G.R. No.

179105

July 26, 2010

METROPOLITAN BANK AND TRUST COMPANY, Petitioner, vs. LARRY MARIAS, Respondent. DECISION NACHURA, J.: This is a petition for review on certiorari under Rule 45 of the Rules of Court, seeking to annul and set aside the Court of Appeals (CA) Decision1 dated July 31, 2007, affirming with modification the Regional Trial Court (RTC) decision2 dated October 14, 2004. The factual and procedural antecedents are as follows: Sometime in April 1998, respondent Larry Marias returned to the Philippines from the United States of America. He opened a personal dollar savings account3 by depositing US$100,000.00 with petitioner Metropolitan Bank and Trust Company. On April 13, 1998, respondent obtained a loan from petitioner in the amount of P2,300,000.00, evidenced by Promissory Note No. 355873.4 From the initial deposit of US$100,000.00, respondent withdrew5US$67,227.95,6 then deposited it under Account No. 026400171-6 (Foreign Currency Deposit [FCD] No. 505671),7 which he used as security8 for the P2,300,000.00 loan. Respondent subsequently opened two more foreign currency accounts Account No. 0-26400244-5 (FCD No. 505688)9 and Account No. 0-264-00357-3 (FCD No. 739809)10 depositing therein US$25,000.00 and US$17,000.00, respectively. On April 30, 1999, respondent obtained a second loan of P645,150.00,11 secured12by Account No. 0-264-00357-3 (FCD No. 739809). When he inquired about his dollar deposits, respondent discovered that petitioner made deductions against the formers accounts. On May 31, 1999, respondent, through his counsel, demanded from petitioner a proper and complete accounting of his dollar deposits, and the restoration of his deposits to their proper amount without the deductions.13 In response, petitioner explained that the deductions made from respondents dollar accounts were used to pay the interest due on the latters loan with the former. These deductions, according to petitioner, were authorized by respondent through the Deeds of Assignment with Power of Attorney voluntarily executed by respondent.14 Unsatisfied, and believing that the deductions were unauthorized, respondent commenced an action for Damages against petitioner and its Kabihasnan, Paraaque City Branch Manager Expedito Fernandez (Fernandez) before the RTC, Las Pias City. The case was docketed as Civil Case No. 990172 and was raffled to Branch 255. While admitting the existence of the P2,300,000.00 and P645,150.00 loans, respondent claimed that when he signed the loan documents, they were all in blank and they were actually filled up by petitioner. Aside from the complete accounting of his dollar accounts and the restoration of the true amounts of his deposits, respondent sought the payment of P400,000.00 as moral damages, P100,000.00 as exemplary damages, and P100,000.00 as attorneys fees.15 On its part, petitioner insisted that respondent freely and voluntarily signed the loan documents. While admitting the full payment of respondents P2,300,000.00 and P645,150.00 loans, petitioner claimed that the payments were made using the formers US$67,227.95, US$25,000.00, and US$17,000.00 time deposits. Accordingly, there was nothing to account for and restore. By way of counterclaim,

petitioner prayed for the payment of P200,000.00 as attorneys fees, P1,000,000.00 as moral damages, and P500,000.00 as exemplary damages.16 As no amicable settlement was reached, trial on the merits ensued. On October 14, 2004, the RTC rendered a decision in favor of respondent, the dispositive portion of which reads: WHEREFORE, the foregoing considered, judgment is hereby rendered in favor of plaintiff Larry Mari[]as, and against the defendants Metropolitan Bank and Trust Company and Expedito Fernandez, ordering the said defendants to account for the dollar deposits of the plaintiff in the amounts of US$30,000.00 and US$25,000.00, respectively, and then return the same, including the interests due thereon reckoned from 31 May 1999 until fully paid. Likewise, the defendants are hereby directed to pay to the herein plaintiff the following amounts, to wit: 1. P100,000.00 in moral damages; 2. P50,000.00 in exemplary damages; 3. P50,000.00 as and by way of attorneys fees; and 4. Costs of suit. SO ORDERED.17 The RTC sustained the validity and regularity of the loan documents signed by respondent, and consequently the existence of the P2,300,000.00 and P645,150.00 loans obtained from petitioner. Acknowledging the full payment of both loans, the trial court found that the payments were made from respondents foreign currency deposits, particularly Account Numbers 0-26400171-6 (FCD No. 505671) and 0-264-00357-3 (FCD No. 739809), amounting to US$67,227.95 and US$17,000.00, respectively. There is no doubt that respondent specifically assigned these accounts to secure the payment of his loans pursuant to the Deeds of Assignment with Power of Attorney. Hence, the deductions made from such accounts were valid. However, the RTC found that petitioner should account for and eventually return the US$30,000.00 and US$25,000.00 deposits of respondent since they were not assigned to answer for the latters loans, and that any deductions made from these accounts were, therefore, illegal. Consequently, petitioner was made to answer for damages suffered by respondent.18 Being the petitioners Kabihasnan Branch Manager, Fernandez was declared solidarily liable with petitioner. On appeal, the CA modified the RTC decision by absolving Fernandez from liability. The appellate court held that Fernandez could not be made to answer for acts done in the performance of his duty absent any showing that he assented to patently unlawful acts of the corporation or was guilty of bad faith or gross negligence in directing its affairs, or that he agreed to hold himself personally and solidarily liable with the corporation.19 No proof was adduced in this regard. Hence, the instant petition raising the following issues: 1. WHETHER OR NOT THE HONORABLE COURT OF APPEALS ERRED IN ORDERING PETITIONER TO ACCOUNT FOR AND RETURN TO RESPONDENT THE SUMS OF US$30,000.00 AND US$25,000.00.

