[G.R. No. 94723. August 21, 1997] counts of Rape.

counts of Rape. On the same day, petitioners filed with the Regional
Trial Court of Makati Civil Case No. 89-3214 for damages with
preliminary attachment against Greg Bartelli. On February 24, 1989,
KAREN E. SALVACION, minor, thru Federico N. Salvacion, Jr.,
the day there was a scheduled hearing for Bartelli’s petition for bail the
father and Natural Guardian, and Spouses FEDERICO N.
latter escaped from jail.
SALVACION, JR., and EVELINA E. SALVACION, petitioners,
vs. CENTRAL BANK OF THE PHILIPPINES, CHINA BANKING
CORPORATION and GREG BARTELLI y On February 28, 1989, the court granted the fiscal’s Urgent Ex-
NORTHCOTT, respondents. Parte Motion for the Issuance of Warrant of Arrest and Hold Departure
Order. Pending the arrest of the accused Greg Bartelli y Northcott, the
criminal cases were archived in an Order dated February 28, 1989.
DECISION

Meanwhile, in Civil Case No. 89-3214, the Judge issued an Order

TORRES, JR., J.:
dated February 22, 1989 granting the application of herein petitioners,
for the issuance of the writ of preliminary attachment. After petitioners
In our predisposition to discover the “original intent” of a statute, courts gave Bond No. JCL (4) 1981 by FGU Insurance Corporation in the
become the unfeeling pillars of the status quo.  Little do we realize that amount P100,000.00, a Writ of Preliminary Attachment was issued by
statutes or even constitutions are bundles of compromises thrown our the trial court on February 28, 1989.
way by their framers.  Unless we exercise vigilance, the statute may
already be out of tune and irrelevant to our day.
On March 1, 1989, the Deputy Sheriff of Makati served a Notice of
Garnishment on China Banking Corporation. In a letter dated March
The petition is for declaratory relief. It prays for the following reliefs: 13, 1989 to the Deputy Sheriff of Makati, China Banking Corporation
invoked Republic Act No. 1405 as its answer to the notice of
garnishment served on it. On March 15, 1989, Deputy Sheriff of Makati
a.) Immediately upon the filing of this petition, an Order be issued Armando de Guzman sent his reply to China Banking Corporation
restraining the respondents from applying and enforcing Section 113 of saying that the garnishment did not violate the secrecy of bank
Central Bank Circular No. 960; deposits since the disclosure is merely incidental to a garnishment
properly and legally made by virtue of a court order which has placed
b.) After hearing, judgment be rendered: the subject deposits in custodia legis. In answer to this letter of the
Deputy Sheriff of Makati, China Banking Corporation, in a letter dated
March 20, 1989, invoked Section 113 of Central Bank Circular No. 960
1.) Declaring the respective rights and duties of petitioners and to the effect that the dollar deposits of defendant Greg Bartelli are
respondents; exempt from attachment, garnishment, or any other order or process of
any court, legislative body, government agency or any administrative
2.) Adjudging Section 113 of Central Bank Circular No. 960 as contrary body, whatsoever.
to the provision of the Constitution, hence void; because its provision
that “Foreign currency deposits shall be exempt from attachment, This prompted the counsel for petitioners to make an inquiry with the
garnishment, or any other order to process of any court, legislative Central Bank in a letter dated April 25, 1989 on whether Section 113 of
body, government agency or any administrative body whatsoever” CB Circular No. 960 has any exception or whether said section has
been repealed or amended since said section has rendered nugatory
i.) has taken away the right of petitioners to have the bank deposit of the substantive right of the plaintiff to have the claim sought to be
defendant Greg Bartelli y Northcott garnished to satisfy the judgment enforced by the civil action secured by way of the writ of preliminary
rendered in petitioners’ favor in violation of substantive due process attachment as granted to the plaintiff under Rule 57 of the Revised
guaranteed by the Constitution; Rules of Court. The Central Bank responded as follows:

ii.) has given foreign currency depositors an undue favor or a class “May 26, 1989
privilege in violation of the equal protection clause of the Constitution;
“Ms. Erlinda S. Carolino
iii.) has provided a safe haven for criminals like the herein respondent
Greg Bartelli y Northcott since criminals could escape civil liability for 12 Pres. Osmeña Avenue
their wrongful acts by merely converting their money to a foreign
currency and depositing it in a foreign currency deposit account with an
authorized bank. South Admiral Village

