Bank Secrecy Case Digests

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Judge. Macumbal | Case Digests
BSB opposed the motion to quash, arguing that the complaint affidavit
C. Law on Secrecy of Bank Deposits showed two checks were deposited to the Metrobank account. Sally also
filed a supplemental motion to quash, invoking the absolutely confidential
nature of the Metrobank account under R.A. 1405.

1. BSB Group v. Go
The trial court denied the motions to quash. In the meantime, the
(G.R. No. 168644, February 16, 2010) representative of Security Bank testified and identified the checks
deposited to Sally’s Security Bank account. Before her testimony could be
completed, however, Sally moved to suppress her testimony, invoking
irrelevancy and privilege of confidentiality under R.A. 1405. When the
trial court denied anew her motion to suppress, Sally filed a petition with
FACTS: the Court of Appeals, alleging grave abuse of discretion on the part of the
trial court in denying her motions to quash with respect to
Petitioner, the BSB Group, Inc., represented by its president, the Metrobank account, and the motion to suppress on the testimony of
Ricardo Bagayan, filed a complaint for estafa and/or Qualified Theft the bank representative from Security Bank.
against Sally, his wife, who was employed by the company as cashier,
engaged to receive and account for the payments made by the various The Court of Appeals granted the petition for certiorari filed by Sally and
customers of the company. reversed the assailed orders of the trial court as well as struck off the
testimony of the bank representative of Security Bank.
Petitioner alleged that several checks representing the aggregate amount
of ₱1,534,135.50 issued by the company’s customers in payment of their ISSUE:
obligation were, instead of being turned over to the company’s coffers,
indorsed by respondent who deposited the same to her personal banking Whether Marasigan's testimony dealing with respondent deposit account
account maintained at Security Bank and Trust Company. with Security Bank constitutes an unallowable inquiry under R.A. 1405.
After a finding of probable cause, the Office of the City Prosecutor filed an HELD:
Information charging Sally with Qualified Theft for theft of “cash” money
belonging to BSB Group Inc. After arraignment, trial ensued on the YES. “R.A. No. 1405 has two allied purposes. It hopes to discourage private
merits. hoarding and at the same time encourage the people to deposit their
money in banking institutions, so that it may be utilized by way of
To prove that Sally deposited the money to her personal account, the authorized loans and thereby assist in economic development. Owing to
prosecution moved for issuance of subpoena duces tecum/ad this piece of legislation, the confidentiality of bank deposits remains to be
testificandum against the managers or records custodians of Security a basic state policy in the Philippines. Section 2 of the law institutionalized
Bank, as well as of the Metrobank in Jose Abad Santos, Manila branch. this policy by characterizing as absolutely confidential in general all
Sally moved to quash the subpoena to Metrobank, noting that no mention deposits of whatever nature with banks and other financial institutions in
was made of Sally’s bank account with Metrobank. While arguing that the the country. It declares:
account with Metrobankwas immaterial to the case, she waived her
objection to the Security Bank subpoena.

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Section 2. All deposits of whatever nature with banks or banking In other words, it can hardly be inferred from the indictment itself that
institutions in the Philippines including investments in bonds issued the Security Bank account is the ostensible subject of the prosecution’s
by the Government of the Philippines, its political subdivisions and its inquiry. Without needlessly expanding the scope of what is plainly alleged
instrumentalities, are hereby considered as of an absolutely in the Information, the subject matter of the action in this case is the
confidential nature and may not be examined, inquired or looked into money alleged to have been stolen by respondent, and not the money
by any person, government official, bureau or office, except upon equivalent of the checks which are sought to be admitted in evidence.
written permission of the depositor, or in cases of impeachment, or Thus, it is that, which the prosecution is bound to prove with its evidence,
upon order of a competent court in cases of bribery or dereliction of and no other.
duty of public officials, or in cases where the money deposited or
invested is the subject matter of the litigation.” It comes clear that the admission of testimonial and documentary
evidence relative to respondent’s Security Bank account serves no other
The Court found guidance in the relevant portions of the legislative purpose than to establish the existence of such account, its nature and the
deliberations on Senate Bill No. 351 and House Bill No. 3977, which later amount kept in it. It constitutes an attempt by the prosecution at an
became the Bank Secrecy Act, and it held that the absolute confidentiality impermissible inquiry into a bank deposit account the privacy and
rule in R.A. No. 1405 actually aims at protection from unwarranted confidentiality of which is protected by law. On this score alone, the
inquiry or investigation if the purpose of such inquiry or investigation is objection posed by respondent in her motion to suppress should have
merely to determine the existence and nature, as well as the amount of indeed put an end to the controversy at the very first instance it was
the deposit in any given bank account. raised before the trial court.

What indeed constitutes the subject matter in litigation in relation to In sum, we hold that the testimony of Marasigan on the particulars of
Section 2 of R.A. No. 1405 has been pointedly and amply addressed in respondent’s supposed bank account with Security Bank and the
Union Bank of the Philippines v. Court of Appeals, in which the Court documentary evidence represented by the checks adduced in support
noted that the inquiry into bank deposits allowable under R.A. No. thereof, are not only incompetent for being excluded by operation of R.A.
1405 must be premised on the fact that the money deposited in the No. 1405. They are likewise irrelevant to the case, inasmuch as they do
account is itself the subject of the action. Given this perspective, we not appear to have any logical and reasonable connection to the
deduce that the subject matter of the action in the case at bar is to be prosecution of respondent for qualified theft. We find full merit in and
determined from the indictment that charges respondent with the affirm respondent’s objection to the evidence of the prosecution. The
offense, and not from the evidence sought by the prosecution to be Court of Appeals was, therefore, correct in reversing the assailed
admitted into the records. In the criminal Information filed with the trial orders of the trial court.
court, respondent, unqualifiedly and in plain language, is charged with
qualified theft by abusing petitioner’s trust and confidence and stealing A final note. In any given jurisdiction where the right of privacy extends
cash. The said Information makes no factual allegation that in some its scope to include an individual’s financial privacy rights and personal
material way involves the checks subject of the testimonial and financial matters, there is an intermediate or heightened scrutiny given
documentary evidence sought to be suppressed. Neither do the by courts and legislators to laws infringing such rights. Should there be
allegations in said Information make mention of the supposed bank doubts in upholding the absolutely confidential nature of bank deposits
account in which the funds represented by the checks have allegedly against affirming the authority to inquire into such accounts, then such
been kept. doubts must be resolved in favor of the former. This attitude persists

unless congress lifts its finger to reverse the general state policy In the course of the hearing, GSIS requested for the issuance of a
respecting the absolutely confidential nature of bank deposits.” subpoena duces tecum to the custodian of records of Westmont Bank
to produce the following documents:

1. Ledger covering the accounts of DOMSAT Holdings, Inc. & Philippine
2. GSIS v. Court of Appeals Agila Satellite, Inc. with Westmont Bank (now United Overseas Bank),
any and all documents, records, files, books, deeds, papers, notes and
(G.R. No. 189206, June 8, 2011) other data and materials relating to the account or transactions of
DOMSAT Holdings, Inc. with or through the Westmont Bank (now
United Overseas Bank) for the period January 1997 to December
2002, in his/her direct or indirect possession, custody or control
(whether actual or constructive), whether in his/her capacity as
Custodian of Records or otherwise
FACTS:
2. All applications for cashiers/ managers checks and bank transfers
This case is incident to Civil Case No. 99-1853, which is the main funded by the accounts of DOMSAT Holdings, Inc. & Philippine Agila
case for collection of sum of money with damages filed by Industrial Satellite, Inc. with or through the Westmont Bank (now United
Overseas Bank) for the period January 1997 to December 2002, and
Bank of Korea, Tong Yang Merchant Bank, First Merchant Banking
all other data and materials covering said applications, in his/her
Corporation, Land Bank of the Philippines, and Westmont Bank (now direct or indirect possession, custody or control (whether actual or
United Overseas Bank), collectively known as the Banks against constructive), whether in his/her capacity as Custodian of Records or
Domsat Holdings, Inc. (Domsat) and the Government Service otherwise;
Insurance System (GSIS). Said case stemmed from a Loan Agreement,
whereby the Banks agreed to lend $11 Million to Domsat for the Initially, the RTC granted the request, but later reversed its decision and
purpose of financing the lease and/or purchase of a Gorizon Satellite ordered that the previously issued subpoena be quashed. It ruled that
from the International Organization of Space Communications foreign currency deposits are absolutely confidential and may be
(Intersputnik). The controversy originated from a surety agreement examined only when there is a written permission from the depositor.
by which Domsat obtained a surety bond from GSIS to secure the
payment of the loan from the Banks. The Court of Appeals declared that Domsats deposit in Westmont
Bank is covered by Republic Act No. 6426 or the Bank Secrecy Law. It
When Domsat failed to pay the loan, GSIS refused to comply with its also ruled that the testimony of the incumbent president of Westmont
obligation reasoning that Domsat did not use the loan proceeds for Bank is not the written consent contemplated by Republic Act No. 6426.
the payment of rental for the satellite. GSIS alleged that Domsat, with The Court of Appeals however upheld the issuance of subpoena
Westmont Bank as the conduit, transferred the U.S. $11 Million loan praying for the production of applications for cashiers or managers
proceeds from the Industrial Bank of Korea to Citibank New York checks by Domsat through Westmont Bank, as well as a copy of an
account of Westmont Bank and from there to the Binondo Branch of Agreement and/or Contract and/or Memorandum between Domsat
Westmont Bank. The Banks filed a complaint before the RTC of Makati and/or Philippine Agila Satellite and Intersputnik for the acquisition
against Domsat and GSIS. and/or lease of a Gorizon Satellite. The appellate court believed that
the production of these documents does not involve the examination
of Domsats account since it will never be known how much money
was deposited into it or withdrawn therefrom and how much remains
therein.

or managers checks by Domsat through Westmont Bank, as well as a
GSIS insists that Domsats deposit with Westmont Bank can be copy of an agreement and/or contract and/or memorandum between
examined and inquired into. It anchored its argument on Republic Domsat and/or Philippine Agila Satellite and Intersputnik for the
Act No. 1405 or the Law on Secrecy of Bank Deposits, which acquisition and/or lease of a Gorizon satellite, the latter became final
allows the disclosure of bank deposits in cases where the money and executory.
deposited is the subject matter of the litigation. GSIS asserts that
the subject matter of the litigation is the U.S. $11 Million obtained by ISSUE:
Domsat from the Banks to supposedly finance the lease of a Russian
satellite from Intersputnik. Whether or not it should be held liable Which of the two laws should apply in the instant case?
as a surety for the principal amount of U.S. $11 Million, GSIS contends,
is contingent upon whether Domsat indeed utilized the amount to HELD:
lease a Russian satellite as agreed in the Surety Bond Agreement.
Hence, GSIS argues that the whereabouts of the U.S. $11 Million is Republic Act No. 6426 is the applicable law. Republic Act No. 1405
the subject matter of the case and the disclosure of bank deposits was enacted in 1955. Section 2 thereof was first amended by
relating to the U.S. $11 Million should be allowed. GSIS also contends Presidential Decree No. 1792 in 1981 and further amended by
that the concerted refusal of Domsat and the banks to divulge the Republic Act No. 7653 in 1993. It now reads:
whereabouts of the U.S. $11 Million will greatly prejudice and burden
the GSIS pension fund considering that a substantial portion of this Section 2. All deposits of whatever nature with banks or banking
institutions in the Philippines including investments in bonds issued by
fund is earmarked every year to cover the surety bond issued.
the Government of the Philippines, its political subdivisions and its
instrumentalities, are hereby considered as of an absolutely confidential
Domsat denies the allegations of GSIS and reiterates that it did not nature and may not be examined, inquired or looked into by any person,
give a categorical or affirmative written consent or permission to GSIS government official, bureau or office, except upon written permission of
to examine its bank statements with Westmont Bank. The Banks the depositor, or in cases of impeachment, or upon order of a competent
court in cases of bribery or dereliction of duty of public officials, or in
maintain that Republic Act No. 1405 is not the applicable law in cases where the money deposited or invested is the subject matter of
the instant case because the Domsat deposit is a foreign currency the litigation.
deposit, thus covered by Republic Act No. 6426. Under said law,
only the consent of the depositor shall serve as the exception for the Section 8 of Republic Act No. 6426, which was enacted in 1974, and
disclosure of his/her deposit. The Banks counter the arguments of GSIS amended by Presidential Decree No. 1035 and later by Presidential
as a mere rehash of its previous arguments before the Court of Decree No. 1246, provides:
Appeals. They justify the issuance of the subpoena as an interlocutory
matter which may be reconsidered anytime and that the pro forma Section 8. Secrecy of Foreign Currency Deposits. All foreign currency
rule has no application to interlocutory orders. deposits authorized under this Act, as amended by Presidential Decree No.
1035, as well as foreign currency deposits authorized under Presidential
Decree No. 1034, are hereby declared as and considered of an absolutely
It appears that only GSIS appealed the ruling of the Court of Appeals confidential nature and, except upon the written permission of the
pertaining to the quashal of the subpoena for the production of depositor, in no instance shall foreign currency deposits be examined,
Domsats bank ledger with Westmont Bank. Since neither Domsat nor inquired or looked into by any person, government official, bureau or
the Banks interposed an appeal from the other portions of the office whether judicial or administrative or legislative or any other entity
whether public or private; Provided, however, That said foreign currency
decision, particularly for the production of applications for cashiers deposits shall be exempt from attachment, garnishment, or any other order

or process of any court, legislative body, government agency or any
administrative body whatsoever. (As amended by PD No. 1035, and further
amended by PD No. 1246, prom. Nov. 21, 1977.)
3. JOSEPH VICTOR G. EJERCITO VS.