2. WHETHER OR NOT THE HONORABLE COURT OF APPEALS ERRED IN HOLDING PETITIONER LIABLE TO RESPONDENT FOR MORAL AND EXEMPLARY DAMAGES, AS WELL AS ATTORNEYS FEES AND COSTS OF SUIT.20 Petitioner assails the CA Decision affirming the formers culpability for making unlawful deductions from respondents dollar accounts without the latters consent. Additionally, it questions the award of moral and exemplary damages, as well as attorneys fees. We agree with the CAs factual findings as to the deposits and withdrawals made and loans obtained by respondent. We do not, however, agree with its conclusion that petitioner absolutely lacked the authority to make deductions from respondents deposits for the payment of his outstanding obligations. It is apt to stress the well-settled principle that factual findings of the trial court, affirmed by the CA, are binding and conclusive upon this Court.21 In the absence of any showing that the findings complained of are totally devoid of support in the evidence on record, or that they are so glaringly erroneous as to constitute serious abuse of discretion, such findings must stand.22 The Court is not a trier of facts, its jurisdiction being limited to reviewing only errors of law that may have been committed by the lower courts.23 It is not the function of the Court to analyze or weigh all over again the evidence or premises supportive of such factual determination.24 The law creating the CA was intended mainly to take away from the Supreme Court the work of examining the evidence, so that it may confine its task to the determination of questions which do not call for the reading and study of transcripts containing the testimony of witnesses.25 In the present case, we find no justification to deviate from the factual findings of the trial court and the appellate court. Petitioner has utterly failed to convince us that the assailed findings are devoid of basis or are not supported by substantial evidence. It is noteworthy that respondent opened four accounts with petitioner: 1) Account No. 2264-00145-0 for US$100,000.00; 2) Account No. 0-26400171-6 (FCD No. 505671) for US$67,227.95; 3) Account No. 0-26400244-5 (FCD No. 505688) for US$25,000.00; and 4) Account No. 0-264-00357-3 (FCD No. 739809) for US$17,000.00. Admittedly, respondent withdrew $70,000.00 from Account No. 226400145-0, leaving a balance of $30,000.00. It is likewise undisputed that respondent obtained two separate loans from petitioner in amounts of P2,300,000.00 and P645,150.00. These were evidenced by promissory notes and secured by respondents two dollar accounts Account Numbers 0-26400171-6 (FCD No. 505671) and 0-26400357-3 (FCD No. 739809) for US$67,227.95 and US$17,000.00, respectively. Respondents first loan of P2,300,000.00, obtained on April 13, 1998, was payable on April 8, 1999; while the second loan of P645,150.00, obtained on April 30, 1999, was payable on April 24, 2000. Records show that the first loan was paid on April 21, 1999, with the payment therefor taken from Account No. 026400171-6. The second loan, on the other hand, was paid on May 10, 1999, out of respondents Account No. 0-264-00357-3. It should be clarified, though, that these payments referred only to the payment of the principal (P2,300,000.00 and P645,150.00) of respondents loans, exclusive of interests stipulated in the promissory notes executed by the latter. Aside from obligating himself to pay P2,300,000.00 as principal, respondent also agreed to pay interest at the rate of 22.929% per annum (not monthly) from April 13, 1998 until full payment. As respondent made full payment of the principal on April 21, 1999, respondent was also obliged to pay interest until that date. As to the P645,150.00 loan, respondent agreed to pay interest at the rate of 16.987% per annum.

Respondent later discovered that his accounts with petitioner were all depleted. Upon inquiry from petitioner, it explained that pursuant to the Deeds of Assignment with Power of Attorney executed by respondent, it deducted from respondents accounts the interest due on his loans.
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Contrary to the conclusions of the RTC and the CA, we find that petitioner is empowered to make lawful deductions from respondents accounts for such amounts due it. This is authorized in the Promissory Notes and Deeds of Assignment with Power of Attorney executed by respondent, to wit: I/We hereby give the Bank a general lien upon, and/or right of set-off and/or right to hold and/or apply to the loan account, or any claim of the Bank against any of us, all my/our rights, title and interest in and to the balance of every deposit account, money, negotiable instruments, commercial papers, notes, bonds, stocks, dividends, securities, interest, credits, chose in action, claims, demands, funds or any interest in any thereof, and in any other property, rights and interest of any of us or any evidence thereof, which have been, or at any time shall be delivered to, or otherwise come into the possession, control or custody of the Bank or any of its subsidiaries, affiliates, agents or correspondents now or anytime hereafter, for any purpose, whether or not accepted for the purpose or purposes for which they are delivered or intended. For this purpose, I/We hereby appoint the Bank as my/our irrevocable Attorney-in-fact with full power of substitution/delegation to sign or endorse any and all documents and perform any and all acts and things required or necessary in the premises.26 Effective upon default in the payment of CREDIT, or any part thereof, the ASSIGNOR hereby grants to the ASSIGNEE, full power and authority to collect/withdraw the deposit/proceeds/receivables/ investments/securities and apply the collection/deposit to the payment of the outstanding principal, interest and other charges on the CREDIT. For this purpose, the ASSIGNOR hereby names, constitutes and appoints the ASSIGNEE as his/its true and lawful Attorney-in-Fact, with powers of substitution, to ask, demand, collect, sue for, recover and receive the deposit/proceeds/receivables/investments/securities or any part thereof, as well as to encash, negotiate and endorse checks, drafts and other commercial papers/instruments received by and paid to the ASSIGNEE, incident thereto and to execute all instruments and agreements connected therewith. A written Certification by the ASSIGNEE of the amount of its claims from the ASSIGNOR and/or the BORROWER shall be conclusive on the ASSIGNOR and/or the BORROWER absent manifest error.27 As provided in Article 1159 of the Civil Code, "obligations arising from contract have the force of law between the contracting parties and should be complied with in good faith." Verily, parties may freely stipulate their duties and obligations which perforce would be binding on them. Not being repugnant to any legal proscription, the agreement entered into between petitioner and respondent must be respected and given the force of law between them.28 Upon the maturity of the first loan on April 8, 1999, petitioner was authorized to automatically deduct, by way of offsetting, respondents outstanding debt (including interests) to it from the latters deposit accounts and their accumulated interest. Respondent did not object to the deduction made from the proceeds of Account No. 0-26400171-6, but would limit such deduction only to the payment of the principal of P2,300,000.00. However, it should be borne in mind that in addition to the authority to effect the said deduction for the principal loan amount, petitioner was authorized to make further deductions for interest payments at the rate of 22.929% per annum until April 21, 1999. With respect to the second loan, barely a month after the execution of the promissory note and definitely prior to the maturity date, respondent already paid the principal of P645,150.00 out of the deposited amount in Account No. 0-264-00357-3. Pursuant to the promissory note, respondent agreed to pay interest at the rate of 16.987% per annum. While it is conceded that petitioner had the right to offset the unpaid interests due it against the deposits of respondent, the issue of whether it acted

