SECOND DIVISION

The case stemmed from a complaint [4] filed by herein respondent

P H I L I P P I NE NATI O N A L B AN K ,
P e t i t i o n e r,

G.R. No. 157845

Pike for damages[5] against Philippine National Bank (PNB) on 04 January

Present:

PUNO,
Chairman,
1994.
AU S TR I A - MA RT I NE Z ,
CALLEJO, SR.,
TINGA, and
CHICO-NAZARIO,

- versus

N O R M A N Y. P I K E ,
R e s p o n d e n t.

Promulgated:

Complainant Pike often traveled to and from Japan as a gay

September 20, 2005

x - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - x

D E C I S I O N

e n t e r t a i n e r i n s a i d c o u n t r y.

Sometime in 1991, he opened U.S. Dollar

Savings Account No. 0265-704591-0 wi th herein petitioner PNB Buendia

CHICO-N AZ ARIO, J.:

branch for which he wa s issued a corresponding passbook.

The complaint

alleged in substance that before complainant Pike left for Japan on 18

This petition for review on certiorari under Rule 45 of the 1997
March 1993, he kept the aforementioned passbook inside a cabinet under
Rules

of

Civil

Procedure,

as

amended,

seeks

to

reverse

the
l o c k a n d k e y, i n h i s h o m e ; t h a t o n 1 9 A p r i l 1 9 9 3 , a f e w h o u r s a f t e r h e

Decision[1] dated 19 December 2002, and the Resolution [2] dated 02 April
arrived from Japan, he discovered that some of his valuables we re missing
2003, both of the Court of Appeals, in CA-G.R. CV No. 59389, which
including the passbook; that he immediately reported the incident to the
a ffi rm e d wi th m o di fi c a ti o n th e De c i s i on [3 ] re n d e re d b y th e Re g i o n al Tri a l
police which led to the arres t and prosecution of a certain Mr. Jo y Manuel
Court (RTC), Branch 07 of Manila, dated 10 January 1997, in Civil Case
Davasol; that complainant Pike also discovered that Davasol made two (2)
No. 94-68821 in favor of herein respondent Norman Pike (Pike).

unauthorized wi thdra wals from his U.S. Dollar Savings Account No. 0265-

account be lifted so that he may withdraw the remaining balance left in his

704591-0, both times at the PNB Buendia branch on the follo wing dates :

U.S.$ Savings Account and nothing else.

D ATE
31 March 1993
0 5 Ap r i l 1 9 9 3
TOTAL

AMOUNT
$3,500.00
4,000.00
$7,500.00

On

Dismiss[6] of

the

other

hand,

defendant

18

April

1994,

PNB

alleged,

counterstatement

of

in

its

facts.

Motion

Its

allegations read:
that on several occasions, complainant Pike went to defendant PNBs

Buendia branch and verball y protested the unauthorized withd ra wals and

like wise

demanded

the

return

of

the

total

wi thdra wn

amount

of

U.S.

$7,500.00, on the ground that he never authori zed an ybod y to wi thdra w

from his account as the signatures appearing on the subject withd ra wal

slips were clearly forgeries; that defendant PNB refused to credit said

amount

back

to

complainants

U.S.

Dollar

Savings

Account

without

justifiable reason, and instead, defendant bank wrote him that it exercised

due diligence in the handling of said account; and that on 06 May 1993,

complainant Pike wrote defendant PNB simply to request that the hold-

. . . On March 15, 1993 at PNB Buendia Branch,

M r . N o r m a n Y. P i k e , t o g e t h e r w i t h a c e r t a i n J o y D a v a s o l
w e n t t o s e e P N B AV P M r . L o r e n z o T. V a l ( s i c ) , J r .
purposel y to wi thdra w the amount of $2,000.00. Mr. Pike
a l s o i n f o r m e d AV P V a l t h a t h e i s l e a v i n g f o r a b r o a d
(Japan) and made verbal instruction to honor all
w i t h d r a w a l s t o b e t r a n s m i t t e d b y h i s Tal e n t M a n a g e r a n d
C h o re o g ra p h e r, J o y D a v a s ol wh o s h al l p re s e n t p re signed wi thdra wal slips bearing his (Pikes) signatu re. . .
On
Ap r i l
19,
1993,
a
certain
Josephine
Balmaceda, who claimed to be plaintiffs sister executed
an affidavit . . . . stating therein that they discovered
today (April 19, 1993) the lost (sic) of her brothers
p a s s b o o k i s s u e d b y P N B o n a c c o u n t o f r o b b e r y,
committed in the residence/office of her brother, promptl y
reporting the matter to the police authorities and her
brother cannot report the matter to the Bank because he
was currently in Japan and therefore requesting the Bank
to issue a hold-order on her brothers passbook.
But a copy of an alarm (Police) Report dated
April 19, 1993. . . stated that plaintiff (who was the one
who reported the matter) after one month in Japan, he
( c o m p l a i n a n t ) a r r i v e d y e s t e r d a y. . .
O n A p r i l 2 6 , 1 9 9 3 , A t t y. N a t h a n i e l I f u r u n g w h o
claims to be plaintiffs counsel sent a demand letter to
V P V i o l e t a T. S u q u i l a ( t h e n V P a n d M a n a g e r o f P N B
Buendia Branch) demanding the bank to credit back the
amount of US$7,500.00 wh ich were wi thdra wn on Ma rch
31, 1993 and April 5, 1993, because his clients