SANDIGANBAYAN
On the one hand, Republic Act No. 1405 provides for four (4) (G.R. Nos. 157294-95, November 30, 2006)
exceptions when records of deposits may be disclosed. These are
under any of the following instances: (a) upon written permission of
the depositor, (b) in cases of impeachment, (c) upon order of a FACTS:
competent court in the case of bribery or dereliction of duty of public
This case involves three resolutions issued in Criminal Case No. 26558,
officials or, (d) when the money deposited or invested is the subject
matter of the litigation, and (e) in cases of violation of the Anti- "People of the Philippines v. Joseph Ejercito Estrada, et al.," for plunder. In
Money Laundering Act (AMLA), the Anti-Money Laundering Council above-stated case of People v. Estrada, et al., the Special Prosecution
(AMLC) may inquire into a bank account upon order of any competent Panel filed on January 20, 2003 before the Sandiganbayan a Request for
court. On the other hand, the lone exception to the non-disclosure of Issuance of Subpoena Duces Tecum for the issuance of a subpoena
foreign currency deposits, under Republic Act No. 6426, is disclosure directing the President of Export and Industry Bank (EIB, formerly Urban
upon the written permission of the depositor. These two laws both Bank) or his/her authorized representative to produce the pertinent
support the confidentiality of bank deposits. docments of certain bank accounts (Trust Account No. 858 and Savings
AccountNo. 0116-17345-9).
There is no conflict between them. Republic Act No. 1405 was
enacted for the purpose of giving encouragement to the people to They also filed a Request for Issuance of Subpoena Duces Tecum/Ad
deposit their money in banking institutions and to discourage private
Testificandum directed t the authorized representative of Equitable-PCI
hoarding so that the same may be properly utilized by banks in
Bank to produce statements of account pertaining to certain accounts in
authorized loans to assist in the economic development of the country.
It covers all bank deposits in the Philippines and no distinction was the name of "Jose Velarde" and to testify thereon.
made between domestic and foreign deposits. Thus, Republic Act
No. 1405 is considered a law of general application. On the other The Sandiganbayan granted both requests by Resolution of January 21,
hand, Republic Act No. 6426 was intended to encourage deposits 2003 and subpoenas were accordingly issued.
from foreign lenders and investors. It is a special law designed
especially for foreign currency deposits in the Philippines. A The Special Prosecution Panel filed still another Request for Issuance of
general law does not nullify a specific or special law. Therefore, it is Subpoena Duces Tecum/Ad Testificandum dated January 23, 2003 for the
beyond cavil that Republic Act No. 6426 applies in this case. President of EIB or his/her authorized representative to produce the
same documents subject of the Subpoena Duces Tecum dated January 21,
Applying Section 8 of Republic Act No. 6426, absent the written 2003 and to testify thereon on the hearings scheduled on January 27 and
permission from Domsat, Westmont Bank cannot be legally compelled 29, 2003 and subsequent dates until completion of the testimony. The
to disclose the bank deposits of Domsat, otherwise, it might expose
request was likewise granted by the Sandiganbayan. A
itself to criminal liability under the same act.
Subpoena Duces Tecum/Ad Testificandum was accordingly issued.

Petitioner, claiming to have learned from the media that the Special ISSUES:
Prosecution Panel had requested for the issuance of subpoenas for the
1. Whether petitioner's Trust Account No. 858 is covered by the term
examination of bank accounts belonging to him, attended the hearing of
"deposit" as used in R.A. 1405;
the case on January 27, 2003 and filed before the Sandiganbayan a letter
of even date expressing his concerns on the protection accorded by the 2. Whether petitioner's Trust Account No. 858 and Savings Account
Bank Secrecy Law, among others. No. 0116-17345-9 are excepted from the protection of R.A. 1405; and

Petitioner, unassisted by counsel, filed a Motion to Quash 3. [CrimPro] Whether the "extremely-detailed" information contained in
Subpoena Duces Tecum/Ad Testificandumpraying that the subpoenas the Special Prosecution Panel's requests for subpoena was obtained
previously issued to the President of the EIB dated January 21 and January through a prior illegal disclosure of petitioner's bank accounts, in
24, 2003 be quashed. violation of the "fruit of the poisonous tree" doctrine.
HELD:
In his Motion to Quash, petitioner claimed that his bank accounts are
covered by R.A. No. 1405 (The Secrecy of Bank Deposits Law) and do not 1. YES. The subject account is considered a deposit.
fall under any of the exceptions stated therein. He further claimed that the For the respondent People, the law applies only to "deposits" which
specific identification of documents in the questioned subpoenas, strictly means the money delivered to the bank by which a creditor-
including details on dates and amounts, could only have been made debtor relationship is created between the depositor and the bank.
possible by an earlier illegal disclosure thereof by the EIB and the
Philippine Deposit Insurance Corporation (PDIC) in its capacity as This contention does not lie. An examination of the law shows that the
receiver of the then Urban Bank. The disclosure being illegal, petitioner term "deposits" used therein is to be understood broadly and not limited
concluded, the prosecution in the case may not be allowed to make use of only to accounts which give rise to a creditor-debtor relationship between
the information. the depositor and the bank.

Before the Motion to Quash was resolved by the Sandiganbayan, the The policy behind the law is laid down in Section 1, thus, “to discourage
private hoarding so that the same may be properly utilized by banks in
prosecution filed another Request for the Issuance of
authorized loans to assist in the economic development of the country.”
Subpoena Duces Tecum/Ad Testificandum the documents previously
requested and additional items. The prosecution also filed a Request for If the money deposited under an account may be used by banks for
the Issuance of Subpoena Duces Tecum/Ad Testificandum bearing the authorized loans to third persons, then such account, regardless of
same date, January 31, 2003, directed to Vice President of the PDIC for her whether it creates a creditor-debtor relationship between the depositor
to produce Letters of Authority and some checks. As with the others, both and the bank, falls under the category of accounts which the law precisely
requests were issued by the Sandiganbayan on January 31, seeks to protect for the purpose of boosting the economic development of
2003. Similarly, Petitioner filed a Motion to Quash said issuances. the country.

The first and second Motion to Quash were all denied by Trust Account No. 858 is, without doubt, one such account. The money
the Sandiganbayan. A Motion for Reconsideration was also denied. deposited under Trust Account No. 858, was intended not merely to
Hence, this petition. remain with the bank but to be invested by it elsewhere.

Cases of unexplained wealth are similar to cases of bribery or dereliction
Section 2 of the same law in fact even more clearly shows that the term of duty and no reason is seen why these two classes of cases cannot
"deposits" was intended to be understood broadly: be excepted from the rule making bank deposits confidential. The policy
as to one cannot be different from the policy as to the other. This policy
SECTION 2. All deposits of whatever nature with banks or banking expresses the notion that a public office is a public trust and any person
institutions in the Philippines including investments in bonds who enters upon its discharge does so with the full knowledge that his life,
issued by the Government of the Philippines, its political so far as relevant to his duty, is open to public scrutiny.
subdivisions and its instrumentalities, are hereby considered as of
an absolutely confidential nature and may not be examined, Undoubtedly, cases for plunder involve unexplained wealth. Section 2 of
inquired or looked into by any person, government official, bureau R.A. No. 7080 states so.
or office, except upon written permission of the depositor, or in
cases of impeachment, or upon order of a competent court in cases SECTION 2. Definition of the Crime of Plunder; Penalties.
of bribery or dereliction of duty of public officials, or in cases where — Any public officer who, by himself or in connivance with membe
the money deposited or invested is the subject matter of the rs of his family,relatives by affinity or consanguinity, business asso
litigation. (Emphasis and underscoring supplied) ciates, subordinates or other persons, amasses, accumulates or acq
uires ill-gotten wealth through a combination or series of overt or
criminal acts as described in Section 1(d) hereof, in the aggregate
The phrase "of whatever nature" proscribes any restrictive interpretation
amount or total value of at least Seventy-five million pesos
of "deposits." Moreover, the law applies not only to money which is
(P75,000,000.00), shall be guilty of the crime of plunder xxx”
deposited but also to those which are invested. This further shows
that the law was not intended to apply only to "deposits" in the strict
sense of the word. Otherwise, there would have been no need to add the An examination of the "overt or criminal acts as described in Section 1(d)"
phrase "or invested." of R.A. No. 7080 would make the similarity between plunder and bribery
even more pronounced since bribery is essentially included among these
Clearly, therefore, R.A. 1405 is broad enough to cover Trust Account No. criminal acts. Thus Section 1(d) states:
858.
d) "Ill-gotten wealth" means any asset, property, business
The protection afforded by the law is, however, not absolute, there being enterprise or material possession of any person within the purview
recognized exceptions thereto, as above-quoted Section 2 provides. In the of Section Two (2) hereof, acquired by him directly or indirectly
present case, two exceptions apply, to wit: (1) the examination of bank through dummies, nominees, agents, subordinates and or business
accounts is upon order of a competent court in cases of bribery or associates by any combination or series of the following means or
dereliction of duty of public officials, and (2) the money deposited or similar schemes.
invested is the subject matter of the litigation.
1)Through misappropriation, conversion, misuse, or
2. YES. They are excepted from the protection of the law. malversation of public funds or raids on the public treasury;

