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CHING V NICDAO (Completion and Delivery) Khalil Facts: Nicdao was charged eleven (11) counts of violation of Batas Pambansa Bilang (BP) 22. MTC found her guilty of said offenses. RTC affirmed. Nicdao filed an appeal to the Court of Appeals. CA reversed the decision and acquitted accused. Ching is now appealing the civil aspect of the case to the Supreme Court. Ching vigorously argues that notwithstanding respondent Nicdaos acquittal by the CA, the Supreme Court has the jurisdiction and authority to resolve and rule on her civil liability. He anchors his contention on Rule 111, Sec 1B: The criminal action for violation of Batas Pambansa Blg. 22 shall be deemed to necessarily include the corresponding civil action, and no reservation to file such civil action separately shall be allowed or recognized. Moreover, under the above-quoted provision, the criminal action for violation of BP 22 necessarily includes the corresponding civil action, which is the recovery of the amount of the dishonored check representing the civil obligation of the drawer to the payee. Nicdaos defense: Sec 2 of Rule 111 Except in the cases provided for in Section 3 hereof, after the criminal action has been commenced, the civil action which has been reserved cannot be instituted until final judgment in the criminal action. According to her, CAs decision is equivalent to a finding that the facts upon which her civil liability may arise do not exist. The instant petition, which seeks to enforce her civil liability based on the eleven (11) checks, is thus allegedly already barred by the final and executory decision acquitting her. Statement of the case: This is a petition for review on certiorari filed by Samson Ching of the Decision dated November 22, 1999 of the Court of Appeals (CA) in CA-G.R. CR No. 23055. Which rooted from 11 informations filed for violation of BP 22 from the Municipal Trial Court in Bataan against the respondent. Issue: 1. WON Ching may appeal the civil aspect of the case within the reglementary period? 2. WON Nicdao is civilly liable? Ruling: 1. Ching is entitled to appeal the civil aspect of the case within the reglementary period. Every person criminally liable for a felony is also civilly liable. Extinctio n of the penal action does not carry with it extinction of the civil, unless the extinction proceeds from a declaration in a final judgment that the fact from which the civil might arise did not exist. Petitioner Ching correctly argued that he, as the offended party, may appeal the civil aspect of the case notwithstanding respondent Nicdaos acquittal by the CA. The civil action was impliedly instituted with the criminal action since he did not reserve his right to institute it separately nor did he institute the civil action prior to the criminal action. If the accused is acquitted on reasonable doubt but the court renders judgment on the civil aspect of the criminal case, the prosecution cannot appeal from the judgment of acquittal as it would place the accused in double jeopardy. However, the aggrieved party, the offended party or the accused or both may appeal from the judgment on the civil aspect of the case within the period therefore. Civil liability is not extinguished by acquittal: 1. where the acquittal is based on reasonable doubt; 2. where the court expressly declares that the liability of the accused is not criminal but only civil in nature; and