judiciously is an entirely different matter.29 As business affected with public interest, and because of the nature of their functions, banks are under obligation to treat the accounts of their depositors with meticulous care, always having in mind the fiduciary nature of their relationship.30 Pursuant to the above disquisition, it is clear that despite such authority, petitioner should still account for whatever excess deductions made on respondents deposits and return to respondent such amounts taken from him. To be sure, respondent had interest-earning deposits with petitioner in accordance with their agreement. On the other hand, after respondent paid the principal on April 21, 1999 and May 10, 1999 on the two loans which he obtained from petitioner, the latter had the authority to make deductions for the payment of interest as stipulated in respondents promissory notes. When we consider the total amount of respondents deposits in his dollar accounts inclusive of interests earned vis--vis his total obligations to petitioner, we find that the total depletion of his accounts is not warranted. Hence, we find no reason to disturb the CA conclusion on the award of damages. As aptly explained in Bank of the Philippine Islands v. Court of Appeals: For the above reasons, the Court finds no reason to disturb the award of damages granted by the CA against petitioner. This whole incident would have been avoided had petitioner adhered to the standard of diligence expected of one engaged in the banking business. A depositor has the right to recover reasonable moral damages even if the banks negligence may not have been attended with malice and bad faith, if the former suffered mental anguish, serious anxiety, embarrassment and humiliation. Moral damages are not meant to enrich a complainant at the expense of defendant. It is only intended to alleviate the moral suffering she has undergone. The award of exemplary damages is justified, on the other hand, when the acts of the bank are attended by malice, bad faith or gross negligence. The award of reasonable attorneys fees is proper where exemplary damages are awarded. It is proper where depositors are compelled to litigate to protect their interest.31 WHEREFORE, premises considered, the Court of Appeals Decision dated July 31, 2007 is hereby AFFIRMED with MODIFICATION. Petitioner is ordered to account for respondents dollar deposits inclusive of interests, subject to its right to deduct from the said deposits his loan obligations amounting to P2,300,000.00, plus interest at 22.929% per annum until full payment on April 21, 1999; and P645,150.00, plus interest at 16.987% per annum until full payment on May 10, 1999. After such accounting, petitioner shall restore to respondent whatever excess amounts may have been deducted from such deposits, together with the earned interests. All other aspects of the assailed decision STAND.

.R. No. 111584

September 17, 2001

PRODUCERS BANK OF THE PHILIPPINES, petitioner, vs. COURT OF APPEALS and SPOUSES SALVADOR Y. CHUA and EMILIA U. CHUA, respondents. MELO, J.: The instant petition assails the decision of the Court of Appeals in its CA G.R.CV No. 20220, dated October 31, 1991, affirming with modification the decision of Branch 48 of the Regional Trial Court of the 6th Judicial Region stationed in Bacolod City, as well as the resolution dated August 12, 1993 denying petitioner's motion for partial consideration. Undersigned ponente was given this case in pursuance of A. M. No. 00-9-03-SC dated February 27, 2001 distributing the so-called back-log cases. The generative facts of the case may be chronicled as follows: Sometime in April, 1982, respondent Salvador Chua was offered by Mr. Jimmy Rojas, manager of petitioner bank, to transfer his account from Pacific Banking Corporation to herein petitioner Producers Bank of the Philippines. In view of Rojas' assurances of longer loan terms and lower rates of interest, respondent spouses opened and maintained substantial savings and current deposits with the Bacolod branch of petitioner bank. Likewise, private respondents obtained various loans from petitioner bank, one of which was a loan for P2,000,000.00 which was secured by a real estate mortgage and payable within a period of three (3) years or from 1982 to 1985. On January 20, 1984, private respondents deposited with petitioner bank the total sum of P960,000.00, which was duly entered in private respondents' savings account passbook. However, petitioner bank failed to credit this deposit in private respondents' savings account due to the fact that its Branch Manager, Sixto Castillo, absconded with the money of the bank's depositors. Also, petitioner bank dishonored the checks drawn out by private respondents in favor of their various creditors on the ground of insufficient funds, despite the fact that at that time, the balance of private respondents' deposit was in the amount of P1,051,051.19. These events prompted private respondents to request for copies of their ledgers covering their savings and current accounts, but petitioner bank refused. Due to petitioner bank's refusal to furnish private respondents copies of their ledgers, private respondents instituted on January 30, 1984 an action for damages against petitioner bank which was docketed as Civil Case No. 2718. On the other hand, petitioner bank filed with the City Sheriff of Bacolod a petition for extrajudicial foreclosure of the real estate mortgage during the pendency of Civil Case No. 2718. As a result, private respondents filed a complaint for injunction and damages docketed as Civil Case No. 3276, alleging that the petition for extrajudicial foreclosure was without basis and was instituted maliciously in order to harass private respondents. On April 26, 1988, the trial court rendered its decision on the latter case, the dispositive portion of which reads: WHEREFORE, from the evidence adduced, judgment is hereby rendered in favor of plaintiff ordering the defendant as follows: 1) To pay plaintiff the sum of P2,000,000.00 as moral damages, with legal rate of interest; the sum of P90,000.00 per month and P18,000.00 per month representing plaintiff's unrealized profits from his cement and gasoline station business, respectively, to commence from October 16, 1984, with legal rate of interest until fully paid; the sum of P250,000.00 as exemplary damages; 2) To off-set the sum of P960,000.00 deposited by plaintiff on January 20, 1984 and entered in his Passbook No. 38240, together with its incremental interests computed at banking rate and to commence from January 20, 1984 with his agricultural loan account in the sum of P1,300,000.00 with interest thereon computed at fourteen (14%)

percent per annum, to commence from January 4, 1984, covered by a real estate mortgage, both of which shall have a cut-off time frame on the date of this decision; 3) That should the said savings deposit and its interest be sufficient to cover the offsetting, compensation shall take place and to be taken from the amounts awarded to plaintiff in the form of moral, actual and compensatory damages; 4) That the time loan in the sum of P175,000.00 and the clean loan of P400,000.00, both without interest, shall be off-settled by the moral, actual and compensatory damages herein awarded to plaintiff; 5) That after compensation or set-off had taken place, to pay plaintiff the balance of the adjudged moral, actual and compensatory damages, with legal rate of interest until fully paid; 6) To render an accounting to plaintiff with respect to his Account Nos. 0142-0014-0 and 042-0014-1 for the period covering January to December, 1982; 7) That in order to make the bank's record complete, to reform the deed of real estate mortgage conformably with the agreement by stipulating in the said document that the maturity date of the agricultural loan is April 5, 1987 at the same rate of interest of fourteen (14%) percent per annum, deducting from the original amount of the loan the payments made on the principal and interests; this reformation shall take place simultaneously with the off-setting of accounts; 8) To pay plaintiff the sum equivalent to fifteen (15%) percent of the amount representing the balance of the sums awarded as moral, actual and compensatory damages as attorney's fees; 9) To pay plaintiff the costs of suit; 10) The writ of preliminary injunction issued by this Court is rendered permanent; and 11) The counterclaim is hereby dismissed. SO ORDERED. (Rollo, pp. 261-263.) On October 31, 1991, upon appeal by petitioner bank, the Court of Appeals modified the decision of the trial court as follows: WHEREFORE, from the evidence adduced, judgment is hereby rendered as follows: 1. Ordering the defendant a. To pay plaintiff the sum of P500,000.00 as moral and exemplary damages;