to

factual

signatures we re forged and the wi thdra wal made the reon

were unauthorized. . .
O n M a y 5 , 1 9 9 3 , M r . N o r m a n Y. P i k e e x e c u t e d
a n af f id a v i t of lo s s ( si c ) D ol l a r Ac c o u n t P a s sb o o k a n d
requested the PNB to replace the same and allow him to
make wi thdra wals thereon . He sta ted tha t his passbook
was stolen toge ther with other valuables which he
discovered onl y in the earl y morning of April 19, 1993. . .
O n M a y 6 , 1 9 9 3 , p l a i n t i f f N o r m a n Y. P i k e w r o t e a
letter. . . addressed to the Manager of PNB, Buendia
Branch the full contents of said letter hereto quoted as
follows:
May 6, 1993
The Manager
Philippine National Bank
Buendia Branch
P a s e o d e R o xa s c o r. Gi l P u ya t S tre e t
Makati, Metro Manila

On the same day May 6, 1993 Plaintiff Norman

Y. P i k e w a s a l l o w e d b y d e f e n d a n t b a n k t o w i t h d r a w t h e
remaining balance from his passbook .
A letter dated May 18, 1993 was sent to
Plaintiffs counsel by PNB stating that the Bank
regrets that it cannot accede to such request inasmuch
as the Bank exercised due diligence of a good father to
his family in the handling of transactions covering the
deposit account of Mr. Pike .
On Jul y 2, 1993, Plaintiffs counsel sent a letter
to P NB Vice P res. S uqui l a den yi ng that hi s cl i ent made
any such promise not to hold responsible the bank and
its officers for the withdrawal made .
A letter dated Jul y 29, 1993 wa s sent to
Plaintiffs counsel by VP Suquila stating that plaintiffs
withd ra wal of the remaining balance of his account wi th
the Bank effectivel y estops him from claiming on the
alleged unauthorized wi thdra wals.

Sir:
In connection wi th the request
of
my
si s te r,
Mrs.
Josephine
P.
Balmaceda for the hold-order on my
dollar
savings
passbook
No.
265704591-0, I am now requesting your
good office to lift the same so I can
withdraw the remaining balance of my
passbook which wa s reported lost
s o m e tim e i n Ma rc h o f th i s ye a r.
I also promise not to hold
responsible the bank and its officers for
the withdra wal made on m y dollar
savings passbook on March 19 and
April 5, 1993 respectively as a result of
the lost (sic) of my passbook.
Sgd.
N O R M A N Y. P I K E
Depositor
Philippine
Passport
No. H918022
Issu
ed
at Manila on
Sept
. 6, 1990
Plac
e of Issuance

The trial court, in its decision dated 10 January 1997, made the

following findings of fact:

. . . [T]hat the bank is responsible for such

unauthorized wi thdra wals. The court is not impressed
with the defense put up by the bank. Its contention that
the wi thdra wals were authorized b y the plaintiff because
there wa s an arrangement between the bank represented
b y its Asst. Vice President Lorenzo Bal, Jr. and the
d e p o s i t o r N o r m a n Y. P i k e t o t h e e f f e c t t h a t p r e - s i g n e d
withd ra wal slips, that is, withdra wal slip signed by the
depositor in the presence of Mr. Bal wh ereb y it would be
made to appear that it wa s the deposito r himself wh o
presented the same to the bank despite the fact that it
was another person who presented the same should be
honored by the bank cannot be sanctioned by the court.
F i r s t l y, t h e c o u r t i s n o t s a t i s f i e d t h a t t h e r e w a s i n d e e d
s u c h a n a rra n g em e n t . . . It i s Mr. B al s c o n te n ti o n th a t
such an arrangement although not ordinarily entered into
is still a legal procedure of the bank and is resorted to
accommodate the depositors specially honored and
valued depositor at that .
. . .