3. where the civil liability is not derived from or based on the criminal act of which the accused is acquitted. 2. A painstaking review of the case leads to the conclusion that respondent Nicdaos acquittal likewise carried with it the extinction of the action to enforce her civil liability. There is simply no basis to hold respondent Nicdao civilly liable to petitioner Ching. CAs acquittal of respondent Nicdao is not merely based on reasonable doubt. Rather, it is based on the finding that she did not commit the act penalized under BP 22. In particular, the CA found that the P20,000,000.00 check was a stolen check which was never issued nor delivered by respondent Nicdao to petitioner Ching. 2. BPI V CASA MONTESSORI and YABUT (Forgery) Em Statement of the Case:These are petitions for review assailing the March 23, 2001 Decision and August 17, 2001 Resolution of the Court of Appeals (CA). Whereby the decision affirmed forgery of the checks and made the plaintiffs liable. Facts: On November 8, 1982, plaintiff CASA Montessori Internationalopened Current Account No. 0291-008101 with defendant Bank of the Philippine Islands(BPI) with CASAs President Ms. Ma. Carina C. Lebron as one of its authorized signatories. In 1991, after conducting an investigation, plaintiff discovered that nine (9) of its checks had been encashed by a certain Sonny D. Santos since 1990 in the total amount of P782,000.00. It turned out that Sonny D. Santos with account at BPIs Greenbelt Branch *was+ a fictitious name used by third party defendant Leonardo T. Yabut who worked as external auditor of CASA. Third party defendant voluntarily admitted that he forged the signature of Ms. Lebron and encashed the checks. The PNP Crime Laboratory conducted an examination of the nine (9) checks and concluded that the handwritings thereon compared to the standard signature of Ms. Lebron were not written by the latter. On March 4, 1991, plaintiff filed the herein Complaint for Collection with Damages against defendant bank praying that the latter be ordered to reinstate the amount of P782,500.00 in the current and savings accounts of the plaintiff with interest at 6% per annum. Regional Trial Court (RTC) granted the Complaint for Collection with Damages against BPI ordering to reinstate the amount in account, with interest. CA took account of CASAs contributory negligence and apportioned the loss between the CASA and BPI, ordered Yabut to reimburse both. However, BPI contends that the monthly statements it issues to its clients contain a notice worded as follows: if no error is reported in 10 days, account will be correct and as such, it should be considered a waiver. Issue: Whether or not forged signature wholly inoperative. Ruling: In accordance with Section 23 of Negotiable Instrument Law forged signature is wholly inoperative. The admission of the perpetrator and the verification of the PNP of the forgery concluded that the signatures were not hers. A forged signature is a real or absolute defense, and a person whose signature on a negotiable instrument is forged is deemed to have never become a party thereto and to have never consented to the contract that allegedly gave rise to it. The counterfeiting of any writing, consisting in the signing of anothers name with intent to defraud is forger.

3. TIMBAL V CA (Postdating/Antedating) Benn Statement of the Case: This is a petition for review filed by the Petitioner appealing the Court of Appeals decision affirming in toto the decision of the Regional Trial Court of Quezon City convicting him of the crime of Estafa. Facts: Pio Timbal and his wife Marites Timbal were charged with the crime of estafa. In the information filed with the Regional Trial Court, they have been accused of conspiring willfully, unlawfully and feloniously to defraud a certain Judy Bigorn. It has been alleged that the said accused knowing that there have been insufficiency in their bank funds issued a postdated check in the amount of 80,716. The check was dated February 22, 1994 or ten days after the transaction. The check was then dishonored upon presentation to the bank by reason of that the account was closed. Notice was given to Maritess Timbla but there was still refusal to pay. The Regional Trial Court convicted Pio Timbal and Marites Timbal with the crime of estafa. Aggrieved, Pio Timbal brought this petition for appeal. The petitioner maintains his innocence and argues that his mere presence at the time of the issuance by his wife of the dishonored check, even if true, would not be sufficient to establish the existence of conspiracy absent any piece of evidence that might indicate his having taken part, enticed or persuaded Bigornia to receive the check in payment for the goods delivered by her. Issue: Whether or not the petition is with merit Held: Yes, the petition has merit. In order to constitute estafa under the statutory provisions, the act of postdating or of issuing a check in payment of an obligation must be the efficient cause of the defraudation; accordingly, it should be either prior to or simultaneous with the act of fraud. In fine, the offender must be able to obtain money or property from the offended party by reason of the issuance, whether postdated or not, of the check. It must be shown that the person to whom the check is delivered would not have parted with his money or property were it not for the issuance of the check by the other party. The decision of the trial court, as well as that of the appellate court, would reveal that the main basis used in convicting petitioner was the fact of his presence at the time of the issuance of the check by his wife. Nothing else was shown nor reflected in the appealed decision that could indicate any overt act on the part of petitioner that would even remotely suggest that he had a hand in dealing with Bigornia. Appellant's mere presence at the scene of a crime would not by itself establish conspiracy, absent any evidence that he, by an act or series of acts, participated in the commission of fraud to the damage of the complainant. 4. BATAAN CIGAR V CA and STATE INVESTMENT HOUSE (Consideration/CrossedCheck/Discharge) Alman Facts: Bataan Cigar & Cigarette Factory, Inc. engaged one of its suppliers, King Tim Pua George to deliver 2,000 bales of tobacco leaf starting October 1978. BCCFI, on July 13, 1978 issued crossed checks post dated sometime in March 1979 in the total amount of P820,000.00. Relying on the supplier's representation that he would complete delivery within three months from December 5, 1978, petitioner agreed to purchase additional 2,500 bales of tobacco leaves, despite the supplier's failure to deliver in accordance with their earlier agreement. Again petitioner issued post dated crossed checks in the total amount of P1,100,000.00, payable sometime in September 1979.

