Leyte Land Transpo Co vs Leyte Farmers and Workers

FACTS:
The petitioner contends that the Court of Industrial Relations made a mistake in conceding salary or
wage increases, after being "convinced that the basic salary of P100 for drivers and P80 for conductors is
just taking into consideration the financial condition of the corporation just now," and merely because
such increases will enable the workers "to meet the high cost of living now in Tacloban in order to help
them buy the necessities for a decent livelihood." It is intimated in this connection that the total amount
of the increases, "if added to the crippling losses will throw the Company into bankruptcy."
There can be no doubt about the propriety of the action of the Court of Industrial Relations in taking
into account the "high cost of living" as a factor for determining the reasonableness of any salary or
wage raise, since said court is impliedly empowered to do so under section 20 of Commonwealth Act
No. 103 which provides that "in the hearing, investigation and determination of any question or
controversy and in exercising any duties and power under this Act, the Court shall act according to
justice and equity and substantial merits of the case, without regard to technicalities or legal forms," not
to mention section 5 which provides, in connection with minimum wages for a given industry or in a
given locality, that the court shall fix the same at a rate that "would give the workingmen a just
compensation for their labor and an adequate income to meet the essential necessities of civilized life,
and at the same time allow the capital a fair return on its investment." It cannot be supposed that the
Court of Industrial Relations is powerless to adopt the latter criterion, simply because it is called upon to
fix a minimum wage to be paid by a specific employer, and not by all employers engaged in the
transportation business.

ISSUE:
Whether or not the ruling of the Court of Industrial Relations will allow the petitioner a fair return on its
investments or result in its bankruptcy is a factual inquiry which we are not authorized to make.

RULING:
The authority of the Court of Industrial Relations to order the petitioner to grant its employees and
laborers vacation and sick leaves with pay is clearly included or implied from its general jurisdictions to
consider, investigate, decide and settle all questions, matters, controversies, or disputes arising
between, and/or affecting employers and employees or laborers, and regulate the relations between
them (Commonwealth Act No. 103, section 1, as amended by Commonwealth Act No. 559), and to take
cognizance of any industrial dispute causing or likely to cause a strike or lockout, arising from differences
as regards, among others, wages or conditions of employment. It is needless to remind all employers
that the concession of vacation and sick leaves in the long run redounds to their benefit, for as well
remarked by Professors Watkins and Dood in "Labor Problems" (1940), pages 330-331, quoted in the
memorandum of the respondent Court of Industrial Relations, "when there is an assurance of holidays
and vacations, workers take up their tasks with greater efficiency and tend to sustain their
productiveness for longer periods."
The petitioner alleges that the lower court erred in fixing a scale of salaries, wages and per diems higher
than that adopted by the National Government and its subdivisions. The comparison is rather sad
because, the Government, unlike the petitioner, is not established for profit and mainly derives its
income from the taxes paid by the people. Moreover, we can take judicial notice of the fact that the
Government, within the limits of its finances, has already striven and is still striving to raise and
standardize the salaries and wages of its employees and laborers, especially those in the lower brackets.
Victoriano vs Elizalde

Facts: Plaintiff is a member of the Elizalde Rope Workers Union who later resigned from his affiliation to
the said union by reason of the prohibition of his religion for its members to become affiliated with any
labor organization. The union has subsisting closed shop agreement in their collective bargaining
agreement with their employer that all permanent employees of the company must be a member of the
union and later was amended by Republic Act No. 3350 with the provision stating "but such agreement
shall not cover members of any religious sects which prohibit affiliation of their members in any such
labor organization".. By his resignation, the union wrote a letter to the company to separate the plaintiff
from the service after which he was informed by the company that unless he makes a satisfactory
arrangement with the union he will be dismissed from the service. The union contends that RA 3350
impairs obligation of contract stipulated in their CBA and discriminatorily favors religious sects in
providing exemption to be affiliated with any labor unions.

Issue: WON RA 3350 impairs the right to form association.

