in possession

of it, or the bearer thereof;

xxx
10 Records, pp. 178-179.
11 CA Rollo, pp. 106-107.
12Id. at 107.
13Madrigal v. CA, G.R. No. 142944, April 15, 2005, 456 SCRA 247; Bernardo v.
CA, G.R. No. 101680, December 7, 1992, 216 SCRA 224; Remalante v. Tibe, G.R.
No. L-59514, February 25,1988, 158 SCRA 138.
14Borromeo v. Sun, G.R. No. 75908, October 22, 1999, 317 SCRA 176.
15Paterno v. Paterno, G.R. No. 63680, March 23, 1990, 183 SCRA 630.
16Arcaba v. Tabancura, 421 Phil. 1096 (2001); Martinez v. CA, G.R. No. 123547,
May 21, 2001, 358 SCRA 38.
17 Act No. 2031 (1911).
1811 Am Jur 2d, § 988, citing Doubleday v. Kress, 50 NY 410, Hoffmaster v.
Black, 84 NE 423, and First Nat. Bank v. Gorman, 21 P2d 549.
19 Records, pp. 286-293.
20 G.R. No. 72764, July 13, 1989, 175 SCRA 310.
21Supra note 18.
22 Negotiable Instruments Law, Section 30.
23Campos Jr. and Lopez Campos, "Notes and Selected Cases on Negotiable
Instruments Law," p. 108, (1994).
24 G.R. No. 156940, December 14, 2004, 446 SCRA 282.
25Id.
26Prudential Bank v. CA, G.R. No. 125536, March 16, 2000, 328 SCRA
264; Simex International [Manila], Inc. v. CA, G.R. No.88013, March 19, 1990,
183 SCRA 360; BPI v. IAC, G.R. No. 69162, February 21, 1992, 206 SCRA 408.
27Banco de Oro Savings and Mortgage Bank v. Equitable Banking Corp., G.R.
No. L-74917, January 20,1988, 157 SCRA 188.
28AssociatedBank v. CA, G.R. No. 89802, May 7, 1992, 208 SCRA 465; City
Trust Banking Corp. v. IAC, G.R. No. 84281, May 27, 1994, 232 SCRA 559.
29CA rollo, p. 112; Transcript of Stenographic Notes dated November 9, 1992, pp.
8-9.
30 CA rollo, pp. 111.
31 Civil Code, Article 2217.
32Prudential Bank v. CA, supra note 26.