Petitioner contends that since plunder is neither bribery nor dereliction 2) By receiving, directly or indirectly, any commission, gift, share,
of duty, his accounts are not excepted from the protection of R.A. 1405. percentage, kickbacks or any other form of pecuniary benefit from
Philippine National Bank v. Gancayco holds otherwise:

any person and/or entity in connection with any government 3. NO. Fruit of a poisonous tree doctrine does not apply.
contract or project or by reason of the office or position of the public
officer concerned; As no plunder case against then President Estrada had yet been filed
xxx before a court of competent jurisdiction at the time the Ombudsman
conducted an investigation, petitioner concludes that the information
The crime of bribery and the overt acts constitutive of plunder are crimes about his bank accounts were acquired illegally, hence, it may not be
committed by public officers, and in either case the noble idea that "a lawfully used to facilitate a subsequent inquiry into the same bank
public office is a public trust and any person who enters upon its
accounts.
discharge does so with the full knowledge that his life, so far as relevant

to his duty, is open to public scrutiny" applies with equal force.
Petitioner's attempt to make the exclusionary rule applicable to the

instant case fails. R.A. 1405, it bears noting, nowhere provides that an
Plunder being thus analogous to bribery, the exception to R.A. 1405 unlawful examination of bank accounts shall render the evidence
applicable in cases of bribery must also apply to cases of plunder. obtained therefrom inadmissible in evidence. Section 5 of R.A. 1405 only
states that "[a]ny violation of this law will subject the offender upon
Further, petitioner'claim that the money in his bank accounts is not the conviction, to an imprisonment of not more than five years or a fine of not
"subject matter of the litigation," the meaning of the phrase "subject more than twenty thousand pesos or both, in the discretion of the court."
matter of the litigation" As used in R.A. 1405 is explained in Union Bank
of the Philippines v. Court of Appeals, thus:
Even assuming arguendo, however, that the exclusionary rule applies in

principle to cases involving R.A. 1405, the Court finds no reason to apply
“xxx the subject of the action is the matter or thing with respect to which
the same in this particular case.
the controversy has arisen, concerning which the wrong has been done,

and this ordinarily is the property or the contract and its subject matter, Clearly, the "fruit of the poisonous tree" doctrine presupposes a violation
or the thing in dispute." of law. If there was no violation of R.A. 1405 in the instant case, then there
would be no "poisonous tree" to begin with, and, thus, no reason to apply
The plunder case now pending with the Sandiganbayan necessarily the doctrine.
involves an inquiry into the whereabouts of the amount purportedly
acquired illegally by former President Joseph Estrada.
Petitioner also asserts the application of the Marquez ruling that there

must be a pending case in order for the Ombudsman to validly inspect
In light then of this Court's pronouncement in Union Bank, the subject
bank records in camera which reversed a prevailing doctrine.
matter of the litigation cannot be limited to bank accounts under the name

of President Estrada alone, but must include those accounts to which the The above-rule notwithstanding, the examination by the Ombudsman of
money purportedly acquired illegally or a portion thereof was alleged to petitioner's bank accounts, conducted before a case was filed with a court
have been transferred. Trust Account No. 858 and Savings Account No. of competent jurisdiction, was lawful. For the Ombudsman issued the
0116-17345-9 in the name of petitioner fall under this description and subpoenas bearing on the bank accounts of petitioner about four
must thus be part of the subject matter of the litigation. months before Marquez was promulgated on June 27, 2001. Hence, it may
not be retroactively applied.

The Ombudsman's inquiry into the subject bank accounts prior to the 1. These accounts are no longer protected by the Secrecy of Bank Deposits
filing of any case before a court of competent jurisdiction was therefore Law, there being two exceptions to the said law applicable in this case,
valid at the time it was conducted. namely: (1) the examination of bank accounts is upon order of a
competent court in cases of bribery or dereliction of duty of public
In fine, the subpoenas issued by the Ombudsman in this case were legal, officials, and (2) the money deposited or invested is the subject matter of
hence, invocation of the "fruit of the poisonous tree" doctrine is the litigation. Exception (1) applies since the plunder case pending against
misplaced. former President Estrada is analogous to bribery or dereliction of duty,
while exception (2) applies because the money deposited in petitioner's
At all events, even if the challenged subpoenas are quashed, the bank accounts is said to form part of the subject matter of the same
Ombudsman is not barred from requiring the production of the same plunder case.
documents based solely on information obtained by it from
sources independent of its previous inquiry. 2. The "fruit of the poisonous tree" principle, which states that once the
primary source (the "tree") is shown to have been unlawfully obtained,
In particular, the Ombudsman, even before its inquiry, had already any secondary or derivative evidence (the "fruit") derived from it is also
possessed information giving him grounds to believe that (1) there are inadmissible, does not apply in this case. In the first place, R.A. 1405 does
bank accounts bearing the number "858," (2) that such accounts are in the not provide for the application of this rule. Moreover, there is no basis for
custody of Urban Bank, and (3) that the same are linked with the bank applying the same in this case since the primary source for the detailed
accounts of former President Joseph Estrada who was then under information regarding petitioner's bank accounts — the investigation
investigation for plunder. previously conducted by the Ombudsman — was lawful.

Thus, with the filing of the plunder case against former President Estrada 3. At all events, even if the subpoenas issued by the Sandiganbayan were
before the Sandiganbayan, the Ombudsman, using the above independent quashed, the Ombudsman may conduct on its own the same inquiry into
information, may now proceed to conduct the same investigation it earlier the subject bank accounts that it earlier conducted last February-March
conducted, through which it can eventually obtain the same information 2001, there being a plunder case already pending against former
previously disclosed to it by the PDIC, for it is an inescapable fact that the President Estrada. To quash the challenged subpoenas would, therefore,
bank records of petitioner are no longer protected by R.A. 1405 for the be pointless since the Ombudsman may obtain the same documents by
reasons already explained above. another route. Upholding the subpoenas avoids an unnecessary delay in
the administration of justice.
Since conducting such an inquiry would, however, only result in the
disclosure of the same documents to the Ombudsman, this Court, in [After the dispositive portion is a 40+ page dissenting opinion of J.
avoidance of whatwould be a time-wasteful and circuitous way of Sandoval-Gutierrez and 10+ page concurring opinion of J. Callejo, Sr.]
administering justice, upholds the challenged subpoenas.