The antecedents facts: Paranaque, Metro Manila

On February 4, 1989, Greg Bartelli y Northcott, an American tourist, “Dear Ms. Carolino:
coaxed and lured petitioner Karen Salvacion, then 12 years old to go
with him to his apartment. Therein, Greg Bartelli detained Karen “This is in reply to your letter dated April 25, 1989 regarding your
Salvacion for four days, or up to February 7, 1989 and was able to inquiry on Section 113, CB Circular No. 960 (1983).
rape the child once on February 4, and three times each day on
February 5, 6, and 7, 1989. On February 7, 1989, after policemen and
people living nearby, rescued Karen, Greg Bartelli was arrested and “The cited provision is absolute in application. It does not admit of any
detained at the Makati Municipal Jail. The policemen recovered from exception, nor has the same been repealed nor amended.
Bartelli the following items: 1.) Dollar Check No. 368, Control No.
021000678-1166111303, US 3,903.20; 2.) COCOBANK Bank Book
“The purpose of the law is to encourage dollar accounts within the
No. 104-108758-8 (Peso Acct.); 3.) Dollar Account – China Banking
country’s banking system which would help in the development of the
Corp., US $/A#54105028-2; 4.) ID-122-30-8877; 5.) Philippine Money
economy. There is no intention to render futile the basic rights of a
(P234.00) cash; 6.) Door Keys 6 pieces; 7.) Stuffed Doll (Teddy Bear)
person as was suggested in your subject letter. The law may be harsh
used in seducing the complainant.
as some perceive it, but it is still the law. Compliance is, therefore,
enjoined.
On February 16, 1989, Makati Investigating Fiscal Edwin G. Condaya
filed against Greg Bartelli, Criminal Case No. 801 for Serious Illegal
“Very truly yours,
Detention and Criminal Cases Nos. 802, 803, 804, and 805 for four (4)
(SGD) AGAPITO S. FAJARDO “The American asked her name and introduced himself as Greg
Bartelli. He sat beside her when he talked to her. He said he was a
Math teacher and told her that he has a sister who is a nurse in New
Director”[1]
York. His sister allegedly has a daughter who is about Karen’s age and
who was with him in his house along Kalayaan Avenue. (TSN, Aug. 15,
Meanwhile, on April 10, 1989, the trial court granted petitioners’ motion 1989, pp. 4-5).
for leave to serve summons by publication in the Civil Case No. 89-
3214 entitled “Karen Salvacion. et al. vs. Greg Bartelli y Northcott.”
“The American asked Karen what was her favorite subject and she told
Summons with the complaint was published in the Manila Times once
him it’s Pilipino. He then invited her to go with him to his house where
a week for three consecutive weeks. Greg Bartelli failed to file his
she could teach Pilipino to his niece. He even gave her a stuffed toy to
answer to the complaint and was declared in default on August 7,
persuade her to teach his niece. (Id., pp.5-6)
1989. After hearing the case ex-parte, the court rendered judgment in
favor of petitioners on March 29, 1990, the dispositive portion of which
reads: “They walked from Plaza Fair along Pasong Tamo, turning right to
reach the defendant’s house along Kalayaan Avenue. (Id., p.6)
“WHEREFORE, judgment is hereby rendered in favor of plaintiffs and
against defendant, ordering the latter: “When they reached the apartment house, Karen notices that
defendant’s alleged niece was not outside the house but defendant told
her maybe his niece was inside. When Karen did not see the alleged
“1. To pay plaintiff Karen E. Salvacion the amount of P500,000.00 as
niece inside the house, defendant told her maybe his niece was
moral damages;
upstairs, and invited Karen to go upstairs. (Id., p. 7)

