CA Agro-Industrial vs CA G.R. No.

90027 March 3, 1993 Facts Petitioner (through its President) purchased 2 parcels of land from spouses Pugao for P350 K with a downpayment of P75 K. Per agreement, the land titles will be transferred upon full payment and will be placed in a safety deposit box (SBDB) of any bank. Moreover, the same could be withdrawn only upon the joint signatures of a representative of the Petitioner and the Pugaos upon full payment of the purchase price. Thereafter, Petitioner and spouses placed the titles in SDB of Respondent Security Bank and signed a lease contract which substantially states that the Bank will not assume liability for the contents of the SDB. Subsequently, 2 renter's keys were given to the renters one to the Petitioner and the other to the Pugaos. A guard key remained in the possession of the Respondent Bank. The SDB can only be opened using these 2 keys simultaneously. Afterwards, a certain Mrs. Ramos offered to buy from the Petitioner the 2 lots that would yield a profit of P285K. Mrs. Ramos demanded the execution of a deed of sale which necessarily entailed the production of the certificates of title. Thus, Petitioner with the spouses went to Respondent Bank to retrieve the titles. However, when opened in the presence of the Bank's representative, the SDB yielded no such certificates. Because of the delay in the reconstitution of the title, Mrs. Ramos withdrew her earlier offer to purchase the lots; as a consequence, the Petitioner allegedly failed to realize the expected profit of P285K. Hence, Petitioner filed a complaint for damages against Respondent Bank. Lower courts ruled in favour of Respondent Bank. Thus, this petition.

Issues: 1. 2. 3. Whether or not the disputed contract is an ordinary contract of lease? Whether or not the provisions of the cited contract are valid? Whether or not Respondent Bank is liable for damages?

Ruling: 1. No. SC ruled that it is a special kind of deposit because: the full and absolute possession and control of the SDB was not given to the joint renters the Petitioner and the Pugaos. The guard key of the box remained with the Respondent Bank; without this key, neither of the renters could open the box and vice versa. In this case, the said key had a duplicate which was made so that both renters could have access to the box. Moreover, the renting out of the SDBs is not independent from, but related to or in conjunction with, the principal function of a contract of deposit the receiving in custody of funds, documents and other valuable objects for safekeeping. NO. SC opined that it is void. Generally, the Civil Code provides that the depositary (Respondent Bank) would be liable if, in performing its obligation, it is found guilty of fraud, negligence, delay or contravention of the tenor of the agreement. In the absence of any stipulation, the diligence of a good father of a family is to be observed. Hence, any stipulation exempting the depositary from any liability arising from the loss of the thing deposited on account of fraud, negligence or delay would be void for being contrary to law and public policy (which is present in the disputed contract)

2.

Said provisions are inconsistent with the Respondent Bank's responsibility as a depositary under Section 72(a) of the General Banking Act.

3.

NO. SC ruled that: no competent proof was presented to show that Respondent Bank was aware of the private agreement between the Petitioner and the Pugaos that the Land titles were withdrawable from the SDB only upon both parties' joint signatures, and that no evidence was submitted to reveal that the loss of the certificates of title was due to the fraud or negligence of the Respondent Bank.

ART. 1977. OBLIGATION NOT TO MAKE USE OF THING DEPOSITED UNLESS AUTHORIZED. JAVELLANA VS. LIM FACTS: Defendants executed a document in favor of plaintiff-appellee wherein it states that they have received, as a deposit, without interest, money from plaintiff-appellee and agreed upon a date when they will return the money. Upon the stipulated due date, defendants asked for an extension to pay and binding themselves to pay 15% interest per annum on the amount of their indebtedness, to which the plaintiff-appellee acceded. The defendants were not able to pay the full amount of their indebtedness notwithstanding the request made by plaintiff-appellee. The lower court ruled in favor of plaintiff-appellee for the recovery of the amount due. ISSUE: Whether the agreement entered into by the parties is one of loan or of deposit? HELD: The document executed was a contract of loan. Where money, consisting of coins of legal tender, is deposited with a person and the latter is authorized by the depositor to use and dispose of the same, the agreement is not a contract of deposit, but a loan. A subsequent agreement between the parties as to interest on the amount said to have been deposited, because the same could not be returned at the time fixed therefor, does not constitute a renewal of an agreement of deposit, but it is the best evidence that the original contract entered into between therein was for a loan under the guise of a deposit.

PEOPLE VS. DICK ONG204 SCRA 942 (1991) Facts: Accused Dick Ong, one of the depositors of the Home Savings Bank and Trust Company (HSBTC) opened a savings account with HSBTC with an initial deposit of P22.14 in cash and P10,000.00 in check. Ong was allowed to withdraw from his savings account with the Bank the sum of P5,000.00,without his check undergoing the usual and reglementary clearance. The withdrawal slip was signed and approved by Lino Morfe, then the Branch Manager, and accused Lucila Talabis, the Branch Cashier. Subsequently, Ong deposited eleven checks in hissavings account with the Bank and against which he made withdrawals against its amount. Again, the withdrawal of the amount by Ong was made before said checks were cleared and the Bank had collected their amounts and with the approval of Talabis. However, when the Bank presented the eleven checks issued, deposited and against which Ong made withdrawals against its amounts, to the irrespective drawee banks for payment, they were all dishonored for lack or insufficiency of funds. Because of this, the Bank filed a criminal action for Estafa against Ong, and the Banks officer in charge Villaran and Talabis.Talabis testified that the approval of the withdrawals of Ong against his uncleared checks was in accordance with the instruction of their then bank manager and that it is a kind of accommodation given to Ong and also a common practice of the Bank. RTC ruled Ong as guilty for the crime of estafa but acquitted Villarin and Talabis as their guilt were not proven beyond reasonable doubt. CA affirmed RTCs decisions.

Issue: 1. What is the nature of bank deposits? 2. WON Ong is guilty of Estafa. No.Ruling:1. The Supreme Court held that bank deposits are in the nature of irregular deposits. Bank deposits are really loans because they earn interest. Whether fixed, savings, or current, all bank A deposits are to be treated as loans and are to be covered by the law on loans.2. The elements of this kind of estafa are the following: (1) postdating or issuance of a check in payment of an obligation contracted at the time the check was issued; (2) lack or insufficiency of funds to cover the check; and (3) damage to the payee thereof. In this case, the fact was established that Ong either issued or indorsed the subject checks. However, it must be remembered that the reason for the conviction of an accused of the crime of estafa is his guilty knowledge of the fact that he had no funds in the bank when he negotiated the spurious check. In the present case, however, the prosecution failed to prove that Ong had knowledge with respect to the checks he indorsed. Moreover, it has also been proven that it was the Bank which granted him a drawn against uncollected deposit (DAUD)privilege without need of any pretensions on his part. The privilege this privilege was not only for the subject checks, but for other past transactions. If ever, he, indeed acted fraudulently, he could not have done so without the active cooperation of the Banks employees. Since Talabis and Villaran were declared innocent of the crimes charged against them, the same should be said for the Ong. Thus, Ong cannot be held criminally liable against the Bank. He can only be held civilly liable as the Bank incurred damages.