Citytrust Banking Corp. v.

Villanueva
G.R. No. 141011
July 19, 2001
Actual Damages

Facts:
In February 1984, Isagani Villanueva (VILLANUEVA) opened a savings account and a current account with
Citytrust Banking Corporation (BANK) with an automatic transfer arrangement.
VILLANUEVA deposited some money in his savings account with the BANKs Legaspi Village Branch.
Realizing that he had run out of blank checks, VILLANUEVA requested a new checkbook from one of the
BANKs customer service representatives.
o He filled up a checkbook requisition slip with the obligatory particulars, except for his current account
number which he could not remember. He expressed his predicament to a customer service
representative of the BANK, who in turn assured him that she could supply the information from the
BANKs account records. After signing the requisition slip, he gave it to her.
o Pia Rempillo, another customer service representative of the BANK, saw VILLANUEVAs checkbook
requisition slip. She took it and proceeded to check the BANKs checkbook register which contained all
the names and account numbers of the BANKs clients who were issued checkbooks.
o Rempillo copied the account number on the space intended for it in Villanuevas requisition slip.
When Villanueva received his requested checkbook, he signed and issued a check for P50k payable to Kingly
Commodities. He delivered this check to Helen Chu, his investment consultant at Kingly Commodities.
HOWEVER, Villanueva's check was dishonored due to insufficiency of funds and disparity in the signature.
He informed the bank about this, and he was assured that the check would be honored subsequently.
When Kingly Commodities tried to deposit the check again, it was again dishonored. This time, it was found
out that the account number assigned to Villanueva's new checkbook was the account number of
another depositor with the same name but with a different middle initial.
The bank issued a manager's check to correct the situation with Kingly Commodities. It apologized to
Villanueva, but reminded him that the dishonor was actually due to his failure to state his current account
number in the requisition slip.
In June 1986, VILLANUEVA sent a letter to the BANK addressed to the President, Jose Facundo (hehe),
demanding for indemnification for alleged losses and damages suffered by him as a result of the dishonor of
his well-funded check.
o He demanded P70, 000 as indemnification for actual damages in the form of lost profits and P2M for
moral and other damages.
o The bank refused, insisting that it was due to VILLANUEVAs irresponsibility.
He then filed a complaint for damages based on breach of contract and/or quasi-delict before the Makati RTC.
Makati RTC dismissed the case for lack of merit and ruled in favor of the bank.
o It found that Villanueva's negligence was the proximate cause of the injury.
o It conceded, however, that the BANK was negligent when it failed to supply VILLANUEVAs correct
account number despite its promise to do so; but its negligence was merely contributory, which would
have reduced the damages recoverable by VILLANUEVA had the latter proved his claims for actual,
moral and exemplary damages, and attorneys fees.
The CA ruled in favor of VILLANUEVA, and decided that the BANKs voluntary processing of the
requisition slip is the proximate cause of the injury.
Thus, this case.

Issues:

1. W/N Villanueva is entitled to payment of damages

Held/Ratio:

1. NO.
a. Actual losses: NOT ENTITLED
The issue of whether VILLANUEVA suffered actual or compensatory damages in the form of loss of
profits is factual. Both lower courts found that he was not able to prove his demand for
compensatory damages arising from loss.
His evidence was found inadequate, uncorroborated, speculative, hearsay, and not the best evidence.
Actual damages cannot be presumed but must be duly proved with reasonable certainty.
Basic is the jurisprudential principle that in determining actual damages, the court cannot rely on
mere assertions, speculations, conjectures, or guesswork but must depend on competent proof and on
the best obtainable evidence of the actual amount of the loss.
b. Moral damages: NOT ENTITLED
Moral damages include physical suffering, mental anguish, fright, serious anxiety, besmirched
reputation, wounded feelings, moral shock, social humiliation, and similar injury.
Although incapable of pecuniary computation, moral damages may be recovered if they are the
proximate result of the defendants wrongful act or omission.
Requisites: (1) injury, (2) culpable act or omission factually established, (3) act or omission is the
proximate cause of the injury, (4) award of damages is predicated on any of the cases stated in Art.
2219
Under the circumstances of this case, VILLANUEVA might have suffered some form of
inconvenience and discomfort as a result of the dishonor of his check. However, the same could not
have been so grave or intolerable. Also, the bank was able to remedy the situation with Kingly
Commodities.
c. Attorney's fees: NOT ENTITLED
The general rule is that attorneys fees cannot be recovered as part of damages because of the policy
that no premium should be placed on the right to litigate. They are not to be awarded every time a
party wins a suit.
The power of the court to award attorneys fees under Art. 2208 of the Civil Code demands factual,
legal, and equitable justification.
Even when a claimant is compelled to litigate with third persons or to incur expenses to protect his
rights, still attorneys fees may not be awarded where there is no sufficient showing of bad faith in the
parties persistence of a case other than an erroneous conviction of the righteousness of his cause.

There is no need to deliberate on whose negligence was the proximate cause, since Villanueva did not
sustain any compensable injury. The present case is considered an instance of damnum absque injuria.

Wherefore, the CAs decision is REVERSED and the RTCs judgment is REINSTATED.