Citibank v.
Sabeniano (Short title) PROVISION
GR # 156132 | October 16, 2006
Petitioner: Citibank, N.A. (Formerly First National City Bank) and Investors Finance
Corporation, doing business under the name and style of FNCB Finance
Respondent: Modesta R. Sabeniano
(Rule 130, Section 34)
FACTS
1. Sabeniano filed a complaint against Citibank before RTC Makati claiming to
have substantial deposits and money market placements as well as money
market placements with the Ayala Investment and Development Corporation
(AIDC) and alleging that Citibank refused to return her deposits and the
proceeds of her money market placements despite her repeated demands.
2. Citibank admitted the deposits and money market placements with them,
including dollar accounts in the Citibank branch in Citibank-Geneva but
alleged that the Sabeniano later obtained several loans from them, for which
she executed Promissory Notes and secured by (a) a Declaration of Pledge
of her dollar accounts in Citibank-Geneva, and (b) Deeds of Assignment of
her money market placements with petitioner FNCB Finance.
3. When Sabeniano failed to pay her loans, Citibank exercised its right to off-
set or compensate the outstanding loans with her deposits and money
market placements, pursuant to the Declaration of Pledge and the Deeds of
Assignment and that Citibank informed Sabeniano of such through letters so
they were surprised when six years later, Sabeniano made repeated
requests for the said withdrawal .
4. Citibank then prayed for the dismissal of the complaint and for the award of
damages, and fees.
5. When the parties failed to reach a compromise during the pre-trial hearing
trial proper ensued and the parties proceeded with the presentation of their
respective evidence.
6. Ten years after the filing of the complaint , RTC (1) declared as illegal, null
and void the setoff effected and ordering Citibank to refund the amount with
legal interest (2) declared Sabeniano as indebted to the Citibank and
ordered to pay with no interest and penalty charges from the time of setoff.
(3) Dismissed all other claims and counterclaims.
7. CA affirmed with modification the RTC and ruled entirely in favor of
Sabeniano. (1) declared as illegal, null and void the set-off and ordered
Citibank to refund the amount with legal interest (2) As Citibank failed to
establish by competent evidence the indebtedness of Sabeniano, such was
declared as without legal and factual basis (3) as Citibank failed to account
Sabeniano's money market placements, savings account and current
accountsthe bank is ordered to return the same, in accordance with the
terms and conditions agreed upon as evidenced by the certificates of
investments.
8. Both parties made separate attempts to bring the CA ruling before the SC.
ISSUE/S
1. W/N the Dy case can be used as evidence with regard to similar acts
Rule 130
Section 34. Similar acts as evidence. — Evidence that one did or did not do a certain
thing at one time is not admissible to prove that he did or did not do the same or
similar thing at another time; but it may be received to prove a specific intent or
knowledge; identity, plan, system, scheme, habit, custom or usage, and the like.
RULING & RATIO
1. No.
1. In the assailed decision, CA said that the case of Dy v. Citibank should be
considered given the similarities of the fraud, machinations, and deceits
employed by the Citibank and its Account Manager Francisco Tan.
o The fact that the present appeal created reasonable doubts as to
whether the 9 PNs were indeed executed with considerations, the
doubts are similar to the Dy case thus, should be construed against
Citibank and FNCB Finance.
2. Although petitioner Citibank and its officer, Mr. Tan, were also involved in the
Dy case, that is the only connection between the Dy case and the one at
bar. Not only did the Dy case tackle transactions between parties other than
the present parties, the transactions are also absolutely independent and
unrelated to those in the instant case.
3. It is apparent that the CA took judicial notice of the Dy case not as a legal
precedent, but rather as evidence of similar acts committed by Citibank and
Mr. Tan.
4. A basic rule of evidence, however, states that, evidence that one did or did
not do a certain thing at one time is not admissible to prove that he did or did
not do the same or similar thing at another time; but it may be received to
prove a specific intent or knowledge, identity, plan, system, scheme, habit,
custom or usage, and the like.
5. The rule is founded upon reason, public policy, justice and judicial
convenience. The fact that a person has committed the same or similar acts
at some prior time affords, as a general rule, no logical guaranty that he
committed the act in question because, subjectively, a man's mind and even
his modes of life may change; and, objectively, the conditions under which
he may find himself at a given time may likewise change and thus induce
him to act in a different way.