George King failed to deliver the bales of tobacco leaf as agreed despite petitioner's demand, BCCFI issued on March 30, 1979, a stop payment order on all checks payable to George King Efforts of SIHI to collect from BCCFI failed, the trial court pronounced SIHI as having a valid claim being a holder in due course. Which was affirmed by the CA. Statement of the Case: This is a review of the decision from the Court of Appeals which affirmed the decision of the Regional Trial Court. Issue: Whether or not SIHI, a second indorser, a holder of crossed checks, is a holder in due course, to be able to collect from the drawer, BCCFI? Ruling: Crossing of a check should have the following effects: (a) the check may not be encashed but only deposited in the bank; (b) the check may be negotiated only once to one who has an account with a bank; (c) and the act of crossing the check serves as warning to the holder that the check has been issued for a definite purpose so that he must inquire if he has received the check pursuant to that purpose, otherwise, he is not a holder in due course

BCCFI's defense in stopping payment is as good to SIHI as it is to George King. Because, really, the checks were issued with the intention that George King would supply BCCFI with the bales of tobacco leaf. There being failure of consideration, SIHI is not a holder in due course.

5. PEOPLE V HERNANDO (Reasonable Time for Deposit) Phy STATEMENT OF FACTS: Spouses Elpidio and Elena Hernando who were engaged in the importation and sale of Apple and IBM Computers, borrowed money from complainant Johnny Sy was the owner of Palomino Club, of which the spouses were good customers. Out of "pakikisama" and because of Elpidio Hernando's assurances that the checks issued by his wife Elena Aban Hernando from her current account with the Union Bank were good checks, complainant was induced to give money in the exchange for the checks. The simultaneous exchange of cash and checks took place on five (5) different dates between May 11, 1995 to June 21, 1995, which amounted to P700,000.00. Sometime in second week of July 1995, Elena requested Johnny not to deposit the checks because Elpidio would pay them in cash. However, Elpidio failed to redeem the checks. When Johnny deposited the checks sometime on July 28, 1995, with Equitable Banking Corporation, they were dishonored because the account from which the checks were drawn had been closed on July 18, 1995 due to overdraft. On the day that the account was closed, it indicated a zero balance. Checks that were issued to Johnny were all dishonored upon presentment for payment to the bank because the account had been closed. In December 1995, Johnny called Elpidio over the telephone and demanded payment. Instead of paying, Elpidio told complainant to "just wait." Complainant Johnny Sy waited (10) months for accused spouses to pay. However, accused spouses failed to pay the value of the five checks, prompting Johnny to file the complaint for Estafa. STATEMENT OF THE CASE: On September 20, 1995, complainant Johnny Sy filed with the Office of the City Prosecutor, Manila, a complaint-affidavit against accused spousesalleging that the checks they issued to him were dishonored due to "Account Closed," later the Assistant Prosecutor filed with the Regional Trial Court, Manila, an information charging accused spouses with Estafa. Accused spouses were arraigned before the trial court and both pleaded not guilty to the information. Trial, thereafter, ensued. The trial court found accused spouses guilty beyond reasonable

doubt of Estafa, and were ordered to indemnify complainant, Johnny Sy, the sum of P700,000.00 representing the value of the checks, and accused spouses were committed to custody. On June 20, 1996, accused spouses filed with the trial court a notice of appeal. On appeal, the Court of Appeals, affirmed the trial courts judgment. Hence, this petition for Certiorari. ISSUE: Can the accused spouses raise as a defense that the Complainant didnt deposit the checks within a reasonable time, thus amounting to his own detriment? RULING: No. The failure of the complainant to immediately deposit with the bank the five checks issued by Elena cannot be used as a defense by accused spouses. Johnny was prevailed upon by Elena not to deposit the checks because Elpidio would pay him in cash. This should not be taken against complainant. The Court AFFIRMED the decision of the trial court finding accused spouses Elpidio Hernando and Elena Aban Hernando guilty beyond reasonable doubt of Estafa, defined and penalized under Article 315, paragraph 2 (d) of the Revised Penal Code, and sentenced each of them to suffer an indeterminate penalty of twelve (12) years of prision mayor, as minimum, to thirty (30) years of reclusion perpetua, as maximum, and to indemnify complainant Johnny Sy in the amount of P700,000.00. Costs in both instances against accused-appellants.