b. To pay the sum of P18,000.00 per month representing plaintiffs' unrealized profits from his gasoline station business to commence from October 16, 1984, with legal rate of interest, until fully paid; c. To allow the plaintiffs to offset their financial obligation with the defendant bank by the moral, exemplary, actual and compensatory damages herein awarded in favor of the aforesaid plaintiffs; d. If, after the off-setting, a balance remains in favor of the plaintiffs, to pay the said plaintiffs such balance of the adjudged moral, exemplary, actual and compensatory damages, with legal rate of interest until fully paid, as of the time of off-setting; e. To render an accounting to plaintiffs with respect to their Account Nos. 0142-0014-0 and 042-0014-1 for the period covering January to December, 1982; f. To pay plaintiffs the sum of P100,000.00 as attorney's fees. g. To pay the costs of suit. 2. Ordering the plaintiffs a. To settle their loan obligation with the defendant bank within 90 days from the finality of this decision, subject to the resolution of this Court to the effect that they shall be relieved from the payment of penalties and surcharges on their outstanding balance starting January 20, 1984; 3. The plaintiffs' prayer for reformation of their mortgage contract or annulment thereof is hereby denied; 4. The counterclaim of defendant-appellant are hereby dismissed. SO ORDERED. Petitioner moved for a partial reconsideration of the above decision but the same was denied on August 12, 1993. Hence, the instant petition with the following submissions which allegedly warrant our review of the assailed decision, viz.: 1. The Court of Appeals erred in not ruling that the application for extrajudicial foreclosure of real estate mortgage is legal and valid; 2. The Court of Appeals erred in not granting petitioner bank its right to foreclose extrajudicially the real estate mortgage and to proceed with its application for extrajudicial foreclosure of real estate mortgage; 3. The Court of Appeals erred in ruling that private respondents be relieved from the payment of penalties and surcharges on their outstanding balance starting January 20, 1984; 4. The Court of Appeals erred in awarding moral and exemplary damages of P500,000.00, unrealized profit of P18,000.00 per month, and attorney's fees of P100,000.00 against petitioner bank;

5. The Court of Appeals erred in ordering an accounting to private respondents with respect to their Account Nos. 0142-0014-0 and 042-0014-1 for the period covering January to December, 1982. It should at once be apparent that except for the first and second imputed errors which involve petitioner bank's right to foreclose extrajudicially the real estate mortgage, the resolution of the assigned errors entails a review of the factual conclusions of the appellate court and the evidentiary bases thereof. Such an assessment is not, as a rule, proper in appeals from the Court of Appeals which should be confined to a consideration and determination only of issues of law as its findings of fact are deemed conclusive (Villanueva vs. Court of Appeals, 294 SCRA 90 [1998]) especially so in this case because the findings of fact of the appellate court concur with those of the trial court. To reiterate, this Court's jurisdiction is only limited to reviewing errors of law in the absence of any showing that the findings complained of are totally devoid of support in the record or they are glaringly erroneous as to constitute serious abuse of discretion. Nonetheless, considering the amount involved, as well as for the satisfaction of the parties who have vigorously pursued this case since 1984, the Court, in the exercise of its discretion, examined the factual bases, particularly with respect to the propriety of the damages awarded to private respondents. The first and second assignments of error, being interrelated, shall be jointly discussed. Petitioner contends that it has the right to foreclose the real estate mortgage executed by private respondents in its favor as the loan under the real estate mortgage contract had become due and demandable. This argument is not well-taken. Foreclosure is but a necessary consequence of nonpayment of a mortgage indebtedness. As a rule, the mortgage can be foreclosed only when the debt remains unpaid at the time it is due (Gov't. of the P.I. vs. Espejo, 57 Phil. 496 [1932]). As found by the trial court and the Court of Appeals, and as borne by the evidence on record, private respondents were constantly paying their loan obligations with petitioner bank. In fact the amount of P960,000.00 was properly deposited with petitioner bank as evidenced by the corresponding deposit slip and the entry made in private respondents' savings account passbook. It is, therefore, not the fault of private respondents that their payment amounting to P960,000.00 was not credited to their account. Thus, it is certain that the loan which was secured by a real estate mortgage cannot be considered as unpaid so as to warrant foreclosure on the mortgage. Clearly, private respondents have not yet defaulted on the payment of their loans. Moreover, the term of the loan, as agreed upon by the parties, is three years, or from 1982 to 1985. But petitioner filed its application for extrajudicial foreclosure on October 15, 1984. Indisputably, the application for foreclosure of the mortgage on October 15, 1984 was premature because by then, private respondents' loan was not yet due and demandable. Likewise, both the Court of Appeals and the trial court found that private respondents are entitled to moral and exemplary damages. We agree. Moral and exemplary damages may be awarded without proof of pecuniary loss. In awarding such damages, the court shall take into account the circumstances obtaining in the case and assess damages according to its discretion. As borne out by the record of this case, private respondents are engaged in several businesses, such as rice and corn trading, cement dealership, and gasoline proprietorship. The dishonor of private respondents' checks and the foreclosure initiated by petitioner adversely affected the credit standing as well as the business dealings of private respondents as their suppliers discontinued credit lines resulting in the collapse of their businesses. In the case of Leopoldo Araneta vs. Bank of America (40 SCRA 144 [1971]), we held that:

"The financial credit of a businessman is a prized and valuable asset, it being a significant part of the foundation of his business. Any adverse reflection thereon constitutes some financial loss to him." The damage to private respondents' reputation and social standing entitles them to moral damages. Article 2217, in relation to Article 2220, of the Civil Code explicitly provides that "moral damages include physical suffering, mental anguish, fright, serious anxiety, besmirched reputation, wounded feelings, moral shock, social humiliation, and similar injury." Obviously, petitioner bank's wrongful act caused serious anxiety, embarrassment, and humiliation to private respondents for which they are entitled to recover moral damages in the amount of P300,000.00 which we deem to be reasonable. The award of exemplary damages is in order in view of the malicious and unwarranted application for extrajudicial foreclosure by petitioner which was obviously done to harass, embarrass, annoy, or ridicule private respondents. Likewise, petitioner, in its application for extrajudicial foreclosure, included the other loans of private respondents which were not covered by the real estate mortgage agreement, such as the loan of P175,000.00 which was a time loan, and the amount of P400,000.00 which was a clean loan. Moreover, petitioner unjustifiably refused to give private respondents copies of their account ledgers which would show the deposits made by them. Also, petitioner bank's failure to credit the deposit in the account of private respondents constituted gross negligence in the performance of its contractual obligation which amounts to evident bad faith. Verily, all these acts of petitioner were accompanied by bad faith and done in wanton, fraudulent and malevolent manner warranting the award of exemplary damages in favor of private respondents, in accordance with Article 2232 of the Civil Code which provides: ART. 2232. In contracts and quasi-contracts, the court may award exemplary damages if the defendant acted in a wanton, fraudulent, reckless, oppressive, or malevolent manner. Of course, a plaintiff need not prove the actual extent of exemplary damages, for its determination is addressed to the sound discretion of the court upon proof of the plaintiff's entitlement to moral, temperate, or compensatory damages (Article 2234, Civil Code). In the instant case, exemplary damages in the amount of P150,000.00 are proper. Anent the award of actual damages, the Court of Appeals granted private respondents the amount of P18,000.00 per month representing private respondents' unrealized profits from his gasoline station business, to commence from October 16, 1984. Under Articles 2199 and 2200 of the Civil Code, actual or compensatory damages are those awarded in satisfaction of, or in recompense for, loss or injury sustained. They proceed from a sense of natural justice and are designed to repair the wrong that has been done. There are two kinds of actual or compensatory damages one is the loss of what a person already possesses, and the other is the failure to receive as a benefit that which would have pertained to him (Tolentino, Civil Code of the Phil., Vol. V, 1992 ed., pp. 633-636). In the latter instance, the familiar rule is that damages consisting of unrealized profits, frequently referred as "ganacias frustradas" or "lucrum cessans," are not to be granted on the basis of mere speculation, conjecture, or surmise, but rather by reference to some reasonably definite standard such as market value, established experienced, or direct inference from known circumstances (Talisay-Silay Milling Co., Inc. vs. Asociacion de Agricultores de Talisay-Silay, Inc., 247 SCRA 361 [1995]) In the case at bar, actual damages in the form of unrealized profits were awarded on the basis of the sole testimony of private respondent Salvador Chua, to wit: Atty. Chua:

Q: You mentioned earlier during your direct testimony that you are engaged in gasoline business. Do you have a gasoline station? A: Q: A: Yes, sir. Where is that located? It is located at Corner Araneta-San Sebastian Sts.

Q: Before the filing of the Extra Judicial Foreclosure, how much more or less, you earned from that gasoline station by way of conservative estimate? A: Q: A: Q: In my gasoline business, based on my record, I have an average of 114,000 liters. Do you mean to say you can dispose 114,000 liters a month? Yes, sir. How much is the mark up per liter?

A: Before the publication of the Extra Judicial Foreclosure the markup is P0.27 per liter. So, it comes out that the profit is P30,78.00 (sic). Q: A: Q: A: How much is your overhead for disposing that much liters of gasoline every month? The overhead is about 12,280.00. That will give you an average of P18,000.00 a month? Yes, sir.

Q: After the filing of the Extra Judicial Foreclosure, what happened to your gasoline business? A: Because of the publication of the Extra Judicial Foreclosure I did not have credit line anymore. Since I have no capital I was forced to sell my right to operate to my relatives. (tsn, March 25, 1986, pp. 9-12) However, other than the testimony of Salvador Chua, private respondents failed to present documentary evidence which is necessary to substantiate their claim for actual or compensatory damages. In order to recover this kind of damages, the injured party must prove his case, thus: When the existence of a loss is established, absolute certainty as to its amount is not required. The benefit to be derived from a contract which one of the parties has absolutely failed to perform is of necessity to some extent, a matter of speculation, but the injured party is not to be denied for that reason alone. He must produce the best evidence of which his case is susceptible and if that evidence warrants the inference that he has been damaged by the loss of profits which he might with reasonable certainty have anticipated but for the defendant's wrongful act, he is entitled to recover. (Cerreno vs.

Tan Chuco, 28 Phil. 312 [1914] quoted in Central Bank of the Philippines vs. Court of Appeals, 63 SCRA 431 [1975]) Applying the foregoing test to the instant case, the Court finds the evidence of private respondents insufficient to be considered within the purview of "best evidence." The bare assertion of private respondent Salvador Chua that he lost an average of P18,000.00 per month is inadequate if not speculative and should be admitted with extreme caution especially because it is not supported by independent evidence. Private respondents could have presented such evidence as reports on the average actual profits earned by their gasoline business, their financial statements, and other evidence of profitability which could aid the court in arriving with reasonable certainty at the amount of profits which private respondents failed to earn. Private respondents did not even present any instrument or deed evidencing their claim that they have transferred their right to operate their gasoline station to their relatives. We cannot, therefore, sustain the award of P18,000.00 a month as unrealized profits commencing from October 16, 1984 because this amount is not amply justified by the evidence on record. Further, well-settled is the rule that even if the petition for extrajudicial foreclosure filed by petitioner against private respondents is clearly unfounded, this does not necessarily mean, in the absence of specific facts proving damages, that actual damage has been sustained. The Court cannot rely on speculations as to the fact and amount of damages. It must depend on actual proof of the damages alleged to have been suffered (Perfecto vs. Gonzales, 128 SCRA 635 [1984]). Finally, the award of attorney's fees as part of damages is deemed just and equitable under the circumstances. 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 unjustified act of the other party (Ching Sen Ben vs. Court of Appeals, 314 SCRA 762 [1999]). In this case, petitioner bank's act of not crediting private respondents' deposit of P960,000.00, as well as the premature filing of the extrajudicial foreclosure, have compelled private respondents to institute an action for injunction and damages primarily in order to protect their rights and interests. The award of attorney's fees is also justified under Article 2208 of the Civil Code which provides: ART. 2208. In the absence of stipulation, attorney's fees and expenses of litigation, other than judicial costs, cannot be recovered, except: (1) when exemplary damages are awarded; (2) when the defendant's act or omission has compelled the plaintiff to litigate with third persons or to incur expenses to protect his interest; WHEREFORE, the decision of the Court of Appeals in its CA-G.R. CV No. 20220 is affirmed with MODIFICATION only as to the award of damages in that petitioner bank is ordered to pay private respondents the following: 1. Three Hundred Thousand Pesos (P300,000.00) as moral damages; 2. One Hundred Fifty Thousand Pesos (P150,000.00) as exemplary damages; and 3. One Hundred Thousand Pesos (P100,000.00) as attorney's fees and litigation expenses. In all other respects, the said judgment is affirmed.

