Citibank N.A. v. Sabeniano

FIRST DIVISION
[G.R. No. 156132. October 16, 2006.]
CITIBANK, N.A. (Formerly First National City Bank) and INVESTORS'

FINANCE CORPORATION, doing business under the name and style of
FNCB Finance , petitioners, vs . MODESTA R. SABENIANO , respondent.
DECISION
CHICO-NAZARIO , J : p
Before this Court is a Petition for Review on Certiorari, 1 under Rule 45 of the
Revised Rules of Court, of the Decision 2 of the Court of Appeals in CA-G.R. CV No. 51930,
dated 26 March 2002, and the Resolution, 3 dated 20 November 2002, of the same court
which, although modifying its earlier Decision, still denied for the most part the Motion for
Reconsideration of herein petitioners.
Petitioner Citibank, N.A. (formerly known as the First National City Bank) is a
banking corporation duly authorized and existing under the laws of the United States of
America and licensed to do commercial banking activities and perform trust functions in
the Philippines.
Petitioner Investor's Finance Corporation, which did business under the name and
style of FNCB Finance, was an a liate company of petitioner Citibank, speci cally
handling money market placements for its clients. It is now, by virtue of a merger, doing
business as part of its successor-in-interest, BPI Card Finance Corporation. However, so
as to consistently establish its identity in the Petition at bar, the said petitioner shall still
be referred to herein as FNCB Finance. 4
Respondent Modesta R. Sabeniano was a client of both petitioners Citibank and
FNCB Finance. Regrettably, the business relations among the parties subsequently went
awry.
On 8 August 1985, respondent led a Complaint 5 against petitioners, docketed as
Civil Case No. 11336, before the Regional Trial Court (RTC) of Makati City. Respondent
claimed to have substantial deposits and money market placements with the petitioners,
as well as money market placements with the Ayala Investment and Development
Corporation (AIDC), the proceeds of which were supposedly deposited automatically and
directly to respondent's accounts with petitioner Citibank. Respondent alleged that
petitioners refused to return her deposits and the proceeds of her money market
placements despite her repeated demands, thus, compelling respondent to le Civil Case
No. 11336 against petitioners for "Accounting, Sum of Money and Damages." Respondent
eventually led an Amended Complaint 6 on 9 October 1985 to include additional claims
to deposits and money market placements inadvertently left out from her original
Complaint.
In their joint Answer 7 and Answer to Amended Complaint, 8 led on 12 September
1985 and 6 November 1985, respectively, petitioners admitted that respondent had
deposits and money market placements with them, including dollar accounts in the
Citibank branch in Geneva, Switzerland (Citibank-Geneva). Petitioners further alleged that
the respondent later obtained several loans from petitioner Citibank, for which she
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executed Promissory Notes (PNs), 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. When respondent failed to pay her loans
despite repeated demands by petitioner Citibank, the latter exercised its right to off-set
or compensate respondent's outstanding loans with her deposits and money market
placements, pursuant to the Declaration of Pledge and the Deeds of Assignment
executed by respondent in its favor. Petitioner Citibank supposedly informed respondent
Sabeniano of the foregoing compensation through letters, dated 28 September 1979 and
31 October 1979. Petitioners were therefore surprised when six years later, in 1985,
respondent and her counsel made repeated requests for the withdrawal of respondent's
deposits and money market placements with petitioner Citibank, including her dollar
accounts with Citibank-Geneva and her money market placements with petitioner FNCB
Finance. Thus, petitioners prayed for the dismissal of the Complaint and for the award of
actual, moral, and exemplary damages, and attorney's fees. HAaScT
When the parties failed to reach a compromise during the pre-trial hearing, 9 trial
proper ensued and the parties proceeded with the presentation of their respective
evidence. Ten years after the ling of the Complaint on 8 August 1985, a Decision 1 0 was
nally rendered in Civil Case No. 11336 on 24 August 1995 by the fourth Judge 1 1 who
handled the said case, Judge Manuel D. Victorio, the dispositive portion of which reads —
WHEREFORE, in view of all the foregoing, decision is hereby rendered as
follows:
(1) Declaring as illegal, null and void the setoff effected by the defendant
Bank [petitioner Citibank] of plaintiff's [respondent Sabeniano] dollar deposit with
Citibank, Switzerland, in the amount of US$149,632.99, and ordering the said
defendant [petitioner Citibank] to refund the said amount to the plaintiff with legal
interest at the rate of twelve percent (12%) per annum, compounded yearly, from 31
October 1979 until fully paid, or its peso equivalent at the time of payment;
(2) Declaring the plaintiff [respondent Sabeniano] indebted to the
defendant Bank [petitioner Citibank] in the amount of P1,069,847.40 as of 5
September 1979 and ordering the plaintiff [respondent Sabeniano] to pay said
amount, however, there shall be no interest and penalty charges from the time the
illegal setoff was effected on 31 October 1979;
(3) Dismissing all other claims and counterclaims interposed by the
parties against each other.
Costs against the defendant Bank.
All the parties appealed the foregoing Decision of the RTC to the Court of Appeals,
docketed as CA-G.R. CV No. 51930. Respondent questioned the ndings of the RTC that
she was still indebted to petitioner Citibank, as well as the failure of the RTC to order
petitioners to render an accounting of respondent's deposits and money market
placements with them. On the other hand, petitioners argued that petitioner Citibank
validly compensated respondent's outstanding loans with her dollar accounts with
Citibank-Geneva, in accordance with the Declaration of Pledge she executed in its favor.
Petitioners also alleged that the RTC erred in not declaring respondent liable for damages
and interest.
On 26 March 2002, the Court of Appeals rendered its Decision 1 2 a rming with
modi cation the RTC Decision in Civil Case No. 11336, dated 24 August 1995, and ruling
entirely in favor of respondent in this wise —

Wherefore, premises considered, the assailed 24 August 1995 Decision of the
court a quo is hereby AFFIRMED with MODIFICATION , as follows:
1. Declaring as illegal, null and void the set-off effected by the defendant-
appellant Bank of the plaintiff-appellant's dollar deposit with Citibank, Switzerland,
in the amount of US$149,632.99, and ordering defendant-appellant Citibank to
refund the said amount to the plaintiff-appellant with legal interest at the rate of
twelve percent (12%) per annum, compounded yearly, from 31 October 1979 until
fully paid, or its peso equivalent at the time of payment;
2. As defendant-appellant Citibank failed to establish by competent

evidence the alleged indebtedness of plaintiff-appellant, the set-off of P1,069,847.40
in the account of Ms. Sabeniano is hereby declared as without legal and factual
basis;
3. As defendants-appellants failed to account the following plaintiff-
appellant's money market placements, savings account and current accounts, the
former is hereby ordered to return the same, in accordance with the terms and
conditions agreed upon by the contending parties as evidenced by the certi cates of
investments, to wit:
(i) Citibank NNPN Serial No. 023356 (Cancels and Supersedes
NNPN No. 22526) issued on 17 March 1977, P318,897.34 with 14.50%
interest p.a.;
(ii) Citibank NNPN Serial No. 23357 (Cancels and Supersedes
NNPN No. 22528) issued on 17 March 1977, P203,150.00 with 14.50 interest
p.a.;
(iii) FNCB NNPN Serial No. 05757 (Cancels and Supersedes NNPN
No. 04952), issued on 02 June 1977, P500,000.00 with 17% interest p.a.;
(iv) FNCB NNPN Serial No. 05758 (Cancels and Supersedes NNPN
No. 04962), issued on 02 June 1977, P500,000.00 with 17% interest per
annum;
(v) The Two Million (P2,000,000.00) money market placements of
Ms. Sabeniano with the Ayala Investment & Development Corporation (AIDC)
with legal interest at the rate of twelve percent (12%) per annum compounded
yearly, from 30 September 1976 until fully paid;
4. Ordering defendants-appellants to jointly and severally pay the

plaintiff-appellant the sum of FIVE HUNDRED THOUSAND PESOS (P500,000.00) by
way of moral damages, FIVE HUNDRED THOUSAND PESOS (P500,000.00) as
exemplary damages, and ONE HUNDRED THOUSAND PESOS (P100,000.00) as
attorney's fees.
Apparently, the parties to the case, namely, the respondent, on one hand, and the
petitioners, on the other, made separate attempts to bring the aforementioned Decision
of the Court of Appeals, dated 26 March 2002, before this Court for review.
G.R. No. 152985
Respondent no longer sought a reconsideration of the Decision of the Court of
Appeals in CA-G.R. CV No. 51930, dated 26 March 2002, and instead, led immediately
with this Court on 3 May 2002 a Motion for Extension of Time to File a Petition for Review,
1 3 which, after payment of the docket and other lawful fees, was assigned the docket
number G.R. No. 152985. In the said Motion, respondent alleged that she received a copy
of the assailed Court of Appeals Decision on 18 April 2002 and, thus, had 15 days
therefrom or until 3 May 2002 within which to le her Petition for Review. Since she
informed her counsel of her desire to pursue an appeal of the Court of Appeals Decision
only on 29 April 2002, her counsel neither had enough time to le a motion for
reconsideration of the said Decision with the Court of Appeals, nor a Petition for Certiorari
with this Court. Yet, the Motion failed to state the exact extension period respondent was
requesting for. EcDTIH
Since this Court did not act upon respondent's Motion for Extension of Time to le
her Petition for Review, then the period for appeal continued to run and still expired on 3
May 2002. 1 4 Respondent failed to le any Petition for Review within the prescribed
period for appeal and, hence, this Court issued a Resolution, 1 5 dated 13 November 2002,
in which it pronounced that —
G.R. No. 152985 (Modesta R. Sabeniano vs. Court of Appeals, et
al.). — It appearing that petitioner failed to le the intended petition for review on
certiorari within the period which expired on May 3, 2002, the Court Resolves to
DECLARE THIS CASE TERMINATED and DIRECT the Division Clerk of Court to
INFORM the parties that the judgment sought to be reviewed has become nal and
executory.
The said Resolution was duly recorded in the Book of Entries of Judgments on 3 January
2003.
G.R. No. 156132
Meanwhile, petitioners led with the Court of Appeals a Motion for Reconsideration
of its Decision in CA-G.R. CV No. 51930, dated 26 March 2002. Acting upon the said
Motion, the Court of Appeals issued the Resolution, 1 6 dated 20 November 2002,
modifying its Decision of 26 March 2002, as follows —
WHEREFORE , premises considered, the instant Motion for Reconsideration
i s PARTIALLY GRANTED as Sub-paragraph (V) paragraph 3 of the assailed
Decision's dispositive portion is hereby ordered DELETED .
The challenged 26 March 2002 Decision of the Court is AFFIRMED with
MODIFICATION .
Assailing the Decision and Resolution of the Court of Appeals in CA-G.R. CV No.
51930, dated 26 March 2002 and 20 November 2002, respectively, petitioners led the
present Petition, docketed as G.R. No. 156132. The Petition was initially denied 1 7 by this
Court for failure of the petitioners to attach thereto a Certi cation against Forum
Shopping. However, upon petitioners' Motion and compliance with the requirements, this
Court resolved 1 8 to reinstate the Petition.
The Petition presented fourteen (14) assignments of errors allegedly committed by
the Court of Appeals in its Decision, dated 26 March 2002, involving both questions of
fact and questions of law which this Court, for the sake of expediency, discusses jointly,
whenever possible, in the succeeding paragraphs.
I
The Resolution of this Court, dated
13 November 2002, in G.R. No.
152985, declaring the Decision of the
Court of Appeals, dated 26 March
2002, final and executory, pertains to
respondent Sabeniano alone.
Before proceeding to a discussion of the merits of the instant Petition, this Court
wishes to address rst the argument, persistently advanced by respondent in her
pleadings on record, as well as her numerous personal and uno cial letters to this Court
which were no longer made part of the record, that the Decision of the Court of Appeals in
CA-G.R. CV No. 51930, dated 26 March 2002, had already become nal and executory by
virtue of the Resolution of this Court in G.R. No. 152985, dated 13 November 2002.
G.R. No. 152985 was the docket number assigned by this Court to respondent's
Motion for Extension of Time to File a Petition for Review. Respondent, though, did not le
her supposed Petition. Thus, after the lapse of the prescribed period for the ling of the
Petition, this Court issued the Resolution, dated 13 November 2002, declaring the
Decision of the Court of Appeals, dated 26 March 2002, nal and executory. It should be
pointed out, however, that the Resolution, dated 13 November 2002, referred only to G.R.
No. 152985, respondent's appeal, which she failed to perfect through the ling of a
Petition for Review within the prescribed period. The declaration of this Court in the same
Resolution would bind respondent solely, and not petitioners which led their own
separate appeal before this Court, docketed as G.R. No. 156132, the Petition at bar. This
would mean that respondent, on her part, should be bound by the ndings of fact and law
of the Court of Appeals, including the monetary amounts consequently awarded to her by
the appellate court in its Decision, dated 26 March 2002; and she can no longer refute or
assail any part thereof. 1 9
This Court already explained the matter to respondent when it issued a Resolution
20in G.R. No. 156132, dated 2 February 2004, which addressed her Urgent Motion for the
Release of the Decision with the Implementation of the Entry of Judgment in the following
manner —
[A]cting on Citibank's and FNCB Finance's Motion for Reconsideration, we
resolved to grant the motion, reinstate the petition and require Sabeniano to le a
comment thereto in our Resolution of June 23, 2003. Sabeniano led a Comment
dated July 17, 2003 to which Citibank and FNCB Finance led a Reply dated August
20, 2003.
From the foregoing, it is clear that Sabeniano had knowledge of, and in fact
participated in, the proceedings in G.R. No. 156132. She cannot feign ignorance of
the proceedings therein and claim that the Decision of the Court of Appeals has
become nal and executory. More precisely, the Decision became nal and
executory only with regard to Sabeniano in view of her failure to le a petition
for review within the extended period granted by the Court, and not to Citibank and
FNCB Finance whose Petition for Review was duly reinstated and is now submitted
for decision.
Accordingly, the instant Urgent Motion is hereby DENIED. (Emphasis
supplied.)
To sustain the argument of respondent would result in an unjust and incongruous

situation wherein one party may frustrate the efforts of the opposing party to appeal the
case by merely ling with this Court a Motion for Extension of Time to File a Petition for
Review, ahead of the opposing party, then not actually ling the intended Petition. 2 1 The
party who fails to le its intended Petition within the reglementary or extended period
should solely bear the consequences of such failure. aCTADI
Respondent Sabeniano did not