The court compared the signatures in the

questioned withdra wal slips wi th the kno wn signatures of
the depositor and is convinced that the signatures in the
unauthorized wi thdra wal slips do not correspond to the
t ru e s i g n a tu re s of th e d e p o si to r.
From the evidence that it received, the court is
convinced that the bank wa s negligent in the performance
of its duties such that unauthorized withdrawals were
m a d e i n t h e d e p o s i t o f p l a i n t i f f N o r m a n Y. P i k e . [ 7 ]

The dispositive portion of the trial courts decision reads:

W HEREFORE and considering the foregoing,

judgment is hereby rendered in favor of the plaintiff and
against the defendant and ordering the defendant to pay
the follo wing:
1.
2.
3.
4.

US$7,500.00 plus interest thereon at

the rate of 12% per annum until the full
amount is paid;
P 25,000.00 for and as atto rne y s fees;
P50,000.00 as moral damages and
P50,000.00 as exemplary damages; and
Plus the costs of suit.[8]

i n d u s t r y, h o w e v e r , i t m o d i f i e d t h e r a t e o f i n t e r e s t a n d a w a r d f o r d a m a g e s ,

to wit:

WHEREFORE,
premises
considered,
the
Decision dated January 10, 1997 issued by the Regional
Tri a l Co u rt of Ma n il a , B ra n ch 7 , in C iv il C a s e No . 94 6 8 8 2 1 , i s h e r e b y AF F I R ME D wi t h M O D I F I C ATI O N , as
follows:
1.

Ordering
appellant,
the
Philippine
National Bank, Buendia Branch, to
refund
appellee
the
amount
of
$7,500.00 plus interest of 6% per
annum to be computed from the date of
the filing of
the complaint which
interest rate shall become 12% per
annum from the time the judgment in
this case becomes final and executory
until its satisfaction;

2.

The a ward for moral damages is reduced

to P20,000.00; and

3.

The a ward for exemplary damages

like wise reduced to P20,000.00.

is

Costs against appellant.[10]

Defendant PNBs motion for reconsidera tion wa s subsequentl y

denied b y the court a quo.[9]

O n ap p e a l , t h e C o u r t o f Ap p e a l s is s u e d t h e a s s ai l e d d e ci s i o n

dated 19 December 2002, affirming the findings of the RTC tha t indeed

defendant-appellant PNB wa s negligent in exercising the diligence required

of a business imbued with public interest such as that of the banking

The appellate court held that:

Appellant claims that appellee personally talked
to its officers to allow Joy Manuel Davasol to make
wi t h d r a wa l s . Ap p e ll e e e v e n le f t p r e - si g n e d wi t h d r a wa l
slips before he wen t to Japan. Ho wever, appellant could
have told appellee to autho rize the wi thdra wal b y a
representative by indicating the same at the space
provided at the back portion of the withd ra wal slip. This
operational flaw was observed by the trial court, when it
ruled:
The
court
cannot
also
understand why the bank did not
require the correct, proper and the
usual
procedure
of
requiring
a
depositor who is withdrawing the money
through a representative to fill up the
back portion of the withd ra wal slips,

which
itself.

form

was

issued

by

the

bank
Petitioner PNB now seeks the review of the aforequoted decision

A perusal of the records discloses that appellee

had
previously
authorized
withd ra wals
by
a
representative.
However,
these
withd ra wals
were
properly
accompanied
by
a
wi thdra wal
by
a
representa tive form aside from a hand written request b y
appellee to allo w such withdra wals b y his representa tive,
or a type written letter-request for wi thdra wal b y a
r e p r e s e n t a t i v e . C e r t a i n l y, a p p e l l a n t l a c k e d t h e d u e c a r e
and caution required of managers and employees of a
firm engaged in so sensitive and demanding business as
banking.
I n i t s d e s i r e t o b e e x o n e r a t e d f r o m l i a b i l i t y,
appellant
advances
the
argument
that,
granting
negligence
on
its
part,
appellee
condoned
this
negligence as shown in his letter dated Ma y 6, 1993,
wherein appellee purportedly undertook, not to hold the
bank and its officers responsible for the unauthorized
withd ra wals from his account.
We do not agree. It should be emphasized that
while the appellee admitted signing the letter dated May
6, 1993, he, however, denied having undertook (sic) to
exonerate
the
appellant
from
liability
for
the
unauthorized
withd ra wals.
Appellee
questioned
the
second
paragraph
of
the
said
letter
as
being
superimposed so that his signature overlapped the text of
th e s e c o n d p a ra g ra p h o f s a i d le tte r. A wa i v e r o f ri g h t, in
order to be valid, should be in a language that clearly
manifests his desire to do so. In the instant case,
appellees filing of the instant action is inconsistent with
appellants contention tha t he had wa ived his right to
question appellants negligent act of allo wing the
unauthorized withd ra wals from his account. [11]

and resolution of the Court of Appeals predicated on the follo wing issues:

I.
W HETH ER O R N O T THE P R IN C I P L E O F ES TOP P E L W AS
N O T P R O P E R LY A P P L I E D I N T H I S C A S E ;
II.
WHETHER
OR
NOT
RESPONDENT
H AVE
S U B S T A N T I A L LY P R O V E N T H A T T H E S I G N A T U R E S
A PP E AR I N G O N TH E TW O ( 2 ) Q U E S T I O N ED P R E SIGNED
W I T H D R AW A L
SLIP
FOR MS
AR E
ALL
FORGERIES IN ACCORDANCE W ITH SECTION 22, RULE
1 3 2 O F T H E R E V I S E D R U L E S O F C O U R T; a n d
III.
W HETH ER O R N O T M O R A L AN D E XE M P L A RY DA MA G E S
C A N B E AW A R D E D A G A I N S T A P A R T Y I N G O O D F A I T H .

Petitioner PNB contends that due to the verbal instructions [12] of

respondent Pike, a valued depositor, it allo wed the wi thdra wal b y another

person. Plus, the fact that said respondent wi thdre w the remaining balance
Defendant-appellant PNB filed a motion for reconsideration. In a

in his US Savings Account and executed a waiver releasing petitioner PNB

Resolution dated 02 April 2003, the Court of Appeals denied said motion.
from any liability due to the loss of the funds should rightly negate a

f i n d i n g o f n e g l i g e n c e o n i t s p a r t . A c c o r d i n g l y, p e t i t i o n e r P N B c l a i m s t h a t
Hence, this petition.
the appellate court, as well as the trial court erred in holding that the

withd ra wals in question were unautho rized as the signatures appearing on

the subject withdrawal slips were forgeries. Petitioner PNB, therefore,

a re q u e s ti o n s of f ac t a n d n o t of la w.

I n e x o r a b l y, t h e s e i s s u e s c a l l f o r a n

inquiry into the facts and evidence on record.

This, as we have so often

argues that it should not be held liable for the amount withdrawn from the
held, we cannot do.
account of respondent Pike in the sum of $7,500.00, as well as for moral

and exemplary damages.

Elementary is the rule that this Court is not the appropriate venue
to consider anew the factual issues as it is not a trier of facts, and, it
A priori, it is quite evident that the petition is anchored on a plea

to review or re-examine the factual conclusions reached by the trial court

generall y does not weigh anew the evidence alread y passed upon b y the
C o u r t o f Ap p e a l s . [ 1 4 ] W hen t h i s C o u r t i s t a s k e d t o g o o v e r o n c e m o r e t h e
evi dence presented b y both par ti es, and anal yze , assess and wei gh them

and affirmed b y the Court of Appeals, and for this Court to hold otherwise.
to ascertain if the trial court and the appellate court were correct in
W hether:
according superior credit to this or that piece of evidence of one party or
1) respondent Pikes signatures appearing on the
pertinent
withdrawal
slips
used
by
Joy
Manuel
Davasol[13] to withdraw the amount of $7,500.00, were
forgeries, as found by the trial court and affirmed by the
C o u r t of Ap p e a l s , o r we r e a u t h e n t i c a s c l ai m e d b y
petitioner bank; and
2) respondent Pike in fact execu ted a waive r
absolving petitioner bank from any legal responsibility
due to the unauthorized wi thdra wals, as maintained b y
petitioner bank, or the paragraph containing said wa iver
was intercalated by some other person, thus, amounting
no waive r at all, as held b y the courts a quo.

the other, the Court cannot and will not do the same. [15] Such task is
foreclosed by the rule enunciated under Section 1 of Rule 45 [16] of the
Rules of Court:

SECTION
1. Filing
of
petition
with
Supreme Court. - . . . The petition shall raise only
questions of law[17] which must be distinctly set forth.

W e have oft ruled that factual findings of the Court of Appeals

are conclusive on the parties and not revie wable b y this Court and the y

carry even more weight when the Court of Appeals affirms the factual

em pl o yees ,[19] and havi ng such obl i gati on, thi s C ourt cannot i gnore the

findings of the trial court, [18] and in the absence of an y sho wing that the

circumstances

findings complained of are totally devoid of support in the evidence on

p e t i t i o n e r P N B t u r n e d t h e i r h e a d s , n a y, c l o s e d t h e i r e y e s t o t h e s u s p i c i o u s

record, or that they are so glaringl y erroneous as to constitute serious

circumstances enfolding the two wi thdra wals subject of the case at bar. It

abuse of discretion, such findings must stand. The courts a quo are in a

m a y even be sai d tha t the y wen t out of thei r wa ys to di sregard standard

much better position to evaluate properly the evidence.