SO ORDERED. G.R. No. 100755 February 10, 1994 CRISTETA BAUTISTA, REMEDIOS MEJIA-BADUA, CATALINA MEJIA, LAURETA MEJIA, ROSITA MEJIA, MILAGROS MEJIA, JUAN MEJIA, CANDIDA MEJIA, ADRIANA MEJIA, and FAUSTO MEJIA, petitioners, vs. MANGALDAN RURAL BANK, INC., THRU ITS PRESIDENT, DR. VICENTE JIMENEZ, REGISTER OF DEEDS OF PANGASINAN, EFREN RODRIGUEZ: and THE HONORABLE COURT OF APPEALS, respondents. Lorenzo F. Miravite for Mangaldan Rural Bank and Dr. Vicente Jimenez. Eldorado T. Lim for Fred Rodriguez.

PADILLA, J.: Petition for review on certiorari, praying that respondent court's decision 1 dated 29 January 1991, reversing the lower court's decision, and its resolution dated 13 May 1991 denying petitioners' motion for reconsideration, be set aside and the lower court's decision dated 3 March 1986 be confirmed. The facts, as narrated in the decision under review, are as follows: . . . Plaintiff Cristeta Bautista mortgaged her conjugal share of 1/2 of the land covered by TCT No. 1507 for P2,000.00 to defendant Mangaldan Rural Bank on December 1975. The inscription at the back of the title specifically states that only 1/2 portion of the subject land is mortgaged (Exh. "B-1-A"). The said mortgage was foreclosed extra-judicially, on 18 April 1978, for failure of plaintiff to pay the principal obligation and the other charges with the defendant as the highest bidder. After the plaintiff failed to redeem the mortgaged property within the reglementary period, ownership over the whole parcel of land instead of the 1/2 portion which was mortgaged, was consolidated in the name of defendant bank (Exh. "D"). Consequently, OCT No. 1507 was cancelled and TCT No. 130847 was issued in the name of the defendant Bank. Defendant bank, on 18 December 1979, sold for and in consideration of the sum of P3,385.00 (Exh. "F") and executed a deed of absolute sale over the whole property covered by TCT No. 130847 in favor of its co-defendant Fred Rodriguez. Plaintiffs filed a complaint on 23 June 1980 and amended it on 20 September 1980 against herein defendants for the annulment and/or cancellation of the following: 1)

deed of absolute sale dated 18 July 1979; 2) entry no. 492278 on OCT No. 1507; 3) consolidation of ownership dated 18 July 1979; 4) entry no. 592279 on OCT No. No. 1507; 5) TCT No. 130847; and 6) deed of sale dated 18 December 1979. After trial, the court a quo ruled in favor of plaintiffs against defendants and annulled the following documents to the extent of one-half pro-indiviso of the land subject thereof: a) deed of absolute sale dated 18 July 1979 (Exh. "C"); b) Consolidation of Ownership dated 18 July 1979; c) TCT No. 130847 issued on 25 July 1979 (Exh. "E"); d) deed of absolute sale dated 18 December 1979 (Exh. "F"); and e) TCT No. 132467 issued on 27 December 1979 (Exh. "G"). Defendants were also ordered to jointly and severally place plaintiffs in possession of one-half pro-indiviso of the parcel of land subject of the complaint.
Defendants were, likewise, ordered to pay plaintiffs damages in the sum of P5,000.00; attorney's fees in the sum of P11,750.00 and the litigation expenses in the sum of P5,000.00 and to pay double costs. 2

Private respondents appealed the lower court's decision to respondent appellate court. As earlier stated, the respondent court reversed the lower court's decision in regard to its awards, decreeing as follows: WHEREFORE, in view of all the foregoing, the awards of damages in favor of plaintiffs-appellees in the amount of P5,000.00; attorney's fees of P11,750.00 and litigation expenses in the sum of P5,000.00 are hereby SET ASIDE. IT IS SO ORDERED. Hence, this petition for review. The sole issue to be resolved in this petition is whether or not the petitioners are entitled to recover damages as well as attorney's fees as a result of the admitted mistake of respondent bank in selling the entire lot, instead of only-half thereof, to respondent Efren Rodriguez. Under Rule 45 of the Rules of Court, only questions of law may be reviewed by this Court in decision rendered by the Court of Appeals. There are instances, however, where the Court departs from this rule and reviews findings of fact of the Court of Appeals so that substantial justice may be served. The exceptional instances are where:
. . . (1) the conclusion is a finding grounded entirely on speculation, surmise and conjecture; (2) the inference made is manifestly mistaken; (3) there is grave abuse of discretion; (4) the judgment is based on a misapprehension of facts; (5) the findings of fact are conflicting; (6) the Court of Appeals went beyond the issues of the case and its findings are contrary to the admissions of both appellant and appellees; (7) the findings of fact of the Court of Appeals are contrary to those of the trial court; (8) said findings of facts are conclusions without citation of specific evidence on which they are based; (9) the facts set forth in the petition as well as in the petitioner's main and reply briefs are not disputed by the respondents; and (10) the findings of fact of the Court of Appeals are premised on the supposed absence of evidence are contradicted by the evidence on record. 3