commit forum shopping.
Another issue that does not directly involve the merits of the present Petition, but
raised by petitioners, is whether respondent should be held liable for forum shopping.
Petitioners contend that respondent committed forum shopping on the basis of
the following facts:
While petitioners' Motion for Reconsideration of the Decision in CA-G.R. CV No.
51930, dated 26 March 2002, was still pending before the Court of Appeals, respondent
already led with this Court on 3 May 2002 her Motion for Extension of Time to File a
Petition for Review of the same Court of Appeals Decision, docketed as G.R. No. 152985.
Thereafter, respondent continued to participate in the proceedings before the Court of
Appeals in CA-G.R. CV No. 51930 by ling her Comment, dated 17 July 2002, to
petitioners' Motion for Reconsideration; and a Rejoinder, dated 23 September 2002, to
petitioners' Reply. Thus, petitioners argue that by seeking relief concurrently from this
Court and the Court of Appeals, respondent is undeniably guilty of forum shopping, if not
indirect contempt.
This Court, however, nds no su cient basis to hold respondent liable for forum
shopping.
Forum shopping has been de ned as the ling of two or more suits involving the
same parties for the same cause of action, either simultaneously or successively, for the
purpose of obtaining a favorable judgment. 2 2 The test for determining forum shopping is
whether in the two (or more) cases pending, there is an identity of parties, rights or
causes of action, and relief sought. 2 3 To guard against this deplorable practice, Rule 7,
Section 5 of the revised Rules of Court imposes the following requirement —
SEC. 5. Certi cation against forum shopping . — The plaintiff or principal
party shall certify under oath in the complaint or other initiatory pleading asserting a
claim for relief, or in a sworn certi cation annexed thereto and simultaneously led
therewith: (a) that he has not theretofore commenced any action or led any claim
involving the same issues in any court, tribunal or quasi-judicial agency and, to the
best of his knowledge, no such other action or claim is pending therein; (b) if there is
such other pending action or claim, a complete statement of the present status
thereof; and (c) if he should thereafter learn that the same or similar action or claim
has been led or is pending, he shall report that fact within ve (5) days therefrom
to the court wherein his aforesaid complaint or initiatory pleading has been filed.
Failure to comply with the foregoing requirements shall not be curable by
mere amendment of the complaint or other initiatory pleading but shall be cause for
the dismissal of the case without prejudice, unless otherwise provided, upon motion
and after hearing. The submission of a false certi cation or non-compliance with
any of the undertakings therein shall constitute indirect contempt of court, without
prejudice to the corresponding administrative and criminal actions. If the acts of the
party or his counsel clearly constitute willful and deliberate forum shopping, the
same shall be ground for summary dismissal with prejudice and shall constitute
direct contempt, as well as cause for administrative sanctions.
Although it may seem at rst glance that respondent was simultaneously seeking
recourse from the Court of Appeals and this Court, a careful and closer scrutiny of the
details of the case at bar would reveal otherwise.
It should be recalled that respondent did nothing more in G.R. No. 152985 than to
le with this Court a Motion for Extension of Time within which to le her Petition for
Review. For unexplained reasons, respondent failed to submit to this Court her intended
Petition within the reglementary period. Consequently, this Court was prompted to issue a
Resolution, dated 13 November 2002, declaring G.R. No. 152985 terminated, and the
therein assailed Court of Appeals Decision nal and executory. G.R. No. 152985,
therefore, did not progress and respondent's appeal was unperfected.
The Petition for Review would constitute the initiatory pleading before this Court,
upon the timely ling of which, the case before this Court commences; much in the same
way a case is initiated by the ling of a Complaint before the trial court. The Petition for
Review establishes the identity of parties, rights or causes of action, and relief sought
from this Court, and without such a Petition, there is technically no case before this Court.
The Motion led by respondent seeking extension of time within which to le her Petition
for Review does not serve the same purpose as the Petition for Review itself. Such a
Motion merely presents the important dates and the justi cation for the additional time
requested for, but it does not go into the details of the appealed case.
Without any particular idea as to the assignments of error or the relief respondent
intended to seek from this Court, in light of her failure to le her Petition for Review, there
is actually no second case involving the same parties, rights or causes of action, and relief
sought, as that in CA-G.R. CV No. 51930.
It should also be noted that the Certi cation against Forum Shopping is required to
be attached to the initiatory pleading, which, in G.R. No. 152985, should have been
respondent's Petition for Review. It is in that Certi cation wherein respondent certi es,
under oath, that: (a) she has not commenced any action or led any claim involving the
same issues in any court, tribunal or quasi-judicial agency and, to the best of her
knowledge, no such other action or claim is pending therein; (b) if there is such other
pending action or claim, that she is presenting a complete statement of the present
status thereof; and (c) if she should thereafter learn that the same or similar action or
claim has been led or is pending, she shall report that fact within ve days therefrom to
this Court. Without her Petition for Review, respondent had no obligation to execute and
submit the foregoing Certi cation against Forum Shopping. Thus, respondent did not
violate Rule 7, Section 5 of the Revised Rules of Court; neither did she mislead this Court
as to the pendency of another similar case.
Lastly, the fact alone that the Decision of the Court of Appeals, dated 26 March
2002, essentially ruled in favor of respondent, does not necessarily preclude her from
appealing the same. Granted that such a move is ostensibly irrational, nonetheless, it
does not amount to malice, bad faith or abuse of the court processes in the absence of
further proof. Again, it should be noted that the respondent did not le her intended
Petition for Review. The Petition for Review would have presented before this Court the
grounds for respondent's appeal and her arguments in support thereof. Without said
Petition, any reason attributed to the respondent for appealing the 26 March 2002
Decision would be grounded on mere speculations, to which this Court cannot give
credence. DAESTI
II
As an exception to the general rule,
this Court takes cognizance of
questions of fact raised in the
Petition at bar.
It is already a well-settled rule that the jurisdiction of this Court in cases brought
before it from the Court of Appeals by virtue of Rule 45 of the Revised Rules of Court is
limited to reviewing errors of law. Findings of fact of the Court of Appeals are conclusive
upon this Court. There are, however, recognized exceptions to the foregoing rule, namely:
(1) when the ndings are grounded entirely on speculation, surmises, or conjectures; (2)
when the interference made is manifestly mistaken, absurd, or impossible; (3) when there
is grave abuse of discretion; (4) when the judgment is based on a misapprehension of
facts; (5) when the ndings of fact are con icting; (6) when in making its ndings, the
Court of Appeals went beyond the issues of the case, or its ndings are contrary to the
admissions of both the appellant and the appellee; (7) when the ndings are contrary to
those of the trial court; (8) when the ndings are conclusions without citation of speci c
evidence on which they are based; (9) when the facts set forth in the petition as well as in
the petitioner's main and reply briefs are not disputed by the respondent; and (10) when
the ndings of fact are premised on the supposed absence of evidence and contradicted
by the evidence on record. 2 4
Several of the enumerated exceptions pertain to the Petition at bar.
It is indubitable that the Court of Appeals made factual ndings that are contrary to
those of the RTC, 2 5 thus, resulting in its substantial modi cation of the trial court's
Decision, and a ruling entirely in favor of the respondent. In addition, petitioners invoked in
the instant Petition for Review several exceptions that would justify this Court's review of
the factual ndings of the Court of Appeals, i.e., the Court of Appeals made con icting
ndings of fact; ndings of fact which went beyond the issues raised on appeal before it;
as well as ndings of fact premised on the supposed absence of evidence and
contradicted by the evidence on record.
On the basis of the foregoing, this Court shall proceed to reviewing and re-
evaluating the evidence on record in order to settle questions of fact raised in the Petition
at bar.
The fact that the trial judge who
rendered the RTC Decision in Civil
Case No. 11336, dated 24 August
1995, was not the same judge who
heard and tried the case, does not, by
itself, render the said Decision erroneous.
The Decision in Civil Case No. 11336 was rendered more than 10 years from the
institution of the said case. In the course of its trial, the case was presided over by four
(4) different RTC judges. 2 6 It was Judge Victorio, the fourth judge assigned to the case,
who wrote the RTC Decision, dated 24 August 1995. In his Decision, 2 7 Judge Victorio
made the following findings —
After carefully evaluating the mass of evidence adduced by the parties, this
Court is not inclined to believe the plaintiff's assertion that the promissory notes as
well as the deeds of assignments of her FNCB Finance money market placements
were simulated. The evidence is overwhelming that the plaintiff received the
proceeds of the loans evidenced by the various promissory notes she had signed.
What is more, there was not an iota of proof save the plaintiff's bare testimony that
she had indeed applied for loan with the Development Bank of the Philippines.
More importantly, the two deeds of assignment were notarized, hence they
partake the nature of a public document. It makes more than preponderant proof to
overturn the effect of a notarial attestation. Copies of the deeds of assignments
were actually filed with the Records Management and Archives Office.
Finally, there were su cient evidence wherein the plaintiff had admitted the
existence of her loans with the defendant Bank in the total amount of P1,920,000.00
exclusive of interests and penalty charges (Exhibits "28", "31", "32", and "33").
In ne, this Court hereby nds that the defendants had established the
genuineness and due execution of the various promissory notes heretofore
identi ed as well as the two deeds of assignments of the plaintiff's money market
placements with defendant FNCB Finance, on the strength of which the said money
market placements were applied to partially pay the plaintiff's past due obligation
with the defendant Bank. Thus, the total sum of P1,053,995.80 of the plaintiff's past
due obligation was partially offset by the said money market placement leaving a
balance of P1,069,847.40 as of 5 September 1979 (Exhibit "34").
Disagreeing in the foregoing ndings, the Court of Appeals stressed, in its Decision
in CA-G.R. CV No. 51930, dated 26 March 2002, "that the ponente of the herein assailed
Decision is not the Presiding Judge who heard and tried the case." 2 8 This brings us to the
question of whether the fact alone that the RTC Decision was rendered by a judge other
than the judge who actually heard and tried the case is su cient justi cation for the
appellate court to disregard or set aside the findings in the Decision of the court a quo?
This Court rules in the negative.
What deserves stressing is that, in this jurisdiction, there exists a disputable
presumption that the RTC Decision was rendered by the judge in the regular performance
of his o cial duties. While the said presumption is only disputable, it is satisfactory
unless contradicted or overcame by other evidence. 2 9 Encompassed in this presumption
of regularity is the presumption that the RTC judge, in resolving the case and drafting his
Decision, reviewed, evaluated, and weighed all the evidence on record. That the said RTC
judge is not the same judge who heard the case and received the evidence is of little
consequence when the records and transcripts of stenographic notes (TSNs) are
complete and available for consideration by the former.
In People v. Gazmen , 3 0 this Court already elucidated its position on such an issue
—
Accused-appellant makes an issue of the fact that the judge who penned the
decision was not the judge who heard and tried the case and concludes therefrom
that the ndings of the former are erroneous. Accused-appellant's argument does
not merit a lengthy discussion. It is well-settled that the decision of a judge who did
not try the case is not by that reason alone erroneous. DAEaTS
It is true that the judge who ultimately decided the case had not heard the
controversy at all, the trial having been conducted by then Judge Emilio L. Polig,
who was inde nitely suspended by this Court. Nonetheless, the transcripts of
stenographic notes taken during the trial were complete and were presumably
examined and studied by Judge Baguilat before he rendered his decision. It is not
unusual for a judge who did not try a case to decide it on the basis of the record.
The fact that he did not have the opportunity to observe the demeanor of the
witnesses during the trial but merely relied on the transcript of their testimonies does
not for that reason alone render the judgment erroneous.
(People vs. Jaymalin, 214 SCRA 685, 692 [1992])
Although it is true that the judge who heard the witnesses testify is in a better
position to observe the witnesses on the stand and determine by their demeanor
whether they are telling the truth or mouthing falsehood, it does not necessarily
follow that a judge who was not present during the trial cannot render a valid
decision since he can rely on the transcript of stenographic notes taken during the
trial as basis of his decision.
Accused-appellant's contention that the trial judge did not have the
opportunity to observe the conduct and demeanor of the witnesses since he was not
the same judge who conducted the hearing is also untenable. While it is true that the
trial judge who conducted the hearing would be in a better position to ascertain the
truth and falsity of the testimonies of the witnesses, it does not necessarily follow
that a judge who was not present during the trial cannot render a valid and just
decision since the latter can also rely on the transcribed stenographic notes taken
during the trial as the basis of his decision.
(People vs. De Paz, 212 SCRA 56, 63 [1992])

At any rate, the test to determine the value of the testimony of the witness is
whether or not such is in conformity with knowledge and consistent with the
experience of mankind (People vs. Morre, 217 SCRA 219 [1993]). Further, the
credibility of witnesses can also be assessed on the basis of the substance of their
testimony and the surrounding circumstances (People v. Gonzales , 210 SCRA 44
[1992]). A critical evaluation of the testimony of the prosecution witnesses reveals
that their testimony accords with the aforementioned tests, and carries with it the
ring of truth end perforce, must be given full weight and credit.
Irrefragably, by reason alone that the judge who penned the RTC Decision was not
the same judge who heard the case and received the evidence therein would not render
the ndings in the said Decision erroneous and unreliable. While the conduct and
demeanor of witnesses may sway a trial court judge in deciding a case, it is not, and
should not be, his only consideration. Even more vital for the trial court judge's decision
are the contents and substance of the witnesses' testimonies, as borne out by the TSNs,
as well as the object and documentary evidence submitted and made part of the records
of the case.
This Court proceeds to making its
own findings of fact.
Since the Decision of the Court of Appeals in CA-G.R. CV No. 51930, dated 26
March 2002, has become nal and executory as to the respondent, due to her failure to
interpose an appeal therefrom within the reglementary period, she is already bound by the
factual ndings in the said Decision. Likewise, respondent's failure to le, within the
reglementary period, a Motion for Reconsideration or an appeal of the Resolution of the
Court of Appeals in the same case, dated 20 November 2002, which modi ed its earlier
Decision by deleting paragraph 3(v) of its dispositive portion, ordering petitioners to
return to respondent the proceeds of her money market placement with AIDC, shall
already bar her from questioning such modi cation before this Court. Thus, what is for
review before this Court is the Decision of the Court of Appeals, dated 26 March 2002, as
modified by the Resolution of the same court, dated 20 November 2002.
Respondent alleged that she had several deposits and money market placements
with petitioners. These deposits and money market placements, as determined by the
Court of Appeals in its Decision, dated 26 March 2002, and as modi ed by its Resolution,
dated 20 November 2002, are as follows —
Deposit/Placement Amount
Dollar deposit with Citibank-Geneva $149,632.99
Money market placement with Citibank, evidenced by

Promissory Note (PN) No. 23356 (which cancels and
supersedes PN No. 22526), earning 14.5% interest per
annum (p.a.) P318,897.34
Money market placement with Citibank, evidenced by PN

No. 23357 (which cancels and supersedes PN No. 22528),
earning 14.5% interest p.a. P203,150.00

Money market placement with FNCB Finance, evidenced
by PN No. 5757 (which cancels and supersedes PN No.
4952), earning 17% interest p.a. P500,000.00
Money market placement with FNCB Finance, evidenced

by PN No. 5758 (which cancels and supersedes PN No.
2962), earning 17% interest p.a. P500,000.00
This Court is tasked to determine whether petitioners are indeed liable to return the
foregoing amounts, together with the appropriate interests and penalties, to respondent.
It shall trace respondent's transactions with petitioners, from her money market
placements with petitioner Citibank and petitioner FNCB Finance, to her savings and
current accounts with petitioner Citibank, and to her dollar accounts with Citibank-
Geneva. TcAECH
Money market placements with petitioner Citibank

The history of respondent's money market placements with petitioner Citibank
began on 6 December 1976, when she made a placement of P500,000.00 as principal
amount, which was supposed to earn an interest of 16% p.a. and for which PN No. 20773
was issued. Respondent did not yet claim the proceeds of her placement and, instead,
rolled-over or re-invested the principal and proceeds several times in the succeeding
years for which new PNs were issued by petitioner Citibank to replace the ones which
matured. Petitioner Citibank accounted for respondent's original placement and the
subsequent roll-overs thereof, as follows —
Maturity
Date PN No. Cancels Date Amount Interest
(mm/dd/yyyy) PN No. (mm/dd/yyyy) (P) (p.a.)
12/06/1976 20773 None 01/13/1977 500,000.00 16%

01/14/1977 21686 20773 02/08/1977 508,444.44 15%
02/09/1977 22526 21686 03/16/1977 313,952.59 15-3/4%
22528 21686 03/16/1977 200,000.00 15-3/4%
03/17/1977 23356 22526 04/20/1977 318,897.34 14-1/2%
23357 22528 04/20/1977 203,150.00 14-1/2%
Petitioner Citibank alleged that it had already paid to respondent the principal
amounts and proceeds of PNs No. 23356 and 23357, upon their maturity. Petitioner
Citibank further averred that respondent used the P500,000.00 from the payment of PNs
No. 23356 and 23357, plus P600,000.00 sourced from her other funds, to open two time
deposit (TD) accounts with petitioner Citibank, namely, TD Accounts No. 17783 and
17784.
Petitioner Citibank did not deny the existence nor questioned the authenticity of
PNs No. 23356 and 23357 it issued in favor of respondent for her money market
placements. In fact, it admitted the genuineness and due execution of the said PNs, but
quali ed that they were no longer outstanding. 3 1 In Hibberd v. Rohde and McMillian , 3 2
this Court delineated the consequences of such an admission —
By the admission of the genuineness and due execution of an instrument, as
provided in this section, is meant that the party whose signature it bears admits that
he signed it or that it was signed by another for him with his authority; that at the
time it was signed it was in words and gures exactly as set out in the pleading of
the party relying upon it; that the document was delivered; and that any formal
requisites required by law, such as a seal, an acknowledgment, or revenue stamp,
which it lacks, are waived by him. Hence, such defenses as that the signature is a
forgery (Puritan Mfg. Co. vs. Toti & Gradi , 14 N. M., 425; Cox vs. Northwestern Stage
Co., 1 Idaho, 376; Woollen vs. Whitacre, 73 Ind., 198; Smith vs. Ehnert, 47 Wis., 479;
Faelnar vs. Escaño, 11 Phil. Rep., 92); or that it was unauthorized, as in the case of
an agent signing for his principal, or one signing in behalf of a partnership (Country
Bank vs. Greenberg, 127 Cal., 26; Henshaw vs. Root, 60 Inc., 220; Naftzker vs. Lantz,
137 Mich., 441) or of a corporation (Merchant vs. International Banking Corporation,
6 Phil Rep., 314; Wanita vs. Rollins, 75 Miss., 253; Barnes vs. Spencer & Barnes Co.,
162 Mich., 509); or that, in the case of the latter, that the corporation was authorized
under its charter to sign the instrument (Merchant vs. International Banking
Corporation, supra); or that the party charged signed the instrument in some other
capacity than that alleged in the pleading setting it out (Payne vs. National Bank, 16
Kan., 147); or that it was never delivered (Hunt vs. Weir, 29 Ill., 83; Elbring vs. Mullen,
4 Idaho, 199; Thorp vs. Keokuk Coal Co., 48 N.Y., 253; Fire Association of
Philadelphia vs. Ruby, 60 Neb., 216) are cut off by the admission of its genuineness
and due execution.
The effect of the admission is such that in the case of a promissory note a
prima facie case is made for the plaintiff which dispenses with the necessity of
evidence on his part and entitles him to a judgment on the pleadings unless a
special defense of new matter, such as payment, is interposed by the defendant
(Papa vs. Martinez, 12 Phil. Rep., 613; Chinese Chamber of Commerce vs. Pua To
Ching, 14 Phil. Rep., 222; Banco Español-Filipino vs. McKay & Zoeller, 27 Phil. Rep.,
183). . . .
Since the genuineness and due execution of PNs No. 23356 and 23357 are uncontested,
respondent was able to establish prima facie that petitioner Citibank is liable to her for
the amounts stated therein. The assertion of petitioner Citibank of payment of the said
PNs is an a rmative allegation of a new matter, the burden of proof as to such resting on
petitioner Citibank. Respondent having proved the existence of the obligation, the burden
of proof was upon petitioner Citibank to show that it had been discharged. 3 3 It has
already been established by this Court that —
As a general rule, one who pleads payment has the burden of proving it. Even
where the plaintiff must allege non-payment, the general rule is that the burden rests
on the defendant to prove payment, rather than on the plaintiff to prove non-
payment. The debtor has the burden of showing with legal certainty that the
obligation has been discharged by payment.
When the existence of a debt is fully established by the evidence contained in
the record, the burden of proving that it has been extinguished by payment devolves
upon the debtor who offers such defense to the claim of the creditor. Where the
debtor introduces some evidence of payment, the burden of going forward with the
evidence — as distinct from the general burden of proof — shifts to the creditor, who
is then under the duty of producing some evidence of non-payment. 3 4
Reviewing the evidence on record, this Court nds that petitioner Citibank failed to
satisfactorily prove that PNs No. 23356 and 23357 had already been paid, and that the
amount so paid was actually used to open one of respondent's TD accounts with
petitioner Citibank.
Petitioner Citibank presented the testimonies of two witnesses to support its
contention of payment: (1) That of Mr. Herminio Pujeda, 3 5 the o cer-in-charge of loans
and placements at the time when the questioned transactions took place; and (2) that of
Mr. Francisco Tan, 3 6 the former Assistant Vice-President of Citibank, who directly dealt
with respondent with regard to her deposits and loans.
The relevant portion 3 7 of Mr. Pujeda's testimony as to PNs No. 23356 and 23357
(referred to therein as Exhibits No. "47" and "48," respectively) is reproduced below —
Atty. Mabasa:
Okey [sic]. Now Mr. Witness, you were asked to testify in this case and this case
is [sic] consist [sic] of several documents involving transactions between the
plaintiff and the defendant. Now, were you able to make your own
memorandum regarding all these transactions? TCEaDI
A Yes, based on my recollection of these facts, I did come up of [sic] the outline
of the chronological sequence of events.
Court:
Are you trying to say that you have personal knowledge or participation to
these transactions?
A Yes, your Honor, I was the officer-in charge of the unit that was processing
these transactions. Some of the documents bear my signature.
Court:
And this resume or summary that you have prepared is based on purely your
recollection or documents?
A Based on documents, your Honor.
Court:
Are these documents still available now?
A Yes, your honor.
Court:
Better present the documents.
Atty. Mabasa:
Yes, your Honor, that is why your Honor.
Atty. Mabasa:
Q Now, basing on the notes that you prepared, Mr. Witness, and according to
you basing also on your personal recollection about all the transactions
involved between Modesta Sabeniano and defendant City Bank [sic] in this
case. Now, would you tell us what happened to the money market
placements of Modesta Sabeniano that you have earlier identified in Exhs.
"47" and "48"?
A The transactions which I said earlier were terminated and booked to time
deposits.
Q And you are saying time deposits with what bank?
A With First National Citibank.
Q Is it the same bank as Citibank, N.A.?
A Yes, sir.