operating procedures formulated to ensure the security of each and every

surrounding

the

case

at

bar

how

the

employees

of

account that they are handling. Petitioner PNB does not deny that the
Finding

no

other

alternative

but

to

affirm

their

finding

that

withd ra wal slips used were in breach of standard operating procedures of

petitioner PNB negligentl y allowed the unauthorized wi thdra wals subjec t of

banks in the ordinary and usual course of banking operations as testified

th e c a s e a t b a r, th e in s ta n t p e ti ti o n f o r re vi e w m u s t ne c e s s a ri l y f ai l .

t o b y o n e o f i t s w i t n e s s e s , M r . L o r e n z o T. B a l , A s s i s t a n t V i c e P r e s i d e n t o f
Petitioner PNBs Buendia branch, on cross-examination [20] he stated thus:
Q:

Mr.
Witness,
when
the
original
of
Exhibit
B [21] was presented to you fo r approval, how
many signatures of depositor appears thereon?

A:

T wo ( 2 ) s i g n a t u r e s a p p e a r s ( s i c ) o n t h e f a c e o f t h e
withdrawal slip.

At this juncture, it bears emphasizing that negligence of banking

institutions should never be countenanced. The negligence here lies in the
l ackadai si cal atti tude exhi bi ted b y empl o yees of peti ti oner PN B in thei r

Q:

t r e a t m e n t of r e s p o n d e n t P ik e s US Do ll a r Sa v i n g s Ac c o u n t t h a t r e s u l t e d in

A:

Yes , s i r .

Q:

Are you sure of that?

A:

Yes , s i r . B e c a u s e i t w a s p r e s i g n e d w i t h d r a w a l
slip.

Q:

What does the signature

recipient means?

A:

Received.

Q:

So, what you are saying is that, the depositor here

signed this even before receiving the amount?

the

unauthorized

withdrawal

of

$7,500.00.

Nevertheless,

though

its

em pl o yees ma y be the ones negl igent , a banks li abi l i t y as an obli gor is

n o t m e r e l y v i c a r i o u s b u t p r i m a r y, a s b a n k s a r e e x p e c t e d t o e x e r c i s e t h e
highest degree

of

diligence in the

selection

and

supervision of

their

W hen it (sic)
i mm edi atel y?

was

(sic)

presented

a p p e a r,

to

the

yo u

word

A:

Because before the withdra wal wa s made,

Pike, the depositor came to the bank wh en
withdrew the $2,000.00 and instructed me
requested us even the supervisor to honor
withd ra wal slip.

Q:

And this is a regular procedure?

A:

Yes, si r.

Q:

Are you sure of that?

A:

Yes , s i r .

Mr.
he
or
all

From the foregoing, petitioner PNBs wi tness was utterl y remiss in

protecting the banks client, as well as the bank itself, wh en he allo wed an
account holder to make it appear as if he was the one actually withdrawing
f r o m a n a c c o u n t a n d a c t u a l l y r e c e i v i n g t h e w i t h d r a w n a m o u n t . O r d i n a r i l y,
banks allo w wi thdra wal b y someone who is not the account holder so long

Q:

Do you have written manual on this particular

procedure, Mr. W itness?

A:

Of course, that includes

regulations of the bank.

in

the

Rules

Are you are (sic) are very sure of that?

A:

And banking is a fast transaction between

depositor and the bank.

Q:

And then, is the use of the back portion of the

withdrawal
slip

with
a
heading
of
authorization?

A:

N o r m a l l y, a d e p o s i t o r a n d t h e b a n k a g r e e s o n
certain terms that if you allow withdrawal from
his account, his or her account, its enough that
the signature of the depositor appears on both
spaces in the front side of the withdrawal slip.
Even if you do not have the back portion of the
withdrawal slip.

the

Q:

You a r e v e r y s u r e o f t h a t ?

A:

Yes , s i r .

Q:

An d t h a t h a s be e n d o n e wi t h t h e o t h e r wi t h d r a wa l
slip of Norman Pike as stated or as shown in the
S t a t e m e n t of Ac c o u n t ?
Yes , s i r .

Q:

That withd ra wal made b y representative?

A:

Yes , s i r .

the

account

holder

authorizes

his

representative

to

wi thdra w

and

receive from his account by signing on the space provided particularly for

Q:

A:

as

and

such

transactions,

usually

found

at

the

back

of

wi thdra wal

slips. As

fittingly found by the courts a quo, if indeed, respondent Pike signed the
w i t h d r a w a l s l i p s i n t h e p r e s e n c e o f M r . L o r e n z o B a l , p e t i t i o n e r P N B s AV P
at its Buendia branch, wh y did he not call respondent Pikes atten tion and
refer him to the space provided for authorizing representatives to withdraw
f rom a n d re c e i v e th e p ro c e e d s o f s u c h wi th d ra wa l ? O r, a t th e v e r y l e a s t,
sign or initial the same so tha t he could identif y the pre-signed wi thdra wal
slips made by Mr. Pike?