IN SUM, the Court finds that the Sandiganbayan did not commit grave
abuse of discretion in issuing the challenged subpoenas for documents
pertaining to petitioner's Trust Account No. 858 and Savings Account No.
0116-17345-9 for the following reasons:

By virtue of the complaint filed by Sun Life the Deputy Sheriff claims that
4. Oñ ate et al vs. Abrogar he tried to serve the a copy of the complaint on petitioners on January 3,
(G.R. No. 107303 February 23, 1995) 1992 but that there was no one in the offices of petitioners on whom he

could make a service. This is denied by petitioners who claim that their
office was always open and that Adeliza M. Jaranilla, Econ's Chief
“If the attachment of the petitioner’s properties was invalid, the Accountant who eventually received summons on behalf of Oñate and
examination of bank and book records ordered in connection with such Econ, was present that day.
attachment must likewise be considered invalid.”
This case is not the main case, this is just a motion for reconsideration Whatever the truth is, the fact is that no other attempt was made by the
on the issue of attachment. sheriff to serve the summons except on January 9, 1992, in the case
of Oñate and Econ, and on January 16, 1992, in the case of Diño. Meantime,
he made several levies, which indicates a predisposition to serve the writ
FACTS: of attachment in anticipation of the eventual acquisition by the court of
In its complaint, Sun Life alleges that Oñate, in his personal capacity and jurisdiction over petitioners.
president of Econ, offered to sell to Sun Life P46,990,000.00 worth of On January 21, 1992, respondent judge ordered the examination of the
treasury bills owned by Econ and Brunner at a discounted price of books of accounts and ledgers of Brunner at the Urban
P39,526,500.82. That on November of 1991, Sun Life paid the price by Bank, Legaspi Village branch, and on January 30, 199 the records of
means of check payable to Brunner; that Brunner, through its account of petitioner Oñate at the BPI, even as he ordered the PNB to
President Mr. Diño, issued to it a receipt with undertaking to deliver the produce the records regarding certain checks deposited in it. The
treasury bills to Sun Life. And that on December of 1991, Brunner examination was ordered by the respondent judge because Sun Life
and Diño delivered instead a promissory note dated November 27, alleges that it was Onate who signed the checks transferring huge
1991 in which it was made to appear that the transaction was a money amounts from Brunner’s account in the Urban Bank to the PNB and the
placement instead of sale of treasury bills. Sun Life also alleges that the BPI. But Onate countered that such order was a fishing expedition, he
money paid by it to Brunner was subsequently withdrawn from the Urban asserted that he was not a signatory to any documents evidencing the
Bank after it had been deposited by Brunner and then transferred to BPI transaction between Sun Life and Brunner.
and to the unnamed account in the petitioner Oñate account in the BPI
and to the unnamed account in the PNB. Petitioner Onate now seeks for the reconsideration to the Court en banc
praying among others the reversal decision of the Second Division and
A criminal complaint for estafa which Sun Life filed against petitioner Third Division of the which holds that the subsequent acquisition of the
Onate and Dino was then dismissed by the Office of the Provincial jurisdiction over the person of a defendant (Onate) does not render valid
Prosecutor. The main issue in the case at bar in the RTC is precisely the previous attachment of his property and that the examination of bank
whether petitioners were guilty of fraud in contracting books and records of Onate was also justified.
their obligation; such resolution of the issue must await the trial of the
main case.
This is the gist of the motion of reconsideration in the case at bar.

ISSUE 1: other personal property belonging to such party, may be required to
attend before the court in which the action is pending, or before a
Whether or not the levy on attachment of petitioner’s properties which
commissioner appointed by the court, and be examined on oath
had been made before the trial court acquired jurisdiction over them and
respecting the same. The party whose property is attached may also be
the subsequent service of summons on them cured the invalidity of the
required to attend for the purpose of giving information respecting his
attachment.
property, and may be examined on oath. The court may, after such
HELD: examination, order personal property capable of manual delivery
No. The rules of court explicitly states that “ when the sheriff or other belonging to him, in the possession of the person so required to attend
proper officer commences implementation of the writ of attachment, it is before the court, to be delivered to the clerk of the court, sheriff, or other
essential that he serve on the defendant not only a copy of the applicant's proper officer on such terms as may be just, having reference to any lien
affidavit and attachment bond, and of the order of attachment, as thereon or claims against the same, to await the judgment in the action.
explicitly required by Section 5 of Rule 57, but also the summons
addressed to said defendant as well as a copy of the complaint and order
for appointment of guardian ad litem, if any, as also explicitly directed by
5. Intengan vs. Court of Appeals
Section 3, Rule 14 of the Rules of Court.”
It is clear from the above excerpt, however, that while the petition for a (G.R. No. 128996. February 15, 2002)
writ of preliminary attachment may be granted and the writ
itself issued before the defendant is summoned, the writ of attachment
cannot be implemented until jurisdiction over the person of the A case of alleged violation of Bank Secrecy Law but according to the court
the offense was actually a violation Foreign Currency Deposit Act which
defendant is obtained.
action involving such law prescribes (in this case prescribes on the 8th year).
ISSUE 2: The Petitioners are barred by prescription.

Whether or not order for the examination of bank books and records are
justified. FACTS:
HELD: On September 21, 1993, Citibank filed a complaint for violation of section
No. Since, as already stated, the attachment of petitioners' properties was 31 in relation to section 144 of the Corporation Code against two (2) of its
officers, Dante L. Santos and Marilou Genuino. Attached to the complaint
invalid, the examination ordered in connection with such attachment
was an affidavit executed by private respondent Vic Lim, a vice-president
must likewise be considered invalid. Under Rule 57, § 10, as quoted below,
of Citibank.Affidavit Contains:
such examination is only proper where the property of the person
examined has been validly attached. As evidence, Lim annexed bank records (money transfers) purporting to
Sec. 10. Examination of party whose property is attached and persons establish the deception practiced by Santos and Genuino. Some of the
indebted to him or controlling his property; delivery of property to documents pertained to the dollar deposits of petitioners Carmen Ll.
officer. — Any person owing debts to the party whose property is Intengan, Rosario Ll. Neri, and Rita P. Brawner.

attached or having in his possession or under his control any credit or

A charge of estafa under Article 315 was filed. As an incident to the deposits for their selfish ends in prosecuting their complaint in is. no. 93-
foregoing, petitioners filed respective motions for the exclusion and 8469 that did not involve petitioners.
physical withdrawal of their bank records that were attached to Lims
affidavit. ISSUE:

In turn, private respondent Joven Reyes, vice-president/business Whether or not PRIVATE RESPONDENTS DISCLOSURES DO NOT FALL
manager of the Global Consumer Banking Group of Citibank, admits to UNDER THE FOURTH EXCEPTION OF R.A. NO. 1405 NOR UNDER ANY
having authorized Lim to state the names of the clients involved and to OTHER EXCEPTION; and thus are liable for violation of Secrecy of Bank
attach the pertinent bank records, including those of petitioners’. Deposits Act, RA 1405.

