MESINA V.

IAC
145 SCRA 497

FACTS:
Jose Go purchased from Associate Bank a Cashier’s Check, which he left on top of the manager’s
desk when left the bank. The bank manager then had it kept for safekeeping by one of its
employees. The employee was then in conference with one Alexander Lim. He left the check in his
desk
and upon his return, Lim and the check were gone. When Go inquired about his check, the
same couldn't be found and Go was advised to request for the stoppage of payment which he did. He
executed also an affidavit of loss as well as reported it to the police.

The bank then received the check twice for clearing. For these two times, they dishonored the
payment by saying that payment has been stopped. After the second time, a lawyer contacted
it demanding payment. He refused to disclose the name of his client and threatened to sue. Later,
the
name of Mesina was revealed. When asked by the police on how he possessed the check, he
said it was paid to him Lim. An information for theft was then filed against Lim.

A case of interpleader was filed by the bank and Go moved to participate as intervenor in the
complaint for damages. Mesina moved for the dismissal of the case but was denied. The
trial court ruled in the interpleader case ordering the bank to replace the cashier’s check in favor of
Go.

ISSUE:
Whether or not petitioner can collect on the stolen check on the ground that he is a holder in
due course.
RULING:
No. Petitioner failed to substantiate his claim that he is a holder in due course and for
consideration or value as shown by the established facts of the case. Admittedly, petitioner
became the holder of the cashier's check as endorsed by Alexander Lim who stole the check.
He refused to say how and why it was passed to him. He had therefore notice of the defect of
his title over the check from the start. The holder of a cashier's check who is not a holder in
due course cannot enforce such check against the issuing bank which dishonors the same.
**A person who became the holder of a cashier's check as endorsed by the person who stole it and
who refused to say how and why it was passed to him is not a holder in due course.

HELD:
Petitioner cannot raise as arguments that a cashier’s check cannot be countermanded from the
hands of a holder in due course and that a cashier’s check is a check drawn by the bank
against itself. Petitioner failed to substantiate that he was a holder in due course. Upon
questioning, he admitted that he got the check from Lim who stole the check. He refused to
disclose how and why it has passed to him. It simply means that he has notice of the defect of his title
over the check from the start. The holder of a cashier’s check who is not a holder in due
course
cannot enforce payment against the issuing bank which dishonors the same. If a payee of a
cashier’s check obtained it from the issuing bank by fraud, or if there is some other reason why
the payee is not entitled to collect the check, the bank would of course have the right to
refuse
payment of the check when presented by payee, since the bank was aware of the facts surrounding the
loss of the check in question.