Held: The court held that what the Constitution and the Industrial Peace Act recognize and guarantee is
the "right" to form or join associations which involves two broad notions, namely: first, liberty or
freedom, i.e., the absence of legal restraint, whereby an employee may act for himself without being
prevented by law; and second, power, whereby an employee may join or refrain from joining an
association. Therefore the right to join a union includes the right to abstain from joining any union. The
exceptions provided by the assailed Republic Act is that members of said religious sects cannot be
compelled or coerced to join labor unions even when said unions have closed shop agreements with the
employers; that in spite of any closed shop agreement, members of said religious sects cannot be
refused employment or dismissed from their jobs on the sole ground that they are not members of the
collective bargaining union. Thus this exception does not infringe upon the constitutional provision on
freedom of association but instead reinforces it.
Alalayan vs. NAPOCOR

Alalayan and the Philippine Power and Development Company assails the power vested in NAPOCOR
that "in any contract for the supply of electric power to a franchise holder," receiving at least 50% of its
electric power and energy from it to require as a condition that such franchise holder "shall not realize a
net profit of more than twelve percent annually of its investments plus two-month operating expenses."
Also it could “renew all existing contracts with franchise holders for the supply of electric power and
energy,". This is all in pursuant to RA 3043 and the amendments it offered to RA 2641. Alalayan and
PPDC are contractors with NAPOCOR. They are re-suppliers of power produced by NAPOCOR. They aver
that the provision of the said RA is a rider in only meant to increase the capital stock of NAPOCOR.

ISSUE:
Whether or not RA 3043 is constitutional.

HELD:
No bill "which may be enacted into law shall embrace more than one subject which shall be expressed in
[its] title . . ." This provision is similar to those found in many American State Constitutions. It is aimed
against the evils of the so-called omnibus bills as log-rolling legislation as well as surreptitious or
unconsidered enactments. Where the subject of a bill is limited to a particular matter, the lawmakers
along with the people should be informed of the subject of proposed legislative measures. This
constitutional provision thus precludes the insertion of riders in legislation, a rider being a provision not
germane to the subject matter of the bill. Alalayan asserts that the provision objected to is such a rider.

To lend approval to such a plea is to construe the above constitutional provision as to cripple or impede
proper legislation. To impart to it a meaning which is reasonable and not unduly technical, it must be
deemed sufficient that the title be comprehensive enough reasonably to include the general object
which the statute seeks to effect without expressing each and every end and means necessary for its
accomplishment. Thus, mere details need not be set forth. The legislature is not required to make the
title of the act a complete index of its contents. The provision merely calls for all parts of an act relating
to its subject finding expression in its title. More specifically, if the law amends a section or part of a
statute, it suffices if reference be made to the legislation to be amended, there being no need to state
the precise nature of the amendment. "Of course, the Constitution does not require Congress to employ
in the title of an enactment, language of such precision as to mirror, fully index or catalogue all the
contents and the minute details therein. It suffices if the title should serve the purpose of the
constitutional demand that it inform the legislators, the persons interested in the subject of the bill, and
the public, of the nature, scope and consequences of the proposed law and its operation. And this, to
lead them to inquire into the body of the bill, study and discuss the same, take appropriate action
thereon, and, thus, prevent surprise or fraud upon the legislators."
EMPLOYERS CONFEDERATION OF THE PHILIPPINES vs. NATIONAL WAGES

Facts:
On October 15, 1990, the Regional Board of the National Capital Region issued Wage Order No. NCR-01,
increasing the minimum wage by P17.00 daily in the National Capital Region. The Trade Union Congress
of the Philippines (TUCP) moved for reconsideration; so did the Personnel Management Association of
the Philippines (PMAP). ECOP opposed.
On October 23, 1990, the Board issued Wage Order No. NCR01-A, amending Wage Order No. NCR-01. It
provides that all workers and employees in the private sector in the National Capital Region already
receiving wages above the statutory minimum wage rates up to one hundred and twenty-five pesos
(P125.00) per day shall also receive an increase of seventeen pesos (P17.00) per day.
ECOP appealed to the National Wages and Productivity Commission contending that the board's grant of
an "across-the-board" wage increase to workers already being paid more than existing minimum wage
rates (up to P125.00 a day) as an alleged excess of authority. ECOP further alleges that under the
Republic Act No. 6727, the boards may only prescribe "minimum wages," not determine "salary
ceilings." ECOP likewise claims that Republic Act No. 6727 is meant to promote collective bargaining as
the primary mode of settling wages, and in its opinion, the boards can not preempt collective bargaining
agreements by establishing ceilings.
On November 6, 1990, the Commission promulgated an Order, dismissing the appeal for lack of merit.
On November 14, 1990, the Commission denied reconsideration. ECOP then, elevated the case via
petition for review on certiorari to the Supreme Court.