In the present case, we find that the respondent court not only gravely abused its discretion but also misapprehension the facts when it set aside the lower court's awards for damages and attorney's fees in favor of petitioners. There is merit in petitioners contention that respondent rural bank and its manager, Dr. Vicente Jimenez, committed gross negligence when they allowed the consolidation in the bank's name of the entire property in question and later on sold the entire property to respondent Efren Rodriguez. All the documents starting with the deed of mortgage, the foreclosure of the mortgage, the consolidation of ownership in the bank's name, and finally the sale of the property to Rodriguez, were authored by the bank's personnel and signed by Dr. Jimenez. Prudence dictates that a person signing a document in his official capacity (as bank manager in this case) must closely read and meticulously study the contents of the said document affixing his signature thereon. A bank is not without a legal staff or lawyer who prepares documents concerning its business. The mistake committed by the bank's staff, which was admitted by respondent Jimenez, was not a slight or minor infraction. It deprived petitioners of their property which could ultimately result in their ejectment therefrom. Moreover, the bank's manager, Dr. Jimenez, could not even explain why the mistake occurred. Respondent manager of the bank tries to extricate himself from the wrong done to the petitioners by claiming that respondent Rodriguez refused to give up the one-half portion of the lot despite being informed by the bank of the mistake. And because Rodriguez refused to return one-half of the lot, the bank just left the matter at that. This exculpatory explanation of respondent Jimenez only showed respondent bank's marked apathy to the claim of petitioners. It should have helped, if not taken the proper legal remedies, so that the petitioners could recover their property. The injury to petitioners was exacerbated by the bank's "temerity of putting up a counter-claim for damages and attorney's fees against the plaintiff." 4 This callous treatment of the petitioners by the respondent bank is reprehensible. The banking system has become an indispensable institution in the modern world and plays a vital role in the economic life of every civilized society. Whether as mere passive entities for the safe-keeping and saving of money or as active instruments of business and commerce, banks have attained a ubiquitous presence among the people, who have come to regard them with respect and even gratitude and most of all, confidence. (Simex International [Manila], Inc. vs. Court of Appeals, G.R. No. 88013, March 19, 1990, 183 SCRA 360). Moral damages are not awarded to penalize the defendant but to compensate the plaintiff for the injuries he may have suffered. 5 In the present case, we believe that moral damages are proper for there can be no doubt that petitioners must have suffered sleepless nights, serious anxiety and wounded feelings upon learning that they had lost the remaining one-half of their property on which their house is built due to the negligence of respondent bank. For his part, respondent Rodriguez contends that he was a purchaser for value and in good faith. The records show otherwise. In the words of the lower court: . . . At the time of the sale the manager gave him the folder containing the records of the loan as well as the land he wanted to buy from the bank. Among the documents he saw was Original Certificate of Title No. 1507 (Exh. "B") covering the land. When he saw the title he verified it and he noticed that the land was titled in the name of spouses Saturnino Mejia and Cristeta Bautista. He knew that at the time the land was mortgaged to the rural bank the husband already died.

Had defendant Efren or Fred Rodriguez examined the annotations at the back of the title, Original Certificate of Title No. 1507, he could have found that under Entry No. 42590 (Exh. "B-1-A") only half portion of the land was mortgaged to the rural bank for P2,000.00. 6

Thus, the lower court found him not an innocent purchaser albeit for value. Be that as it may, what we are concerned with here is the question of damages. The respondent appellate court, after its recital of the circumstances leading to the filing of the complaint oddly found that respondent rural bank did not commit negligence, and declared that Article 20 of the Civil Code, providing that: "(E)very person who, contrary to law, wilfully or negligently causes damage to another, shall indemnify the latter for the same," is not applicable in the present case because the causes of action of the plaintiffs (petitioners) are contractual in nature. It is evident that the complaint in this case was not for breach of contract between petitioners and private respondents. It was for the annulment and cancellation of titles and/or documents where petitioners are not parties therein. The crux of the complaint is that due to the gross negligence and bad faith of private respondents, petitioners suffered loss or injury. Clearly, therefore, the cause of action therein is not contractual. Article 20 of the Civil Code is a cannon of conduct which every person must observe in his relation with another. The initial carelessness of the rural bank in consolidating the ownership of the entire property instead of only one-half thereof in its name, its sale of the entire property to respondent Efren Rodriguez, and the lack of promptness to rectify the mistake after its discovery, constitute after its discovery, constitute gross negligence and bad faith. These were sufficiently established by the evidence. Indeed, the bank and its manager were grossly negligent in handling the business transaction involved herein and later showing bad faith by refusing to rectify the wrong done to petitioners. As for respondent Efren Rodriguez, his adamant refusal to return one-half of the land to the lawful owner after having been informed of the error committed by the bank showed bad faith and served to aggravate the sorry plight of the petitioners. It is, however, the Court's view that he was himself a victim of the bank's gross negligence before he was apprised of the mistake. From this viewpoint, the Court believes that he should not be imposed exemplary damages. For the mental anguish, sleepless nights and serious anxiety suffered by the petitioners, respondent are liable jointly and severally for moral damages which the Court believes should be raised to P10,000.00. To serve as deterrent for respondent bank from repeating similar acts, this Court likewise awards exemplary damages against it in the sum of P10,000.00. WHEREFORE, the appealed decision is hereby REVERSED and SET ASIDE. The trial court's decision is reinstated with the above-mentioned modifications. Costs against private respondents. SO ORDERED. Narvasa, C.J., Regalado and Puno, JJ., concur. Nocon, J., took no part.

G.R. No. 150487

July 10, 2003

GERARDO F. SAMSON JR., petitioner, vs. BANK OF THE PHILIPPINE ISLANDS, respondent. PANGANIBAN, J.: Gross negligence of a bank in the handling of its client's deposit amounts to bad faith that calls for an award of moral damages. Credit is very important to businessmen, and its loss or impairment needs to be recognized and compensated. The Case Before us is a Petition for Review1 under Rule 45 of the Rules of Court, seeking to set aside the March 30, 2001 Decision2 and the October 22, 2001 Resolution 3 of the Court of Appeals (CA) in CA-GR CV No. 54599. The dispositive portion of the assailed Decision reads as follows: "WHEREFORE, foregoing premises considered, the Decision appealed from is AFFIRMED WITH A MODIFICATION that the award of moral damages is reduced to P50,000.00."4 The assailed Resolution denied the Motions for Reconsideration filed by the parties. The Facts The CA summarized the antecedents of the case as follows: "Gerardo F. Samson, Jr. filed an action for damages against the Bank of the Philippine Islands. "In his complaint, [petitioner] avers, inter alia that he is a client/depositor of [respondent] with Savings Account No. 3085-0125-75 through the [respondent's] Express Teller System[,] a 24hour banking service; that on August 20, 1990, [petitioner] deposited to his BPI account a Prudential Bank Check No. 209116 in the amount of Three Thousand Five Hundred Pesos (P3,500.00); that as of said date, [petitioner's] account balance was Three Hundred SixtySeven and 38/100 Pesos (P367.38); that on August 24, 1990, [petitioner] instructed his daughter to withdraw P2,000.00 from the said account; that the withdrawal was declined twice as the Express Teller transaction record showed 'Sorry, Insufficient Funds'; that because of such eventuality, [petitioner] suffered embarrassment as he could not then and there produce the required cash with which to fulfill his commitment and monetary obligation towards a creditor who had waited at his residence; that on September 12, 1990, [petitioner] deposited to his aforesaid account through the Express Teller, the amount of Five Thousand Five Hundred Pesos (P5,500.00); that he discovered that his available total balance as of said date was only Three Hundred Forty-Two and 38/100 Pesos (P342.38) without his earlier check deposit of Three Thousand Five Hundred Pesos (P3,500.00) on August 20, 1990 but with a Twenty-Five Peso (P25.00) penalty/service charge; that [petitioner] complained to [respondent] about the discrepancy; that [respondent] confirmed the P3,500.00 check deposit but could not account the same; that investigation only ensued after [petitioner] informed [respondent] that his P3,500.00 Prudential Bank check was encashed by [respondent's] security guard named Nonilon E. Rondina; that per such investigation, it was discovered that one of the deposit