6. PACHECO V CA (Reasonable Time/Agreement not to Encash) Megan FACTS: Petitioner spouses are engaged in the construction business while complainant spouses, a former Judge Romualdo Vicencio and his wife, own a pawnshop. Due to financial difficulties from the repeated delays in the payment of their receivables for construction projects from DPWH, petitioners were constrained to obtain a loan from Mrs. Vicencio. Instead of merely requiring a note of indebtedness, Mr. Vincencio required petitioners to issue an undated check as evidence of the loan. Despite being informed by the petitioners that their bank account no longer had any funds, complainant spouses insisted that they should issue the check, which according to Mrs. Vicencio, it was only a formality. Thereafter, petitioner obtained three more loans from complainants and issued five checks. A total of six undated checks from petitioner representing their obligation to pay to complainant were issued with the assurance that the checks shall not be presented for payment but stand only as evidence of indebtedness in lieu of the usual promissory note. Petitioners were unable to pay in full leaving a balance of P15, 000. When the balance on the loans became due and demandable, three years later, complainant spouses insisted that petitioners should place a date on the undated checks so that it will become evidence of their indebtedness. Petitioner reluctantly complied. Later, petitioners received a demand letter from complainant that the checks were dishonored due to Account Closed and that two informations for estafa were filed against them. Issue: Whether or not petitioner spouses are guilty of estafa. Held: No. The elements of estafa are not present in this case. Also, a check has the character of negotiability. It constitutes an evidence of indebtedness. By mutual agreement of the parties, the negotiable character of a check may be waived and the instrument may be treated as simply as proof of an obligation. There cannot be deceit on the part of the petitioners because they agree with the complainants at the tine if the issuance and postdating of the checks that the same shall not be encashed or presented to the banks. The checks became a mere evidence of indebtedness and that a drawer who issues a check as security or evidence of investment is not liable for estafa. Furthermore, complainant cannot invoke that she has been deceived or defrauded because she was fully informed that the petitioners no longer have funds in their accounts.

A check must also be presented within reasonable tine from issue. By current banking practice, a check becomes stale after more than six months. In this case, the checks were issued more than three years prior to their presentment

7. EUSEBIO V PCIB (Solidary/Several Liabaility of Two or More Signatories / Liability of Parties) Josh STATEMENT OF THE CASE: -Appeal via a Petition for Review on Certiorari under Rule 45 from the Decision dated October 22, 2007 of the Court of Appeals (CA) in CA-G.R. CV. No. 74466, which denied Eusebio Gonzales appeal from the December 10, 2001 decision in Civil Case No. 99-1324 of the Regional Trial Court FACTS: Gonzales was a client of PCIB. He opened a credit line with PCIB and was granted the same; the accounts of Gonzales were put up as collateral for the credit line, including his foreign currency deposit account. Gonzales and his wife obtained a loan of PhP 500,000 from PCIB, subsequently the Spouses Panlilio obtained two loans amounting to PhP 1,000,000 and PhP 300,000. These three loans were covered by promissory notes signed by Gonzales and the Spouses Panlilio secured by a Real Estate Mortgage. Spouses Panlilio defaulted in its obligation which, in due time, resulted in the termination of the credit line of Gonzales. Gonzales gave a check to Unson for PhP 250,000 for payment of its obligation, but upon presentment, it was dishonored, for the credit line from which it was drawn from was already terminated. Gonzales received two demand letters from Unson with the second one containing a threat for legal action, Gonzales sourced out money to pay his obligation. Gonzales wrote to PCIB contending that the check drawn in favor of Unson was properly funded and asked for damages, PCIB, however, maintained its ground that the termination of the credit line and the freezing of the FCD was valid, due to the outstanding unpaid obligations of the Spouses Panlilio. Gonzales reiterated his demand contending that the actual borrowers of the loans were the spouses Panlilio and that he was only accommodating them, and that he never benefited from the proceeds of the loan. RTC and CA found Gonzales to be solidarily liable with the spouses Panlilio. Hence this appeal. ISSUE: Whether or not the CA erredin not considering that the liability arising from promissory notes pertained to Spouses Panlilio and not to him as recognized and acknowledge by PCIB. RULING: Gonzales is liable for the three promissory notes he made with the spouses Panlilio. Gonzales admitted that he is an accommodation party. Pursuant to Section 29 of the NIL an accommodation party is a person who has signed the instrument as makes, drawer, acceptor or indorser without receiving value therefore and for the purpose of lending his name to some other person. This fact has not been disputed by the PCIB. The first note covering PhP 500,000 was signed by Gonzales and his wife, while the two subsequent notes showed that the spouses Panlilio signed as borrowers with Gonzales. For signing as borrower and co-borrower on the promissory notes with the proceeds of the loans going to the spouses Panlilio, Gonzales has extended an accommodation to said spouses. As an accommodation party Gonzales is liable with the spouses Panlilio for the loans. The solidary liability of Gonzales is clearly stipulated in the promissory notes which uniformly begin For value received, the undersigned (the BORROWER) jointly and severally promise to pay x xx. Solidary liability cannot be presumed but must be established by law or contract. Gonzales, as accommodation party, is immediately, equally, and absolutely bound with the spouses Panlilio on the promissory notes which indubitably stipulated solidary liability for all the borrowers. Moreover, the three promissory notes serve as the contract between the parties. Contracts have the force of law between the parties and must be complied with in good faith.