Q And how much was the amount booked as time deposit with defendant
Citibank?
A In the amount of P500,000.00.
Q And outside this P500,000.00 which you said was booked out of the proceeds
of Exhs. "47" and "48", were there other time deposits opened by Mrs.
Modesta Sabeniano at that time.
A Yes, she also opened another time deposit for P600,000.00.
Q So all in all Mr. Witness, sometime in April of 1978 Mrs. Modesta Sabeneano
[sic] had time deposit placements with Citibank in the amount of
P500,000.00 which is the proceeds of Exh. "47" and "48" and another
P600,000.00, is it not?
A Yes, sir.
Q And would you know where did the other P600,000 placed by Mrs. Sabeneano
[sic] in a time deposit with Citibank, N.A. came [sic] from?
A She funded it directly.
Q What are you saying Mr. Witness is that the P600,000 is a [sic] fresh money
coming from Mrs. Modesta Sabeneano [sic]?
A That is right.
In his deposition in Hong Kong, Mr. Tan recounted what happened to PNs No.
23356 and 23357 (referred to therein as Exhibits "E" and "F," respectively), as follows —
Atty. Mabasa:
Now from the Exhibits that you have identified Mr. Tan from Exhibits "A" to "F",
which are Exhibits of the plaintiff. Now, do I understand from you that the
original amount is Five Hundred Thousand and thereafter renewed in the
succeeding exhibits?
Mr. Tan:
Yes, Sir.
Atty. Mabasa:
Alright, after these Exhibits "E" and "F" matured, what happened thereafter?
Mr. Tan:
Split into two time deposits.

Atty. Mabasa:
Exhibits "E" and "F"?
Before anything else, it should be noted that when Mr. Pujeda's testimony before
the RTC was made on 12 March 1990 and Mr. Tan's deposition in Hong Kong was
conducted on 3 September 1990, more than a decade had passed from the time the
transactions they were testifying on took place. This Court had previously recognized the
frailty and unreliability of human memory with regards to gures after the lapse of ve
year s . 3 8 Taking into consideration the substantial length of time between the
transactions and the witnesses' testimonies, as well as the undeniable fact that bank
o cers deal with multiple clients and process numerous transactions during their tenure,
this Court is reluctant to give much weight to the testimonies of Mr. Pujeda and Mr. Tan
regarding the payment of PNs No. 23356 and 23357 and the use by respondent of the
proceeds thereof for opening TD accounts. This Court nds it implausible that they
should remember, after all these years, this particular transaction with respondent
involving her PNs No. 23356 and 23357 and TD accounts. Both witnesses did not give
any reason as to why, from among all the clients they had dealt with and all the
transactions they had processed as o cers of petitioner Citibank, they specially
remembered respondent and her PNs No. 23356 and 23357. Their testimonies likewise
lacked details on the circumstances surrounding the payment of the two PNs and the
opening of the time deposit accounts by respondent, such as the date of payment of the
two PNs, mode of payment, and the manner and context by which respondent relayed her
instructions to the o cers of petitioner Citibank to use the proceeds of her two PNs in
opening the TD accounts. ADSIaT
Moreover, while there are documentary evidences to support and trace

respondent's money market placements with petitioner Citibank, from the original PN No.
20773, rolled-over several times to, nally, PNs No. 23356 and 23357, there is an evident
absence of any documentary evidence on the payment of these last two PNs and the use
of the proceeds thereof by respondent for opening TD accounts. The paper trail seems to
have ended with the copies of PNs No. 23356 and 23357. Although both Mr. Pujeda and
Mr. Tan said that they based their testimonies, not just on their memories but also on the
documents on le, the supposed documents on which they based those portions of their
testimony on the payment of PNs No. 23356 and 23357 and the opening of the TD
accounts from the proceeds thereof, were never presented before the courts nor
made part of the records of the case . Respondent's money market placements were
of substantial amounts — consisting of the principal amount of P500,000.00, plus the
interest it should have earned during the years of placement — and it is di cult for this
Court to believe that petitioner Citibank would not have had documented the payment
thereof.
When Mr. Pujeda testi ed before the RTC on 6 February 1990, 3 9 petitioners'
counsel attempted to present in evidence a document that would supposedly support the
claim of petitioner Citibank that the proceeds of PNs No. 23356 and 23357 were used by
respondent to open one of her two TD accounts in the amount of P500,000.00.
Respondent's counsel objected to the presentation of the document since it was a mere
"xerox" copy, and was blurred and hardly readable. Petitioners' counsel then asked for a
continuance of the hearing so that they can have time to produce a better document,
which was granted by the court. However, during the next hearing and continuance of Mr.
Pujeda's testimony on 12 March 1990, petitioners' counsel no longer referred to the said
document.
As respondent had established a prima facie case that petitioner Citibank is
obligated to her for the amounts stated in PNs No. 23356 and 23357, and as petitioner
Citibank failed to present su cient proof of payment of the said PNs and the use by the
respondent of the proceeds thereof to open her TD accounts, this Court nds that PNs
No. 23356 and 23357 are still outstanding and petitioner Citibank is still liable
to respondent for the amounts stated therein .
The signi cance of this Court's declaration that PNs No. 23356 and 23357 are still
outstanding becomes apparent in the light of petitioners' next contentions — that
respondent used the proceeds of PNs No. 23356 and 23357, together with additional
money, to open TD Accounts No. 17783 and 17784 with petitioner Citibank; and,
subsequently, respondent pre-terminated these TD accounts and transferred the
proceeds thereof, amounting to P1,100,000.00, to petitioner FNCB Finance for money
market placements. While respondent's money market placements with petitioner FNCB
Finance may be traced back with de niteness to TD Accounts No. 17783 and 17784,
there is only imsy and unsubstantiated connection between the said TD accounts and
the supposed proceeds paid from PNs No. 23356 and 23357. With PNs No. 23356 and
23357 still unpaid, then they represent an obligation of petitioner Citibank separate and
distinct from the obligation of petitioner FNCB Finance arising from respondent's money
market placements with the latter.
Money market placements with petitioner FNCB Finance
According to petitioners, respondent's TD Accounts No. 17783 and 17784, in the
total amount of P1,100,000.00, were supposed to mature on 15 March 1978. However,
respondent, through a letter dated 28 April 1977, 4 0 pre-terminated the said TD accounts
and transferred all the proceeds thereof to petitioner FNCB Finance for money market
placement. Pursuant to her instructions, TD Accounts No. 17783 and 17784 were pre-
terminated and petitioner Citibank (then still named First National City Bank) issued
Manager's Checks (MC) No. 199253 4 1 and 199251 4 2 for the amounts of P500,000.00
and P600,00.00, respectively. Both MCs were payable to Citi nance (which, according to
Mr. Pujeda, 4 3 was one with and the same as petitioner FNCB Finance), with the additional
notation that "A/C MODESTA R. SABENIANO." Typewritten on MC No. 199253 is the
phrase "Ref. Proceeds of TD 17783," and on MC No. 199251 is a similar phrase, "Ref.
Proceeds of TD 17784." These phrases purportedly established that the MCs were paid
from the proceeds of respondent's pre-terminated TD accounts with petitioner Citibank.
Upon receipt of the MCs, petitioner FNCB Finance deposited the same to its account with
Feati Bank and Trust Co., as evidenced by the rubber stamp mark of the latter found at the
back of both MCs. In exchange, petitioner FNCB Finance booked the amounts received as
money market placements, and accordingly issued PNs No. 4952 and 4962, for the
amounts of P500,000.00 and P600,000.00, respectively, payable to respondent's savings
account with petitioner Citibank, S/A No. 25-13703-4, upon their maturity on 1 June 1977.
Once again, respondent rolled-over several times the principal amounts of her money
market placements with petitioner FNCB Finance, as follows —
Maturity
Date PN No. Cancels Date Amount Interest
(mm/dd/yyyy) PN No. (mm/dd/yyyy) (P) (p.a.)
04/29/1977 4952 None 06/01/1977 500,000.00 17%

4962 None 06/01/1977 600,000.00 17%
06/02/1977 5757 4952 08/31/1977 500,000.00 17%
5758 4962 08/31/1977 500,000.00 17%
08/17/1977 8167 5757 08/25/1978 500,000.00 14%
8169 5752 08/25/1978 500,000.00 14%
As presented by the petitioner FNCB Finance, respondent rolled-over only the principal
amounts of her money market placements as she chose to receive the interest income
therefrom. Petitioner FNCB Finance also pointed out that when PN No. 4962, with
principal amount of P600,000.00, matured on 1 June 1977, respondent received a partial
payment of the principal which, together with the interest, amounted to P102,633.33; 4 4
thus, only the amount of P500,000.00 from PN No. 4962 was rolled-over to PN No. 5758.
Based on the foregoing records, the principal amounts of PNs No. 5757 and 5758,
upon their maturity, were rolled over to PNs No. 8167 and 8169, respectively. PN No.
8167 4 5 expressly canceled and superseded PN No. 5757, while PN No. 8169 4 6 also
explicitly canceled and superseded PN No. 5758. Thus, it is patently erroneous for the
Court of Appeals to still award to respondent the principal amounts and interests covered
by PNs No. 5757 and 5758 when these were already canceled and superseded. It is now
incumbent upon this Court to determine what subsequently happened to PNs No. 8167
and 8169. AcISTE
Petitioner FNCB Finance presented four checks as proof of payment of the

principal amounts and interests of PNs No. 8167 and 8169 upon their maturity. All the
checks were payable to respondent's savings account with petitioner Citibank, with the
following details —
Date of Issuance Amount
(mm/dd/yyyy) Check No. (P) Notation
09/01/1978 76962 12,833.34 Interest payment on PN#08167

09/01/1978 76961 12,833.34 Interest payment on PN#08169
09/05/1978 77035 500,000.00 Full payment of principal on PN#08167
which is hereby cancelled
09/05/1978 77034 500,000.00 Full payment of principal on PN#08169
which is hereby cancelled
Then again, Checks No. 77035 and 77034 were later returned to petitioner FNCB Finance
together with a memo, 4 7 dated 6 September 1978, from Mr. Tan of petitioner Citibank, to
a Mr. Bobby Mendoza of petitioner FNCB Finance. According to the memo, the two
checks, in the total amount of P1,000,000.00, were to be returned to respondent's
account with instructions to book the said amount in money market placements for one
more year. Pursuant to the said memo, Checks No. 77035 and 77034 were invested by
petitioner FNCB Finance, on behalf of respondent, in money market placements for which
it issued PNs No. 20138 and 20139. The PNs each covered P500,000.00, to earn 11%
interest per annum, and to mature on 3 September 1979.
On 3 September 1979, petitioner FNCB Finance issued Check No. 100168, pay to
the order of "Citibank N.A. A/C Modesta Sabeniano," in the amount of P1,022,916.66, as
full payment of the principal amounts and interests of both PNs No. 20138 and 20139
and, resultantly, canceling the said PNs. 4 8 Respondent actually admitted the issuance
and existence of Check No. 100168, but with the quali cation that the proceeds thereof
were turned over to petitioner Citibank. 4 9 Respondent did not clarify the circumstances
attending the supposed turn over, but on the basis of the allegations of petitioner Citibank
itself, the proceeds of PNs No. 20138 and 20139, amounting to P1,022,916.66, was used
by it to liquidate respondent's outstanding loans. Therefore, the determination of whether
or not respondent is still entitled to the return of the proceeds of PNs No. 20138 and
20139 shall be dependent on the resolution of the issues raised as to the existence of the
loans and the authority of petitioner Citibank to use the proceeds of the said PNs,
together with respondent's other deposits and money market placements, to pay for the
same.
Savings and current accounts with petitioner Citibank
Respondent presented and submitted before the RTC deposit slips and bank
statements to prove deposits made to several of her accounts with petitioner Citibank,
particularly, Accounts No. 00484202, 59091, and 472-751, which would have amounted
to a total of P3,812,712.32, had there been no withdrawals or debits from the said
accounts from the time the said deposits were made.

Although the RTC and the Court of Appeals did not make any de nitive ndings as
to the status of respondent's savings and current accounts with petitioner Citibank, the
Decisions of both the trial and appellate courts effectively recognized only the
P31,079.14 coming from respondent's savings account which was used to off-set her
alleged outstanding loans with petitioner Citibank. 5 0
Since both the RTC and the Court of Appeals had consistently recognized only the
P31,079.14 of respondent's savings account with petitioner Citibank, and that respondent
failed to move for reconsideration or to appeal this particular nding of fact by the trial
and appellate courts, it is already binding upon this Court. Respondent is already
precluded from claiming any greater amount in her savings and current accounts with
petitioner Citibank. Thus, this Court shall limit itself to determining whether or not
respondent is entitled to the return of the amount of P31,079.14 should the off-set
thereof by petitioner Citibank against her supposed loans be found invalid.
Dollar accounts with Citibank-Geneva
Respondent made an effort of preparing and presenting before the RTC her own
computations of her money market placements and dollar accounts with Citibank-
Geneva, purportedly amounting to a total of United States (US) $343,220.98, as of 23
June 1985. 5 1 In her Memorandum led with the RTC, she claimed a much bigger amount
of deposits and money market placements with Citibank-Geneva, totaling
US$1,336,638.65. 5 2 However, respondent herself also submitted as part of her formal
offer of evidence the computation of her money market placements and dollar accounts
with Citibank-Geneva as determined by the latter. 5 3 Citibank-Geneva accounted for
respondent's money market placements and dollar accounts as follows —
MODESTA SABENIANO &/OR
US$ 30'000.-- Principal Fid. Placement

+ US$ 339.06 Interest at 3,875% p.a. from 12.07.-25.10.79
- US$ 95.-- Commission (minimum)
––––––––––––––––––
US$ 30'244.06 Total proceeds on 25.10.1979
US$ 114'000.-- Principal Fid. Placement
+ US$ 1'358.50 Interest at 4,125% p.a. from 12.07.-25.10.79
- US$ 41.17 Commission
––––––––––––––––––
US$ 115'317.33 Total proceeds on 25.10.1979
US$ 145'561.39 Total proceeds of both placements on 25.10.1979
+ US$ 11'381.31 total of both current accounts
––––––––––––––––––
US$ 156'942.70 Total funds available
- US$ 149'632.99 Transfer to Citibank Manila on 26.10.1979
–––––––––––––––––– (counter value of Pesos 1'102'944.78)
US$ 7'309.71 Balance in current accounts
- US$ 6'998.84 Transfer to Citibank Zurich — ac no. 121359 on March 13,
–––––––––––––––––– 1980
US$ 310.87 various charges including closing charges
According to the foregoing computation, by 25 October 1979, respondent had a
total of US$156,942.70, from which, US$149,632.99 was transferred by Citibank-Geneva
to petitioner Citibank in Manila, and was used by the latter to off-set respondent's
outstanding loans. The balance of respondent's accounts with Citibank-Geneva, after the
remittance to petitioner Citibank in Manila, amounted to US$7,309.71, which was
subsequently expended by a transfer to another account with Citibank-Zuerich, in the
amount of US$6,998.84, and by payment of various bank charges, including closing
charges, in the amount of US$310.87. Rightly so, both the RTC and the Court of Appeals
gave more credence to the computation of Citibank-Geneva as to the status of
respondent's accounts with the said bank, rather than the one prepared by respondent
herself, which was evidently self-serving. Once again, this Court shall limit itself to
determining whether or not respondent is entitled to the return of the amount of
US$149,632.99 should the off-set thereof by petitioner Citibank against her alleged
outstanding loans be found invalid. Respondent cannot claim any greater amount since
she did not perfect an appeal of the Decision of the Court of Appeals, dated 26 March
2002, which found that she is entitled only to the return of the said amount, as far as her
accounts with Citibank-Geneva is concerned. TcDaSI
III
Petitioner Citibank was able to
establish by preponderance of
evidence the existence of
respondent's loans.
Petitioners' version of events
In sum, the following amounts were used by petitioner Citibank to liquidate
respondent's purported outstanding loans —
Description Amount
Principal and interests of PNs No. 20138 and 20139

(money market placements with petitioner FNCB Finance) P1,022,916.66
Savings account with petitioner Citibank 31,079.14
Dollar remittance from Citibank-Geneva (peso equivalent
Of US$149,632.99) 1,102,944.78
Total P2,156,940.58
According to petitioner Citibank, respondent incurred her loans under the
circumstances narrated below.
As early as 9 February 1978, respondent obtained her rst loan from petitioner
Citibank in the principal amount of P200,000.00, for which she executed PN No. 31504. 5 4
Petitioner Citibank extended to her several other loans in the succeeding months. Some
of these loans were paid, while others were rolled-over or renewed. Signi cant to the
Petition at bar are the loans which respondent obtained from July 1978 to January 1979,
appropriately covered by PNs ( rst set). 5 5 The aggregate principal amount of these
loans was P1,920,000.00, which could be broken down as follows —
Date of Date of Date of
PN Issuance Maturity Principal Release MC
No. (mm/dd/yyyy) (mm/dd/yyyy) Amount (mm/dd/yyyy) No.
32935 07/20/1978 09/18/1978 P400,000.00 07/20/1978 220701

33751 10/13/1978 12/12/1978 100,000.00 Unrecovered
33798 10/19/1978 11/03/1978 100,000.00 10/19/1978 226285
34025 11/15/1978 01/15/1979 150,000.00 11/16/1978 226439
34079 11/21/1978 01/19/1979 250,000.00 11/21/1978 226467
34192 12/04/1978 01/18/1979 100,000.00 12/05/1978 228057
34402 12/26/1978 02/23/1979 300,000.00 12/26/1978 228203
34534 01/09/1979 03/09/1979 150,000.00 01/09/1979 228270
34609 01/17/1979 03/19/1979 150,000.00 01/17/1979 228357
34740 01/30/1979 03/30/1979 220,000.00 01/30/1979 228400
Total P1,920,000.00
When respondent was unable to pay the rst set of PNs upon their maturity, these were
rolled-over or renewed several times, necessitating the execution by respondent of new
PNs in favor of petitioner Citibank. As of 5 April 1979, respondent had the following
outstanding PNs (second set), 5 6 the principal amount of which remained at
P1,920,000.00 —
Date of Issuance Date of Maturity
PN No. (mm/dd/yyyy) (mm/dd/yyyy) Principal Amount
34510 01/01/1979 03/02/1979 P400,000.00

