Professional Documents
Culture Documents
2. Banco de Oro Savings and Mortgage Bank v. Equitable Banking Corp. [G.R. No. 74917.
January 20, 1988]
24MAR
FACTS
Equitable Bank drew six crossed managers check payable to certain member establishments of Visa
Card. Subsequently, the checks were deposited with Banco De Oro (BDO) to the credit of its depositor.
Following normal procedures and after stamping at the back of the checks the usual
endorsements,BDOsent the checks for clearing through the Philippine Clearing House Corporation
(PCHC). Accordingly, Equitable Banking paid the checks; its clearing account was debited for the value
of the checks and BDOs clearing account was credited for the same amount. Thereafter, Equitable
Banking discovered that the endorsements appearing at the back of the checks and purporting to be
that of the payees were forged and/or unauthorized or otherwise belong to persons other than the
payees.Equitable Banking presented the checks directly to BDO for the purpose of claiming
reimbursement from the latter. However, BDO refused to accept such direct presentation and to
reimburse Equitable Banking for the value of the checks.
ISSUES
(a) Whether or not BDO is estopped from claiming that checks under consideration are non-negotiable
instruments.
RULING
(a) YES. BDO having stamped its guarantee of all prior endorsements and/or lack of endorsements is
now estopped from claiming that the checks under consideration are not negotiable instruments. The
checks were accepted for deposit by the petitioner stamping thereon its guarantee, in order that it can
clear the said checks with the respondent bank. By such deliberate and positive attitude of the
petitioner it has for all legal intents and purposes treated the said cheeks as negotiable instruments
and accordingly assumed the warranty of the endorser when it stamped its guarantee of prior
endorsements at the back of the checks. It led the said respondent to believe that it was acting as
endorser of the checks and on the strength of this guarantee said respondent cleared the checks in
question and credited the account of the petitioner. Petitioner is now barred from taking an opposite
posture by claiming that the disputed checks are not negotiable instrument.
(b) NO. A commercial bank cannot escape the liability of an endorser of a check and which may turn
out to be a forged endorsement. Whenever any bank treats the signature at the back of the checks as
endorsements and thus logically guarantees the same as such there can be no doubt said bank has
considered the checks as negotiable.The collecting bank or last endorser generally suffers the loss
because it has the duty to ascertain the genuineness of all prior endorsements considering that the act
of presenting the check for payment to the drawee is an assertion that the party making the
presentment has done its duty to ascertain the genuineness of the endorsements.
(c) NO. PCHCs jurisdiction is not limited to negotiable checks only. The term check as used in the said
Articles of Incorporation of PCHC can only connote checks in general use in commercial and business
activities. Thus, no distinction. Ubi lex non distinguit, nec nos distinguere debemus. Checks are used
between banks and bankers and their customers, and are designed to facilitate banking operations. It
is of the essence to be payable on demand, because the contract between the banker and the
customer is that the money is needed on demand.
3.
4. People vs Nazario
Facts:
Eusebio Nazario was charged in violation of refusal and failure to pay his municipal taxes amounting to
Php 362.62 because of his fishpond operation provided under Ordinance 4, Series of 1955, as
amended. He is a resident of Sta. Mesa Manila and just leases a fishpond located at Pagbilao, Quezon
with the Philippine Fisheries Commission. The years in question of failure to pay was for 1964, 1965,
and 1966. Nazario did not pay because he was not sure if he was covered under the ordinance. He was
found
guilty
thus
this
petition.
Issues:
1. Whether or not Ordinance 4, Series of 1955, as amended null and void for being ambiguous and
uncertain
2. Whether or not the ordinance was unconstitutional for being ex post facto
Held:
1. No, the coverage of the ordinance covers him as the actual operator of the fishpond thus he comes
with the term Manager. He was the one who spent money in developing and maintaining it, so
despite only leasing it from the national government, the latter does not get any profit as it goes only
to Nazario. The dates of payment are also clearly stated Beginnin and taking effect from 1964 if the
fishpond
started
operating
in
1964.