Provincial Prosecutor directed the filing of informations against private HELD:
respondents for alleged violation of Republic Act No. 1405, otherwise
known as the Bank Secrecy Law and was affirmed by DOJ as an order for No. The petition is not meritorious. The accounts in question are U.S.
the appeal filed by respondents. dollar deposits; consequently, the applicable law is not Republic Act No.
1405 but Republic Act (RA) No. 6426, known as the Foreign
Court of Appeals rendered judgment dismissing the petition and declared Currency Deposit Act of the Philippines
therein, as follows:
Thus, under R.A. No. 6426 there is only a single exception to the secrecy
Clearly, the disclosure of petitioners deposits was necessary to of foreign currency deposits, that is, disclosure is allowed only upon the
establish the allegation that Santos and Genuino had violated written permission of the depositor.
Section 31 of the Corporation Code in acquiring any interest adverse
to the corporation in respect of any matter which has been reposed A case for violation of Republic Act No. 6426 (Foreign Currency Deposit
in him in confidence. Act) should have been the proper case brought against private
respondents. Private respondents Lim and Reyes admitted that they had
Although petitioners (Intengan at al) were not the parties disclosed details of petitioners dollar deposits without the latters written
involved in IS. No. 93-8469, their accounts were relevant to the permission. Lim’s act of disclosing details of petitioners bank records
regarding their foreign currency deposits, with the authority of Reyes,
complete prosecution of the case against Santos and Genuino and
would appear to belong to that species of criminal acts punishable by
the respondent DOJ properly ruled that the disclosure of the same
special laws, called malum prohibitum, which the law implies
falls under the last exception of R.A. No. 1405. Significantly, conclusively the guilty intent, although the offender was honestly
therefore, as long as the bank deposits are material to the case, mistaken as to the meaning of the law he violates. The matter would have
although not necessarily the direct subject matter thereof, a ended here were it not for the intervention of time, specifically the lapse
disclosure of the same is proper and falls within the scope of the thereof.
exceptions provided for by R.A. No. 1405.
WE REFER TO THE ISSUE OF PRESCRIPTION.
Petitioners aver that in blatant violation of R.A. no. 1405, private
respondents illegally made disclosures of petitioners confidential bank A violation of Foreign Currency Deposit Act shall subject the offender to
imprisonment of not less than one year nor more than five years, or by a

fine of not less than five thousand pesos nor more than twenty-five appears that a certain George Trivinio purchased trail managers check
thousand pesos, or both. Applying Act No. 3326, the offense prescribes and deposited some of it to an account maintained at petitioner’s branch.
in eight years. Per available records, private respondents may no longer Petitioner after meeting with the FFIB Panel to ensure the veracity of the
be penalized for violation of Foreign Currency Deposit Act. checks agreed to the in camera inspection. Petitioner being unable to
readily identify the accounts in question, the Ombudsman issued an order
Private respondent Vic Lim made the disclosure in September of 1993 in directing petitioner to produce the bank documents. Thus, petitioner
his affidavit Intengan learned about it on October 14, 1993; Neri on sought a declaration of her rights from the court due to the clear conflict
October 24, 1993; Brawner, on January 5, 1994. Based on any of these between RA 6770 and RA 1405. Meanwhile, FFIB moved to cite petitioner
dates, prescription has set in. (This case was decided on 2002) in contempt before the Ombudsman.

The filing of the complaint or information did not have the effect of tolling Petitioner Lourdes Marquez received an Order from respondent
the prescriptive period. For it is the filing of the complaint or information Ombudsman Aniano A. Desierto to produce several bank documents for
corresponding to the correct offense which produces that effect. purposes of inspection in camera relative to various accounts maintained
at Union Bank of the Philippines where petitioner is the branch manager.
Ignorance thereof cannot be pretended, ignorantia legis non The accounts to be inspected are were involved in a case pending with the
excusat. Even during the pendency of this appeal, nothing prevented the Ombudsman entitled, Fact-Finding and Intelligence Bureau (FFIB) v.
petitioners from filing a complaint charging the correct offense against Amado Lagdameo, et al. The Order was grounded on Section 15 of RA
private respondents. This was not done, as everyone involved was content 6770 (Ombudsman Act of 1989) which provides, among others, the
to submit the case on the basis of an alleged violation of Republic Act No. following powers, functions and duties of the Ombudsman, to wit:
1405 (Bank Secrecy Law), however, incorrectly invoked.
x x x

WHEREFORE, the petition is hereby DENIED. (8) Administer oaths, issue subpoena duces tecum and take
testimony in any investigation or inquiry, including the power
to examine and have access to banks accounts and records;

6. Marquez v. Desierto (9) Punish for contempt in accordance with the Rules of Court
(G.R. 135882, January 27, 2001) and under the same procedure and with the same penalties
provided therein.

FACTS: The basis of the Ombudsman in ordering an in camera inspection of the
accounts is a trail managers checks purchased by one George Trivinio, a
Petitioner Lourdes Marquez received an Order from respondent respondent in OMB-097-0411, pending with the office of the Ombudsman.
Ombudsman Aniano Desierto to produce several bank documents for It would appear that Mr. George Trivinio, purchased fifty one (51)
purposes of inspection in camera relative to various accounts maintained Managers Checks (MCs) for a total amount of P272.1 Million at Traders
at the bank where petitioner is the branch manager. The accounts to be Royal Bank, United Nations Avenue branch, on May 2 and 3, 1995. Out of
inspected are involved in a case pending with the Ombudsman entitled, the 51 MCs, eleven (11) MCs in the amount of P70.6 million, were
Fact-Finding and Intelligence Bureau (FFIB) v. Amado Lagdameo. It

deposited and credited to an account maintained at the Union Bank, Julia disobedience of or resistance to a lawful order issued by the office and is
Vargas Branch. punishable as Indirect Contempt under Section 3(b) of R.A. 6770.

On May 26, 1998, the FFIB panel met with petitioner Marquez and Atty. On July 10, 1998, Marquez together with UBP filed a petition for
Fe B. Macalino at the bank’s main office for the purpose of allowing declaratory relief, prohibition and injunction with the Makati RTC against
petitioner and Atty. Macalino to view the checks furnished by TRB. After the Ombudsman. The petition was intended to clear the rights and duties
convincing themselves of the veracity of the checks, Atty. Macalino of petitioner. Thus, petitioner sought a declaration of her rights from the
advised Ms. Marquez to comply with the order of the Ombudsman. court due to the clear conflict between RA No.6770, Section 15 and R.A.
Petitioner agreed to an in camera inspection set on June 3, 1998. No. 1405, Sections 2 and 3.

However, on June 4, 1998, Marquez wrote the Ombudsman explaining to Petitioner prayed for a temporary restraining order (TRO) because the
him that the accounts in question could not readily be identified since the Ombudsman and the other persons acting under his authority were
checks were issued in cash or bearer, and asked for time to respond to the continuously harassing her to produce the bank documents relatives to
order. Marquez surmised that these accounts had long been dormant, the accounts in question. Moreover, on June 16, 1998, the Ombudsman
hence were not covered by the new account number generated by the UB issued another order stating that unless petitioner appeared before the
system, thus sought to verify from the Interbank records archives for the FFIB with the documents requested, petitioner manager would be
whereabouts of these accounts. charged with indirect contempt and obstruction of justice.

The Ombudsman stated that UBP-Julia Vargas, not Interbank, was the The lower court denied petitioner's prayer for a temporary restraining
depositary bank of the subject TRB MCs as shown at its dorsal portion and order and stated that the court finds the application for a Temporary
as cleared by the Philippine Clearing House. Notwithstanding the fact that Restraining Order to be without merit.
the checks were payable to cash or bearer, the name of the depositor(s)
could easily be identified since the account numbers where said checks The questioned orders were issued with the investigation of the case of
were deposited were identified in the order. Fact-Finding and Intelligence Bureau vs. Amado Lagdameo, et. al., OMB-0-
97-0411, for violation of RA. 3019. Since petitioner failed to show prima
Even assuming that the accounts xxx were already classified as "dormant facie evidence that the subject matter of the investigation is outside the
accounts," the bank is still required to preserve the records pertaining to jurisdiction of the Office of the Ombudsman, no writ of injunction may be
the accounts within a certain period of time as required by existing issued by this Court to delay this investigation pursuant to section 14 of
banking rules and regulations. Ombudsman Act of 1989.

