BANK OF THE PHILIPPINE ISLANDS, vs. THE INTERMEDIATE APPELLATE COURT and the SPOUSES ARTHUR CANLAS and VIVIENE CANLAS.
- G.R. Number: G.R. No. 69162
- Promulgated: 1992-02-21
- Ponente: Griño-Aquino, J.
Doctrine
Banks, being businesses affected with public interest and in a fiduciary relationship with depositors, must handle depositors' accounts with meticulous care and prompt, accurate recording of transactions.
Negligence causing embarrassment, anxiety or financial loss justifies award of moral damages and reasonable attorney's fees; exemplary damages require malice or bad faith and are improper if absent.
Facts
The Intermediate Appellate Court reduced a trial court damage award to P105,000 for error of a bank teller that caused dishonor of two small checks, and the Bank petitioned for review (appeal from AC-G.R. CV No. 69178).
Arthur and Vivienne Canlas opened a joint current account No. 210-520-73 on 25 April 1977 with initial deposit of P2,250; Arthur previously had a separate checking account at same branch.
Trial court had ordered defendant to pay actual and substantial moral damages including P5,000 actual and P150,000 each for moral damages to the plaintiffs.
On appeal the Appellate Court modified awards, deleting an award of P50,000 in actual damages and awarding moral damages of P50,000 to both plaintiffs jointly (not P50,000 each).
Issues
Whether the bank is liable for damages for the dishonor of checks caused by its teller's error.
Whether the private respondents are entitled to moral and exemplary damages and attorney's fees for the bank's negligence.
Ruling
Yes. The bank, as a business affected with public interest and in a fiduciary relationship with depositors, must exercise meticulous care and is liable for the teller's error that caused dishonor and resulting harm.
Moral damages and reasonable attorney's fees were proper because the bank's negligence caused anxiety and compelled litigation; exemplary damages were improper due to absence of malice or bad faith.
The petition is granted only to delete the award of exemplary damages; in all other respects the Court of Appeals decision is affirmed. No costs.
Keywords
G.R. No. 69162, personal actions, Section 2(b), Rule 4 of the Rules of Court, gross negligence, moral damages, exemplary damages, attorney's fees, fiduciary nature of the relationship, banks and depositors, diligence of a good father of family, Article 1173 Civil Code, Simex International (Manila), Inc. vs. Court of Appeals (183 SCRA 360, 367), merger agreement, Section 80 (5) of the Corporation Code of the Philippines, bank teller error, dishonored checks, improper venue, private respondents, rollo, account