8. BPI V ROXAS (Cashiers Check) Che Facts: Gregorio C. Roxas, respondent, is a trader. He sold and delivered stocks of vegetable oil to spouses Rodrigo and Marissa Cawili and as payment therefor, the Spouses issued a personal check in the

amount of P348,805.50. However, when Roxas tried to encash the check, it was dishonored by the drawee bank. The Spouses Cawili then assured him that they would replace the bounced check with a cashiers check from the Bank of the Philippine Islands (BPI), petitioner. Thus, on the same month, Roxas and Rodrigo went to BPI, Shaw Boulevard branch where Elma Capistrano, the branch manager, personally attended to them. Upon Elmas instructions, Lita Sagun, the bank teller, prepared BPI Cashiers Check No. 14428 in the amount of P348,805.50, drawn against the account of Marissa Cawili, payable to Roxas. Rodrigo then handed the check to respondent in the presence of Elma. The following day, Roxas enchased the cashiers check but it was dishonored. Elma informed him that Marissas account was closed on that date. Upon advise of his lawyer, Roxas deposited the check in his account at Citytrust, Ortigas Avenue. However, the check was dishonored on the ground Account Closed. Statement of the Case: Four months after, Roxas filed with the Regional Trial Court, Branch 263, Pasig City a complaint for sum of money against BPI. He prayed that BPI be ordered to pay the amount of the check, damages and cost of the suit. In its answer, BPI specifically denied the allegations in the complaint, claiming that it issued the check by mistake in good faith; that its dishonor was due to lack of consideration; and that Roxas remedy was to sue Rodrigo Cawili who purchased the check. BPI also filed a counterclaim, praying that Roxas be ordered to pay attorneys fees and expenses of litigation. They also filed a thirdparty complaint against spouses Cawili, who were later declared in default for their failure to file their answer. After trial, the RTC rendered in favor of herein plaintiff and ordered BPI to pay Roxas the face value of the cashiers check, moral and exemplary damages, including attorneys fees and costs of suit. The Spouses Cawili were also ordered to indemnify defendant BPI for the amounts actually paid to Roxas, including the costs of suit. On appeal, the Court of Appeals, affirmed the trial courts judgment. Hence, this petition for Certiorari. BPI avers that the Court of Appeals committed the following errors: (1) in finding that respondent is a holder in due course; and (2) in holding that it (petitioner) is liable to respondent for the amount of the cashiers check. Issue: Whether or not BPI is liable to Roxas for the amount of the Cashiers check. Ruling: YES.BPI is liable to Respondent. It bears emphasis that the disputed check is a cashiers check. A cashiers check is really the banks own check and may be treated as a promissory note with the bank as the maker. The check becomes the primary obligation of the bank which issues it and constitutes a written promise to pay upon demand. The mere issuance of a cashiers check is considered acceptance thereof. BPI became liable to Roxas from the moment it issued the cashiers check. Having been accepted by respondent, subject to no condition whatsoever, petitioner should have paid the same upon presentment by the former. The petition is DENIED. The assailed Decision of the Court of Appeals (Fourth Division) is AFFIRMED.