34509 01/02/1979 03/02/1979 100,000.00
34534 01/09/1979 03/09/1979 150,000.00
34612 01/19/1979 03/16/1979 150,000.00
34741 01/26/1979 03/12/1979 100,000.00
35689 02/23/1979 05/29/1979 300,000.00
35694 03/19/1979 05/29/1979 150,000.00
35695 03/19/1979 05/29/1979 100,000.00
356946 03/20/1979 05/29/1979 250,000.00
35697 03/30/1979 05/29/1979 220,000.00
Total P1,920,000.00
All the PNs stated that the purpose of the loans covered thereby is "To liquidate existing
obligation," except for PN No. 34534, which stated for its purpose "personal investment."
Respondent secured her foregoing loans with petitioner Citibank by executing
Deeds of Assignment of her money market placements with petitioner FNCB Finance. On
2 March 1978, respondent executed in favor of petitioner Citibank a Deed of Assignment
5 7 of PN No. 8169, which was issued by petitioner FNCB Finance, to secure payment of
the credit and banking facilities extended to her by petitioner Citibank, in the aggregate
principal amount of P500,000.00. On 9 March 1978, respondent executed in favor of
petitioner Citibank another Deed of Assignment, 5 8 this time, of PN No. 8167, also issued
by petitioner FNCB Finance, to secure payment of the credit and banking facilities
extended to her by petitioner Citibank, in the aggregate amount of P500,000.00. When
PNs No. 8167 and 8169, representing respondent's money market placements with
petitioner FNCB Finance, matured and were rolled-over to PNs No. 20138 and 20139,
respondent executed new Deeds of Assignment, 5 9 in favor of petitioner Citibank, on 25
August 1978. According to the more recent Deeds, respondent assigned PNs No. 20138
and 20139, representing her rolled-over money market placements with petitioner FNCB
Finance, to petitioner Citibank as security for the banking and credit facilities it extended
to her, in the aggregate principal amount of P500,000.00 per Deed.
In addition to the Deeds of Assignment of her money market placements with
petitioner FNCB Finance, respondent also executed a Declaration of Pledge, 6 0 in which
she supposedly pledged "[a]ll present and future duciary placements held in my personal
and/or joint name with Citibank, Switzerland," to secure all claims the petitioner Citibank
may have or, in the future, acquire against respondent. The petitioners' copy of the
Declaration of Pledge is undated, while that of the respondent, a copy certi ed by a
Citibank-Geneva officer, bore the date 24 September 1979. 6 1
When respondent failed to pay the second set of PNs upon their maturity, an
exchange of letters ensued between respondent and/or her representatives, on one hand,
and the representatives of petitioners, on the other.
The rst letter 6 2 was dated 5 April 1979, addressed to respondent and signed by
Mr. Tan, as the manager of petitioner Citibank, which stated, in part, that —
Despite our repeated requests and follow-up, we regret you have not granted
us with any response or payment.
We, therefore, have no alternative but to call your loan of P1,920,000.00 plus
interests and other charges due and demandable. If you still fail to settle this
obligation by 4/27/79, we shall have no other alternative but to refer your account to
our lawyers for legal action to protect the interest of the bank.
Respondent sent a reply letter 6 3 dated 26 April 1979, printed on paper bearing the
letterhead of respondent's company, MC Adore International Palace, the body of which
reads —
This is in reply to your letter dated April 5, 1979 inviting my attention to my
loan which has become due. Pursuant to our representation with you over the
telephone through Mr. F. A. Tan, you allow us to pay the interests due for the
meantime.
Please accept our Comtrust Check in the amount of P62,683.33.

Please bear with us for a little while, at most ninety days. As you know, we
have a pending loan with the Development Bank of the Philippines in the amount of
P11-M. This loan has already been recommended for approval and would be
submitted to the Board of Governors. In fact, to further facilitate the early release of
this loan, we have presented and furnished Gov. J. Tengco a xerox copy of your
letter.
You will be doing our corporation a very viable service, should you grant us
our request for a little more time.
A week later or on 3 May 1979, a certain C. N. Pugeda, designated as "Executive

Secretary," sent a letter 6 4 to petitioner Citibank, on behalf of respondent. The letter was
again printed on paper bearing the letterhead of MC Adore International Palace. The
pertinent paragraphs of the said letter are reproduced below —
Per instructions of Mrs. Modesta R. Sabeniano, we would like to request for a
re-computation of the interest and penalty charges on her loan in the aggregate
amount of P1,920,000.00 with maturity date of all promissory notes at June 30,
1979. As she has personally discussed with you yesterday, this date will more or
less assure you of early settlement. cTECHI
In this regard, please entrust to bearer, our Comtrust check for P62,683.33 to
be replaced by another check with amount resulting from the new computation.
Also, to facilitate the processing of the same, may we request for another set of
promissory notes for the signature of Mrs. Sabeniano and to cancel the previous
ones she has signed and forwarded to you.
This was followed by a telegram, 6 5 dated 5 June 1979, and received by petitioner
Citibank the following day. The telegram was sent by a Dewey G. Soriano, Legal Counsel.
The telegram acknowledged receipt of the telegram sent by petitioner Citibank regarding
the "re-past due obligation" of McAdore International Palace. However, it reported that
respondent, the President and Chairman of MC Adore International Palace, was presently
abroad negotiating for a big loan. Thus, he was requesting for an extension of the due
date of the obligation until respondent's arrival on or before 31 July 1979.
The next letter, 6 6 dated 21 June 1979, was signed by respondent herself and
addressed to Mr. Bobby Mendoza, a Manager of petitioner FNCB Finance. Respondent
wrote therein —
Re: PN No. 20138 for P500,000.00 & PN No. 20139 for
P500,000.00 totalling P1 Million, both PNs will mature on
9/3/1979.
This is to authorize you to release the accrued quarterly interests payment
from my captioned placements and forward directly to Citibank, Manila Attention:
Mr. F. A. Tan, Manager, to apply to my interest payable on my outstanding loan with
Citibank.
Please note that the captioned two placements are continuously
pledged/hypothecated to Citibank, Manila to support my personal outstanding loan.
Therefore, please do not release the captioned placements upon maturity until you
have received the instruction from Citibank, Manila.
On even date, respondent sent another letter 6 7 to Mr. Tan of petitioner Citibank,
stating that —
Re: S/A No. 25-225928
and C/A No. 484-946

This letter serves as an authority to debit whatever the outstanding balance
from my captioned accounts and credit the amount to my loan outstanding account
with you.
Unlike respondent's earlier letters, both letters, dated 21 June 1979, are printed on plain
paper, without the letterhead of her company, MC Adore International Palace.
By 5 September 1979, respondent's outstanding and past due obligations to
petitioner Citibank totaled P2,123,843.20, representing the principal amounts plus
interests. Relying on respondent's Deeds of Assignment, petitioner Citibank applied the
proceeds of respondent's money market placements with petitioner FNCB Finance, as
well as her deposit account with petitioner Citibank, to partly liquidate respondent's
outstanding loan balance, 6 8 as follows —
Respondent's outstanding obligation (principal and interest) P2,123,843.20

Less:Proceeds from respondent's money market placements
with petitioner FNCB Finance (principal and interest) (1,022,916.66)
Deposits in respondent's bank accounts with petitioner
Citibank (31,079.14)
––––––––––––
Balance of respondent's obligation P1,069,847.40
==========
Mr. Tan of petitioner Citibank subsequently sent a letter, 6 9 dated 28 September
1979, notifying respondent of the status of her loans and the foregoing compensation
which petitioner Citibank effected. In the letter, Mr. Tan informed respondent that she still
had a remaining past-due obligation in the amount of P1,069,847.40, as of 5 September
1979, and should respondent fail to pay the amount by 15 October 1979, then petitioner
Citibank shall proceed to off-set the unpaid amount with respondent's other collateral,
particularly, a money market placement in Citibank-Hongkong.
On 5 October 1979, respondent wrote Mr. Tan of petitioner Citibank, on paper
bearing the letterhead of MC Adore International Palace, as regards the P1,920,000.00
loan account supposedly of MC Adore Finance & Investment, Inc., and requested for a
statement of account covering the principal and interest of the loan as of 31 October
1979. She stated therein that the loan obligation shall be paid within 60 days from receipt
of the statement of account.
Almost three weeks later, or on 25 October 1979, a certain Atty. Moises Tolentino
dropped by the o ce of petitioner Citibank, with a letter, dated 9 October 1979, and
printed on paper with the letterhead of MC Adore International Palace, which authorized
the bearer thereof to represent the respondent in settling the overdue account, this time,
purportedly, of MC Adore International Palace Hotel. The letter was signed by respondent
as the President and Chairman of the Board.
Eventually, Atty. Antonio Agcaoili of Agcaoili & Associates, as counsel of petitioner
Citibank, sent a letter to respondent, dated 31 October 1979, informing her that petitioner
Citibank had effected an off-set using her account with Citibank-Geneva, in the amount of
US$149,632.99, against her "outstanding, overdue, demandable and unpaid obligation" to
petitioner Citibank. Atty. Agcaoili claimed therein that the compensation or off-set was
made pursuant to and in accordance with the provisions of Articles 1278 through 1290 of
the Civil Code. He further declared that respondent's obligation to petitioner Citibank was
now fully paid and liquidated.aEDCAH
Unfortunately, on 7 October 1987, a re gutted the 7th oor of petitioner Citibank's

building at Paseo de Roxas St., Makati, Metro Manila. Petitioners submitted a Certification
7 0 to this effect, dated 17 January 1991, issued by the Chief of the Arson Investigation
Section, Fire District III, Makati Fire Station, Metropolitan Police Force. The 7th oor of
petitioner Citibank's building housed its Control Division, which was in charge of keeping
the necessary documents for cases in which it was involved. After compiling the
documentary evidence for the present case, Atty. Renato J. Fernandez, internal legal
counsel of petitioner Citibank, forwarded them to the Control Division. The original copies
of the MCs, which supposedly represent the proceeds of the rst set of PNs, as well as
that of other documentary evidence related to the case, were among those burned in the
said fire. 7 1
Respondent's version of events
Respondent disputed petitioners' narration of the circumstances surrounding her
loans with petitioner Citibank and the alleged authority she gave for the off-set or
compensation of her money market placements and deposit accounts with petitioners
against her loan obligation.
Respondent denied outright executing the rst set of PNs, except for one (PN No.
34534 in particular). Although she admitted that she obtained several loans from
petitioner Citibank, these only amounted to P1,150,000.00, and she had already paid
them. She secured from petitioner Citibank two loans of P500,000.00 each. She executed
in favor of petitioner Citibank the corresponding PNs for the loans and the Deeds of
Assignment of her money market placements with petitioner FNCB Finance as security. 7 2
To prove payment of these loans, respondent presented two provisional receipts of
petitioner Citibank — No. 19471, 7 3 dated 11 August 1978, and No. 12723, 7 4 dated 10
November 1978 — both signed by Mr. Tan, and acknowledging receipt from respondent
of several checks in the total amount of P500,744.00 and P500,000.00, respectively, for
"liquidation of loan."
She borrowed another P150,000.00 from petitioner Citibank for personal
investment, and for which she executed PN No. 34534, on 9 January 1979. Thus, she
admitted to receiving the proceeds of this loan via MC No. 228270. She invested the loan
amount in another money market placement with petitioner FNCB Finance. In turn, she
used the very same money market placement with petitioner FNCB Finance as security for
her P150,000.00 loan from petitioner Citibank. When she failed to pay the loan when it
became due, petitioner Citibank allegedly forfeited her money market placement with
petitioner FNCB Finance and, thus, the loan was already paid. 7 5
Respondent likewise questioned the MCs presented by petitioners, except for one
(MC No. 228270 in particular), as proof that she received the proceeds of the loans
covered by the rst set of PNs. As recounted in the preceding paragraph, respondent
admitted to obtaining a loan of P150,000.00, covered by PN No. 34534, and receiving MC
No. 228270 representing the proceeds thereof, but claimed that she already paid the
same. She denied ever receiving MCs No. 220701 (for the loan of P400,000.00, covered
by PN No. 33935) and No. 226467 (for the loan of P250,000.00, covered by PN No.
34079), and pointed out that the checks did not bear her indorsements. She did not deny
receiving all other checks but she interposed that she received these checks, not as
proceeds of loans, but as payment of the principal amounts and/or interests from her
money market placements with petitioner Citibank. She also raised doubts as to the
notation on each of the checks that reads "RE: Proceeds of PN#[corresponding PN No.],"
saying that such notation did not appear on the MCs when she originally received them
and that the notation appears to have been written by a typewriter different from that
used in writing all other information on the checks (i.e., date, payee, and amount). 7 6 She
even testi ed that MCs were not supposed to bear notations indicating the purpose for
which they were issued.
As to the second set of PNs, respondent acknowledged having signed them all.
However, she asserted that she only executed these PNs as part of the simulated loans
she and Mr. Tan of petitioner Citibank concocted. Respondent explained that she had a
pending loan application for a big amount with the Development Bank of the Philippines
(DBP), and when Mr. Tan found out about this, he suggested that they could make it
appear that the respondent had outstanding loans with petitioner Citibank and the latter
was already demanding payment thereof; this might persuade DBP to approve
respondent's loan application. Mr. Tan made the respondent sign the second set of PNs,
so that he may have something to show the DBP investigator who might inquire with
petitioner Citibank as to respondent's loans with the latter. On her own copies of the said
PNs, respondent wrote by hand the notation, "This isa (sic) simulated non-negotiable note,
signed copy given to Mr. Tan., ( sic) per agreement to be shown to DBP representative.
itwill (sic) be returned to me if the P11=M (sic) loan for MC Adore Palace Hotel is
approved by DBP." 7 7
Findings of this Court as to the existence of the loans
After going through the testimonial and documentary evidence presented by both
sides to this case, it is this Court's assessment that respondent did indeed have
outstanding loans with petitioner Citibank at the time it effected the off-set or
compensation on 25 July 1979 (using respondent's savings deposit with petitioner
Citibank), 5 September 1979 (using the proceeds of respondent's money market
placements with petitioner FNCB Finance) and 26 October 1979 (using respondent's
dollar accounts remitted from Citibank-Geneva). The totality of petitioners' evidence as to
the existence of the said loans preponderates over respondent's. Preponderant evidence
means that, as a whole, the evidence adduced by one side outweighs that of the adverse
party. 7 8
Respondent's outstanding obligation for P1,920,000.00 had been su ciently
documented by petitioner Citibank.
The second set of PNs is a mere renewal of the prior loans originally covered by the
rst set of PNs, except for PN No. 34534. The rst set of PNs is supported, in turn, by the
existence of the MCs that represent the proceeds thereof received by the respondent. AaEcHC
It bears to emphasize that the proceeds of the loans were paid to respondent in
MCs, with the respondent speci cally named as payee. MCs checks are drawn by the
bank's manager upon the bank itself and regarded to be as good as the money it
represents. 7 9 Moreover, the MCs were crossed checks, with the words "Payee's Account
Only."
In general, a crossed check cannot be presented to the drawee bank for payment in
cash. Instead, the check can only be deposited with the payee's bank which, in turn, must
present it for payment against the drawee bank in the course of normal banking hours.
The crossed check cannot be presented for payment, but it can only be deposited and the
drawee bank may only pay to another bank in the payee's or indorser's account. 8 0 The
effect of crossing a check was described by this Court in Philippine Commercial
International Bank v. Court of Appeals 8 1 —
[T]he crossing of a check with the phrase "Payee's Account Only" is a warning
that the check should be deposited in the account of the payee. Thus, it is the duty
of the collecting bank PCI Bank to ascertain that the check be deposited in payee's
account only. It is bound to scrutinize the check and to know its depositors before it
can make the clearing indorsement "all prior indorsements and/or lack of
indorsement guaranteed."
The crossed MCs presented by petitioner Bank were indeed deposited in several
different bank accounts and cleared by the Clearing O ce of the Central Bank of the
Philippines, as evidenced by the stamp marks and notations on the said checks. The
crossed MCs are already in the possession of petitioner Citibank, the drawee bank, which
was ultimately responsible for the payment of the amount stated in the checks. Given that
a check is more than just an instrument of credit used in commercial transactions for it
also serves as a receipt or evidence for the drawee bank of the cancellation of the said
check due to payment, 8 2 then, the possession by petitioner Citibank of the said MCs, duly
stamped "Paid" gives rise to the presumption that the said MCs were already paid out to
the intended payee, who was in this case, the respondent.
This Court nds applicable herein the presumptions that private transactions have
been fair and regular, 8 3 and that the ordinary course of business has been followed. 8 4
There is no question that the loan transaction between petitioner Citibank and the
respondent is a private transaction. The transactions revolving around the crossed MCs —
from their issuance by petitioner Citibank to respondent as payment of the proceeds of
her loans; to its deposit in respondent's accounts with several different banks; to the
clearing of the MCs by an independent clearing house; and nally, to the payment of the
MCs by petitioner Citibank as the drawee bank of the said checks — are all private
transactions which shall be presumed to have been fair and regular to all the parties
concerned. In addition, the banks involved in the foregoing transactions are also
presumed to have followed the ordinary course of business in the acceptance of the
crossed MCs for deposit in respondent's accounts, submitting them for clearing, and
their eventual payment and cancellation.
The afore-stated presumptions are disputable, meaning, they are satisfactory if
uncontradicted, but may be contradicted and overcome by other evidence. 8 5
Respondent, however, was unable to present su cient and credible evidence to dispute
these presumptions.
It should be recalled that out of the nine MCs presented by petitioner Citibank,
respondent admitted to receiving one as proceeds of a loan (MC No. 228270), denied
receiving two (MCs No. 220701 and 226467), and admitted to receiving all the rest, but
not as proceeds of her loans, but as return on the principal amounts and interests from
her money market placements.
Respondent admitted receiving MC No. 228270 representing the proceeds of her
loan covered by PN No. 34534. Although the principal amount of the loan is P150,000.00,
respondent only received P146,312.50, because the interest and handling fee on the loan
transaction were already deducted therefrom. 8 6 Stamps and notations at the back of MC
No. 228270 reveal that it was deposited at the Bank of the Philippine Islands (BPI), Cubao
Branch, in Account No. 0123-0572-28. 8 7 The check also bore the signature of
respondent at the back. 8 8 And, although respondent would later admit that she did sign
PN No. 34534 and received MC No. 228270 as proceeds of the loan extended to her by
petitioner Citibank, she contradicted herself when, in an earlier testimony, she claimed
that PN No. 34534 was among the PNs she executed as simulated loans with petitioner
Citibank. 8 9
Respondent denied ever receiving MCs No. 220701 and 226467. However,
considering that the said checks were crossed for payee's account only, and that they
were actually deposited, cleared, and paid, then the presumption would be that the said
checks were properly deposited to the account of respondent, who was clearly named
the payee in the checks. Respondent's bare allegations that she did not receive the two
checks fail to convince this Court, for to sustain her, would be for this Court to conclude
that an irregularity had occurred somewhere from the time of the issuance of the said
checks, to their deposit, clearance, and payment, and which would have involved not only
petitioner Citibank, but also BPI, which accepted the checks for deposit, and the Central
Bank of the Philippines, which cleared the checks. It falls upon the respondent to
overcome or dispute the presumption that the crossed checks were issued, accepted for
deposit, cleared, and paid for by the banks involved following the ordinary course of their
business.
The mere fact that MCs No. 220701 and 226467 do not bear respondent's
signature at the back does not negate deposit thereof in her account. The liability for the
lack of indorsement on the MCs no longer fall on petitioner Citibank, but on the bank who
received the same for deposit, in this case, BPI Cubao Branch. Once again, it must be
noted that the MCs were crossed, for payee's account only, and the payee named in both
checks was none other than respondent. The crossing of the MCs was already a warning
to BPI to receive said checks for deposit only in respondent's account. It was up to BPI to
verify whether it was receiving the crossed MCs in accordance with the instructions on
the face thereof. If, indeed, the MCs were deposited in accounts other than respondent's,
then the respondent would have a cause of action against BPI. 9 0
BPI further stamped its guarantee on the back of the checks to the effect that, "All
prior endorsement and/or Lack of endorsement guaranteed." Thus, BPI became the
indorser of the MCs, and assumed all the warranties of an indorser, 9 1 speci cally, that
the checks were genuine and in all respects what they purported to be; that it had a good
title to the checks; that all prior parties had capacity to contract; and that the checks
were, at the time of their indorsement, valid and subsisting. 9 2 So even if the MCs
deposited by BPI's client, whether it be by respondent herself or some other person,
lacked the necessary indorsement, BPI, as the collecting bank, is bound by its warranties
as an indorser and cannot set up the defense of lack of indorsement as against petitioner
Citibank, the drawee bank. 9 3
Furthermore, respondent's bare and unsubstantiated denial of receipt of the MCs in
question and their deposit in her account is rendered suspect when MC No. 220701 was
actually deposited in Account No. 0123-0572-28 of BPI Cubao Branch, the very same
account in which MC No. 228270 (which respondent admitted to receiving as proceeds
of her loan from petitioner Citibank), and MCs No. 228203, 228357, and 228400 (which
respondent admitted to receiving as proceeds from her money market placements) were
deposited. Likewise, MC No. 226467 was deposited in Account No. 0121-002-43 of BPI
Cubao Branch, to which MCs No. 226285 and 226439 (which respondent admitted to
receiving as proceeds from her money market placements) were deposited. It is an
apparent contradiction for respondent to claim having received the proceeds of checks
deposited in an account, and then deny receiving the proceeds of another check
deposited in the very same account. HDCTAc
Another inconsistency in respondent's denial of receipt of MC No. 226467 and her