“2. To pay her parents, plaintiffs spouses Federico N. Salvacion, Jr.,

“Upon entering the bedroom defendant suddenly locked the door.
and Evelina E. Salvacion the amount of P150,000.00 each or a total
Karen became nervous because his niece was not there. Defendant
of P300,000.00 for both of them;
got a piece of cotton cord and tied Karen’s hands with it, and then he
undressed her. Karen cried for help but defendant strangled her. He
“3. To pay plaintiffs exemplary damages of P100,000.00; and took a packing tape and he covered her mouth with it and he circled it
around her head. (Id., p. 7)
“4. To pay attorney’s fees in an amount equivalent to 25% of the total
amount of damages herein awarded; “Then, defendant suddenly pushed Karen towards the bed which was
just near the door. He tied her feet and hands spread apart to the bed
posts. He knelt in front of her and inserted his finger in her sex organ.
“5. To pay litigation expenses of P10,000.00; plus She felt severe pain. She tried to shout but no sound could come out
because there were tapes on her mouth. When defendant withdrew his
“6. Costs of the suit. finger it was full of blood and Karen felt more pain after the withdrawal
of the finger. (Id., p.8)
“SO ORDERED.”
“He then got a Johnsons Baby Oil and he applied it to his sex organ as
well as to her sex organ. After that he forced his sex organ into her but
The heinous acts of respondents Greg Bartelli which gave rise to the he was not able to do so. While he was doing it, Karen found it difficult
award were related in graphic detail by the trial court in its decision as to breathe and she perspired a lot while feeling severe pain. She
follows: merely presumed that he was able to insert his sex organ a little,
because she could not see. Karen could not recall how long the
“The defendant in this case was originally detained in the municipal jail defendant was in that position. (Id., pp. 8-9)
of Makati but was able to escape therefrom on February 24, 1989 as
per report of the Jail Warden of Makati to the Presiding Judge, “After that, he stood up and went to the bathroom to wash. He also told
Honorable Manuel M. Cosico of the Regional Trial Court of Makati, Karen to take a shower and he untied her hands. Karen could only
Branch 136, where he was charged with four counts of Rape and hear the sound of the water while the defendant, she presumed, was in
Serious Illegal Detention (Crim. Cases Nos. 802 to 805). Accordingly, the bathroom washing his sex organ. When she took a shower more
upon motion of plaintiffs, through counsel, summons was served upon blood came out from her. In the meantime, defendant changed the
defendant by publication in the Manila Times, a newspaper of general mattress because it was full of blood. After the shower, Karen was
circulation as attested by the Advertising Manager of the Metro Media allowed by defendant to sleep. She fell asleep because she got tired
Times, Inc., the publisher of the said newspaper. Defendant, however, crying. The incident happened at about 4:00 p.m. Karen had no way of
failed to file his answer to the complaint despite the lapse of the period determining the exact time because defendant removed her watch.
of sixty (60) days from the last publication; hence, upon motion of the Defendant did not care to give her food before she went to sleep.
plaintiffs through counsel, defendant was declared in default and Karen woke up at about 8:00 o’clock the following morning. (Id., pp. 9-
plaintiffs were authorized to present their evidence ex parte. 10)