Issue:
The main issue in this case is whether Wage Order No. NCR-01-A providing for new wage rates, as well
as authorizing various Regional Tripartite Wages and Productivity Boards to prescribe minimum wage
rates for all workers in the various regions, and for a National Wages and Productivity Commission to
review, among other functions, wage levels determined by the boards is valid.

Ruling:
The Supreme Court ruled in favor of the National Wages and Productivity Commission and Regional
Tripartite Wages and Productivity Board-NCR, Trade Union Congress of the Philippines and denied the
petition of ECOP.
The Supreme Court held that Republic Act No. 6727 was intended to rationalize wages, first, by
providing for full-time boards to police wages round-the-clock, and second, by giving the boards enough
powers to achieve this objective. The Court is of the opinion that Congress meant the boards to be
creative in resolving the annual question of wages without labor and management knocking on the
legislature's door at every turn.
The Court's opinion is that if Republic No. 6727 intended the boards alone to set floor wages, the Act
would have no need for a board but an accountant to keep track of the latest consumer price index, or
better, would have Congress done it as the need arises, as the legislature, prior to the Act, has done so
for years. The fact of the matter is that the Act sought a "thinking" group of men and women bound by
statutory standards. The Court is not convinced that the Regional Board of the National Capital Region,
in decreeing an across-the-board hike, performed an unlawful act of legislation. It is true that wage-
firing, like rate-fixing, constitutes an act Congress; it is also true, however, that Congress may delegate
the power to fix rates provided that, as in all delegations cases, Congress leaves sufficient standards. As
this Court has indicated, it is impressed that the above-quoted standards are sufficient, and in the light
of the floor-wage method's failure, the Court believes that the Commission correctly upheld the
Regional Board of the National Capital Region.
PHILIPPINE AIRLINES vs. NLRC et al

FACTS:
On March 15, 1985, the Philippine Airlines, Inc. (PAL) completely revised its 1966 Code of Discipline. The
Code was circulated among the employees and was immediately implemented, and some employees
were forthwith subjected to the disciplinary measures embodied therein.
on August 20, 1985, the Philippine Airlines Employees Association (PALEA) filed a complaint before the
National Labor Relations Commission (NLRC) for unfair labor practice with the following remarks: “ULP
with arbitrary implementation of PAL’s Code of Discipline without notice and prior discussion with Union
by Management”. In its position paper, PALEA contended that PAL, by its unilateral implementation of
the Code, was guilty of unfair labor practice, specifically Paragraphs E and G of Article 249 and Article
253 of the Labor Code. PALEA alleged that copies of the Code had been circulated in limited numbers;
that being penal in nature the Code must conform with the requirements of sufficient publication, and
that the Code was arbitrary, oppressive, and prejudicial to the rights of the employees. It prayed that
implementation of the Code be held in abeyance; that PAL should discuss the substance of the Code
with PALEA; that employees dismissed under the Code be reinstated and their cases subjected to further
hearing; and that PAL be declared guilty of unfair labor practice and be ordered to pay damages.
PAL filed a motion to dismiss the complaint, asserting its prerogative as an employer to prescibe rules
and regulations regarding employess’ conduct in carrying out their duties and functions, and alleging
that by implementing the Code, it had not violated the collective bargaining agreement (CBA) or any
provision of the Labor Code.
Labor Arbiter Isabel P. Ortiguerra handling the case called the parties to a conference but they failed to
appear at the scheduled date. Interpreting such failure as a waiver of the parties’ right to present
evidence, the labor arbiter considered the case submitted for decision. On November 7, 1986, a decision
was rendered finding no bad faith on the part of PAL in adopting the Code and ruling that no unfair labor
practice had been committed. However, the arbiter held that PAL was “not totally fault free”
considering that while the issuance of rules and regulations governing the conduct of employees is a
“legitimate management prerogative” such rules and regulations must meet the test of
“reasonableness, propriety and fairness.”
PAL appealed to the NLRC. On August 19, 1988, the NLRC through Commissioner Encarnacion, with
Presiding Commissioner Bonto-Perez and Commissioner Maglaya concurring, found no evidence of
unfair labor practice committed by PAL and affirmed the dismissal of PALEA’s charge.
PAL then filed the instant petition for certiorari charging public respondents with grave abuse of
discretion

ISSUE:
whether management may be compelled to share with the union or its employees its prerogative of
formulating a code of discipline.