deposit of the same in her account, is her presentation of Exhibit "HHH," a provisional
receipt which was supposed to prove that respondent turned over P500,000.00 to Mr.
Tan of petitioner Citibank, that the said amount was split into three money market
placements, and that MC No. 226467 represented the return on her investment from one
of these placements. 9 4 Because of her Exhibit "HHH," respondent effectively admitted
receipt of MC No. 226467, although for reasons other than as proceeds of a loan.
Neither can this Court give credence to respondent's contention that the notations
on the MCs, stating that they were the proceeds of particular PNs, were not there when
she received the checks and that the notations appeared to be written by a typewriter
different from that used to write the other information on the checks. Once more,
respondent's allegations were uncorroborated by any other evidence. Her and her
counsel's observation that the notations on the MCs appear to be written by a typewriter
different from that used to write the other information on the checks hardly convinces
this Court considering that it constitutes a mere opinion on the appearance of the
notation by a witness who does not possess the necessary expertise on the matter. In
addition, the notations on the MCs were written using both capital and small letters, while
the other information on the checks were written using capital letters only, such
difference could easily confuse an untrained eye and lead to a hasty conclusion that they
were written by different typewriters.
Respondent's testimony, that based on her experience transacting with banks, the
MCs were not supposed to include notations on the purpose for which the checks were
issued, also deserves scant consideration. While respondent may have extensive
experience dealing with banks, it still does not qualify her as a competent witness on
banking procedures and practices. Her testimony on this matter is even belied by the fact
that the other MCs issued by petitioner Citibank (when it was still named First National
City Bank) and by petitioner FNCB Finance, the existence and validity of which were not
disputed by respondent, also bear similar notations that state the reason for which they
were issued.
Respondent presented several more pieces of evidence to substantiate her claim
that she received MCs No. 226285, 226439, 226467, 226057, 228357, and 228400, not
as proceeds of her loans from petitioner Citibank, but as the return of the principal
amounts and payment of interests from her money market placements with petitioners.
Part of respondent's exhibits were personal checks 9 5 drawn by respondent on her
account with Feati Bank & Trust Co., which she allegedly invested in separate money
market placements with both petitioners, the returns from which were paid to her via MCs
No. 226285 and 228400. Yet, to this Court, the personal checks only managed to
establish respondent's issuance thereof, but there was nothing on the face of the checks
that would reveal the purpose for which they were issued and that they were actually
invested in money market placements as respondent claimed.
Respondent further submitted handwritten notes that purportedly computed and
presented the returns on her money market placements, corresponding to the amount
stated in the MCs she received from petitioner Citibank. Exhibit "HHH-1" 9 6 was a
handwritten note, which respondent attributed to Mr. Tan of petitioner Citibank, showing
the breakdown of her BPI Check for P500,000.00 into three different money market
placements with petitioner Citibank. This Court, however, noticed several factors which
render the note highly suspect. One, it was written on the reversed side of Provisional
Receipt No. 12724 of petitioner Citibank which bore the initials of Mr. Tan acknowledging
receipt of respondent's BPI Check No. 120989 for P500,000.00; but the initials on the
handwritten note appeared to be that of Mr. Bobby Mendoza of petitioner FNCB Finance.
9 7 Second, according to Provisional Receipt No. 12724, BPI Check No. 120989 for
P500,000.00 was supposed to be invested in three money market placements with
petitioner Citibank for the period of 60 days. Since all these money market placements
were made through one check deposited on the same day, 10 November 1978, it made
no sense that the handwritten note at the back of Provisional Receipt No. 12724 provided
for different dates of maturity for each of the money market placements (i.e., 16
November 1978, 17 January 1979, and 21 November 1978), and such dates did not
correspond to the 60 day placement period stated on the face of the provisional receipt.
And third, the principal amounts of the money market placements as stated in the
handwritten note — P145,000.00, P145,000.00 and P242,000.00 — totaled P532,000.00,
and was obviously in excess of the P500,000.00 acknowledged on the face of Provisional
Receipt No. 12724.
Exhibits "III" and "III-1," the front and bank pages of a handwritten note of Mr. Bobby
Mendoza of petitioner FNCB Finance, 9 8 also did not deserve much evidentiary weight,
and this Court cannot rely on the truth and accuracy of the computations presented
therein. Mr. Mendoza was not presented as a witness during the trial before the RTC, so
that the document was not properly authenticated nor its contents su ciently explained.
No one was able to competently identify whether the initials as appearing on the note
were actually Mr. Mendoza's.
Also, going by the information on the front page of the note, this Court observes
that payment of respondent's alleged money market placements with petitioner FNCB
Finance were made using Citytrust Checks; the MCs in question, including MC No.
228057, were issued by petitioner Citibank. Although Citytrust (formerly Feati Bank &
Trust Co.), petitioner FNCB Finance, and petitioner Citibank may be a liates of one
another, they each remained separate and distinct corporations, each having its own
nancial system and records. Thus, this Court cannot simply assume that one
corporation, such as petitioner Citibank or Citytrust, can issue a check to discharge an
obligation of petitioner FNCB Finance. It should be recalled that when petitioner FNCB
Finance paid for respondent's money market placements, covered by its PNs No. 8167
and 8169, as well as PNs No. 20138 and 20139, petitioner FNCB Finance issued its own
checks. cCSHET
As a last point on this matter, if respondent truly had money market placements
with petitioners, then these would have been evidenced by PNs issued by either petitioner
Citibank or petitioner FNCB Finance, acknowledging the principal amounts of the
investments, and stating the applicable interest rates, as well as the dates of their of
issuance and maturity. After respondent had so meticulously reconstructed her other
money market placements with petitioners and consolidated the documentary evidence
thereon, she came surprisingly short of offering similar details and substantiation for
these particular money market placements.
Since this Court is satis ed that respondent indeed received the proceeds of the
first set of PNs, then it proceeds to analyze her evidence of payment thereof.
In support of respondent's assertion that she had already paid whatever loans she
may have had with petitioner Citibank, she presented as evidence Provisional Receipts
No. 19471, dated 11 August 1978, and No. 12723, dated 10 November 1978, both of
petitioner Citibank and signed by Mr. Tan, for the amounts of P500,744.00 and
P500,000.00, respectively. While these provisional receipts did state that Mr. Tan, on
behalf of petitioner Citibank, received respondent's checks as payment for her loans, they
failed to speci cally identify which loans were actually paid. Petitioner Citibank was able
to present evidence that respondent had executed several PNs in the years 1978 and
1979 to cover the loans she secured from the said bank. Petitioner Citibank did admit
that respondent was able to pay for some of these PNs, and what it identi ed as the rst
and second sets of PNs were only those which remained unpaid. It thus became
incumbent upon respondent to prove that the checks received by Mr. Tan were actually
applied to the PNs in either the rst or second set; a fact that, unfortunately, cannot be
determined from the provisional receipts submitted by respondent since they only
generally stated that the checks received by Mr. Tan were payment for respondent's
loans.
Mr. Tan, in his deposition, further explained that provisional receipts were issued
when payment to the bank was made using checks, since the checks would still be
subject to clearing. The purpose for the provisional receipts was merely to acknowledge
the delivery of the checks to the possession of the bank, but not yet of payment. 9 9 This
bank practice nds legitimacy in the pronouncement of this Court that a check, whether
an MC or an ordinary check, is not legal tender and, therefore, cannot constitute valid
tender of payment. In Philippine Airlines, Inc. v. Court of Appeals , 1 0 0 this Court elucidated
that:
Since a negotiable instrument is only a substitute for money and not money,
the delivery of such an instrument does not, by itself, operate as payment (Sec. 189,
Act 2031 on Negs. Insts.; Art. 1249, Civil Code; Bryan Landon Co. v. American Bank ,
7 Phil. 255; Tan Sunco, v. Santos , 9 Phil. 44; 21 R.C.L. 60, 61). A check, whether a
manager's check or ordinary check, is not legal tender, and an offer of a check in
payment of a debt is not a valid tender of payment and may be refused receipt by
the obligee or creditor. Mere delivery of checks does not discharge the obligation
under a judgment. The obligation is not extinguished and remains suspended until
the payment by commercial document is actually realized (Art. 1249, Civil Code, par.
3).
In the case at bar, the issuance of an o cial receipt by petitioner Citibank would
have been dependent on whether the checks delivered by respondent were actually
cleared and paid for by the drawee banks.
As for PN No. 34534, respondent asserted payment thereof at two separate
instances by two different means. In her formal offer of exhibits, respondent submitted a
deposit slip of petitioner Citibank, dated 11 August 1978, evidencing the deposit of BPI
Check No. 5785 for P150,000.00. 1 0 1 In her Formal Offer of Documentary Exhibits, dated
7 July 1989, respondent stated that the purpose for the presentation of the said deposit
slip was to prove that she already paid her loan covered by PN No. 34534. 1 0 2 In her
testimony before the RTC three years later, on 28 November 1991, she changed her story.
This time she narrated that the loan covered by PN No. 34534 was secured by her money
market placement with petitioner FNCB Finance, and when she failed to pay the said PN
when it became due, the security was applied to the loan, therefore, the loan was
considered paid. 1 0 3 Given the foregoing, respondent's assertion of payment of PN No.
34534 is extremely dubious.
According to petitioner Citibank, the PNs in the second set, except for PN No.
34534, were mere renewals of the unpaid PNs in the rst set, which was why the PNs
stated that they were for the purpose of liquidating existing obligations. PN No. 34534,
however, which was part of the rst set, was still valid and subsisting and so it was
included in the second set without need for its renewal, and it still being the original PN
for that particular loan, its stated purpose was for personal investment. 1 0 4 Respondent
essentially admitted executing the second set of PNs, but they were only meant to cover
simulated loans. Mr. Tan supposedly convinced her that her pending loan application with
DBP would have a greater chance of being approved if they made it appear that
respondent urgently needed the money because petitioner Citibank was already
demanding payment for her simulated loans.
Respondent's defense of simulated loans to escape liability for the second set of
PNs is truly a novel one. It is regrettable, however, that she was unable to substantiate the
same. Yet again, respondent's version of events is totally based on her own
uncorroborated testimony. The notations on the second set of PNs, that they were non-
negotiable simulated notes, were admittedly made by respondent herself and were, thus,
self-serving. Equally self-serving was respondent's letter, written on 7 October 1985, or
more than six years after the execution of the second set of PNs, in which she demanded
return of the simulated or ctitious PNs, together with the letters relating thereto, which
Mr. Tan purportedly asked her to execute. Respondent further failed to present any proof
of her alleged loan application with the DBP, and of any circumstance or correspondence
wherein the simulated or fictitious PNs were indeed used for their supposed purpose. EcTDCI
In contrast, petitioner Citibank, as supported by the testimonies of its o cers and

available documentation, consistently treated the said PNs as regular loans — accepted,
approved, and paid in the ordinary course of its business.
The PNs executed by the respondent in favor of petitioner Citibank to cover her
loans were duly- lled out and signed, including the disclosure statement found at the
back of the said PNs, in adherence to the Central Bank requirement to disclose the full
finance charges to a loan granted to borrowers.
Mr. Tan, then an account o cer with the Marketing Department of petitioner
Citibank, testi ed that he dealt directly with respondent; he facilitated the loans; and the
PNs, at least in the second set, were signed by respondent in his presence. 1 0 5
Mr. Pujeda, the o cer who was previously in charge of loans and placements,
con rmed that the signatures on the PNs were veri ed against respondent's specimen
signature with the bank. 1 0 6
Ms. Cristina Dondoyano, who worked at petitioner Citibank as a loan processor,
was responsible for booking respondent's loans. Booking the loans means recording it in
the General Ledger. She explained the procedure for booking loans, as follows: The
account o cer, in the Marketing Department, deals directly with the clients who wish to
borrow money from petitioner Citibank. The Marketing Department will forward a loan
booking checklist, together with the borrowing client's PNs and other supporting
documents, to the loan pre-processor, who will check whether the details in the loan
booking checklist are the same as those in the PNs. The documents are then sent to
Signature Control for veri cation of the client's signature in the PNs, after which, they are
returned to the loan pre-processor, to be forwarded nally to the loan processor. The loan
processor shall book the loan in the General Ledger, indicating therein the client name,
loan amount, interest rate, maturity date, and the corresponding PN number. Since she
booked respondent's loans personally, Ms. Dondoyano testi ed that she saw the original
PNs. In 1986, Atty. Fernandez of petitioner Citibank requested her to prepare an
accounting of respondent's loans, which she did, and which was presented as Exhibit
"120" for the petitioners. The gures from the said exhibit were culled from the bookings
in the General Ledger, a fact which respondent's counsel was even willing to stipulate. 1 0 7
Ms. Teresita Glorioso was an Investigation and Reconcilement Clerk at the Control
Department of petitioner Citibank. She was presented by petitioner Citibank to expound
on the micro lming procedure at the bank, since most of the copies of the PNs were
retrieved from micro lm. Micro lming of the documents are actually done by people at
the Operations Department. At the end of the day or during the day, the original copies of
all bank documents, not just those pertaining to loans, are micro lmed. She refuted the
possibility that insertions could be made in the micro lm because the micro lm is
inserted in a cassette; the cassette is placed in the micro lm machine for use; at the end
of the day, the cassette is taken out of the micro lm machine and put in a safe vault; and
the cassette is returned to the machine only the following day for use, until the spool is
full. This is the micro lming procedure followed everyday. When the micro lm spool is
already full, the micro lm is developed, then sent to the Control Department, which double
checks the contents of the micro lms against the entries in the General Ledger. The
Control Department also conducts a random comparison of the contents of the
micro lms with the original documents; a random review of the contents is done on every
role of microfilm. 1 0 8
Ms. Renee Rubio worked for petitioner Citibank for 20 years. She rose from the
ranks, initially working as a secretary in the Personnel Group; then as a secretary to the
Personnel Group Head; a Service Assistant with the Marketing Group, in 1972 to 1974,
dealing directly with corporate and individual clients who, among other things, secured
loans from petitioner Citibank; the Head of the Collection Group of the Foreign
Department in 1974 to 1976; the Head of the Money Transfer Unit in 1976 to 1978; the
Head of the Loans and Placements Unit up to the early 1980s; and, thereafter, she
established operations training for petitioner Citibank in the Asia-Paci c Region
responsible for the training of the o cers of the bank. She testi ed on the standard loan
application process at petitioner Citibank. According to Ms. Rubio, the account o cer or
marketing person submits a proposal to grant a loan to an individual or corporation.
Petitioner Citibank has a worldwide policy that requires a credit committee, composed of
a minimum of three people, which would approve the loan and amount thereof. There can
be no instance when only one o cer has the power to approve the loan application. When
the loan is approved, the account officer in charge will obtain the corresponding PNs from
the client. The PNs are sent to the signature veri er who would validate the signatures
therein against those appearing in the signature cards previously submitted by the client
to the bank. The Operations Unit will check and review the documents, including the PNs,
if it is a clean loan, and securities and deposits, if it is collateralized. The loan is then
recorded in the General Ledger. The Loans and Placements Department will not book the
loans without the PNs. When the PNs are liquidated, whether they are paid or rolled-over,
they are returned to the client. 1 0 9 Ms. Rubio further explained that she was familiar with
respondent's accounts since, while she was still the Head of the Loan and Placements
Unit, she was asked by Mr. Tan to prepare a list of respondent's outstanding obligations.
1 1 0 She thus calculated respondent's outstanding loans, which was sent as an attachment
to Mr. Tan's letter to respondent, dated 28 September 1979, and presented before the
RTC as Exhibits "34-B" and "34-C." 1 1 1
Lastly, the exchange of letters between petitioner Citibank and respondent, as well
as the letters sent by other people working for respondent, had consistently recognized
that respondent owed petitioner Citibank money.
In consideration of the foregoing discussion, this Court nds that the
preponderance of evidence supports the existence of the respondent's loans, in the
principal sum of P1,920,000.00, as of 5 September 1979. While it is well-settled that the
term "preponderance of evidence" should not be wholly dependent on the number of
witnesses, there are certain instances when the number of witnesses become the
determining factor —
The preponderance of evidence may be determined, under certain conditions,
by the number of witnesses testifying to a particular fact or state of facts. For
instance, one or two witnesses may testify to a given state of facts, and six or seven
witnesses of equal candor, fairness, intelligence, and truthfulness, and equally well
corroborated by all the remaining evidence, who have no greater interest in the result
of the suit, testify against such state of facts. Then the preponderance of evidence
is determined by the number of witnesses. (Wilcox vs. Hines, 100 Tenn. 524, 66 Am.
St. Rep., 761.) 1 1 2
Best evidence rule