“In support of the complaint, plaintiffs presented as witness the minor “The following day, February 5, 1989, a Sunday, after breakfast of
Karen E. Salvacion, her father, Federico N. Salacion, Jr., a certain biscuit and coke at about 8:30 to 9:00 a.m. defendant raped Karen
Joseph Aguilar and a certain Liberato Mandulio, who gave the while she was still bleeding. For lunch, they also took biscuit and coke.
following testimony: She was raped for the second time at about 12:00 to 2:00 p.m. In the
evening, they had rice for dinner which defendant had stored
“Karen took her first year high school in St. Mary’s Academy in Pasay downstairs; it was he who cooked the rice that is why it looks like
City but has recently transferred to Arellano University for her second “lugaw”. For the third time, Karen was raped again during the night.
year. During those three times defendant succeeded in inserting his sex
organ but she could not say whether the organ was inserted wholly.
“In the afternoon of February 4, 1989, Karen was at the Plaza Fair
Makati Cinema Square, with her friend Edna Tangile whiling away her “Karen did not see any firearm or any bladed weapon. The defendant
free time. At about 3:30 p.m. while she was finishing her snack on a did not tie her hands and feet nor put a tape on her mouth anymore but
concrete bench in front of Plaza Fair, an American approached her. she did not cry for help for fear that she might be killed; besides, all
She was then alone because Edna Tangile had already left, and she those windows and doors were closed. And even if she shouted for
was about to go home. (TSN, Aug. 15, 1989, pp. 2 to 5) help, nobody would hear her. She was so afraid that if somebody
would hear her and would be able to call a police, it was still possible
that as she was still inside the house, defendant might kill her.  Exhibit A. Then they proceeded to the National Bureau of Investigation
Besides, the defendant did not leave that Sunday, ruling out her together with the investigator and her parents. At the NBI, a doctor,
chance to call for help. At nighttime he slept with her again. (TSN, Aug. a medico-legal officer, examined her private parts. It was already 3:00
15, 1989, pp. 12-14) in early morning, of the following day when they reached the NBI,
(TSN, Aug. 15, 1989, p. 22)  The findings of the medico-legal officer
has been marked as Exhibit B.
“On February 6, 1989, Monday, Karen was raped three times, once in
the morning for thirty minutes after breakfast of biscuits; again in the
afternoon; and again in the evening. At first, Karen did not know that “She was studying at the St. Mary’s Academy in Pasay City at the time
there was a window because everything was covered by a carpet, until of the Incident but she subsequently transferred to Apolinario Mabini,
defendant opened the window for around fifteen minutes or less to let Arellano University, situated along Taft Avenue, because she was
some air in, and she found that the window was covered by styrofoam ashamed to be the subject of conversation in the school. She first
and plywood. After that, he again closed the window with a hammer applied for transfer to Jose Abad Santos, Arellano University along Taft
and he put the styrofoam, plywood, and carpet back. (Id., pp. 14-15) Avenue near the Light Rail Transit Station but she was denied
admission after she told the school the true reason for her transfer. The
reason for their denial was that they might be implicated in the case.
“That Monday evening, Karen had a chance to call for help, although
(TSN, Aug. 15, 1989, p. 46)
defendant left but kept the door closed. She went to the bathroom and
saw a small window covered by styrofoam and she also spotted a
small hole. She stepped on the bowl and she cried for help through the xxx       xxx       xxx
hole. She cried: ‘Maawa na po kayo sa akin. Tulungan n’yo akong
makalabas dito. Kinidnap ako!’ Somebody heard her. It was a woman,
“After the incident, Karen has changed a lot. She does not play with
probably a neighbor, but she got angry and said she was ‘istorbo.’
her brother and sister anymore, and she is always in a state of shock;
Karen pleaded for help and the woman told her to sleep and she will
she has been absent-minded and is ashamed even to go out of the
call the police. She finally fell asleep but no policeman came. (TSN,
house. (TSN, Sept. 12, 1989, p. 10) She appears to be restless or sad.
Aug. 15, 1989, pp. 15-16)
(Id., p. 11) The father prays for P500,000.00 moral damages for Karen
for this shocking experience which probably, she would always recall
“She woke up at 6:00 o’clock the following morning, and she saw until she reaches old age, and he is not sure if she could ever recover
defendant in bed, this time sleeping. She waited for him to wake up. from this experience.” (TSN, Sept. 24, 1989, pp. 10-11)
When he woke up, he again got some food but he always kept the door
locked. As usual, she was merely fed with biscuit and coke. On that
Pursuant to an Order granting leave to publish notice of decision, said
day, February 7, 1989, she was again raped three times. The first at
notice was published in the Manila Bulletin once a week for three
about 6:30 to 7:00 a.m., the second at about 8:30 – 9:00, and the third
consecutive weeks. After the lapse of fifteen (15) days from the date of
was after lunch at 12:00 noon. After he had raped her for the second
the last publication of the notice of judgment and the decision of the
time he left but only for a short while. Upon his return, he caught her
trial court had become final, petitioners tried to execute on Bartelli’s
shouting for help but he did not understand what she was shouting
dollar deposit with China Banking Corporation. Likewise, the bank
about. After she was raped the third time, he left the house. (TSN, Aug.
invoked Section 113 of Central Bank Circular No. 960.
15, 1989, pp. 16-17) She again went to the bathroom and shouted for
help. After shouting for about five minutes, she heard many voices.
The voices were asking for her name and she gave her name as Karen Thus, petitioners decided to seek relief from this Court.
Salvacion. After a while, she heard a voice of a woman saying they will
just call the police. They were also telling her to change her clothes.
The issues raised and the arguments articulated by the parties boil
She went from the bathroom to the room but she did not change her
down to two:
clothes being afraid that should the neighbors call the police and the
defendant see her in different clothes, he might kill her. At that time she
was wearing a T-shirt of the American bacause the latter washed her May this Court entertain the instant petition despite the fact that original
dress. (Id., p. 16) jurisdiction in petitions for declaratory relief rests with the lower court?
She Section 113 of Central Bank Circular No. 960 and Section 8 of
R.A. 6426, as amended by P.D. 1246, otherwise known as the Foreign
“Afterwards, defendant arrived and opened the door. He asked her if
Currency Deposit Act be made applicable to a foreign transient?
she had asked for help because there were many policemen outside
and she denied it. He told her to change her clothes, and she did
change to the one she was wearing on Saturday. He instructed her to Petitioners aver as heretofore stated that Section 113 of Central Bank
tell the police that she left home and willingly; then he went downstairs Circular No. 960 providing that “Foreign currency deposits shall be
but he locked the door. She could hear people conversing but she exempt from attachment, garnishment, or any other order or process of
could not understand what they were saying. (Id., p. 19) any court, legislative body, government agency or any administrative
body whatsoever.” should be adjudged as unconstitutional on the
grounds that: 1.) it has taken away the right of petitioners to have the
“When she heard the voices of many people who were conversing
bank deposit of defendant Greg Bartelli y Northcott garnished to satisfy
downstairs, she knocked repeatedly at the door as hard as she could.