Q:

You a r e a l s o s a y i n g t h a t o n M a r c h 1 5 , 1 9 9 3 , y o u
like wise met Jo y Manuel Dabasol?

A:

Yes , s i r .

Q:

And yo u (si c) al so sa yi ng on March 15, 1993, you

a l s o m e t N o rma n Pi k e , th e d e p o s i to r,

A:

Yes , s i r .

Q:

And when did you first met (sic) Norman Pike?

A:

March 15 when he withdrew $2,000.00.

Q:

That was the first time?

A:

First time, yes.

Q:

And Mr. Norman Pike was already transacting with

you l ong before that day, i s thi s cor rect? For
how long was he transacting with you?

B y h i s o w n t e s t i m o n y, t h e w i t n e s s n e g a t e d t h e v e r y r e a s o n f o r t h e
banks

A:

That was my first time.

Q:

That was the first time. What I mean is, that he

was transacting with the PNB, Buendia Branch
long before you met him?

A:

bizarre

accommodation

of

the

alleged

verbal

request

of

respondent Pike that he was a valued client. From the aforequoted, it

appears that the witness, Lorenzo Bal, was not even reasonably familiar

Maybe.

w i t h r e s p o n d e n t P i k e , y e t , h e w a s r e a d y, w i l l i n g a n d a b l e t o a c c o m m o d a t e
the verbal request

of

said

depositor.

W orse

still,

the

asking

for

wi tness

still

Q:

An d t h e wi t h d r a wa l m a de o n Ap r il 5 , 19 9 3 wh i c h
you approved, you did not look at Exhibit C,
the Savings Signature Card Individual?

A:

We do not look at that, that is kept in the vault.

Q:

Yes o r n o ?

A:

No, sir.

approved

the

withd ra wal

transaction

without

any

proof

of

identification for the reason that: 1) Davasol wa s in possession of a presigned wi thdra wal slip; and 2) the wi tness recognized the signature of
respondent Pike even after admitting that he did not bother to counter

Q:

An d M r. wi t n e s s , E xh i b i t C - 1 [ 2 2 ] wh i c h i s b ei n g
kept at your vault, also contains a picture?

respondent Pike and that he

A:

Yes , s i r .

Q:

And the pictu re of the depositor?

A:

Yes , s i r .

Q:

And are you familiar with

depositor Norman Pike?

A:

W hat parti cular i denti t y?

Q:

His appearance?

A:

H e i s g a y l o o k i n g f e l l o w.

C O U R T:
A:

check the signature on the slip wi th

the

the specimen signature

met respondent Pike just once so that he

cannot seem to recall what the latter looks like.

identity

of

the

A n s w e r . You a r e f a m i l i a r w i t h h i s p h y s i c a l
appearance?

Not so much. Because there are so much

depositor (sic) in the bank . [23] [Em phasis ours .]

testimony

of

the

same

witness

will

justify

The ensuing quoted

finding

of

negligence

amounting to bad faith, to wit:

Q:

card of

And yo u also met Jo y Ma nuel Dabasol on March

15?

A:

Yes , s i r .

Q:

And can yo u describe Jo y Manuel D abasol ?

A:

I c a n n o t r e c a l l h i s f a c e b u t t h e n h e i s a Tal e n t
manager, because there are so many depositors
in the bank.

Q:

Is that all your basis?

A:

Yes, si r. Because his signature appears.

. . .
. . .
Q:

Mr. wi tness, you are sa ying that Mr. Pike, the

depositor gave you verbal authority to honor
withd ra wal b y Jo y Manuel Dabasol?

A:

Yes , s i r .

Q:

Why did you not require then that Mr. Pike instead
si gn the authori za ti on porti on and that the na me
of Joy Manuel Dabasol appear thereon with his
signature?

Q:

Mr. wi tn e s s , th i s al l eg e d a u th o ri t y gi v e n to yo u b y
Norman Pike to honor wi thdra wal b y Jo y Manuel
Dabasol, was that in writing?

A:

It was verbally requested.

Q:

An d t h a t is S P O ( s i c ) o f P NB , Bu e n d i a B r a n c h t o
accept verbal authorities?

A:

Yes .

Q:

Is that Standard Operating Procedure?