This Court disagrees in the pronouncement made by the Court of Appeals
summarily dismissing the documentary evidence submitted by petitioners based on its
broad and indiscriminate application of the best evidence rule.
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, 1 1 3 to the exclusion of any
secondary or substitutionary evidence. 1 1 4
The best evidence rule has been made part of the revised Rules of Court, Rule 130,
Section 3, which reads —
SEC. 3. Original document must be produced; exceptions. — When the
subject of inquiry is the contents of a document, no evidence shall be admissible
other than the original document itself, except in the following cases:
(a) When the original has been lost or destroyed, or cannot be produced
in court, without bad faith on the part of the offeror;
(b) When the original is in the custody or under the control of the party
against whom the evidence is offered, and the latter fails to produce it after
reasonable notice;
(c) When the original consists of numerous accounts or other documents

which cannot be examined in court without great loss of time and the fact sought to
be established from them is only the general result of the whole; and ISADET
(d) When the original is a public record in the custody of a public o cer
or is recorded in a public office.
As the afore-quoted provision states, the best evidence rule applies only when the subject
of the inquiry is the contents of the document. The scope of the rule is more extensively
explained thus —
But even with respect to documentary evidence, the best evidence rule applies
only when the content of such document is the subject of the inquiry. Where the
issue is only as to whether such document was actually executed, or exists, or on
the circumstances relevant to or surrounding its execution, the best evidence rule
does not apply and testimonial evidence is admissible (5 Moran, op. cit., pp. 76-66; 4
Martin, op. cit., p. 78). Any other substitutionary evidence is likewise admissible
without need for accounting for the original.
Thus, when a document is presented to prove its existence or condition it is
offered not as documentary, but as real, evidence. Parol evidence of the fact of
execution of the documents is allowed (Hernaez, et al. vs. McGrath, etc., et al., 91
Phil 565). . . . 1 1 5
In Estrada v. Desierto, 1 1 6 this Court had occasion to rule that —

It is true that the Court relied not upon the original but only copy of the
Angara Diary as published in the Philippine Daily Inquirer on February 4-6, 2001. In
doing so, the Court, did not, however, violate the best evidence rule. Wigmore , in his
book on evidence, states that:
"Production of the original may be dispensed with, in the trial court's
discretion, whenever in the case in hand the opponent does not bona de dispute
the contents of the document and no other useful purpose will be served by
requiring production.
xxx xxx xxx
"In several Canadian provinces, the principle of unavailability has been

abandoned, for certain documents in which ordinarily no real dispute arised. This
measure is a sensible and progressive one and deserves universal adoption (post,
sec. 1233). Its essential feature is that a copy may be used unconditionally, if the
opponent has been given an opportunity to inspect it." (Emphasis supplied.)
This Court did not violate the best evidence rule when it considered and weighed in
evidence the photocopies and microfilm copies of the PNs, MCs, and letters submitted by
the petitioners to establish the existence of respondent's loans. The terms or contents of
these documents were never the point of contention in the Petition at bar. It was
respondent's position that the PNs in the rst set (with the exception of PN No. 34534)
never existed, while the PNs in the second set (again, excluding PN No. 34534) were
merely executed to cover simulated loan transactions. As for the MCs representing the
proceeds of the loans, the respondent either denied receipt of certain MCs or admitted
receipt of the other MCs but for another purpose. Respondent further admitted the letters
she wrote personally or through her representatives to Mr. Tan of petitioner Citibank
acknowledging the loans, except that she claimed that these letters were just meant to
keep up the ruse of the simulated loans. Thus, respondent questioned the documents as
to their existence or execution, or when the former is admitted, as to the purpose for
which the documents were executed, matters which are, undoubtedly, external to the
documents, and which had nothing to do with the contents thereof.
Alternatively, even if it is granted that the best evidence rule should apply to the
evidence presented by petitioners regarding the existence of respondent's loans, it should
be borne in mind that the rule admits of the following exceptions under Rule 130, Section
5 of the revised Rules of Court —
SEC. 5. When the original document is unavailable. — When the original
document has been lost or destroyed, or cannot be produced in court, the offeror,
upon proof of its execution or existence and the cause of its unavailability without
bad faith on his part, may prove its contents by a copy, or by a recital of its contents
in some authentic document, or by the testimony of witnesses in the order stated.
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 respondent. The original PNs also went through
the whole loan booking system of petitioner Citibank — from the account o cer in its
Marketing Department, to the pre-processor, to the signature veri er, back to the pre-
processor, then to the processor for booking. 1 1 7 The original PNs were seen by Ms.
Dondoyano, the processor, who recorded them in the General Ledger. Mr. Pujeda
personally saw the original MCs, proving respondent's receipt of the proceeds of her
loans from petitioner Citibank, when he helped Attys. Cleofe and Fernandez, the bank's
legal counsels, to reconstruct the records of respondent's loans. The original MCs were
presented to Atty. Cleofe who used the same during the preliminary investigation of the
case, sometime in years 1986-1987. The original MCs were subsequently turned over to
the Control and Investigation Division of petitioner Citibank. 1 1 8
It was only petitioner FNCB Finance who claimed that they lost the original copies
of the PNs when it moved to a new o ce. Citibank did not make a similar contention;
instead, it explained that the original copies of the PNs were returned to the borrower
upon liquidation of the loan, either through payment or roll-over. Petitioner Citibank
proffered the excuse that they were still looking for the documents in their storage or
warehouse to explain the delay and di culty in the retrieval thereof, but not their absence
or loss. The original documents in this case, such as the MCs and letters, were destroyed
and, thus, unavailable for presentation before the RTC only on 7 October 1987, when a re
broke out on the 7th oor of the o ce building of petitioner Citibank. There is no showing
that the re was intentionally set. The re destroyed relevant documents, not just of the
present case, but also of other cases, since the 7th oor housed the Control and
Investigation Division, in charge of keeping the necessary documents for cases in which
petitioner Citibank was involved.
The foregoing would have been su cient to allow the presentation of photocopies
or micro lm copies of the PNs, MCs, and letters by the petitioners as secondary evidence
to establish the existence of respondent's loans, as an exception to the best evidence
rule. HcDaAI
The impact of the Decision of the Court of Appeals in the Dy case

In its assailed Decision, the Court of Appeals made the following pronouncement —
Besides, We find the declaration and conclusions of this Court in CA-G.R. CV
No. 15934 entitled Sps. Dr. Ricardo L. Dy and Rosalind O. Dy vs. City Bank, N.A., et
al, promulgated on 15 January 1990, as disturbing taking into consideration the
similarities of the fraud, machinations, and deceits employed by the defendant-
appellant Citibank and its Account Manager Francisco Tan.
Worthy of note is the fact that Our declarations and conclusions against
Citibank and the person of Francisco Tan in CA-G.R. CV No. 15934 were a rmed
in toto by the Highest Magistrate in a Minute Resolution dated 22 August 1990
entitled Citibank, N.A., vs. Court of Appeals, G.R. 93350.
As the factual milieu of the present appeal created reasonable doubts as to

whether the nine (9) Promissory Notes were indeed executed with considerations,
the doubts, coupled by the ndings and conclusions of this Court in CA-G.R. CV
No. 15934 and the Supreme Court in G.R. No. 93350 . should be construed
against herein defendants-appellants Citibank and FNCB Finance.
What this Court truly nds disturbing is the signi cance given by the Court of
Appeals in its assailed Decision to the Decision 1 1 9 of its Third Division in CA-G.R. CV No.
15934 (or the Dy case), when there is an absolute lack of legal basis for doing such.
Although petitioner Citibank and its o cer, Mr. Tan, were also involved in the Dy
case, that is about 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 parties presently
before this Court, but the transactions are absolutely independent and unrelated to those
in the instant Petition.
In the Dy case, Severino Chua Caedo managed to obtain loans from herein
petitioner Citibank amounting to P7,000,000.00, secured to the extent of P5,000,000.00
by a Third Party Real Estate Mortgage of the properties of Caedo's aunt, Rosalind Dy. It
turned out that Rosalind Dy and her husband were unaware of the said loans and the
mortgage of their properties. The transactions were carried out exclusively between
Caedo and Mr. Tan of petitioner Citibank. The RTC found Mr. Tan guilty of fraud for his
participation in the questionable transactions, essentially because he allowed Caedo to
take out the signature cards, when these should have been signed by the Dy spouses
personally before him. Although the Dy spouses' signatures in the PNs and Third Party
Real Estate Mortgage were forged, they were approved by the signature veri er since the
signature cards against which they were compared to were also forged. 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.
In the Petition at bar, respondent dealt with Mr. Tan directly, there was no third
party involved who could have perpetrated any fraud or forgery in her loan transactions.
Although respondent 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. 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.
While the Court of Appeals can take judicial notice of the Decision of its Third
Division in the Dy case, it should not have given the said case much weight when it
rendered the assailed Decision, since the former does not constitute a precedent. The
Court of Appeals, in the challenged Decision, did not apply any legal argument or principle
established in the Dy case but, rather, adopted the ndings therein of wrongdoing or
misconduct on the part of herein petitioner Citibank and Mr. Tan. Any nding of
wrongdoing or misconduct as against herein petitioners should be made based on the
factual background and pieces of evidence submitted in this case, not those in another
case.
It is apparent that the Court of Appeals took judicial notice of the Dy case not as a
legal precedent for the present case, but rather as evidence of similar acts committed by
petitioner Citibank and Mr. Tan. 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
speci c intent or knowledge, identity, plan, system, scheme, habit, custom or usage, and
the like." 1 2 0 The rationale for the rule is explained thus —
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. This is so because, subjectively, a man's mind and even his modes
of life may change; and, objectively, the conditions under which he may nd himself
at a given time may likewise change and thus induce him to act in a different way.
Besides, 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. 1 2 1

The factual backgrounds of the two cases are so different and unrelated that the Dy case
cannot be used to prove speci c intent, knowledge, identity, plan, system, scheme, habit,
custom or usage on the part of petitioner Citibank or its o cer, Mr. Tan, to defraud
respondent in the present case.
IV
The liquidation of respondent's
outstanding loans were valid in so
far as petitioner Citibank used
respondent's savings account with
the bank and her money market
placements with petitioner FNCB
Finance; but illegal and void in so
far as petitioner Citibank used
respondent's dollar accounts with
Citibank-Geneva.
Savings Account with petitioner Citibank
Compensation is a recognized mode of extinguishing obligations. Relevant
provisions of the Civil Code provides —
Art. 1278. Compensation shall take place when two persons, in their own
right, are creditors and debtors of each other.
Art. 1279. In order that compensation may be proper, it is necessary;
(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; DISEaC
(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.
There is little controversy when it comes to the right of petitioner Citibank to

compensate respondent's outstanding loans with her deposit account. As already found
by this Court, petitioner Citibank was the creditor of respondent for her outstanding
loans. At the same time, respondent was the creditor of petitioner Citibank, as far as her
deposit account was concerned, since bank deposits, whether xed, savings, or current,
should be considered as simple loan or mutuum by the depositor to the banking
institution. 1 2 2 Both debts consist in sums of money. By June 1979, all of respondent's
PNs in the second set had matured and became demandable, while respondent's savings
account was demandable anytime. Neither was there any retention or controversy over
the PNs and the deposit account commenced by a third person and communicated in due
time to the debtor concerned. Compensation takes place by operation of law, 1 2 3
therefore, even in the absence of an expressed authority from respondent, petitioner
Citibank had the right to effect, on 25 June 1979, the partial compensation or off-set of
respondent's outstanding loans with her deposit account, amounting to P31,079.14.
Money market placements with FNCB Finance
Things though are not as simple and as straightforward as regards to the money
market placements and bank account used by petitioner Citibank to complete the
compensation or off-set of respondent's outstanding loans, which came from persons
other than petitioner Citibank.
Respondent's money market placements were with petitioner FNCB Finance, and
after several roll-overs, they were ultimately covered by PNs No. 20138 and 20139, which,
by 3 September 1979, the date the check for the proceeds of the said PNs were issued,
amounted to P1,022,916.66, inclusive of the principal amounts and interests. As to these
money market placements, respondent was the creditor and petitioner FNCB Finance the
debtor; while, as to the outstanding loans, petitioner Citibank was the creditor and
respondent the debtor. Consequently, legal compensation, under Article 1278 of the Civil
Code, would not apply since the rst requirement for a valid compensation, that each one
of the obligors be bound principally, and that he be at the same time a principal creditor
of the other, was not met.
What petitioner Citibank actually did was to exercise its rights to the proceeds of
respondent's money market placements with petitioner FNCB Finance by virtue of the
Deeds of Assignment executed by respondent in its favor.
The Court of Appeals did not consider these Deeds of Assignment because of
petitioners' failure to produce the original copies thereof in violation of the best evidence
rule. This Court again nds itself in disagreement in the application of the best evidence
rule by the appellate court.
To recall, the best evidence rule, in so far as documentary evidence is concerned,
requires the presentation of the original copy of the document only when the context
thereof is the subject of inquiry in the case. Respondent does not question the contents
of the Deeds of Assignment. While she admitted the existence and execution of the Deeds
of Assignment, dated 2 March 1978 and 9 March 1978, covering PNs No. 8169 and 8167
issued by petitioner FNCB Finance, she claimed, as defense, that the loans for which the
said Deeds were executed as security, were already paid. She denied ever executing both
Deeds of Assignment, dated 25 August 1978, covering PNs No. 20138 and 20139. These
are again issues collateral to the contents of the documents involved, which could be
proven by evidence other than the original copies of the said documents.
Moreover, the Deeds of Assignment of the money market placements with
petitioner FNCB Finance were notarized documents, thus, admissible in evidence. Rule
132, Section 30 of the Rules of Court provides that —
SEC. 30. Proof of notarial documents. — Every instrument duly
acknowledged or proved and certi ed as provided by law, may be presented in
evidence without further proof, the certi cate of acknowledgement being prima
facie evidence of the execution of the instrument or document involved.
Signi cant herein is this Court's elucidation in De Jesus v. Court of Appeals , 124
which reads —
On the evidentiary value of these documents, it should be recalled that the
notarization of a private document converts it into a public one and renders it
admissible in court without further proof of its authenticity (Joson vs. Baltazar, 194
SCRA 114 [1991]). This is so because a public document duly executed and entered
in the proper registry is presumed to be valid and genuine until the contrary is shown
by clear and convincing proof (Asido vs. Guzman, 57 Phil. 652 [1918]; U.S. vs.
Enriquez, 1 Phil 241 [1902]; Favor vs. Court of Appeals, 194 SCRA 308 [1991]). As
such, the party challenging the recital of the document must prove his claim with
clear and convincing evidence (Diaz vs. Court of Appeals, 145 SCRA 346 [1986]).
The rule on the evidentiary weight that must be accorded a notarized document is
clear and unambiguous. The certi cate of acknowledgement in the notarized Deeds of
Assignment constituted prima facie evidence of the execution thereof. Thus, the burden
of refuting this presumption fell on respondent. She could have presented evidence of any
defect or irregularity in the execution of the said documents 1 2 5 or raised questions as to
the verity of the notary public's acknowledgment and certi cate in the Deeds. 1 2 6 But
again, respondent admitted executing the Deeds of Assignment, dated 2 March 1978 and
9 March 1978, although claiming that the loans for which they were executed as security
were already paid. And, she assailed the Deeds of Assignment, dated 25 August 1978,
with nothing more than her bare denial of execution thereof, hardly the clear and
convincing evidence required to trounce the presumption of due execution of a notarized
document. IHaSED
Petitioners not only presented the notarized Deeds of Assignment, but even
secured certi ed literal copies thereof from the National Archives. 1 2 7 Mr. Renato Medua,
an archivist, working at the Records Management and Archives O ce of the National
Library, testi ed that the copies of the Deeds presented before the RTC were certi ed
literal copies of those contained in the Notarial Registries of the notary publics
concerned, which were already in the possession of the National Archives. He also
explained that he could not bring to the RTC the Notarial Registries containing the original
copies of the Deeds of Assignment, because the Department of Justice (DOJ) Circular
No. 97, dated 8 November 1968, prohibits the bringing of original documents to the
courts to prevent the loss of irreplaceable and priceless documents. 1 2 8
Accordingly, this Court gives the Deeds of Assignment grave importance in
establishing the authority given by the respondent to petitioner Citibank to use as security
for her loans her money her market placements with petitioner FNCB Finance,
represented by PNs No. 8167 and 8169, later to be rolled-over as PNs No. 20138 and
20139. These Deeds of Assignment constitute the law between the parties, and the
obligations arising therefrom shall have the force of law between the parties and should
be complied with in good faith. 1 2 9 Standard clauses in all of the Deeds provide that —
The ASSIGNOR and the ASSIGNEE hereby further agree as follows:
xxx xxx xxx
2. In the event the OBLIGATIONS are not paid at maturity or upon

demand, as the case may be, the ASSIGNEE is fully authorized and empowered to
collect and receive the PLACEMENT (or so much thereof as may be necessary) and
apply the same in payment of the OBLIGATIONS. Furthermore, the ASSIGNOR
agrees that at any time, and from time to time, upon request by the ASSIGNEE, the
ASSIGNOR will promptly execute and deliver any and all such further instruments
and documents as may be necessary to effectuate this Assignment.
xxx xxx xxx
5. This Assignment shall be considered as su cient authority to FNCB

