G.R. No. 170984 January 30, 2009
Lessons Applicable: Consideration and Accommodation Party (Negotiable Instruments law)
FACTS:
FACTS:
- January 9, 1981: Security Bank and Trust Company (SBTC) issued a manager’s check for P 8M, payable to "CASH," as proceeds of the loan granted to Guidon Construction and Development Corporation (GCDC)
- deposited by Continental Manufacturing Corporation (CMC) in its Current Account with Rizal Commercial Banking Corporation (RCBC)
- Immediately, RCBC honored the P8M check and allowed CMC to withdraw
- January 12, 1981: GCDC issued a "Stop Payment Order" to SBTC claiming that the P 8M check was released to a 3rd party by mistake
- SBTC dishonored and returned the manager’s check to RCBC
- February 13, 1981: RCBC filed a complaint for damages against SBTC with CFI then transferred to RTC
- Following the rules of the Philippine Clearing House, RCBC and SBTC stopped returning the checks to each other.
- By way of a temporary arrangement pending resolution of the case, the P 8 M check was equally divided between RCBC and SBTC
- May 9, 2000: RTC in favor of RCBC
- CA: affirmed with modification RTC decision by adding interest
ISSUE: W/N SBTC should be held liable for its manager's check
HELD: YES. CA affirmed.
- At the outset, it must be noted that the questioned check issued by SBTC is not just an ordinary check but a manager’s check.
- manager’s check
- one drawn by a bank’s manager upon the bank itself
- same footing as a certified check which is deemed to have been accepted by the bank that certified it
- As the bank’s own check, a manager’s check becomes the primary obligation of the bank and is accepted in advance by the act of its issuance
- RCBC, in immediately crediting the amount of P8 million to CMC’s account, relied on the integrity and honor of the check as it is regarded in commercial transactions
- July 9, 1980 Memorandum: banks were given the discretion to allow immediate drawings on uncollected deposits of manager’s checks, among others
- important that banks should guard against injury attributable to negligence or bad faith on its part
- banking business is impressed with public interest, the trust and confidence of the public in it is of paramount importance
- highest degree of diligence is expected, and high standards of integrity and performance are required of it