the judgment rendered in petitioners’ favor in violation of substantive
She heard somebody going upstairs and when the door was opened,
due process guaranteed by the Constitution; 2.) it has given foreign
she saw a policeman. The policeman asked her name and the reason
currency depositors an undue favor or a class privilege n violation of
why she was there. She told him she was kidnapped. Downstairs, he
the equal protection clause of the Constitution; 3.) it has provided a
saw about five policemen in uniform and the defendant was talking to
safe haven for criminals like the herein respondent Greg Bartelli y
them. ‘Nakikipag-areglo po sa mga pulis,’ Karen added. “The
Northcott since criminal could escape civil liability for their wrongful
policeman told him to just explain at the precinct. (Id., p. 20)
acts by merely converting their money to a foreign currency and
depositing it in a foreign currency deposit account with an authorized
“They went out of the house and she saw some of her neighbors in bank; and 4.) The Monetary Board, in issuing Section 113 of Central
front of the house. They rode the car of a certain person she called Bank Circular No. 960 has exceeded its delegated quasi- legislative
Kuya Boy together with defendant, the policeman, and two of her power when it took away: a.) the plaintiff’s substantive right to have the
neighbors whom she called Kuya Bong Lacson and one Ate Nita. They claim sought to be enforced by the civil action secured by way of the
were brought to Sub-Station I and there she was investigated by a writ of preliminary attachment as granted by Rule 57 of the Revised
policeman. At about 2:00 a.m., her father arrived, followed by her Rules of Court; b.) the plaintiff’s substantive right to have the judgment
mother together with some of their neighbors. Then they were brought credit satisfied by way of the writ of execution out of the bank deposit
to the second floor of the police headquarters. (Id., p. 21) of the judgment debtor as granted to the judgment creditor by Rule 39
of the Revised Rules of Court, which is beyond its power to do so.
“At the headquarters, she was asked several questions by the
investigator. The written statement she gave to the police was marked
On the other hand, respondent Central Bank, in its Comment alleges could alleviate the humiliation, anxiety, and besmirched reputation she
that the Monetary Board in issuing Section 113 of CB Circular No. 960 had suffered and may continue to suffer for a long, long time; and
did not exceed its power or authority because the subject Section is knowing that this person who had wronged her has the money, could
copied verbatim from a portion of R.A. No. 6426 as amended by P.D. not, however get the award of damages because of this unreasonable
1246. Hence, it was not the Monetary Board that grants exemption law. This questioned law, therefore makes futile the favorable judgment
from attachment or garnishment to foreign currency deposits, but the and award of damages that she and her parents fully deserve. As
law (R.A. 6426 as amended) itself; that it does not violate the stated by the trial court in its decision,
substantive due process guaranteed by the Constitution because  a.) it
was based on a law; b.) the law seems to be reasonable; c.) it is
“Indeed, after hearing the testimony of Karen, the Court believes that it
enforced according to regular methods of procedure; and d.) it applies
was indoubtedly a shocking and traumatic experience she had
to all members of a class.
undergone which could haunt her mind for a long, long time, the mere
recall of which could make her feel so humiliated, as in fact she had
Expanding, the Central Bank said; that one reason for exempting the been actually humiliated once when she was refused admission at the
foreign currency deposits from attachment, garnishment or any other Abad Santos High School, Arellano University, where she sought to
order process of any court, is to assure the development and speedy transfer from another school, simply because the school authorities of
growth of the Foreign Currency Deposit System and the Offshore the said High School learned about what happened to her and
Banking System in the Philippines; that another reason is to encourage allegedly feared that they might be implicated in the case.
the inflow of foreign currency deposits into the banking institutions
thereby placing such institutions more in a position to properly channel
xxx
the same to loans and investments in the Philippines, thus directly
contributing to the economic development of the country; that the
subject section is being enforced according to the regular methods of The reason for imposing exemplary or corrective damages is due to
procedure; and that it applies to all currency deposits made by any the wanton and bestial manner defendant had committed the acts of
person and therefore does not violate the equal protection clause of rape during a period of serious illegal detention of his hapless victim,
the Constitution. the minor Karen Salvacion whose only fault was in her being so naive
and credulous to believe easily that defendant, an American national,
could not have such a bestial desire on her nor capable of committing
Respondent Central Bank further avers that the questioned provision is
such heinous crime. Being only 12 years old when that unfortunate
needed to promote the public interest and the general welfare; that the
incident happened, she has never heard of an old Filipino adage that in
State cannot just stand idly by while a considerable segment of the
every forest there is a snake, xxx.”[4]
society suffers from economic distress; that the State had to take some
measures to encourage economic development; and that in so doing
persons and property may be subjected to some kinds of restraints or If Karen’s sad fate had happened to anybody’s own kin, it would be
burdens to secure the general welfare or public interest. Respondent difficult for him to fathom how the incentive for foreign currency deposit
Central Bank also alleges that Rule 39 and Rule 57 of the Revised could be more important than his child’s right to said award of
Rules of Court provide that some properties are exempted from damages; in this case, the victim’s claim for damages from this alien
execution/attachment especially provided by law and R.A. No. 6426 as who had the gall to wrong a child of tender years of a country where he
amended is such a law, in that it specifically provides, among others, is mere visitor. This further illustrates the flaw in the questioned
that foreign currency deposits shall be exempted from attachment, provisions.
garnishment, or any other order or process of any court, legislative
body, government agency or any administrative body whatsoever.
It is worth mentioning that R.A. No. 6426 was enacted in 1983 or at a
time when the country’s economy was in a shambles; when foreign
For its part, respondent China Banking Corporation, aside from giving investments were minimal and presumably, this was the reason why
reasons similar to that of respondent Central Bank, also stated that said statute was enacted. But the realities of the present times show
respondent China Bank is not unmindful of the inhuman sufferings that the country has recovered economically; and even if not, the
experienced by the minor Karen E. Salvacion from the beastly hands of questioned law still denies those entitled to due process of law for
Greg Bartelli; that it is not only too willing to release the dollar deposit being unreasonable and oppressive. The intention of the questioned
of Bartelli which may perhaps partly mitigate the sufferings petitioner law may be good when enacted. The law failed to anticipate the
has undergone; but it is restrained from doing so in view of R.A. No. inquitous effects producing outright injustice and inequality such as as
6426 and Section 113 of Central Bank Circular No. 960; and that the case before us.
despite the harsh effect to these laws on petitioners, CBC has no other
alternative but to follow the same.
It has thus been said that-