Finance to pay and deliver the PLACEMENT or so much thereof as may be
necessary to liquidate the OBLIGATIONS, to the ASSIGNEE in accordance with terms
and provisions hereof. 1 3 0
Petitioner Citibank was only acting upon the authority granted to it under the
foregoing Deeds when it nally used the proceeds of PNs No. 20138 and 20139, paid by
petitioner FNCB Finance, to partly pay for respondent's outstanding loans. Strictly
speaking, it did not effect a legal compensation or off-set under Article 1278 of the Civil
Code, but rather, it partly extinguished respondent's obligations through the application of
the security given by the respondent for her loans. Although the pertinent documents
were entitled Deeds of Assignment, they were, in reality, more of a pledge by respondent
to petitioner Citibank of her credit due from petitioner FNCB Finance by virtue of her
money market placements with the latter. According to Article 2118 of the Civil Code —
ART. 2118. If a credit has been pledged becomes due before it is
redeemed, the pledgee may collect and receive the amount due. He shall apply the
same to the payment of his claim, and deliver the surplus, should there be any, to
the pledgor.
PNs No. 20138 and 20139 matured on 3 September 1979, without them being
redeemed by respondent, so that petitioner Citibank collected from petitioner FNCB
Finance the proceeds thereof, which included the principal amounts and interests earned
by the money market placements, amounting to P1,022,916.66, and applied the same
against respondent's outstanding loans, leaving no surplus to be delivered to respondent.
Dollar accounts with Citibank-Geneva
Despite the legal compensation of respondent's savings account and the total
application of the proceeds of PNs No. 20138 and 20139 to respondent's outstanding
loans, there still remained a balance of P1,069,847.40. Petitioner Citibank then proceeded
to applying respondent's dollar accounts with Citibank-Geneva against her remaining loan
balance, pursuant to a Declaration of Pledge supposedly executed by respondent in its
favor.
Certain principles of private international law should be considered herein because
the property pledged was in the possession of an entity in a foreign country, namely,
Citibank-Geneva. In the absence of any allegation and evidence presented by petitioners
of the speci c rules and laws governing the constitution of a pledge in Geneva,
Switzerland, they will be presumed to be the same as Philippine local or domestic laws;
this is known as processual presumption. 1 3 1
Upon closer scrutiny of the Declaration of Pledge, this Court nds the same
exceedingly suspicious and irregular.
First of all, it escapes this Court why petitioner Citibank took care to have the
Deeds of Assignment of the PNs notarized, yet left the Declaration of Pledge unnotarized.
This Court would think that petitioner Citibank would take greater cautionary measures
with the preparation and execution of the Declaration of Pledge because it involved
respondent's "all present and future duciary placements" with a Citibank branch in
another country, speci cally, in Geneva, Switzerland. While there is no express legal
requirement that the Declaration of Pledge had to be notarized to be effective, even so, it
could not enjoy the same prima facie presumption of due execution that is extended to
notarized documents, and petitioner Citibank must discharge the burden of proving due
execution and authenticity of the Declaration of Pledge.
Second, petitioner Citibank was unable to establish the date when the Declaration
of Pledge was actually executed. The photocopy of the Declaration of Pledge submitted
by petitioner Citibank before the RTC was undated. 1 3 2 It presented only a photocopy of
the pledge because it already forwarded the original copy thereof to Citibank-Geneva
when it requested for the remittance of respondent's dollar accounts pursuant thereto.
Respondent, on the other hand, was able to secure a copy of the Declaration of Pledge,
certi ed by an o cer of Citibank-Geneva, which bore the date 24 September 1979. 1 3 3
Respondent, however, presented her passport and plane tickets to prove that she was out
of the country on the said date and could not have signed the pledge. Petitioner Citibank
insisted that the pledge was signed before 24 September 1979, but could not provide an
explanation as to how and why the said date was written on the pledge. Although Mr. Tan
testi ed that the Declaration of Pledge was signed by respondent personally before him,
he could not give the exact date when the said signing took place. It is important to note
that the copy of the Declaration of Pledge submitted by the respondent to the RTC was
certi ed by an o cer of Citibank-Geneva, which had possession of the original copy of
the pledge. It is dated 24 September 1979, and this Court shall abide by the presumption
that the written document is truly dated. 1 3 4 Since it is undeniable that respondent was
out of the country on 24 September 1979, then she could not have executed the pledge
on the said date. DSCIEa
Third, the Declaration of Pledge was irregularly lled-out. The pledge was in a
standard printed form. It was constituted in favor of Citibank, N.A., otherwise referred to
therein as the Bank. It should be noted, however, that in the space which should have
named the pledgor, the name of petitioner Citibank was typewritten, to wit —
The pledge right herewith constituted shall secure all claims which the Bank
now has or in the future acquires against Citibank, N.A., Manila (full name and
address of the Debtor), regardless of the legal cause or the transaction (for example
current account, securities transactions, collections, credits, payments, documentary
credits and collections) which gives rise thereto, and including principal, all
contractual and penalty interest, commissions, charges, and costs.
The pledge, therefore, made no sense, the pledgor and pledgee being the same entity.
Was a mistake made by whoever lled-out the form? Yes, it could be a possibility.
Nonetheless, considering the value of such a document, the mistake as to a signi cant
detail in the pledge could only be committed with gross carelessness on the part of
petitioner Citibank, and raised serious doubts as to the authenticity and due execution of
the same. The Declaration of Pledge had passed through the hands of several bank
o cers in the country and abroad, yet, surprisingly and implausibly, no one noticed such a
glaring mistake.
Lastly, respondent denied that it was her signature on the Declaration of Pledge.
She claimed that the signature was a forgery. When a document is assailed on the basis
of forgery, the best evidence rule applies —
Basic is the rule of evidence that when the subject of inquiry is the contents
of a document, no evidence is admissible other than the original document itself
except in the instances mentioned in Section 3, Rule 130 of the Revised Rules of
Court. Mere photocopies of documents are inadmissible pursuant to the best
evidence rule. This is especially true when the issue is that of forgery .
As a rule, forgery cannot be presumed and must be proved by clear, positive

and convincing evidence and the burden of proof lies on the party alleging forgery.
The best evidence of a forged signature in an instrument is the instrument itself
re ecting the alleged forged signature. The fact of forgery can only be established
by a comparison between the alleged forged signature and the authentic and
genuine signature of the person whose signature is theorized upon to have been
forged. Without the original document containing the alleged forged signature, one
cannot make a de nitive comparison which would establish forgery. A comparison
based on a mere xerox copy or reproduction of the document under controversy
cannot produce reliable results. 1 3 5
Respondent made several attempts to have the original copy of the pledge
produced before the RTC so as to have it examined by experts. Yet, despite several
Orders by the RTC, 1 3 6 petitioner Citibank failed to comply with the production of the
original Declaration of Pledge. It is admitted that Citibank-Geneva had possession of the
original copy of the pledge. While petitioner Citibank in Manila and its branch in Geneva
may be separate and distinct entities, they are still incontestably related, and between
petitioner Citibank and respondent, the former had more in uence and resources to
convince Citibank-Geneva to return, albeit temporarily, the original Declaration of Pledge.
Petitioner Citibank did not present any evidence to convince this Court that it had exerted
diligent efforts to secure the original copy of the pledge, nor did it proffer the reason why
Citibank-Geneva obstinately refused to give it back, when such document would have
been very vital to the case of petitioner Citibank. There is thus no justi cation to allow the
presentation of a mere photocopy of the Declaration of Pledge in lieu of the original, and
the photocopy of the pledge presented by petitioner Citibank has nil probative value. 1 3 7
In addition, even if this Court cannot make a categorical nding that respondent's
signature on the original copy of the pledge was forged, it is persuaded that petitioner
Citibank willfully suppressed the presentation of the original document, and takes into
consideration the presumption that the evidence willfully suppressed would be adverse to
petitioner Citibank if produced. 1 3 8
Without the Declaration of Pledge, petitioner Citibank had no authority to demand
the remittance of respondent's dollar accounts with Citibank-Geneva and to apply them to
her outstanding loans. It cannot effect legal compensation under Article 1278 of the Civil
Code since, petitioner Citibank itself admitted that Citibank-Geneva is a distinct and
separate entity. As for the dollar accounts, respondent was the creditor and Citibank-
Geneva is the debtor; and as for the outstanding loans, petitioner Citibank was the
creditor and respondent was the debtor. The parties in these transactions were evidently
not the principal creditor of each other.
Therefore, this Court declares that the remittance of respondent's dollar accounts
from Citibank-Geneva and the application thereof to her outstanding loans with petitioner
Citibank was illegal, and null and void. Resultantly, petitioner Citibank is obligated to return
to respondent the amount of US$149,632.99 from her Citibank-Geneva accounts, or its
present equivalent value in Philippine currency; and, at the same time, respondent
continues to be obligated to petitioner Citibank for the balance of her outstanding loans
which, as of 5 September 1979, amounted to P1,069,847.40.
V
The parties shall be liable for
interests on their monetary
obligations to each other,
as determined herein.
In summary, petitioner Citibank is ordered by this Court to pay respondent the
proceeds of her money market placements, represented by PNs No. 23356 and 23357,
amounting to P318,897.34 and P203,150.00, respectively, earning an interest of 14.5%
per annum as stipulated in the PNs, 1 3 9 beginning 17 March 1977, the date of the
placements.
Petitioner Citibank is also ordered to refund to respondent the amount of
US$149,632.99, or its equivalent in Philippine currency, which had been remitted from her
Citibank-Geneva accounts. These dollar accounts, consisting of two duciary placements
and current accounts with Citibank-Geneva shall continue earning their respective
stipulated interests from 26 October 1979, the date of their remittance by Citibank-
Geneva to petitioner Citibank in Manila and applied against respondent's outstanding
loans.
As for respondent, she is ordered to pay petitioner Citibank the balance of her
outstanding loans, which amounted to P1,069,847.40 as of 5 September 1979. These
loans continue to earn interest, as stipulated in the corresponding PNs, from the time of
their respective maturity dates, since the supposed payment thereof using respondent's
dollar accounts from Citibank-Geneva is deemed illegal, null and void, and, thus,
ineffective.
VI
Petitioner Citibank shall be liable for
damages to respondent.
Petitioners protest the award by the Court of Appeals of moral damages,
exemplary damages, and attorney's fees in favor of respondent. They argued that the RTC
did not award any damages, and respondent, in her appeal before the Court of Appeals,
did not raise in issue the absence of such. CAaSED
While it is true that the general rule is that only errors which have been stated in the
assignment of errors and properly argued in the brief shall be considered, this Court has
also recognized exceptions to the general rule, wherein it authorized the review of
matters, even those not assigned as errors in the appeal, if the consideration thereof is
necessary in arriving at a just decision of the case, and there is a close inter-relation
between the omitted assignment of error and those actually assigned and discussed by
the appellant. 1 4 0 Thus, the Court of Appeals did not err in awarding the damages when it
already made findings that would justify and support the said award.
Although this Court appreciates the right of petitioner Citibank to effect legal
compensation of respondent's local deposits, as well as its right to the proceeds of PNs
No. 20138 and 20139 by virtue of the notarized Deeds of Assignment, to partly extinguish
respondent's outstanding loans, it nds that petitioner Citibank did commit wrong when it
failed to pay and properly account for the proceeds of respondent's money market
placements, evidenced by PNs No. 23356 and 23357, and when it sought the remittance
of respondent's dollar accounts from Citibank-Geneva by virtue of a highly-suspect
Declaration of Pledge to be applied to the remaining balance of respondent's outstanding
loans. It bears to emphasize that banking is impressed with public interest and its
duciary character requires high standards of integrity and performance. 1 4 1 A bank is
under the obligation to treat the accounts of its depositors with meticulous care whether
such accounts consist only of a few hundred pesos or of millions of pesos. 1 4 2 The bank
must record every single transaction accurately, down to the last centavo, and as
promptly as possible. 1 4 3 Petitioner Citibank evidently failed to exercise the required
degree of care and transparency in its transactions with respondent, thus, resulting in the
wrongful deprivation of her property.
Respondent had been deprived of substantial amounts of her investments and
deposits for more than two decades. During this span of years, respondent had found
herself in desperate need of the amounts wrongfully withheld from her. In her testimony
1 4 4 before the RTC, respondent narrated —
Q By the way Mrs. Witness will you kindly tell us again, you said before that you
are a businesswoman, will you tell us again what are the businesses you are
engaged into [sic]?
A I am engaged in real estate. I am the owner of the Modesta Village 1 and 2 in

San Mateo, Rizal. I am also the President and Chairman of the Board of
Macador [sic] Co. and Business Inc. which operates the Macador [sic]
International Palace Hotel. I am also the President of the Macador [sic]
International Palace Hotel, and also the Treasures Home Industries, Inc.
which I am the Chairman and president of the Board and also operating
affiliated company in the name of Treasures Motor Sales engaged in car
dealers [sic] like Delta Motors, we are the dealers of the whole Northern Luzon
and I am the president of the Disto Company, Ltd., based in Hongkong
licensed in Honkong [sic] and now operating in Los Angeles, California.
Q What is the business of that Disto Company Ltd.?
A Disto Company, Ltd., is engaged in real estate and construction.
Q Aside from those businesses are you a member of any national or community
organization for social and civil activities?
A Yes sir.
Q What are those?
A I am the Vice-President of thes [sic] Subdivision Association of the Philippines

in 1976, I am also an officer of the . . . Chamber of Real Estate Business
Association; I am also an officer of the Chatholic [sic] Women's League and I
am also a member of the CMLI, I forgot the definition.
Q How about any political affiliation or government position held if any?
A I was also a candidate for Mayo last January 30, 1980.
Q Where?
A In Dagupan City, Pangasinan.

Q What else?
A I also ran as an Assemblywoman last May, 1984, Independent party in

Regional I, Pangasinan.
Q What happened to your businesses you mentioned as a result of your failure

to recover you [sic] investments and bank deposits from the defendants?
A They are not all operating, in short, I was hampered to push through the
businesses that I have.
A [sic] Of all the businesses and enterprises that you mentioned what are those that
are paralyzed and what remain inactive?
A Of all the company [sic] that I have, only the Disto Company that is now
operating in California.
Q How about your candidacy as Mayor of Dagupan, [sic] City, and later as
Assemblywoman of Region I, what happened to this?
A I won by voting but when election comes on [sic] the counting I lost and I
protested this, it is still pending and because I don't have financial resources I
was not able to push through the case. I just have it pending in the Comelec.
Q Now, do these things also affect your social and civic activities?
A Yes sir, definitely. CacISA
Q How?
A I was embarrassed because being a businesswoman I would like to inform
the Honorable Court that I was awarded as the most outstanding
businesswoman of the year in 1976 but when this money was not given back
to me I was not able to comply with the commitments that I have promised to
these associations that I am engaged into [sic], sir.
For the mental anguish, serious anxiety, besmirched reputation, moral shock and social
humiliation suffered by the respondent, the award of moral damages is but proper.
However, this Court reduces the amount thereof to P300,000.00, for the award of moral
damages is meant to compensate for the actual injury suffered by the respondent, not to
enrich her. 1 4 5
Having failed to exercise more care and prudence than a private individual in its
dealings with respondent, petitioner Citibank should be liable for exemplary damages, in
the amount of P250,000.00, in accordance with Article 2229 1 4 6 and 2234 1 4 7 of the Civil
Code.
With the award of exemplary damages, then respondent shall also be entitled to an
award of attorney's fees. 1 4 8 Additionally, attorney's fees may be awarded when a party is
compelled to litigate or to incur expenses to protect his interest by reason of an
unjusti ed act of the other party. 1 4 9 In this case, an award of P200,000.00 attorney's
fees shall be satisfactory.
In contrast, this Court nds no su cient basis to award damages to petitioners.
Respondent was compelled to institute the present case in the exercise of her rights and
in the protection of her interests. In fact, although her Complaint before the RTC was not
sustained in its entirety, it did raise meritorious points and on which this Court rules in her
favor. Any injury resulting from the exercise of one's rights is damnum absque injuria. 1 5 0
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 modi ed by its Resolution, dated 20 November 2002, is hereby AFFIRMED WITH
MODIFICATION, as follows —
1. PNs No. 23356 and 23357 are DECLARED subsisting and outstanding.
Petitioner Citibank is ORDERED to return to respondent the principal amounts of the said
PNs, amounting to Three Hundred Eighteen Thousand Eight Hundred Ninety-Seven Pesos
and Thirty-Four Centavos (P318,897.34) and Two Hundred Three Thousand One Hundred
Fifty Pesos (P203,150.00), respectively, plus the stipulated interest of Fourteen and a half
percent (14.5%) per annum, beginning 17 March 1977;
2. The remittance of One Hundred Forty-Nine Thousand Six Hundred Thirty Two
US Dollars and Ninety-Nine Cents (US$149,632.99) from respondent's Citibank-Geneva
accounts to petitioner Citibank in Manila, and the application of the same against
respondent's outstanding loans with the latter, is DECLARED illegal, null and void.
Petitioner Citibank is ORDERED to refund to respondent the said amount, or its equivalent
in Philippine currency using the exchange rate at the time of payment, plus the stipulated
interest for each of the duciary placements and current accounts involved, beginning 26
October 1979;
3. Petitioner Citibank is ORDERED to pay respondent moral damages in the
amount of Three Hundred Thousand Pesos (P300,000.00); exemplary damages in the
amount of Two Hundred Fifty Thousand Pesos (P250,000.00); and attorney's fees in the
amount of Two Hundred Thousand Pesos (P200,000.00); and
4. Respondent is ORDERED to pay petitioner Citibank the balance of her
outstanding loans, which, from the respective dates of their maturity to 5 September
1979, was computed to be in the sum of One Million Sixty-Nine Thousand Eight Hundred
Forty-Seven Pesos and Forty Centavos (P1,069,847.40), inclusive of interest. These
outstanding loans shall continue to earn interest, at the rates stipulated in the
corresponding PNs, from 5 September 1979 until payment thereof. DTIaHE

SO ORDERED.
Panganiban, C.J., Ynares-Santiago, Austria-Martinez and Callejo, Sr., JJ., concur.
Footnotes
1. Rollo, pp. 165-325.

