G.R. No. 176697 - CESAR V. AREZA AND LOLITA B. AREZA, VS. EXPRESS SAVINGS BANK, INC. AND MICHAEL POTENCIANO.D E C I S I O N - Supreme Court E-Library

Ruling

WHEREFORE, the foregoing considered, the Court orders that judgment be rendered in favor of plaintiffs and against the defendants jointly and severally to pay plaintiffs as follows, to wit: P1,800,000.00 representing the amount unlawfully withdrawn by the defendants from the account of plaintiffs; P500,000.00 as moral damages; and P300,000.00 as attorneys fees. [8] The trial court reduced the issue to whether or not the rights of petitioners were violated by respondents when the deposits of the former were debited by respondents without any court order and without their knowledge and consent. According to the trial court, it is the depositary bank which should safeguard the right of the depositors over their money. Invoking Article 1977 of the Civil Code, the trial court stated that the depositary cannot make use of the thing deposited without the express permission of the depositor. The trial court also held that respondents should have observed the 24-hour clearing house rule that checks should be returned within 24-hours after discovery of the forgery but in no event beyond the period fixed by law for filing a legal action. In this case, petitioners deposited the checks in May 2000, and respondents notified them of the problems on the check three months later or in August 2000. In sum, the trial court characterized said acts of respondents as attended with bad faith when they debited the amount of P1,800,000.00 from the account of petitioners. Respondents filed a motion for reconsideration while petitioners filed a motion for execution from the Decision of the RTC on the ground that respondents motion for reconsideration did not conform with Section 5, Rule 16 of the Rules of Court; hence, it was a mere scrap of paper that did not toll the running of the period to appeal. On 22 April 2004, the RTC, through Pairing Judge Romeo C. De Leon granted the motion for reconsideration, set aside the Pozas Decision, and dismissed the complaint. The trial court awarded respondents their counterclaim of moral and exemplary damages of P100,000.00 each. The trial court first applied the principle of liberality when it disregarded the alleged absence of a notice of hearing in respondents motion for reconsideration. On the merits, the trial court considered the relationship of the Bank and petitioners with respect to their savings account deposits as a contract of loan with the bank as the debtor and petitioners as creditors. As such, Article 1977 of the Civil Code prohibiting the depository from making use of the thing deposited without the express permission of the depositor is not applicable. Instead, the trial court applied Article 1980 which provides that fixed, savings and current deposits of money in banks and similar institutions shall be governed by the provisions governing simple loan. The trial court then opined that the Bank had all the right to set-off against petitioners savings deposits the value of their nine checks that were returned. On a