This court finds the petition to be partly meritorious.

“But I also know,[5] that laws and institutions must go hand in hand with
the progress of the human mind. As that becomes more developed,
Petitioner deserves to receive the damages awarded to her by the more enlightened, as new discoveries are made, new truths are
court. But this petition for declaratory relief can only be entertained and disclosed and manners and opinions change with the change of
treated as a petition for mandamus to require respondents to honor circumstances, institutions must advance also, and keep pace with the
and comply with the writ of execution in Civil Case No. 89-3214. times… We might as well require a man to wear still the coat which
fitted him when a boy, as civilized society to remain ever under the
regimen of their barbarous ancestors.”
The Court has no original and exclusive jurisdiction over a petition for
declatory relief.[2] However, exceptions to this rule have been
recognized. Thus, where the petition has far-reaching implications and In his comment, the Solicitor General correctly opined, thus:
raises questions that should be resolved, it may be treated as one for
mandamus.[3]
“The present petition has far-reaching implications on the right of a
national to obtain redress for a wrong committed by an alien who takes
Here is a child, a 12-year old girl, who in her belief that all Americans refuge under a law and regulation promulgated for a purpose which
are good and in her gesture of kindness by teaching his alleged niece does not contemplate the application thereof envisaged by the allien.
the Filipino language as requested by the American, trustingly went More specifically, the petition raises the question whether the
with said stranger to his apartment, and there she was raped by said protection against attachment, garnishment or other court process
American tourist Greg Bartelli. Not once, but ten times. She was accorded to foreign currency deposits PD No. 1246 and CB Circular
detained therein for four (4) days. This American tourist was able to No. 960 applies when the deposit does not come from a lender or
escape from the jail and avoid punishment. On the other hand, the investor but from a mere transient who is not expected to maintain the
child, having received a favorable judgment in the Civil Case for deposit in the bank for long.
damages in the amount of more than P1,000,000.00, which amount
“The resolution of this question is important for the protection of thereby placing such institutions more in a position to properly channel
nationals who are victimized in the forum by foreigners who are merely the same to loans and investments in the Philippines, thus directly
passing through. contributing to the economic development of the country;’

