Jai-Alai, V. Bpi 66 Scra 29 August 6, 1975

JAI-ALAI, v.
BPI 66 SCRA 29
August 6, 1975
DOCTRINE: A forged signature is wholly inoperative and no right to discharge it or

enforce its payment can be acquired through or under the
forged signature except against a party who cannot invoke its forgery or want
of authority.
FACTS:
1. Ten (10) checks amounting to P8,030.58 were deposited by Jai-Alai and

credited in its account with the BPI. All checks were acquired from one
Antonio J. Ramirez, a sales agent of the Inter-Island Gas. Upon deposit, it
was temporarily credited to the petitioner's account.
2. But later on, Inter-islands discovered that these checks were forgeries,
and advised the petitioner for the matter and the BPI, for its part debited
the petitioner's current account and forwarded to the latter the checks
containing the forged indorsements, however petitioner refused to accept.
3. The petitioner later drew against its current account with the respondent a
check for P135,000 payable to the order of the Mariano Olondriz y Cia in
payment of certain shares of stock, but he check was dishonored by the
respondent as its records showed that the current account of the
petitioner, after netting out the value of the checks P8,030.58 with the
forged indorsements, had a balance of only P128,257.65.
Issue:
Whether the respondent is liable to return the amount debited from the account of
the Petitioner.
Held:
No, the respondent bank acted within legal bounds when it debited the petitioner’s
account. It is true that the respondent had already collected the proceeds of the
checks when it debited the petitioner’s account. Section 23 of the NIL states that “A
forged signature is wholly inoperative and no right to discharge it or enforce its
payment can be acquired through or under the forged signature except against a
party who cannot invoke its forgery or want of authority.
REPUBLIC vs. EBRADA
G.R. No. L-40796 July 31, 1975
DOCTRINE: When a signature is forged or made without the authority of the person
whose signature it purports to be, it is wholly inoperative, and no right to retain the
instruments, or to give a discharge thereof against any party thereto, can be
acquired through or under such signature unless the party against whom it is sought
to enforce such right is precluded from setting up the forgery or want of authority.
Facts:
1. Defendant Mauricia T. Ebrada, encashed Back Pay Check at the main office
of the plaintiff Republic Bank at Escolta, Manila. The check was issued by the
Bureau of Treasury.
2. Plaintiff Bank was later advised by the said bureau that the alleged
indorsement on the reverse side of the aforesaid check by the payee, "Martin
Lorenzo" was a forgery since the latter had allegedly died as of July 14, 1952.
3. Plaintiff Bank was then requested by the Bureau of Treasury to refund the
amount of P1,246.08.
4. To recover what it had refunded to the Bureau of Treasury, plaintiff Bank
made verbal and formal demands upon defendant Ebrada to account for the
sum of P1,246.08, but said defendant refused to do so.
5. Plaintiff Bank sued defendant Ebrada before the City Court of Manila.
6. Defendant Ebrada filed her answer denying the material allegations of the
complaint and as affirmative defenses alleged that she was a holder in due
course of the check in question, or at the very least, has acquired her rights
from a holder in due course and therefore entitled to the proceeds thereof.
She also alleged that the plaintiff Bank has no cause of action against her;
that it is in estoppel, or so negligent as not to be entitled to recover anything
from her.
Issue:
Whether or not the bank can recover from the last indorser Ebrada.
Held:
Yes. According to Section 23 of the Negotiable Instruments Law, where the
signature on a negotiable instrument is forged, the negotiation of the check is without
force or effect. The last indorser, Ebrada, was duty-bound to ascertain whether the
check was genuine before presenting it to the bank for payment. Her failure to do so
makes her liable for the loss and the Bank may recover from her the money she
received for the check. Had she performed her duty, the forgery would have been
detected and fraud defeated. Even if she turned over the amount to Dominguez
immediately after receiving the cash proceeds of the check, she is liable as an
accommodation party under Section 29 of the Negotiable Instruments Law.
EQUITABLE PCI BANK vs. ONG
G.R. No. 156207 September 15, 2006
DOCTRINE: Where a check is certified by the bank on which it is drawn, the

certification is equivalent to an acceptance. A check which has been cleared and
credited to the account of the creditor shall be equivalent to a delivery to the creditor
of cash in an amount equal to the amount credited to his account.
Facts:
1. Warliza Sarande deposited in her account at Philippine Commercial International

(PCI), Davao City Branch, amount of P225,000.00. Upon inquiry by Serande at
PCI Bank on whether TCBT Check No. 0249188 had been cleared, she received
an affirmative answer.
2. Relying on this assurance, she issued two checks drawn against the proceeds of
TCBT Check No. 0249188. One of these was PCI Bank Check No. 073661
dated 5 December 1991 for P132,000.00 which Sarande issued to respondent
Rowena Ong Owing to a business transaction.
3. On the same day, Ong presented to PCI Bank Magsaysay Avenue Branch said
Check No. 073661, and instead of encashing it, requested PCI Bank to convert
the proceeds thereof into a manager's check, which the PCI Bank obliged.
Whereupon, Ong was issued PCI Bank Manager's Check No. 10983 dated 5
December 1991 for the sum of P132,000.00, the value of Check No. 073661.
4. The next day, Ong deposited PCI Bank Manager's Check No. 10983 in her
account with Equitable Banking Corporation Davao City Branch, she received a
check return-slip informing her that PCI Bank had stopped the payment of the
said check on the ground of irregular issuance.
5. Despite several demands made by her to PCI Bank for the payment of the
amount in PCI Bank Manager's Check No. 10983, the same was met with
refusal; thus, Ong was constrained to file a Complaint for sum of money,
damages and attorney's fees against PCI Bank.
Issue:
Whether Ong can hold PCI liable.
Held:
Yes. A check which has been cleared and credited to the account of the creditor
shall be equivalent to a delivery to the creditor of cash in an amount equal to the
amount credited to his account. Having cleared the check earlier, PCI Bank,
therefore, became liable to Ong and it cannot allege want or failure of consideration
between it and Sarande. Under settled jurisprudence, Ong is a stranger as regards
the transaction between PCI Bank and Sarande. PCI Bank next insists that since
there was no consideration for the issuance of the manager's check, ergo, Ong is not
a holder in due course.
By admitting it committed an error, clearing the check of Sarande and issuing in
favor of Ong not just any check but a manager's check for that matter, PCI Bank's
liability is fixed.

Jai-Alai, V. Bpi 66 Scra 29 August 6, 1975

Uploaded by

Copyright:

Available Formats

Jai-Alai, V. Bpi 66 Scra 29 August 6, 1975

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Jai-Alai, V. Bpi 66 Scra 29 August 6, 1975

Uploaded by

Copyright:

Available Formats

JAI-ALAI, v.

DOCTRINE: A forged signature is wholly inoperative and no right to discharge it or

1. Ten (10) checks amounting to P8,030.58 were deposited by Jai-Alai and

G.R. No. L-40796 July 31, 1975

G.R. No. 156207 September 15, 2006

DOCTRINE: Where a check is certified by the bank on which it is drawn, the

1. Warliza Sarande deposited in her account at Philippine Commercial International

You might also like