HELD:
Indeed, it was only on March 2, 1989, with the approval of Republic Act No. 6715, amending Article 211
of the Labor Code, that the law explicitly considered it a State policy “(t)o ensure the participation of
workers in decision and policy-making processes affecting the rights, duties and welfare.” However,
even in the absence of said clear provision of law, the exercise of management prerogatives was never
considered boundless.
BREWMASTER INTERNATIONAL INC. v. NAFLU

FACTS:
Private respondent Estrada is a member of the respondent labor union. He did not report for work for 1
month due to a grave family problem as his wife deserted him and nobody was there to look after his
children. He was required to explain. Finding his reasons to be unjustified, the petitioner terminated
him, since according to company rules, absence for 6 consecutive days is considered abandonment of
work.

ISSUE:
Should a worker be summarily dismissed relying on some company rules?

HELD:
No. While the employer is not precluded from prescribing rules and regulations to govern the conduct of
his employees, these rules and their implementation must be fair, just and reasonable. No less than the
Constitution looks with compassion on the workingman and protects his rights not only under a general
statement of a state policy but under the Article on Social Justice and Human Rights, thus placing labor
contracts on a higher plane and with greater safeguards. Verily, relations between labor and capital are
not merely contractual. They are impressed with public interest and labor contracts must, perforce,
yield to the common good.
PT&T vs NLRC

FACTS:
PT&T (Philippine Telegraph & Telephone Company) initially hired Grace de Guzman specifically as
“Supernumerary Project Worker”, for a fixed period from November 21, 1990 until April 20, 1991 as
reliever for C.F. Tenorio who went on maternity leave. She was again invited for employment as
replacement of Erlina F. Dizon who went on leave on 2 periods, from June 10, 1991 to July 1, 1991 and
July 19, 1991 to August 8, 1991.
On September 2, 1991, de Guzman was again asked to join PT&T as a probationary employee where
probationary period will cover 150 days. She indicated in the portion of the job application form under
civil status that she was single although she had contracted marriage a few months earlier. When
petitioner learned later about the marriage, its branch supervisor, Delia M. Oficial, sent de Guzman a
memorandum requiring her to explain the discrepancy. Included in the memorandum, was a reminder
about the company’s policy of not accepting married women for employment. She was dismissed from
the company effective January 29, 1992. Labor Arbiter handed down decision on November 23, 1993
declaring that petitioner illegally dismissed De Guzman, who had already gained the status of a regular
employee. Furthermore, it was apparent that she had been discriminated on account of her having
contracted marriage in violation of company policies.

ISSUE:
Whether the alleged concealment of civil status can be grounds to terminate the services of an
employee.

HELD:
Article 136 of the Labor Code, one of the protective laws for women, explicitly prohibits discrimination
merely by reason of marriage of a female employee. It is recognized that company is free to regulate
manpower and employment from hiring to firing, according to their discretion and best business
judgment, except in those cases of unlawful discrimination or those provided by law.
PT&T’s policy of not accepting or disqualifying from work any woman worker who contracts marriage is
afoul of the right against discrimination provided to all women workers by our labor laws and by our
Constitution. The record discloses clearly that de Guzman’s ties with PT&T were dissolved principally
because of the company’s policy that married women are not qualified for employment in the company,
and not merely because of her supposed acts of dishonesty.The government abhors any stipulation or
policy in the nature adopted by PT&T. As stated in the labor code:
“ART. 136. Stipulation against marriage. — It shall be unlawful for an employer to require as a condition
of employment or continuation of employment that a woman shall not get married, or to stipulate
expressly or tacitly that upon getting married, a woman employee shall be deemed resigned or
separated, or to actually dismiss, discharge, discriminate or otherwise prejudice a woman employee
merely by reason of marriage.”
The policy of PT&T is in derogation of the provisions stated in Art.136 of the Labor Code on the right of a
woman to be free from any kind of stipulation against marriage in connection with her employment and
it likewise is contrary to good morals and public policy, depriving a woman of her freedom to choose her
status, a privilege that is inherent in an individual as an intangible and inalienable right. The kind of
policy followed by PT&T strikes at the very essence, ideals and purpose of marriage as an inviolable
social institution and ultimately, family as the foundation of the nation. Such policy must be prohibited
in all its indirect, disguised or dissembled forms as discriminatory conduct derogatory of the laws of the
land not only for order but also imperatively required.
General Bank and Trust vs CA