9. WESTMONT BANK V ONG (Delivery) Elkie Statement of the Facts: Respondent Eugene Ong maintained an account with Petitioner Westmont Bank. He sold certain shares of stocks through Island Securities Corporation (ISC). ISC then issued 2 Managers check to pay respondent with total value of P1.7 million and issued them in his name. Respondents friend, Tanlimco, got hold of the checks before respondent even did. He then forged respondents signature, brought this

to the bank for deposit, where he was also a depositor, which credited both checks to his account, without verifying the signature indorsements appearing thereof, even though respondents specimen signature was on file. Tanlimco then withdrew the money and left. Upon having knowledge of the incident, respondent tried to recover from Tanlimcos family, reported to the Central Bank but had never recovered. It was 5 months after discovery of the fraud that respondent demanded in his complaint that petitioner pay the value of the checks for its gross negligence. Respondent claimed that he did not deliver or endorse to any person the said checks and that his signature was forged. Petitioner claimed that since Ong admitted to have never received the checks, he never acquired ownership of these checks. Hence, he had no legal personality to sue as he is not a real party-in-interest. Statement of the Case: This is a petition for review of the decision of the CA ordering the petitioner to pay respondent P1.7 million, plus interest and damages. The case was filed by Ong in the RTC to recover from Westmont Bank. The loss was allegedly due to the Banks gross negligence when Tanlimco, who forged the 2 checks issued by ISC to Ong as payment, succeeded in withdrawing the value of said checks. RTC, rendered judgment for Ong, and ordered the latter to pay. It was elevated to the Court of Appeals. But the appellate court rendered judgment still in favor of Ong and affirmed the RTCs decision in toto. Issue: Whether or not respondent Ong has no cause of action against petitioner Westmont Bank and is barred to recover the money from Westmont Bank due to laches? Ruling: NO. There is a cause of action since it is respondent's right as payee of the manager's checks to receive the amount involved. Saying that Ong never got hold of the checks, no delivery, no ownership, no cause of action, and his remedy is with the drawer and not with petitioner bank, is of no merit. Delivery is immaterial. The rationale for this is that in said cases the plaintiff uses one action to reach, by a desirable short cut, the person who ought in any event to be ultimately liable as among the innocent persons involved in the transaction. In other words, the payee ought to be allowed to recover directly from the collecting bank, regardless of whether the check was delivered to the payee or not. Since the signature of the payee was forged, such signature should be deemed as inoperative and ineffectual. Bank was clearly negligent. Banks are engaged in a business impressed with public interest, and it is their duty to protect in return their many clients and depositors who transact business with them. The bank had in its files specimen signatures. Given the substantial value of the checks and the fact that they were being deposited by a person not the payee, the very least defendant bank should have done was to verify the genuineness of the indorsements thereon. The payee, respondent, should therefore be allowed to recoverfrom the collecting bank. As a general rule, a bank or corporation who has obtained possession of a check upon an unauthorized or forged indorsement of the payees signature and who collects the amount of the check from the drawee, is liable for the proceeds thereof to the payee or other owner, notwithstanding that the amount has been paid to the person from whom the check was obtained.

10. MEDALLA V LAXA (Check as Guarantee) Juvert

11. METROBANK V BA FINANCE (Crossed Checks) Var FACTS: Lamberto Bitanga applied for and was granted a loan by BA Finance, Corp., herein respondent, secured by a chattel mortgage. The said mortgage includes a stipulation that Bilanga as mortgagor will be responsible to insure the vehicle mortgage against accident, theft or fire for one year with an insurance company accepted by the mortgage, proceeds of which amounting to not less than the outstanding