And finally, the in camera inspection was already extended twice from Petitioner filed a motion for reconsideration but was denied.
May 13, 1998 to June 3,1998 thereby giving the bank enough time within
which to sufficiently comply with the order." On August 21, 1998, petitioner received a copy of the motion to cite her
for contempt. On August 31, 1998, petitioner filed with the Ombudsman
Thus, on June 16, 1998, the Ombudsman issued an order directing an opposition to the motion to cite her in contempt on the ground that the
Marquez to produce the bank documents relative to the accounts in issue, filing thereof was premature due to the petition pending in the lower
stating that her persistent refusal to comply with the order is unjustified, court. Petitioner likewise reiterated that she had no intention to disobey
was merely intended to delay the investigation of the case, constitutes the orders of the Ombudsman. However, she wanted to be clarified as to

how she would comply with the orders without her breaking any law, during the inspection, and such inspection may cover only the account
particularly RA 1405. identified in the pending case.

ISSUES: In Union Bank of the Philippines v. Court of Appeals, we held that “Section
2 of the Law on Secrecy of Bank Deposits, as amended, declares bank
1. Whether or not Marquez may be cited for indirect contempt for her deposits to be “absolutely confidential” except:
failure to produce the documents requested by the Ombudsman. - NO
(1) In an examination made in the course of a special or general
2. Whether or not the order of the Ombudsman to have an in camera examination of a bank that is specifically authorized by the Monetary
inspection of the questioned account is allowed as an exception to the law Board after being satisfied that there is reasonable ground to believe that
on secrecy of bank deposits (RA 1405). - NO a bank fraud or serious irregularity has been or is being committed and
that it is necessary to look into the deposit to establish such fraud or
HELD: irregularity,
(2) In an examination made by an independent auditor hired by the bank
An examination of the secrecy of bank deposits law (R.A. No.1405) would to conduct its regular audit provided that the examination is for audit
reveal the following exceptions: purposes only and the results thereof shall be for the exclusive use of the
bank,
1. Where the depositor consents in writing; (3) Upon written permission of the depositor,
2. Impeachment case; (4) In cases of impeachment,
3. By court order in bribery or dereliction of duty cases against public (5) Upon order of a competent court in cases of bribery or dereliction of
officials; duty of public officials, or
4. Deposit is subject of litigation; (6) In cases where the money deposited or invested is the subject matter
5. Sec. 8, R.A. No.3019, in cases of unexplained wealth as held in the case of the litigation”
of PNB vs. Gancayco.
In the case at bar, there is yet no pending litigation before any court of
The order of the Ombudsman to produce for in camera inspection the competent authority. What is existing is an investigation by the office of
subject accounts with the Union Bank of the Philippines, Julia Vargas the Ombudsman. In short, what the Office of the Ombudsman would wish
Branch, is based on a pending investigation at the Office of the to do is to fish for additional evidence to formally charge Amado
Ombudsman against Amado Lagdameo, et. al. for violation of R.A. No. Lagdameo, et. al., with the Sandiganbayan. Clearly, there was no pending
3019, Sec. 3 (e) and (g) relative to the Joint Venture Agreement between case in court which would warrant the opening of the bank account for
the Public Estates Authority and AMARI. inspection.

We rule that before an in camera inspection may be allowed, there must Zones of privacy are recognized and protected in our laws. The Civil Code
be a pending case before a court of competent jurisdiction. Further, the provides that “every person shall respect the dignity, personality, privacy
account must be clearly identified, the inspection limited to the subject and peace of mind of his neighbors and other persons” and punishes as
matter of the pending case before the court of competent jurisdiction. The actionable torts several acts for meddling and prying into the privacy of
bank personnel and the account holder must be notified to be present another. It also holds a public officer or employee or any private
individual liable for damages for any violation of the rights and liberties

of another person, and recognizes the privacy of letters and other private 5. WAIVER OF CONFIDENTIALITY. – The petitioner and the
communications. The Revised Penal Code makes a crime of the violation members of its Board of Directors shall waive all rights to
of secrets by an officer, the revelation of trade and industrial secrets, and confidentiality provided under the provisions of Republic Act No.
trespass to dwelling. Invasion of privacy is an offense in special laws like 1405, as amended, otherwise known as the Law on Secrecy of Bank
the Anti-Wiretapping Law, the Secrecy of Bank Deposits Act, and the Deposits, and Republic Act No. 8791, otherwise known as The
Intellectual Property Code. General Banking Law of 2000. Accordingly, the petitioner and the
members of its Board of Directors by these presents grant TIDCORP
Ombudsman is ordered to cease and desist from requiring Union Bank and BPI access to any deposit or other accounts maintained by
Manager Lourdes T. Marquez, or anyone in her place to comply with the them with any bank. For this purpose, the petitioner and the
order dated October 14, 1998, and similar orders. members of its Board of Directors shall authorize TIDCORP and BPI
to make, sign, execute and deliver any document of whatever kind
or nature which may be necessary or proper to allow them access
to such deposits or other accounts.
7. DONA ADELA EXPORT
xxx
INTERNATIONAL, INC. v. TIDCORP
Petitioner filed a motion for partial reconsideration claiming that
and BPI TIDCORP and BPI’s agreement imposes upon it several obligations such
as payment of expenses and taxes and waiver of confidentiality of bank
(G.R. No. 201931, February 11, 2015) deposits when it is not a party and signatory to the said agreement. RTC
denied the motion.

Hence, this petition.
FACTS:
Petitioner asserts that express and written waiver from the depositor
concerned is required by law before any third person or entity is allowed
Petitioner Dona Adela filed a Petition for Voluntary Insolvency before the to examine bank deposits or bank records. According to petitioner, it is
RTC. After finding the petition sufficient in form and substance, RTC not a party to the compromise agreement between BPI and TIDCORP and
declared petitioner herein as insolvent and stayed all civil proceedings its silence or acquiescence is not tantamount to an admission that binds it
against it. Thereafter, Atty. Arlene Gonzales was appointed as a receiver to the compromise agreement of the creditors especially the waiver of
and proceeded to make the necessary report, to engage appraisers and confidentiality of bank deposits. Petitioner cites the rule on relativity of
require the creditors to submit proof of their respective claims. Atty. contracts which states that contracts can only bind the parties who
Gonzales then filed a Motion for Parties to Enter Into Compromise
entered into it, and it cannot favor or prejudice a third person, even if he
Agreement incorporating therein her proposed terms of compromise.
is aware of such contract and has knowledge thereof.
Then, TIDCORP and BPI also filed a Joint Motion to Approve
Agreement which was approved by the RTC. Such agreement provided the Respondent BPI counters that petitioner is estopped from questioning the
terms of settlement and imposed upon the petitioner an obligation to pay BPI-TIDCORP compromise agreement because petitioner and its counsel
expenses and taxes incurred in connection to the implementation of such participated in all the proceedings involving the subject compromise
agreement. The agreement also contained a provision stating: agreement and did not object when the compromise agreement was
considered by the RTC.
xxx