2. No, it is not ex post facto. Ordinance 4 was enacted in 1955 so it cant be that the amendment
under Ordinance 12 is being made to apply retroactively. Also, the act of non-payment has been made
punishable since 1955 so it means Ordinance 12 is not imposing a retroactive penalty
Laws should refer to all laws and not only to those of general application, for strictly speaking, all
laws relate to the people in general albeit there are some that do not apply to them directly. A law
without any bearing on the public would be invalid as an intrusion of privacy or as class legislation or
as an ultra vires act of the legislature. To be valid, the law must invariably affect the public interest eve
if it might be directly applicable only to one individual, or some of the people only, and not to the
public as a whole.
All statutes, including those of local application and private laws, shall be published as a condition for
their effectivity, which shall begin 15 days after publication unless a different effectivity date is fixed
by the legislature.
Publication must be in full or it is no publication at all, since its purpose is to inform the public of the
content of the law.
Article 2 of the Civil Code provides that publication of laws must be made in the Official Gazette, and
not elsewhere, as a requirement for their effectivity. The Supreme Court is not called upon to rule upon
the wisdom of a law or to repeal or modify it if it finds it impractical.
The publication must be made forthwith, or at least as soon as possible.
J. Cruz:
Laws must come out in the open in the clear light of the sun instead of skulking in the shadows with
their dark, deep secrets. Mysterious pronouncements and rumored rules cannot be recognized as
binding unless their existence and contents are confirmed by a valid publication intended to make full
disclosure and give proper notice to the people. The furtive law is like a scabbarded saber that cannot
faint, parry or cut unless the naked blade is drawn.
CALTEX (PHILIPPINES), INC vs. ENRICO PALOMAR, in his capacity as THE POSTMASTER
GENERAL
FACTS:
In 1960, Caltex launched their "Caltex Hooded Pump Contest", which called for participants to estimate
the actual number of liters a hooded gas pump at each Caltex station will dispense during a specified
period.Participants were not required consideration nor pay a fee. No purchase of Caltex products were
also required to be made. Entry forms were to be made available upon request at each Caltex station
where a sealed can would be provided for the deposit of accomplished entry stubs.
Foreseeing the extensive use of the mails not only as amongst the media for publicizing the contest
but also for the transmission of communications relative thereto, representations were made by Caltex
with the postal authorities for the contest to be cleared in advance for mailing, having in view the Antilottery provisions of the Revised Administrative Code. Postmaster General Enrico Palomar denied the
request, arguing that the said contest violated the provisions of the law on subject. CALTEX sought
judicial intervention wherein the trial court ruled in its favor. Respondent Palomar appealed, posing the
same argument that the said contest violated the prohibitive provisions of the Postal Law.
Issue:
Whether or not the "Caltex Hooded Pump Contest" fell on the purview of the prohibitive provisions of
the Postal Law.
HELD:
The Postal Law does not allow any lottery, gift enterprise, or scheme for the distribution of money, or
of any real or personal property by lot, chance, or drawing of any kind".
The Court held that the "Caltex Hooded Pump Contest" by CALTEX is not a lottery nor a gift
enterprise but rather a gratuitous distribution of property by chance, which the law does not prohibit.
The term "lottery" extends to all schemes for the distribution of prizes by chance, such as policy
playing, gift exhibitions, prize concerts, raffles at fairs, etc., and various forms of gambling. The three
essential elements of a lottery are: First, consideration; second, prize; and third, chance. The contest in
question, lacking the element of consideration, cannot be deemed al lottery. The rules of the contest
made no mention of a valuable consideration of some kind being paid directly or indirectly for the
chance to draw a prize. The term gift enterprise also could not embrace the scheme at bar. As
already noted, there is no sale of anything to which the chance offered is attached as an inducement
to the purchaser. The contest is open to all qualified contestants irrespective of whether or not they
buy the appellee's products.
By virtue of noscitur a sociis which Opinion 217 aforesaid also relied upon although only insofar as
the element of chance is concerned it is only logical that the term under a construction should be
accorded no other meaning than that which is consistent with the nature of the word associated
therewith. Hence, if lottery is prohibited only if it involves a consideration, so also must the term "gift
enterprise" be so construed. Significantly, there is not in the law the slightest indication of any intent
to eliminate that element of consideration from the "gift enterprise" therein included.