Facts:
". . . this case starts with the employment of plaintiff-appellee with the Cebu Branch of the First National
City Bank of New York for 18 years, where he rose to the position of Chief Clerk, Accounting Department
(Exhibit O); that on January 11, 1965, plaintiff-appellee joined the defendant bank in its Cebu branch as
accountant with an annual compensation of P6,000.00 (Exhibit A); that on April 26, 1965, the Cebu
Branch of defendant bank began operating and doing business with the public; that on January 1, 1966,
plaintiff received an increase of P50.00 bringing his monthly salary to P550.00 (Exhibit D); that on April
11, 1967 defendant bank appointed the plaintiff to the position of Acting Manager of its Cebu Branch,
with the corresponding increase of salary to P700.00 a month (Exhibit E); that effective September 1,
1967, defendant bank granted plaintiff a monthly housing allowance of P200.00 in addition to his
monthly salary (Exhibit F); that on October 3, 1967 defendant bank appointed plaintiff as the regular
Manager of its Cebu Branch (Exhibit G) effective May 1, 1968; that defendant bank increased plaintiff’s
salary to P800.00 a month (Exhibit H); that on May 16, 1969 while the plaintiff was on vacation leave, he
happened to visit the bank and learned that three tellers of defendant bank’s branch in Cebu City,
namely, Miss Crystal Enriquez, Miss Yolanda Chu, and Miss Sonia Chiu, had been transferred to the head
office in Manila by defendant Jose D. Santos; that the plaintiff went to Manila on May 18, 1969 to make
personal representation with the head office for the retention of the said tellers in Cebu; that on May
26, 1969 the plaintiff reported back for duty with defendant bank’s branch in Cebu and reinstated
immediately the three tellers to their respective positions in the Cebu branch of defendant bark; that on
May 28, 1969 defendant Jose D, Santos submitted a report to defendant Salvador D. Tenorio alleging
that there was excess personnel in the Cebu Branch; that on the same date defendant Jose D. Santos
submitted a supplementary report to defendant Salvador D. Tenorio charging the plaintiff of over-
appraising the real estate offered by Domingo Chua as collateral for his credit accommodation (Exhibit
34); that defendant Salvador D. Tenorio immediately dispatched a letter to the plaintiff dated May 30,
1969 requiring him to explain within twenty-four hours why no disciplinary action should be taken
against him for alleged repeated violation of defendant bank’s policies and directives regarding credit
accommodations and for over-appraisal of the real estate collateral for Domingo Chua’s account, among
others (Exhibit 8); that on June 6, 1969, the plaintiff received the said letter of defendant Salvador D.
Tenorio but found it impossible to render the required explanation in 24 hours; that on June 19, 1969
defendant Jose D. Santos went to Cebu City and served plaintiff with the letter of defendant Salvador D.
Tenorio, dated June 18, 1969, suspending the plaintiff; and that on July 22, 1969 plaintiff was served
with the order of his termination signed by defendant Clarencio S. Yujuico, dated July 18, 1969."

ISSUE:
Whether or not the dismissal of Manuel E. Batucan was justified on the ground that he repeatedly failed
to uphold the interests of the bank thus leading to his employer’s loss of confidence on him.

HELD:
After a careful review of the case, we find no error in the finding of the Court of Appeals that Mr.
Batucan was indeed illegally dismissed.
Mr. Batucan left a stable job with a reputable bank to join the petitioner bank. He had been an
employee of the First National City Bank of New York for eighteen (18) years. Undoubtedly, before he
accepted petitioner Tenorio’s invitation, he must have thought the matter over several times. And from
the time he joined the petitioner bank, the records show that Mr. Batucan has indeed worked his way
up from accountant to permanent branch manager of the bank. During his term as manager, he was
able to increase the income and resources of the bank. He raised the image of petitioner bank in the
business and banking community and placed its operations on a good and competitive basis. His
peremptory dismissal from the bank was certainly a shock to him and damaged his moral feelings and
personal pride after all the loyalty and hard work he had dedicated to the bank.
We quote with favor the finding of the respondent Court, to wit:
"The evidence shows that the individual defendants acted jointly in causing the illegal and unjustifiable
dismissal of the plaintiff-appellee. Hence, the trial court is correct in holding the individual defendants
jointly and severally liable to the plaintiff-appellee."
Star Paper Corporation vs. Ronaldo Simbol

FACTS:
Simbol was employed by the company and met a co-
employee and they eventually had a relationship and got married. Prior to the marriage, the manager ad
vise the couple that should they decide to get married, one of them should resign pursuant to a compan
y policy: 1) new applicant will not be allowed to be hired if he/she has a relative, up to 3rd degree of con
sanguinity, already employed by the company. 2) if the two employees got married, one of them should
resign to preserve the policy stated first. Simbol resigned.