2. Penned by Associate Justice Andres B. Reyes, Jr. with Associate Justices Conrado M.
Vasquez, Jr. and Amelita G. Tolentino, concurring; id. at 327-366.
3. Id. at 368-374.
4. TSN, Deposition of Mr. Francisco Tan, 3 September 1990, pp. 9-10.
5. Records, Vol. I, pp. 1-8.
6. Id. at 148-157.
7. Id. at 40-51.
8. Id. at 208-227.
9. Order, dated 11 December 1985, penned by Judge Ansberto P. Paredes, Records, Vol. I, p.
346.
10. Penned by Judge Manuel D. Victorio, Records, Vol. III, pp. 1607-1621.
11. Civil Case No. 11336 was raffled and re-reffled to four different Judges of the Makati RTC
before it was finally resolved. It was originally raffled to Makati RTC, Branch 140, presided
by Judge Ansberto P. Paredes. On 4 February 1987, before the termination of the re-direct
examination of herein respondent (plaintiff before the RTC), the case was transferred to
Makati RTC, Branch 57, presided by Judge Francisco X. Velez, for reasons not disclosed in
the Records. Judge Velez was able to try and hear the case until the presentation of the
evidence by herein petitioners (defendants before the RTC). Respondent again took the
stand to present rebuttal evidence, but even before she could finish her testimony, Judge
Velez inhibited himself upon petitioners' motion (Order, dated 10 April 1992, penned by
Judge Francisco X. Velez, Records, Vol. 11, p. 1085). The case was transferred to Makati
RTC, Branch 141, presided by Judge Marcelino F. Bautista, Jr. For reasons not disclosed in
the Records, Judge Manuel D. Victorio took over Makati RTC, Branch 141. After the parties
submitted their respective Memoranda, Judge Victorio declared the case submitted for
decision (Order, dated 9 December 1994, penned by Judge Manuel D. Victorio, Records, Vol.
III, p. 1602). Judge Victorio rendered his Decision in Civil Case No. 11336 on 24 August
1995 (Records, Vol. III, pp. 1607-1621).
12. Rollo, pp. 365-366.
13. Rollo of G.R. No. 152985, pp. 3-4.
14. The filing of a motion for extension does not automatically suspend the running of the
period for appeal, since the purpose of such motion is to merely ask the court to grant an
enlargement of the time fixed by law. The movant, therefore, has no right to assume that
his motion would be granted, and should check with the court as to the outcome of his
motion, so that if the same is denied, he can still perfect his appeal. (Hon. Bello and Ferrer
v. Fernando, 114 Phil. 101, 104 [1962].)
15. Rollo of G.R. No. 156132, p. 1227.
16. Rollo, p. 374.
17. Resolution, dated 29 January 2003; rollo, pp. 980-A-B.
18. Resolution, dated 23 June 2003; id. at 1311-1312.
19. Firestone Tire and Rubber Company of the Philippines v. Tempongko, 137 Phil. 239, 244
(1969); Singh v. Liberty Insurance Corp., 118 Phil. 532, 535 (1963).
20. Rollo, pp. 1443-1445.

21. See the case of Borromeo v. Court of Appeals (162 Phil. 430, 438 [1976]) wherein this
Court pronounced that a party's right to appeal shall not be affected by the perfection of
another appeal from the same decision; otherwise, it would lead to the absurd proposition
that one party may be deprived of the right to appeal from the portion of a decision against
him just because the other party who had been notified of the decision ahead had already
perfected his appeal in so far as the said decision adversely affects him. If the perfection
of an appeal by one party would not bar the right of the other party to appeal from the
same decision, then an unperfected appeal, as in the case at bar, would have far less
effect.
22. The Executive Secretary v. Gordon, 359 Phil. 266, 271 (1998).
23. Young v. John Keng Seng, 446 Phil. 823, 833 (2003).
24. Sps. Sta. Maria v. Court of Appeals, 349 Phil. 275, 282-283 (1998).
25. The Court of Appeals modified the trial court's findings and conclusions, as follows: (1)
By declaring the P1,069,847.40 alleged indebtedness of Ms. Sabeniano as non-existing for
failure of Citibank to substantiate its allegations; (2) By declaring that there are unpaid
money market placements, current accounts and savings account of Ms. Sabeniano; and
(3) The awarding of damages in favor of Ms. Sabeniano and against Citibank.
26. Supra note 11.
27. Records, Vol. III, pp. 1612-1613.
28. Penned by Associate Justice Andres B. Reyes with Associate Justices Conrado M.
Vasquez, Jr. and Amelita G. Tolentino, concurring; rollo, p. 344.
29. Section 3(m) of Rule 131 of the REVISED RULES OF COURT reads —
SEC. 3. Disputable presumptions. — The following presumptions are satisfactory if

uncontradicted, but may be contradicted and overcome by other evidence:
xxx xxx xxx
(m) That official duty has been regularly performed.
30. 317 Phil. 495, 501-503 (1995).
31. Records, Vol. I, p. 515.
32. 32 Phil. 476, 478-479.

33. Behn, Meyer & Co. v. Rosatzin, 5 Phil. 660, 662 (1906).
34. Jimenez v. National Labor Relations Commission, 326 Phil. 89, 95 (1996).
35. Mr. Herminio Pujeda, at the time he testified before the RTC in 1990, was already the Vice
President of petitioner Citibank.
36. Mr. Francisco Tan, at the time of his deposition in 1990, was already working as Assistant
General Manager for Dai-Chi Kangyo Bank in Hong Kong.
37. TSN, 12 March 1990, pp. 6-10.
38. Lichauco v. Atlantic Gulf & Pacific Co., 84 Phil. 330, 346 (1949).
39. TSN, 6 February 1990, Vol. V, pp. 16-24.
40. Exhibit "37," defendants' folder of exhibits, p. 106.
41. Exhibit "37-C," id. at 107.
42. Exhibit "37-F," id. at 108.
43. TSN, 12 March 1990, p. 13.

44. Exhibit "104-C," defendants' folder of exhibits, p. 111.
45. Exhibit "105," id. at 112.
46. Exhibit "106," id. at 114.
47. Exhibit "108," id. at 118.
48. Exhibits "112" and "119," id. at 121-A, 124.

49. Records, Vol. III, p. 1367.
50. Exhibit "34-B," petitioners' folder of exhibits, p. 102.
51. Exhibit "G," plaintiff's folder of exhibits, pp. 4-15.
52. Records, Vol. III, p. 1,562.

53. Exhibit "J," plaintiff's folder of exhibits, p. 49.
54. Exhibit "120-H," defendants' folder of exhibits, pp. 131.
55. Exhibits "1" to "9," id. at 44-52.
56. Exhibits "18" to "26," id. at 83-92.
57. Exhibit "13-E," id. at 65-67.

58. Exhibit "14-G," id. at 72-74.
59. Exhibit "15" and "Exhibit 17-D," id. at 77-78, 81-82.
60. Exhibit "38," id. at 109-110.
61. Exhibit "K-1," plaintiff's folder of exhibits, pp. 54-55.

63. Exhibit "28," id. at 94.
64. Exhibit "29," id. at 95.
65. Exhibit "30," id. at 96.
66. Exhibit "31," id. at 97.

67. Exhibit "32," id. at 98.
68. Exhibits "34-B" and "34-C," id. at 102-103.
69. Exhibit "34," id. at 100.

70. Exhibit "121," id. at 207.
71. TSN, 14 May 1991, Vol. XI, pp. 12-14.
72. TSN, 28 November 1991, Vol. XIII, pp. 5, 15, 23, 28-29.
73. Exhibit "QQQ," plaintiff's folder of exhibits, p. 117.

74. Exhibit "AAAA," id. at 124.
75. TSN, 28 November 1991, Vol. XIII, pp. 7-8, 23.
76. Id. at 16-23.

77. TSN, 7 May 1986, Vol. II, pp. 42-52; TSN, 19 May 1986, Vol. II, pp. 3-28.
78. Sarmiento v. Court of Appeals, 364 Phil. 613, 621 (1999).

79. Bank of the Philippine Islands v. Court of Appeals, 383 Phil. 538, 553 (2000), with
reference to Tan v. Court of Appeals, 239 Phil. 310, 322 (1994).
80. Gempesaw v. Court of Appeals, G.R. No. 92244, 9 February 1993, 218 SCRA 682, 695.
81. 403 Phil. 361, 383 (2001).
82. Moran v. Court of Appeals, G.R. No. 105836, 7 March 1994, 230 SCRA 799, 311-312.
83. REVISED RULES OF COURT, Rule 131, Section 3(p).
84. Id., Rule 131, Section 3(q).
85. Id., Section 3.
87. Exhibits "9-D" and "9-G," id. at 52.

88. Exhibit "9-F," id. at 52.
89. TSN, 19 May 1986, Vol. II, p. 10.
90. Associated Bank v. Court of Appeals, G.R. No. 89802, 7 May 1992, 208 SCRA 465, 469-
471.
91. Banco de Oro Savings and Mortgage Bank v. Equitable Banking Corporation, G.R. No.
74917, 20 January 1988, 157 SCRA 188, 199.
92. NEGOTIABLE INSTRUMENTS LAW, Section 66, in connection with Section 65.
93. Associated Bank v. Court of Appeals, 322 Phil. 677, 697 (1996); Associated Bank v. Court
of Appeals, G.R. No. 89802, 7 May 1992, 208 SCRA 465, 472.
94. Plaintiff's Formal Offer of Documentary Exhibits, records, Vol. I, pp. 504-505; plaintiff's
folder of exhibits, p. 110.
95. Exhibits "GGG" and "JJJ," plaintiff's folder of exhibits, pp. 109, 113.
96. Plaintiff's folder of exhibits, p. 110.
97. See the initials on Exhibit "III-1," plaintiff's folder of exhibits, p. 112.
98. Plaintiff's folder of exhibits, p. 112.

99. TSN, deposition of Mr. Francisco Tan, 3 September 1990, p. 118.
100. G.R. No. 49188, 30 January 1990, 181 SCRA 557, 568.
101. Exhibit "MMM," plaintiff's folder of exhibits, p. 115.
102. Records, Vol. I, p. 507.
103. TSN, 28 November 1991, Vol. XIII, pp. 7-8.
104. TSN, deposition of Mr. Francisco Tan, 3 September 1990, p. 96.
105. TSN, deposition of Mr. Francisco A. Tan, 3 September 1990, pp. 13-16.
106. TSN, 22 May 1990, Vol. V, pp. 31-61.
107. TSN, 7 March 1991, Vol. IX, pp. 15-19; TSN, 13 March 1991, Vol X, pp. 7-9.
108. TSN, 19 March 1991, Vol. X, pp. 17-21; TSN, 8 April 1991, Vol. X, pp. 31-34.
109. TSN, 18 April 1991, Vol. X, pp. 3-13.
110. Id. at 15-23.

111. Folder of defendants' exhibits, pp. 102-103.
112. Municipality of Moncada v. Cajuigan, 21 Phil 184, 190 (1912).

113. J.A.R. Sibal and J.N. Salazar, Jr., COMPENDIUM ON EVIDENCE 31 (4th ed., 1995).
114. F.D. Regalado, REMEDIAL LAW COMPENDIUM, Vol. II, p. 571 (8th ed., 2000).
115. F.D. Regalado, REMEDIAL LAW COMPENDIUM, Vol. II, 571 (8th ed., 2000).
116. G.R. Nos. 146710-15, 3 April 2001, 356 SCRA 108, 137-138.
117. TSN, 13 March 1991, Vol X, pp. 7-9.
118. TSN, 22 May 1990, Vol. V, pp. 14-17.
119. Dr. Ricardo L. Dy and Rosalind O. Dy vs. Citibank, N.A., CA-G.R. CV No. 15934, 15
January 1990, penned by Associate Justice Nicolas P. Lapeña, Jr. with Associate Justices
Santiago M. Kapunan and Emeterio C. Cui, concurring.
120. REVISED RULES OF COURT, Rule 130, Section 34.
121. J.A.R. Sibal and J.N. Salazar, Jr., COMPENDIUM ON EVIDENCE 199-200 (4th ed., 1995).
122. CIVIL CODE, Article 1980; Guingona, Jr. v. City Fiscal of Manila, 213 Phil. 516,523-524
(1984).
123. CIVIL CODE, Article 1286.
124. G.R. No. 57092, 21 January 1993, 217 SCRA 307, 313-314.
125. Anachuelo v. Intermediate Appellate Court, G.R. No. L-71391, 29 January 1987, 147
SCRA 434, 441-442.
126. Antillon v. Barcelon, 37 Phil. 148, 150-151 (1917).
127. See Exhibits "13-E, "14-G," "15-D," and "17-D," defendants' folder of exhibits, pp. 65-67, 72-
74, 77-78, 81-82.
128. TSN, 7 March 1991, Vol. IX, pp. 3-6.
129. Cuizon v. Court of Appeals, 329 Phil. 456, 482 (1996).

130. Exhibits "13-E, "14-G," "15-D," and "17-D," defendants' folder of exhibits, pp. 65-66, 72-73,
77-78, 81-82.
131. Wildvalley Shipping Co., Ltd. v. Court of Appeals, 396 Phil. 383, 396 (2000).
132. Exhibit "38," defendants' folder of exhibits, pp. 109-110.
133. Exhibit "K-1," plaintiff's folder of exhibits, 54-55.
134. REVISED RULES OF COURT, Rule 131, Section 3(u).
135. Heirs of Severa P. Gregorio v. Court of Appeals, 360 Phil. 753, 763 (1998).
136. Order, dated 12 November 1985, penned by Judge Ansberto P. Paredes, records, Vol. I, p.
310; Order, dated 2 September 1988, id. at penned by Judge Francisco X. Velez, records,
Vol. I, p. 449; Order, dated 24 November 1988, penned by Judge Francisco X. Velez, records,
Vol. I, p. 458; Order, dated 25 April 1989, penned by Judge Francisco X. Velez, records, Vol. I,
pp. 476-477
137. Security Bank & Trust Co. v. Triumph Lumber and Construction Corporation, 361 Phil.
463, 477 (1999).
138. REVISED RULES OF COURT, Rule 131, Section 3(e).

139. The stipulated interest shall apply as indemnity for the damages incurred in the delay of
payment as provided in Article 2209 of the CIVIL CODE which reads —
ART. 2209. If the obligation consists in the payment of a sum of money, and the debtor
incurs delay, the indemnity for damages, there being no stipulation to the contrary, shall be
the payment of the interest agreed upon , and in the absence of a stipulation, the legal
interest, which is six percent per annum. [Emphasis supplied.]
Note, however, that the legal interest has been increased from six percent to twelve
percent per annum by virtue of Central Bank Circulars No. 416, dated 29 July 1974, and No.
905, dated 10 December 1982.
140. Radio Communications of the Philippines, Inc. v. National Labor Relations Commission,
G.R. Nos. 101181-84, 22 June 1992, 210 SCRA 222, 226-227; Ortigas, Jr. v. Lufthansa
German Airlines, G.R. No. L-28773, 30 June 1975, 64 SCRA 610, 633-634; Hernandez v.
Andal, 78 Phil. 196, 209-210 (1947).
141. THE GENERAL BANKING LAW OF 2000, Section 2.
142. Philippine National Bank v. Court of Appeals, 373 Phil. 942, 948 (1999).
143. Simex International (Manila), Inc. vs. Court of Appeals, G.R. No. 88013, 19 March 1990,
183 SCRA 360, 367; Bank of Philippine Islands vs. Intermediate Appellate Court, G.R. No.
69162, 21 February 1992, 206 SCRA 408, 412-413.
144. TSN, 28 January 1986, Vol. I, pp. 5-7.

145. Tiongco v. Atty. Deguma, 375 Phil. 978, 994-995 (1999); Zenith Insurance Corporation v.
Court of Appeals, G.R. No. 85296, 14 May 1990, 185 SCRA 398, 402-403.
146. Exemplary or corrective damages are imposed, by way of example or correction for the
public good, in addition to the moral, temperate, liquidated or compensatory damages.
147. While the amount of exemplary damages need not be proved, the plaintiff must show
that he is entitled to moral, temperate or compensatory damages before the court may
consider the question of whether or not exemplary damages should be awarded. . . .

148. CIVIL CODE, Article 2208(1).
149. Ching Sen Ben vs. Court of Appeals, 373 Phil. 544, 555 (1999).
150. ABS-CBN Broadcasting Corporation v. Court of Appeals, 361 Phil. 498, 531-532 (1999);
Tierra International Construction Corp. v. National Labor Relations Commission, G.R. No.
88912, 3 July 1992, 211 SCRA 73, 81; Saba v. Court of Appeals, G.R. No. 77950, 24 August
1990, 189 SCRA 50, 55.

Citibank N.A. v. Sabeniano

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Citibank N.A. v. Sabeniano

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FIRST DIVISION

[G.R. No. 156132. October 16, 2006.]

CITIBANK, N.A. (Formerly First National City Bank) and INVESTORS'

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2. As defendant-appellant Citibank failed to establish by competent

4. Ordering defendants-appellants to jointly and severally pay the

To sustain the argument of respondent would result in an unjust and incongruous

Respondent Sabeniano did not

(People vs. De Paz, 212 SCRA 56, 63 [1992])

Dollar deposit with Citibank-Geneva $149,632.99

Money market placement with Citibank, evidenced by

Money market placement with Citibank, evidenced by PN

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Money market placement with FNCB Finance, evidenced

Money market placements with petitioner Citibank

(mm/dd/yyyy) PN No. (mm/dd/yyyy) (P) (p.a.)

12/06/1976 20773 None 01/13/1977 500,000.00 16%

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Split into two time deposits.

Moreover, while there are documentary evidences to support and trace

04/29/1977 4952 None 06/01/1977 500,000.00 17%

Petitioner FNCB Finance presented four checks as proof of payment of the

09/01/1978 76962 12,833.34 Interest payment on PN#08167

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US$ 30'000.-- Principal Fid. Placement

Principal and interests of PNs No. 20138 and 20139

32935 07/20/1978 09/18/1978 P400,000.00 07/20/1978 220701

34510 01/01/1979 03/02/1979 P400,000.00

Please accept our Comtrust Check in the amount of P62,683.33.

A week later or on 3 May 1979, a certain C. N. Pugeda, designated as "Executive

and C/A No. 484-946

Respondent's outstanding obligation (principal and interest) P2,123,843.20

Unfortunately, on 7 October 1987, a re gutted the 7th oor of petitioner Citibank's

Another inconsistency in respondent's denial of receipt of MC No. 226467 and her

In contrast, petitioner Citibank, as supported by the testimonies of its o cers and

Best evidence rule

(c) When the original consists of numerous accounts or other documents

In Estrada v. Desierto, 1 1 6 this Court had occasion to rule that —

"In several Canadian provinces, the principle of unavailability has been

The impact of the Decision of the Court of Appeals in the Dy case

As the factual milieu of the present appeal created reasonable doubts as to

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(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,

There is little controversy when it comes to the right of petitioner Citibank to

2. In the event the OBLIGATIONS are not paid at maturity or upon

xxx xxx xxx

5. This Assignment shall be considered as su cient authority to FNCB

As a rule, forgery cannot be presumed and must be proved by clear, positive

A I am engaged in real estate. I am the owner of the Modesta Village 1 and 2 in

Q What is the business of that Disto Company Ltd.?

A Disto Company, Ltd., is engaged in real estate and construction.

A I am the Vice-President of thes [sic] Subdivision Association of the Philippines

Q How about any political affiliation or government position held if any?

A I was also a candidate for Mayo last January 30, 1980.

A In Dagupan City, Pangasinan.

A I also ran as an Assemblywoman last May, 1984, Independent party in

Q What happened to your businesses you mentioned as a result of your failure

A Yes sir, definitely. CacISA

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1. Rollo, pp. 165-325.

5. Records, Vol. I, pp. 1-8.

18. Resolution, dated 23 June 2003; id. at 1311-1312.