6. If evidence of similar acts are to be invariably admitted, they will give rise to
a multiplicity of collateral issues and will subject the defendant to surprise as
well as confuse the court and prolong the trial.
7. The factual backgrounds of the two cases are so different and
unrelated that the Dy case cannot be used to prove specific intent,
knowledge, identity, plan, system, scheme, habit, custom or usage on
the part of Citibank or Mr. Tan, to defraud respondent in the present
case.
DISPOSITION
IN VIEW OF THE FOREGOING, the instant Petition is PARTLY GRANTED. The
assailed Decision of the Court of Appeals in CA-G.R. No. 51930, dated 26 March
2002, as already modified by its Resolution, dated 20 November 2002, is hereby
AFFIRMED WITH MODIFICATION.
NOTES 8. It was only FNCB Finance who claimed that they lost the original copies of
the PNs when it moved to a new office. Citibank did not make a similar
Dy Case compared to present case contention.
1. In the Dy case, Caedo obatined loans from Citibank secured by a Third 9. Citibank proffered the excuse that they were still looking for the documents
Party Real Estate Mortgage of the properties of Caedo's aunt, Rosalind Dy. in their storage or warehouse to explain the delay and difficulty in the
2. It turned out that Rosalind Dy and her husband were unaware of the said retrieval thereof, but not their absence or loss.
loans and the mortgage. The transactions were carried out exclusively 10. The original documents in this case, such as the MCs and letters, were
between Caedo and Mr. Tan of Citibank. destroyed and, thus, unavailable for presentation before the RTC, when a
3. RTC found Mr. Tan guilty of fraud for his participation in the questionable fire broke out on the 7th floor of the office building of Citibank.
transactions, essentially because he allowed Caedo to take out the signature 11. There is no showing that the fire was intentionally set. The fire destroyed
cards, when these should have been signed by the Dy spouses personally relevant documents, not just of the present case, but also of other cases,
before him. 12. The foregoing would have been sufficient to allow the presentation of
4. Although the Dy spouses signatures in the PNs and Third Party Real Estate photocopies or microfilm copies of the PNs, MCs, and letters by the
Mortgage were forged, they were approved by the signature verifier since petitioners as secondary evidence to establish the existence of respondents
the signature cards against which they were compared to were also forged. loans, as an exception to the best evidence rule.
5. Neither the RTC nor the Court of Appeals, however, categorically declared
Mr. Tan personally responsible for the forgeries, which, in the narration of
the facts, were more likely committed by Caedo.
6. In the Petition at bar, Sabeniano dealt with Mr. Tan directly, there was no
third party involved.
7. Although Sabeniano attempted to raise suspicion as to the authenticity of
her signatures on certain documents, these were nothing more than naked
allegations with no corroborating evidence; worse, even her own allegations
were replete with inconsistencies.
8. She could not even establish in what manner or under what circumstances
the fraud or forgery was committed, or how Mr. Tan could have been directly
responsible for the same.

Best Evidence Rule

1. SC disagrees in the pronouncement by CA summarily dismissing the
documentary evidence submitted by Citibank based on its broad and
indiscriminate application of the best evidence rule.
2. In general, the best evidence rule requires that the highest available degree
of proof must be produced. Accordingly, for documentary evidence, the
contents of a document are best proved by the production of the document
itself, to the exclusion of any secondary or substitutionary evidence.
3. The best evidence rule applies only when the subject of the inquiry is the
contents of the document thus, when a document is presented to prove its
existence or condition it is offered not as documentary, but as real, evidence.
4. The best evidence rule was not violated when it considered and weighed in
evidence the photocopies and microfilm copies of the PNs, MCs, and letters
submitted by Citibank to establish the existence of Sabeniano's loans.
5. The terms or contents of these documents were never the point of
contention.
6. Alternatively, even if it is granted that the best evidence rule should apply to
the evidence presented by Citibank regarding the existence of the loans, it
should be borne in mind that the rule admits exceptions.
7. The execution or existence of the original copies of the documents was
established through the testimonies of witnesses, such as Mr. Tan, before
whom most of the documents were personally executed by Sabeniano.