ISSUE:
Whether or not the policy of the employer banning spouse from working in the same company, a valid e
xercise of management prerogative.

RULING:
No, it is not a valid exercise of management prerogative and violates the rights of employees under the c
onstitution. The case at bar involves Article 136 of the Labor Code which provides “it shall be unlawful fo
r an employer to require as a condition of employment or continuation of employment that a woman e
mployee shall not get married, or to stipulate expressly or tacitly that upon getting married, a woman e
mployee shall be deemed resigned or separated , or to actually dismiss, discharge , discriminate or other
wise prejudice a woman employee merely by reason of her marriage.” The company policy of Star Paper
, to be upheld, must clearly establish the requirement of reasonableness. In the case at bar, there was n
o reasonable business necessity. Petitioners failed to show how the marriage of Simbol, then a Sheeting
Machine Operator, to Alma Dayrit, then an employee of the Repacking Section, could be detrimental to i
ts business operations. The questioned policy may not facially violate Article 136 of the Labor Code but it
creates a disproportionate effect and under the disparate impact theory, the only way it could pass judi
cial scrutiny is a showing that it is reasonable despite the discriminatory, albeit disproportionate, effect.
Lastly, the absence of a statute expressly prohibiting marital discrimination in our jurisdiction cannot be
nefit the petitioners.
Firestone Tire & Rubber Co. of the Phils. vs., Court of Appeals

FACTS:
Fojas-Arca Enterprises Company maintained a special account with respondent Luzon Development
Bank which authorized and allowed the former to withdraw funds from its account through the medium
of special withdrawal slips. Fojas-Arca purchased on credit products from Firestone with a total amount
of P4,896,000.00. In payment of these purchases, Fojas-Arca delivered to plaintiff six special withdrawal
slips drawn upon the respondent bank. In turn, these were deposited by the plaintiff with its current
account with the Citibank. All of them were honored and paid by the Luzon Development
Bank. However, in a subsequent transaction involving the payment of withdrawal slips by Fojas-Arca for
purchases on credit from petitioner, two withdrawal slips for the total sum of P2,078,092.80 were
dishonored and not paid by respondent bank for the reason “NO ARRANGEMENT”.
As a consequence, the Citibank debited Firestone’s account for the total sum of P2,078,092.80
representing the aggregate amount of the above-two special withdrawal slips. Under such situation,
plaintiff averred that the pecuniary losses it suffered is caused by and directly attributable to defendants
gross negligence. Hence, Firestone filed a case before the RTC, but such was dismissed. The case was
appealed by the CA.

ISSUE:
Whether or not the acceptance and payment of the special withdrawal slips gives the impression that it
is a negotiable instrument like a check?

HELD:
No.
The essence of negotiability which characterizes a negotiable paper as a credit instrument lies in its
freedom to circulate freely as a substitute for money. The withdrawal slips in question lacked this
character. As the withdrawal slips in question were non-negotiable, the rules governing the giving of
immediate notice of dishonor of negotiable instruments do not apply.
The respondent bank was under no obligation to give immediate notice that it would not make payment
on the subject withdrawal slips. Citibank should have known that withdrawal slips were not negotiable
instruments. It could not expect these slips to be treated as checks by other entities. Payment or notice
of dishonor from respondent bank could not be expected immediately, in contrast to the situation
involving checks. Citibank was not bound to accept the withdrawal slips as a valid mode of deposit. But
having erroneously accepted them as such, Citibank – and petitioner as account-holder – must bear the
risks attendant to the acceptance of these instruments.
It bears stressing that Citibank could not have missed the non-negotiable nature of the withdrawal slips.
The essence of negotiability which characterizes a negotiable paper as a credit instrument lies in its
freedom to circulate freely as a substitute for money. The withdrawal slips in question lacked this
character.
A bank is under obligation to treat the accounts of its depositors with meticulous care, whether such
account consists only of a few hundred pesos or of millions of pesos. The fact that the other withdrawal
slips were honored and paid by respondent bank was no license for Citibank to presume that
subsequent slips would be honored and paid immediately. By doing so, it failed in its fiduciary duty to
treat the accounts of its clients with the highest degree of care.