Respondent TIDCORP contends that the waiver of confidentiality under or upon written permission of the depositor, or in cases of
Republic Act (R.A.) Nos. 1405 and 8791 does not require the express or impeachment, or upon order of a competent court in cases of
written consent of the depositor. It is TIDCORP’s position that upon bribery or dereliction of duty of public officials, or in cases where
declaration of insolvency, the insolvency court obtains complete the money deposited or invested is the subject matter of the
jurisdiction over the insolvent’s property which includes the authority to litigation.
issue orders to look into the insolvent’s bank deposits. Since bank
deposits are considered debts owed by the banks to the petitioner, the R.A. No. 1405 provides for exceptions when records of deposits may be
receiver is empowered to recover them even without petitioner’s express disclosed. These are under any of the following instances: (a) upon
or written consent, said TIDCORP. written permission of the depositor, (b) in cases of
impeachment, (c) upon order of a competent court in the case of bribery
ISSUE: or dereliction of duty of public officials or, (d) when the money deposited
or invested is the subject matter of the litigation, and (e) in cases of
Whether or not petitioner is bound by the provision in the BPI-TIDCORP violation of the Anti-Money Laundering Act, the Anti-Money Laundering
Joint Motion to Approve Agreement to waive its rights to confidentiality Council may inquire into a bank account upon order of any competent
of its bank deposits under R.A. No. 1405 as amended, otherwise known as court.
the Law on Secrecy of Bank Deposits and R.A. No. 8791, otherwise known
as The General Banking Law of 2000. In this case, the Joint Motion to Approve Agreement was executed by BPI
and TIDCORP only. There was no written consent given by petitioner or
HELD: its representative, EpifanioRamos, Jr., that petitioner is waiving the
NO. Section 2 of R.A. No. 1405, the Law on Secrecy of Bank Deposits confidentiality of its bank deposits. The provision on the waiver of the
enacted in 1955, was first amended by Presidential Decree No. 1792 in confidentiality of petitioner’s bank deposits was merely inserted in the
1981 and further amended by R.A. No. 7653 in 1993. It now reads: agreement. It is clear therefore that petitioner is not bound by the said
provision since it was without the express consent of petitioner who was
SEC. 2. All deposits of whatever nature with banks or banking not a party and signatory to the said agreement.
institutions in the Philippines including investments in bonds
issued by the Government of the Philippines, its political Neither can petitioner be deemed to have given its permission by failure
subdivisions and its instrumentalities, are hereby considered as to interpose its objection during the proceedings. It is an elementary rule
of an absolutely confidential nature and may not be examined, that the existence of a waiver must be positively demonstrated since a
inquired or looked into by any person, government official, waiver by implication is not normally countenanced. The norm is that a
bureau or office, except when the examination is made in the waiver must not only be voluntary, but must have been made knowingly,
course of a special or general examination of a bank and is intelligently, and with sufficient awareness of the relevant circumstances
specifically authorized by the Monetary Board after being and likely consequences. There must be persuasive evidence to show an
satisfied that there is reasonable ground to believe that a bank actual intention to relinquish the right. Mere silence on the part of the
fraud or serious irregularity has been or is being committed and holder of the right should not be construed as a surrender thereof; the
that it is necessary to look into the deposit to establish such fraud courts must indulgeevery reasonable presumption against the existence
or irregularity, or when the examination is made by an and validity of such waiver.
independent auditor hired by the bank to conduct its regular In addition, considering that petitioner was already declared insolvent by
audit provided that the examination is for audit purposes only the RTC, all its property, assets and belongings were ordered delivered to
and the results thereof shall be for the exclusive use of the bank, the appointed receiver or assignee. Thus, in the order of the RTC

appointing Atty. Gonzales as receiver, petitioner was directed to assign
and convey to Atty. Gonzales all its real and personal property, monies, 8. PHILIPPINE SAVINGS BANK et al v.
estate and effects with all the deeds, books and papers relating SENATE IMPEACHMENT COURT
thereto, pursuant to Section 32 of the Insolvency Law. Such assignment
(G.R. No. 200238, February 9, 2012)
shall operate to vest in the assignee all of the estate of the insolvent debtor
not exempt by law from execution. Corollarily, the stipulation in the Joint
Motion to Approve Compromise Agreement that petitioner waives its
right to confidentiality of its bank deposits requires the approval and FACTS:
conformity of Atty. Gonzales as receiver since all the property, money, Philippine Savings Bank (PS Bank) and its President, Pascual M. Garcia III,
estate and effects of petitioner have been assigned and conveyed to filed before the Supreme Court an original civil action for certiorari and
her and she has the right to recover all the estate, assets, debts and claims prohibition with application for temporary restraining order and/or writ
belonging to or due to the insolvent debtor. While it was Atty. Gonzales of preliminary injunction. The TRO was sought to stop the Senate, sitting
who filed the Motion for Parties to Enter IntoCompromise Agreement, she as impeachment court, from further implementing the Subpoena Ad
did not sign or approve the Joint Motion to Approve Agreement submitted Testificandum et Duces Tecum, dated February 6, 2012, that it issued
by TIDCORP and BPI against the Branch Manager of PS Bank, Katipunan Branch. The subpoena
Clearly, the waiver of confidentiality of petitioner’s bank deposits in the assailed by petitioners covers the foreign currency denominated accounts
BPI-TIDCORP Joint Motion to Approve Agreement lacks the required allegedly owned by the impeached Chief Justice Renato Corona of the
written consent of petitioner and conformity of the receiver. We, thus, Philippine Supreme Court.
hold that petitioner is not bound by the said provision. ISSUE:
It is basic in law that a compromise agreement, as a contract, is binding Should a TRO be issued against the impeachment court to enjoin it from
only upon the parties to the compromise, and not upon non-parties. This further implementing the subpoena with respect to the alleged foreign
is the doctrine of relativity of contracts. The rule is based on Article 1311 currency denominated accounts of CJ Corona?
(1) of the Civil Code which provides that “contracts take effect only
between the parties, their assigns and heirs x x x. HELD:
Petition is granted. YES, a TRO should be issued against the impeachment court to enjoin it
from further implementing the subpoena with respect to the alleged
As regards the Joint Motion to Approve Agreement dated July 29, 2011, foreign currency denominated accounts of CJ Corona.
filed by creditors Trade and Investment Development Corporation of the
Philippines and the Bank of the Philippine Islands, with the exception of There are two requisite conditions for the issuance of a preliminary
paragraph 4 and paragraph 5 thereof pertaining to Expenses and Taxes injunction:
and Waiver of Confidentiality, the same is likewise APPROVED, for the (1) the right to be protected exists prima facie, and
same is not contrary to law, morals, good customs, public order or public
policy. (2) the acts sought to be enjoined are violative of that right. It must be
proven that the violation sought to be prevented would cause an
irreparable injustice.

A clear right to maintain the confidentiality of the foreign currency
deposits of the Chief Justice is provided under Section 8 of Republic Act
No. 6426, otherwise known as the Foreign Currency Deposit Act of the
Philippines (RA 6426). This law establishes the absolute confidentiality
of foreign currency deposits.
Under R.A. No. 6426 there is only a single exception to the secrecy of
foreign currency deposits, that is, disclosure is allowed only upon the
written permission of the depositor. In Intengan v. Court of Appeals, the
Court ruled that where the accounts in question are U.S. dollar deposits,
the applicable law is not Republic Act No. 1405 but RA 6426. Similarly, in
the recent case of Government Service Insurance System v. 15th Division
of the Court of Appeals, the Court also held that RA 6426 is the applicable
law for foreign currency deposits and not Republic Act No. 1405.
The written consent under RA 6426 constitutes a waiver of the
depositor’s right to privacy in relation to such deposit. In the present case,
neither the prosecution nor the Impeachment Court has presented any
such written waiver by the alleged depositor, Chief Justice Renato C.
Corona. Also, while impeachment may be an exception to the secrecy of
bank deposits under RA 1405, it is not an exemption to the absolute
confidentiality of foreign currency deposits under RA 6426.

~Nothing follows.~


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This is the gist of the motion of reconsideration in the case at bar.

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