xxx “Thus, one of the principal purposes of the protection accorded to

foreign currency deposits is to assure the development and speedy
growth of the Foreign Currency Deposit system and the Offshore
“xxx Respondents China Banking Corporation and Central Bank of the
Banking in the Philippines’ (3rd Whereas).
Philippines refused to honor the writ of execution issued in Civil Case
No. 89-3214 on the strength of the following provision of Central Bank
Circular No. 960: “The Offshore Banking System was established by PD No. 1034. In
turn, the purposes of PD No. 1034 are as follows:
‘Sec. 113 Exemption from attachment. – Foreign currency deposits
shall be exempt from attachment, garnishment, or any other order or ‘WHEREAS, conditions conducive to the establishment of an offshore
process of any court, legislative body, government agency or any banking system, such as political stability, a growing economy and
administrative body whatsoever.’ adequate communication facilities, among others, exist in the
Philippines;
“Central Bank Circular No. 960 was issued pursuant to Section 7 of
Republic Act No. 6426: ‘WHEREAS, it is in the interest of developing countries to have as wide
access as possible to the sources of capital funds for economic
development;
‘Sec. 7. Rules and Regulations. The Monetary Board of the Central
Bank shall promulgate such rules and regulations as may be
necessary to carry out the provisions of this Act which shall take effect ‘WHEREAS, an offshore banking system based in the Philippines will
after the publication of such rules and regulations in the Official be advantageous and beneficial to the country by increasing our links
Gazette and in a newspaper of national circulation for at least once a with foreign lenders, facilitating the flow of desired investments into the
week for three consecutive weeks. In case the Central Bank Philippines, creating employment opportunities and expertise in
promulgates new rules and regulations decreasing the rights of international finance, and contributing to the national development
depositors, the rules and regulations at the time the deposit was made effort.
shall govern.”
‘WHEREAS, the geographical location, physical and human resources,
“The aforecited Section 113 was copied from Section 8 of Republic Act and other positive factors provide the Philippines with the clear
No. 6426. As amended by P.D. 1246, thus: potential to develop as another financial center in Asia;’

‘Sec. 8. Secrecy of Foreign Currency Deposits. — All foreign currency “On the other hand, the Foreign Currency Deposit system was created
deposits authorized under this Act, as amended by Presidential Decree by PD No. 1035. Its purpose are as follows:
No. 1035, as well as foreign currency deposits authorized under
Presidential Decree No. 1034, are hereby declared as and considered
‘WHEREAS, the establishment of an offshore banking system in the
of an absolutely confidential nature and, except upon the written
Philippines has been authorized under a separate decree;
permission of the depositor, in no instance shall such foreign currency
deposits be examined, inquired or looked into by any person,
government official, bureau or office whether judicial or administrative ‘WHEREAS, a number of local commercial banks, as depository bank
or legislative or any other entity whether public or private: Provided, under the Foreign Currency Deposit Act (RA No. 6426), have the
however, that said foreign currency deposits shall be exempt from resources and managerial competence to more actively engage in
attachment, garnishment, or any other order or process of any court, foreign exchange transactions and participate in the grant of foreign
legislative body, government agency or any administrative body currency loans to resident corporations and firms;
whatsoever.’
‘WHEREAS, it is timely to expand the foreign currency lending
“The purpose of PD 1246 in according protection against attachment, authority of the said depository banks under RA 6426 and apply to their
garnishment and other court process to foreign currency deposits is transactions the same taxes as would be applicable to transaction of
stated in its whereases, viz.: the proposed offshore banking units;’