A:

I t i s n o t S P O , b u t w h e n y o u k n e w t h e c l i e n t , Yo u r
H o n o r, yo u h a v e to h o n o r al s o th e tru s t an d
confidence. Let us say if you

Q:

According to you, you met Norman Pike only on

March 15, 1993 and i mmediately you allowed
him to withdraw through pre-signed withdrawal
slip?

A:

Yes , You r Ho n o r. Be c a u s e a d e p o si t o r r e q u e s t e d
you to honor his signature, you have to do that
or else willand besides the request is for
p u r p o s e o f e x p e d i en c y, You r H o n o r. B e c a u s e
m o s t o f t e n t h a n t h a t , h e i s o u t o f t h e c o u n t r y, i n
J a p a n . A n d h i s Tal e n t M a n a g e r i s t h e o n e
m a n a g i n g t h e r e c r u i t i n g a g e n c y. T h e m o n e y w i l l
be used in the operating expenses.

. . .
A:
Q:

I required Mr. Norman Pike to sign the withdrawal

slip on the face of the withdrawal slip.
B ut not the authori za ti on
withdrawal slip?

portion

of

the

said

. . .
A:

N o , b e c a u s e t h a t i s s u f f i c i e n t a l r e a d y.

Q:

And is this your normal procedure, Mr. witness?

This particular procedure that you conducted?

A:

I dont think so.

Q:

Mr. wi tness, when on April 5, 1993, when Joy

Dabasol came to the office and according to
you, you do not remember hi m, is that correct?

A:

I cannot recall his face.

Q:

. . .

. . .

Q:

You did not even bother to look at the Savings

Signature Card Individual, yes or no?

An d h e ju s t s h o we d yo u a wi t h d r a wa l sl i p , i s t h i s
correct?

A:

No, sir.[24]

A:

Yes , o n A p r i l 5 .

Q:

Did you require him to produce any Identification

Card, yes or no?

A:

No.

Q:

And how did you know then that it was Joy

Dabasol who was making the withd rawal on April
5?

A:

Because
the
presigned
presented to me.

[Emphases supplied.]

Having admitted that pre-signed wi thdra wal slips do not constitu te

withdrawal

slip

was

the

normal

procedure

with

respect

to

wi thdra wals

by

representatives

shoul d have al read y put peti ti oner PN B s em pl o yees on guard.

Rather

than readil y validating and permitting said wi thdra wals, the y should have
p r o c e e d e d m o r e c a u t i o u s l y.

recognizes the fiduciary nature of banking that requires high standards of

C l e a r l y, p e t i t i o n e r b a n k s e m p l o y e e , L o r e n z o
integrity and performance. [26]

T. B a l , a n A s s i s t a n t V i c e P r e s i d e n t a t t h a t , w a s e x c e e d i n g l y c a r e l e s s i n h i s
treatment of respondent Pikes savings account.
Though passed long after the unauthorized withdrawals in this

From

the

foregoing,

the

evidence

clearly

sho wed

that

the

petitioner bank did not exercise the degree of diligence that it ought to
have exercised in dealing with their clients.

case, the aforequoted provision is a statutory affirmation of Supreme Court

decisions alread y in esse at the time of such withdra wals.

We elucidated

i n the 1990 case of Si mex In ternati onal , Inc. v. Court of Appeal s , [27] that

the bank is under obligation to treat the accounts of its depositors wi th

W ith banks, the degree of diligence required, contrary to the
meticulous

care,

al wa ys

having

in

mind

the

fiduciary

nature

of

their

position of petitioner PNB, is more than that of a good father of a famil y

relationship.[28]
considering that the business of banking is imbued wi th public interest due

to the nature of their functions. The stability of banks largely depends on

Likewise ,
the confidence of the people in the honesty and efficiency of banks.

in

the

case

of The

Consolidated

Bank

and

T ru s t

Thus,
Corporation

v.

Court

relationship

means

of

Appeals ,[29] we

clarified

that

said

fiduciary

observe

highest

the law imposes on banks a high degree of obligation to treat the accounts
that

the

banks

obligation

to

of its depositors wi th meticulous care, al wa ys having in mind the fiduciary

standards

of

integrity and performance

is deemed written into every

n a t u r e o f b a n ki n g . Se c t i o n 2 o f Re p u b li c Ac t N o . 87 9 1 , [ 2 5 ] wh i c h t o o k e f f e c t
deposit agreement between a bank and its depositor. The fiduciary nature
on

13

June

2000,

makes

categorical

declaration

that

the

State

The a wa rd of moral and exemplary damages is left to the sound

of banking requires banks to assume a degree of diligence higher than that

discretion of the court, and if such discretion is well exercised, as in this

o f a g o o d f a t h e r o f a f a m i l y. A r t i c l e 117 2 o f t h e N e w C i v i l C o d e s t a t e s t h a t
case, it will not be disturbed on appeal. [33]
the degree of diligence required of an obligor

