PILIPINAS BANK, PETITIONER, VS. HON. COURT OF APPEALS AND FLORENCIO REYES, RESPONDENTS.

This is a petition for review of the Decision of the respondent
court^[1]
in CA-G.R. CV No. 29524 dated May 13, 1992 which ordered petitioner to pay the
private respondent the sum of P50,000.00
as moral damages, P25,000.00 as attorney’s fees and cost of suit.

The facts as found
both by the trial court^[2] and
the respondent court are:

“As payments for the purchased shoe materials and rubber
shoes, Florencio Reyes issued postdated checks to Winner Industrial Corporation
for P20,927.00 and Vicente Tui, for P11,419.50, with due dates on October 10
and 12, 1979, respectively.

To cover the face value of the checks, plaintiff, on October 10,
1979, requested PCIB Money Shop’s manager Mike Potenciano to effect the
withdrawal of P32,000.00 from his savings account therein and have it deposited
with his current account with Pilipinas Bank (then Filman Bank), Biñan
Branch. Roberto Santos was requested to
make the deposit.

In depositing in the name of FLORENCIO REYES, he inquired from the
teller the current account number of Florencio Reyes to complete the deposit
slip he was accomplishing. He was
informed that it was ‘815’ and so this was the same current account number he
placed on the deposit slip below the depositor’s name FLORENCIO REYES.

Noting that the account number coincided with the name Florencio,
Efren Alagasi, then Current Account Bookkeeper of Pilipinas Bank, thought it
was for Florencio Amador who owned the listed account number. He, thus, posted the deposit in the latter’s
account not noticing that the depositor’s surname in the deposit slip was
REYES.

On October 11, 1979, the October 10 check in favor of Winner
Industrial Corporation was presented for payment. Since the ledger of Florencio Reyes indicated that his account
had only a balance of P4,078.43,
it was dishonored and the payee was advised to try it for next clearing.

On October 15, 1979, the October 10, 1979 check was redeposited but
was again dishonored. Likewise, the
October 12, 1979 check in favor of Vicente Tui when presented for payment on
that same date met the same fate but was
advised to try the next clearing. Two days after the October 10 check was again dishonored, the payee returned the same to Florencio
Reyes and demanded a cash payment of its face value which he did if only to
save his name. The October 12, 1979
check was redeposited on October 18, 1979, but again dishonored for the reason
that the check was drawn against insufficient fund.

Furious over the incident, he immediately proceeded to the bank and
urged an immediate verification of his account.

Upon verification, the bank noticed the error. The P32,000.00 deposit posted in the account
of Florencio Amador was immediately
transferred to the account of Reyes upon being cleared by Florencio Amador that
he did not effect a deposit in the amount of P32,000.00. The transfer having been effected, the bank
then honored the October 12, 1979 check (Exh. “C”).”

On the basis of these facts, the trial court ordered petitioner
to pay to the private respondent: (1)
P200,000.00 as compensatory damages; (2) P100,000.00 as moral damages; (3)
P25,000.00 as attorney’s fees, and (4) the costs of suit. On appeal to the respondent court, the
judgment was modified as aforestated.

In this petition for review, petitioner argues:

“I. Respondent Court of Appeals erred
on a matter of law, in not applying the first sentence of Article 2179, New
Civil Code, in view of its own finding that respondent Reyes’ own
representative committed the mistake in writing down the correct account
number;

II. Respondent Court of Appeals erred, on a matter of law, in holding that
respondent Reyes has the right to recover moral damages and in awarding the
amount of P50,000.00, when there is no legal nor factual basis for it;

III. The Honorable Court of Appeals
erred, on a matter of law, in holding petitioner liable for attorney’s fees in
the amount of P20,000.00, when there is no legal nor factual basis for
it.”

We find no merit in the petition.

First. For Article 2179^[3]
of the Civil Code to apply, it must be established that private respondent’s
own negligence was the immediate and proximate cause of his injury. The concept of proximate cause is well defined in our corpus of
jurisprudence as “any cause
which, in natural and continuous sequence, unbroken by any efficient
intervening cause, produces the result complained of and without which would not
have occurred and from which it ought to have been forseen or reasonably
anticipated by a person of ordinary case that the injury complained of or some
similar injury, would result therefrom as a natural and probable
consequence.”^[4]
In the case at bench, the proximate cause of the injury is the negligence of petitioner’s employee in erroneously posting
the cash deposit of private respondent in the name of another depositor who had
a similar first name. As held by the
trial court:

x x x

“Applying the test, the bank employee is, on that basis,
deemed to have failed to exercise the degree of care required in the
performance of his duties. As earlier
stated, the bank employee posted the cash deposit in the account of Florencio
Amador from his assumption that the name Florencio appearing on the ledger
without, however, going through the full name, is the same Florencio stated in
the deposit slip. He should have
continuously gone beyond mere assumption, which was proven to be erroneous, and
proceeded with clear certainty, considering the amount involved and the
repercussions it would create on the totality of the person notable of which is
the credit standing of the person involved should a mistake happen. The checks issued by the plaintiff in the
course of his business were dishonored by the bank because the ledger of
Florencio Reyes indicated a balance insufficient to cover the face value of
checks.”

Second. In light of this
negligence, the liability of petitioner for moral damages cannot be
impugned. So we held in Bank of the
Philippine Islands vs. IAC, et al.^[5]

“The bank is not expected to be infallible but, as correrctly
observed by respondent Appellate Court, in this instance, it must bear the
blame for not discovering the mistake of its teller despite the established
procedure requiring the papers and bank books to pass through a battery of bank
personnel whose duty it is to check and countercheck them for possible
errors. Apparently, the officials and
employees tasked to do that did not peform their duties with due care, as may
be gathered from the testimony of the bank’s lone witness, Antonio Enciso, who
casually declared that ‘the approving officer does not have to see the account
numbers and all those things. Those are very petty things for the approving
manager to look into’ (p.
78, Record on Appeal). Unfortunately, it was a ‘petty thing,’ like the incorrect account number
that the bank teller wrote on the initial deposit slip for the newly-opened
joint current account of the Canlas spouses, that sparked this
half-a-million-peso damage suit against the bank.

While the bank’s negligence may not have been attended with malice
and bad faith, nevertheless, it caused serious anxiety, embarrassment and
humiliation to the private respondents for which they are entitled to recover
reasonable moral damages (American Express International, Inc. IAC, 167 SCRA
209). The award of reasonable
attorney’s fees is proper for the private respondents were compelled to
litigate to protect their interest (Art. 2208, Civil Code). However, the absence of malice and bad faith
renders the award of exemplary damages improper (Globe Mackay Cable and Radio
Corp. vs. Court of Appeals, 176 SCRA 778).”

IN VIEW WHEREOF,
the petition is denied there being no reversible
error in the Decision of the respondent court. Cost against petitioner.

SO ORDERED.

Narvasa, C.J., (Chairman), Padilla, Regalado, and Mendoza, JJ.,
concur.

^[1]
Second Division composed of Justices Jose A.R. Melo (Chairman), Segundino Chua
(ponente) and Artemon D. Luna (member).

^[2]
RTC of Biñan, Laguna, Br. XXV.

^[3]
It states in part: “When the
plaintiff’s own negligence was the immediate and proximate cause of his injury,
he cannot recover damages…”

^[4]
People vs. Desalina, 57 OG 8694.

^[5]
G.R. No. 69162, February 21, 1992, 206 SCRA 408, 413.