‘WHEREAS, under Republic Act No. 6426, as amended by Presidential “It is evident from the above [Whereas clauses] that the Offshore
Decree No. 1035, certain Philippine banking institutions and branches Banking System and the Foreign Currency Deposit System were
of foreign banks are authorized to accept deposits in foreign currency; designed to draw deposits from foreign lenders and investors (Vide
second Whereas of PD No. 1034; third Whereas of PD No. 1035). It is
these depositors that are induced by the two laws and given protection
‘WHEREAS, under provisions of Presidential Decree No. 1034
and incentives by them.
authorizing the establishment of an offshore banking system in the
Philippines, offshore banking units are also authorized to receive
foreign currency deposits in certain cases; “Obviously, the foreign currency deposit made by a transient or a
tourist is not the kind of deposit encourage by PD Nos. 1034 and 1035
and given incentives and protection by said laws because such
‘WHEREAS, in order to assure the development and speedy growth of
depositor stays only for a few days in the country and, therefore, will
the Foreign Currency Deposit System and the Offshore Banking
maintain his deposit in the bank only for a short time.
System in the Philippines, certain incentives were provided for under
the two Systems such as confidentiality subject to certain exceptions
and tax exemptions on the interest income of depositors who are “Respondent Greg Bartelli, as stated, is just a tourist or a transient. He
nonresidents and are not engaged in trade or business in the deposited his dollars with respondent China Banking Corporation only
Philippines; for safekeeping during his temporary stay in the Philippines.

‘WHEREAS, making absolute the protective cloak of confidentiality “For the reasons stated above, the Solicitor General thus submits that
over such foreign currency deposits, exempting such deposits from tax, the dollar deposit of respondent Greg Bartelli is not entitled to the
and guaranteeing the vested right of depositors would better protection of Section 113 of Central Bank Circular No. 960 and PD No.
encourage the inflow of foreign currency deposits into the banking 1246 against attachment, garnishment or other court processes.” [6]
institutions authorized to accept such deposits in the Philippines
In fine, the application of the law depends on the extent of its justice.
Eventually, if we rule that the questioned Section 113 of Central Bank
Circular No. 960 which exempts from attachment, garnishment, or any
other order or process of any court. Legislative body, government
agency or any administrative body whatsoever, is applicable to a
foreign transient, injustice would result especially to a citizen aggrieved
by a foreign guest like accused Greg Bartelli. This would negate Article
10 of the New Civil Code which provides that “in case of doubt in the
interpretation or application of laws, it is presumed that the lawmaking
body intended right and justice to prevail. “Ninguno non deue
enriquecerse tortizerzmente con damo de otro.” Simply stated, when
the statute is silent or ambiguous, this is one of those fundamental
solutions that would respond to the vehement urge of conscience.
(Padilla vs. Padilla, 74 Phil. 377)

It would be unthinkable, that the questioned Section 113 of Central

Bank No. 960 would be used as a device by accused Greg Bartelli for
wrongdoing, and in so doing, acquitting the guilty at the expense of the
innocent.

Call it what it may – but is there no conflict of legal policy here? Dollar
against Peso? Upholding the final and executory judgment of the lower
court against the Central Bank Circular protecting the foreign
depositor? Shielding or protecting the dollar deposit of a transient alien
depositor against injustice to a national and victim of a crime? This
situation calls for fairness legal tyranny.

We definitely cannot have both ways and rest in the belief that we have
served the ends of justice.

IN VIEW WHEREOF, the provisions of Section 113 of CB Circular No.

960 and PD No. 1246, insofar as it amends Section 8 of R.A. 6426 are
hereby held to be INAPPLICABLE to this case because of its peculiar
circumstances. Respondents are hereby REQUIRED to COMPLY with
the writ of execution issued in Civil Case No. 89-3214, “Karen
Salvacion, et al. vs. Greg Bartelli y Northcott, by Branch CXLIV, RTC
Makati and to RELEASE to petitioners the dollar deposit of respondent
Greg Bartelli y Northcott in such amount as would satisfy the judgment.

SO ORDERED.