envelopes was missing; that [respondent] did nothing to look for the missing check deposit or to inform [petitioner] about it; that despite [respondent's] knowledge of the irregularity and suspicious discrepancy in its records as early as of August 20, 1990, it did not even bother to conduct its own inquiry into said irregularity; that worse, despite being at fault, [respondent's] Manager, Nerissa M. Cayanga, displayed arrogance, indifference and discourtesy towards [petitioner]. "In its Answer, [respondent] Bank denied all the material allegations in the [C]omplaint and alleged among others, that the [C]omplaint fails to state a cause of action; that [petitioner] has violated the provisions of the covering contract of deposit which provides that representatives are not allowed to contract business on the account on behalf of the depositor; that [petitioner's] claim has been paid, waived and extinguished; that [petitioner] by his inaction in reporting the loss of his check deposit, is estopped from claiming damages from defendant. "After trial on the merits, the trial court rendered [a Decision in favor of petitioner]."5 Ruling of the Court of Appeals The CA affirmed the ruling of the trial court, but modified the amount of damages. It held that since the banking business was affected with public interest, Bank of the Philippine Islands (BPI) was required to exercise a high degree of care with respect to the accounts of its clients. Thus, the bank was rendered liable by its negligence resulting in damage to its depositor. Since it was undisputed that BPI had lost the check of petitioner, the appellate court reviewed the evidence and held that respondent bank was grossly negligent in its failure to observe the required degree of care. This gross negligence on the part of BPI amounted to bad faith that entitled petitioner to moral damages. The moral damages of P200,000 awarded by the trial court was, however, found to be excessive. It was therefore reduced to P50,000, because petitioner claimed only P3,500, which had already been credited back to his account. Hence, this Petition.6 Issues: In his Memorandum, petitioner submits the following issues for the Court's consideration: "I Whether the reduction of the award of moral damages to Php50,000.00, a mere one-fourth of the moral damages awarded by the trial court, was proper. "II Assuming that Respondent BPI is not precluded from raising this defense in this appeal, whether petitioner was negligent in demanding the return of his deposit, which was lost through the bank's gross negligence and inaction."7 In sum, the main issue in this case is whether the CA erred in reducing the award of moral damages from P200,000 to only P50,000. The Court's Ruling

The Petition is partly meritorious. Sole Issue: Amount of Moral Damages Moral damages are meant to compensate the claimant for any physical suffering, mental anguish, fright, serious anxiety, besmirched reputation, wounded feelings, moral shock, social humiliation and similar injuries unjustly caused.8 Although incapable of pecuniary estimation, the amount must somehow be proportional to and in approximation of the suffering inflicted.9 Moral damages are not punitive in nature10 and were never intended to enrich the claimant at the expense of the defendant.11 There is no hard-and-fast rule in determining what would be a fair and reasonable amount of moral damages, since each case must be governed by its own peculiar facts.12 Trial courts are given discretion in determining the amount, with the limitation that it "should not be palpably and scandalously excessive."13 Indeed, it must be commensurate to the loss or injury suffered.14 In the present case, petitioner bases his claim on the failure of respondent to credit the sum of P3,500 to his account due to its gross negligence. As a result of such failure, he was unable to fulfill his obligation to a valued creditor, resulting in the severance of his credit line. He further alleges that he suffered humiliation and besmirched reputation.15 According to him, his suffering was exacerbated by his subjection to indifference, discourtesy and arrogance from respondents' officers. Moral damages are awarded to achieve a "spiritual status quo," thus: "Moral damages are awarded to enable the injured party to obtain means, diversions or amusements that will serve to alleviate the moral suffering he/she has undergone, by reason of the defendant's culpable action. Its award is aimed at restoration, as much as possible, of the spiritual status quo ante; thus, it must be proportionate to the suffering inflicted. Since each case must be governed by its own peculiar circumstances, there is no hard and fast rule in determining the proper amount. . . .."16 The social standing of the aggrieved party is essential to the determination of the proper amount of the award. Otherwise, the goal of enabling him to obtain means, diversions, or amusements to restore him to the status quo ante would not be achieved. We believe that the award should be increased to P100,000, considering (1) that petitioner was a businessman and was the highest lay person in the United Methodist Church; (2) that he was regarded by respondent and its officers with arrogance and a condescending manner; and (3) that respondent successfully postponed compensating him for more than a decade. This amount is more than the P50,000 granted by the CA, but not as much as the P200,000 granted by the RTC. That petitioner reported the missing check deposit to respondent only after three weeks did not constitute contributory negligence. The injury resulted from the denial of his withdrawal due to insufficient funds, an injury he suffered before learning that his check deposit had been lost. Respondent, not he, immediately knew that a deposit envelop was missing, yet it did nothing to solve the problem. His alleged delay in reporting the matter did not at all contribute to his injury. Though the amount of P3,500 was already credited back to his account, this step was made only after his persistent prompting. Prior to this development, he suffered damages that could no longer be reversed by the belated restoration of the amount lost. It is for this suffering that moral damages are due.

In Prudential Bank v. CA,17 Philippine National Bank v. CA18 and Metropolitan Bank v. Wong,19 the Court consistently awarded moral damages of P100,000 in consideration of the reputation and the social standing of the claimant, as well as the rulings in similar cases involving the negligence of banks with regard to the accounts of their depositors. WHEREFORE, the Petition is partly GRANTED and the assailed Decision MODIFIED. The award of moral damages is increased to P100,000. No pronouncement as to costs. SO ORDERED.