[30]

In the case of Philippine

is that prescribed by law

T el e g r a p h & T el e p h o n e C o r p o r a t i o n v . C o u r t o f A p p e a l s , [ 3 4 ] w e h a d t h e

o r c o n t r a c t , a n d a b s e n t s u c h s t i p u l a t i o n t h e n t h e d i l i g e n c e o f a f a m i l y. I n
occasion to reiterate the conditions to be met in order that moral damages
every case, the depositor expects the bank to treat his account with the

may be recovered. In said case we stated:

u t m o s t f i d e l i t y, w h e t h e r s u c h a c c o u n t s c o n s i s t o n l y o f a f e w h u n d r e d p e s o s
An award of moral damages wo uld require,
f i r s t l y, e v i d e n c e o f b e s m i r c h e d r e p u t a t i o n , o r p h y s i c a l ,
mental or psychological suffering sustained by the
c l a i m a n t ; s e c o n d l y, a c u l p a b l e a c t o r o m i s s i o n f a c t u a l l y
e s t a b l i s h e d ; t h i r d l y, p r o o f t h a t t h e w r o n g f u l a c t o r
omission of the defendant is the proximate cause of the
d a m a g e s s u s t a i n e d b y t h e c l a i m a n t ; a n d f o u r t h l y, t h a t
the case is predicated on any of the instances expressed
or envisioned b y Articles 2219 [35] and 2220[36] of the Civil
Code.

or of millions of pesos. [31]

Anent the issue of the propriety of the award of damages in this

case, petitioner PNB asseverates that there was no evidence to prove that
respondent

Pike

sufferings[32] due
withd ra wals.

suffered
to

its

acts

anguish,
in

embarrassment

allo wing

the

alleged

and

mental

unauthorized

And, having relied on the instruc tions of a valued depositor,

petitioner PNB like wise avers that its actions were made in good faith, for
this reason, the re is no factual basis for said a ward .

S p e c i f i c a l l y, i n c u l p a c o n t r a c t u a l o r b r e a c h o f c o n t r a c t , a s h e r e ,
moral

damages

are

recoverable

fraudulently or in bad faith, [37]

amounting

to bad

obligations.[39]

faith,[38]

only

the

defendant

has

acted

or is found guilty of gross negligence

or in wanton

disregard

of

his contractual

V e r i l y, t h e b r e a c h m u s t b e w a n t o n , r e c k l e s s , m a l i c i o u s , o r

in bad faith, oppressive or abusive. [40]

Petitioner PNBs assertions fail to impress us.

if

There is no reason to disturb the trial courts finding of petitioner

banks

employees

account.

negligence

in

their

treatment

of

respondent

Pikes

I n t h e c a se o n h a n d , t h e C o u r t o f Ap p e a l s s u s t ai n e d , an d r i g h t l y

so, that an a wa rd of moral damages is warranted .

F i n a l l y,

the aforestated

grant

of

exemplary

damages

entitles

respondent Pi ke the a ward of atto rne y' s fees i n the am ount of P20,000.00
and

the

a ward

of

P10,000.00

for

litigation

expenses. [42]

F o r, a s fo u n d b y s a i d

a p p e l l a t e c o u r t , c i t i n g t h e c a s e o f P r u d e n t i a l B a n k v. C o u r t o f A p p e a l s ,
[41]

the banks negligence is a result of lack of due care and caution

WHEREFORE,

the

instant

petition

is

DENIED.

The

requi red of m anagers and empl o yees of a fi rm engaged in so sensi ti ve and

assailed Decision dated 19 December 2002, and the Resolution dated 02

demanding business, as banking, hence, the award of P20,000.00 as moral

April 2003, both of the Court of Appeals, in CA-G.R. CV No. 59389, which

damages, is proper.

a ffi rm e d wi th m o di fi c a ti o n th e De c i s i on re n d e re d b y th e R e gi o n a l Tri a l
Court (RTC), Branch 07 of Manila, dated 10 January 1997, in Civil Case

The award of exemplary damages is also proper as a warning to

petitioner

PNB

and

all

concerned

not

to

recklessly

disregard

No.

94-68821,

are

hereby

AFFIRMED

with

t h e M O D I F I C ATI O N t h a t

their

petitioner PNB is directed to pay respondent Pike additional 1) P20,000.00

obligation to exercise the highest and strictest diligence in serving their

representi ng at torne y s f ees; and 2) P 10,000.00 representi ng expenses of

depositors.

litigation.

Costs against petitioner PNB.

SO ORDERED.