Producers Bank of the Philippines vs CA G.R. No.

115324, February 19, 2003 – Vives and Doronilla,

Sterela

Doctrine: By the contract of loan, one of the parties delivers to another, either something not consumable so
that the latter may use the same for a certain time and return it, in which case the contract is called a
commodatum; or money or other consumable thing, upon the condition that the same amount of the same
kind and quality shall be paid, in which case the contract is simply called a loan or mutuum. Commodatum is
essentially gratuitous. Simple loan may be gratuitous or with a stipulation to pay interest. In commodatum,
the bailor retains the ownership of the thing loaned, while in simple loan, ownership passes to the borrower.

Facts: Sometime in 1979, private respondent Franklin Vives was asked by his neighbor and friend Angeles
Sanchez to help her friend and townmate, Col. Arturo Doronilla, in incorporating his business, the Sterela
Marketing and Services (Sterela). Specifically, Sanchez asked Vives to deposit in a bank a certain amount of
money in the bank account of Sterela for purposes of its incorporation. She assured private respondent that
he could withdraw his money from said account within a month’s time. Vives asked Sanchez to bring
Doronilla to their house so that they could discuss Sanchez’s request but only Estrella Dumagi, Doronilla’s
private secretary met with them.

Relying on their assurance, Vives agreed. Sanchez, Mrs. Vives, and Dumagpi went to the bank and opened an
account for Sterela in the amount of Php200k. The account’s authorized signatories were Mrs. Vives and
Sanchez. Vives learned that Sterela was no longer holding office in the address previously given. They went
to the bank and was informed that only Php90k remained and it could not withdraw because the said amount
had to answer for the PDCs issued by Doronilla. Doronilla opened a CA and authorized the bank to debit the
savings account opened by Mrs. Vives and Sanchez. In opening a CA account, Dornilla obtained a loan of
Php175k from the bank. Doronilla issued PDCs to pay for the said loan but were all dishonored. Atienza,
officer at the Bank, said that Doronilla could assign or withdraw the money from the said SA because he was
the sole proprietor of Sterela.

Doronilla issued checks three times and were dishonored three times. Vives instituted an action for recovery
of sum of money with the RTC. He also filed criminal action against Doronilla, Sanchez, and Dumagpi.
However, Sanchez passed away while case is pending. RTC sentenced Doronilla, Dumagpi, and Producers
Bank of the Philippines to pay Vives jointly and severally. Petitioned appealed but was denied. Motion for
reconsideration was filed but denied. Hence, the present petition.

Petitioner contends that the transaction between private respondent and Doronilla is a simple loan
(mutuum) since all the elements of a mutuum are present: first, what was delivered by private respondent
to Doronilla was money, a consumable thing; and second, the transaction was onerous as Doronilla was
obliged to pay interest, as evidenced by the check issued by Doronilla in the amount of P212,000.00, or
P12,000 more than what private respondent deposited in Sterela’s bank account. Petitioner argues that it
cannot be held liable for the return of private respondent’s P200,000.00 because it is not privy to the
transaction between the latter and Doronilla.

It argues further that petitioner’s Assistant Manager, Mr. Rufo Atienza, could not be faulted for allowing
Doronilla to withdraw from the savings account of Sterela since the latter was the sole proprietor of said
company. Petitioner should not be held liable for allowing Doronilla to withdraw from Sterela’s savings
account.

Private respondent, on the other hand, argues that the transaction between him and Doronilla is not a
mutuum but an accommodation, since he did not actually part with the ownership of his P200,000.00 and
in fact asked his wife to deposit said amount in the account of Sterela so that a certification can be issued to
the effect that Sterela had sufficient funds for purposes of its incorporation but at the same time, he retained
some degree of control over his money through his wife who was made a signatory to the savings account and
in whose possession the savings account passbook was given.
Issue: Whether or not the transaction was a commodatum.

Ruling: Yes, the transaction was a commodatum.

A circumspect examination of the records reveals that the transaction between them was a commodatum.
There are some instances where a commodatum may have for its object a consumable thing. Article 1936 of
the Civil Code provides:

Consumable goods may be the subject of commodatum if the purpose of the contract is not the
consumption of the object, as when it is merely for exhibition.

Thus, if consumable goods are loaned only for purposes of exhibition, or when the intention of the parties is
to lend consumable goods and to have the very same goods returned at the end of the period agreed upon, the
loan is a commodatum and not a mutuum. Private respondent merely “accommodated” Doronilla by
lending his money without consideration, as a favor to his good friend Sanchez. It was however clear
to the parties to the transaction that the money would not be removed from Sterela’s savings account
and would be returned to private respondent after thirty (30) days.

Doronilla’s attempts to return to private respondent the amount of P200,000.00 which the latter deposited in
Sterela’s account together with an additional P12,000.00, allegedly representing interest on the mutuum, did
not convert the transaction from a commodatum into a mutuum because such was not the intent of the parties
and because the additional P12,000.00 corresponds to the fruits of the lending of the P200,000.00.
Article 1935 of the Civil Code expressly states that “[t]he bailee in commodatum acquires the use of the thing
loaned but not its fruits.” Hence, it was only proper for Doronilla to remit to private respondent the interest
accruing to the latter’s money deposited with petitioner.

Neither does the Court agree with petitioner’s contention that it is not solidarily liable for the return of
private respondent’s money because it was not privy to the transaction between Doronilla and private
respondent.

The nature of said transaction, that is, whether it is a mutuum or a commodatum, has no bearing on the
question of petitioner’s liability for the return of private respondent’s money because the factual
circumstances of the case clearly show that petitioner, through its employee Mr. Atienza, was partly
responsible for the loss of private respondent’s money and is liable for its restitution.

Doronilla was permitted by petitioner, through Atienza, the Assistant Branch Manager for the Buendia Branch
of petitioner, to withdraw therefrom even without presenting the passbook (which Atienza very well knew
was in the possession of Mrs. Vives), not just once, but several times. Both the Court of Appeals and the trial
court found that Atienza allowed said withdrawals because he was party to Doronilla’s “scheme” of
defrauding private respondent

Under Article 2180 of the Civil Code, employers shall be held primarily and solidarily liable for damages
caused by their employees acting within the scope of their assigned tasks.

The foregoing shows that the Court of Appeals correctly held that under Article 2180 of the Civil Code,
petitioner is liable for private respondent’s loss and is solidarily liable with Doronilla and Dumagpi for the
return of the P200,000.00 since it is clear that petitioner failed to prove that it exercised due diligence to
prevent the unauthorized withdrawals from Sterela’s savings account, and that it was not negligent in the
selection and supervision of Atienza.

Petition is denied. Assailed decision is affirmed.