balance of the mortgage obligations. Such policy shall inure to the benefit of the mortgagee BA Finance or its assigns. To satisfy this stipulation, Bitanga entered into an insurance contract with Malayan Insurance Co., Inc. for the benefit of BA Finance. The car was stolen. Malayan Insurance, upon demand of Bitanga, issued a check payable to the order of BA Finance Corp. and Lamberto Bitanga for P 224,500.00 drawn against China Banking Corporation. Such was a crossed check with notation For Deposit Payees Account Only. Bitanga deposited and subsequently withdrew the amount of the check with petitioner bank Metropolitan Bank and Trust Company without obtaining the indorsement or consent of BA Finance. Bitanga also defaulted on his obligation with BA Finance. Upon learning the default and the circumstances on the encashment of the crossed check, BA Finance demanded from Asianbank the value of the check, but the same remained unpaid. This led to the filing of a complaint with the Makati RTC for recovery of money with damages against Asianbank and Bitanga. Asianbank filed a cross-claim against Bitanga alleging fraud in inducing the release of the check and in disconnecting contacts upon learning of the Asiabank that the amount did not belong to Bitanga, as well as a third-party complaint against Malayan Insurace for gross negligence in delivering the check to Bitanga without the consent of BA Finance. The lower court in its judgment held Asianbank and Bitanga jointly and severally liable to BA Finance for the principal amount of the check with 12% interest, damages and costs. The third-party complaint against Malayan Insurance was dismissed. Asianbank (Metropolitan Bank) filed this instant petition for certiorari praying for reversal of the decision of the lower court. ISSUES: I. Whether or not the principle on the case of Associated Bank vs. CA involving forgery which is applied in the instant case is applicable in cases without proven acts of forgery or unauthorized indorsement of negotiable instrument. II. Whether or not the general rule of Art. 1207 and 1208 of the Civil Code presuming joint obligations when two or more debtors are involved applies in negotiable instruments RULINGS: I. The trial court is correct in applying the Associated Bank vs. CA doctrine in deciding the instant case. Petitioner argues that the doctrine should not be applied because, unlike in Associated Bank vs. CA, there is no forgery nor unauthorized indorsement in the instant case. The Supreme Court disagrees with the contention of the petitioner. Sec. 41 of the Negotiable Instruments Law mandates that in case an instrument is payable to the order of two or more non-partner payees or indorsees, indorsement should be made by all payees or indorsees unless one has authority to do so in behalf of the others. This provision is clearly violated by Bitanga when, without authority from his co-payee BA Finance, Bitanga endorsed the crossed check and petitioner bank allowed the deposit and subsequent withdrawal thereof. Payment on an instrument despite a missing indorsement such as the instant case is equivalent to payment over a forged instrument or of unauthorized indorsement. The contention of the petitioner bank that its acts were of normal banking procedures is controverted by its own testimony that the bank eemployee that received the disputed check for deposit and approved the withdrawal has been dismissed for it. It was clear that the bank through its employee have been negligent in allowing the deposit and withdrawal of the crossed check in gross violation of the public interest which calls for banks to exercise the highest degree of diligence and integrity in its banking operations. II. Art. 1207 and 1208 do not apply in the instant case. Petitioner Asianbank has full liability for the value of the check. The provisions of Negotiable Instruments Law and related jurisprudence support this ruling of the trial court. In the instant case, Asianbank with which the check was deposited and indorses the check to the drawee bank Chinabank is effectively an indorser. This is brought by the stamping of all prior endorsements and/or lack of endorsement guaranteed treating the check as a negotiable instrument, acts consistent with the nature of an indorser. Without such warranty, Chinabank would not have paid value for the check. One of the duties of an indorser is to ascertain genuineness of all prior indorsements. Art. 1207 and 1208 are completely irrelevant.

Also, the contention of petitioner upholding Art. 1207 and 1208 would directly counter the principles governing the Negotiable Instruments Law, in particular its Art. 68. Art. 68 expressly mandates solidary liability in joint payees who made the indorsement; hence, if the maker dishonors the instrument, the holder can turn to any indorser for recovery. Applying the rule to the instant case, the holder can turn to either Bitanga or BA Finance jointly and severally.

12. CAYANAN V NORTH STAR (Consideration) Gab Facts: Virginia Balagtas, the General Manager of North Star, in accommodation and upon the instruction of its client, petitioner herein, sent the amount of US$60,000 to View Sea Ventures Ltd., in Nigeria from her personal account in Citibank Makati. On March 29, 1994, Virginia again sent US$40,000 to View Sea Ventures by telegraphic transfer, with US$15,000 coming from petitioner. Likewise, on various dates, North Star extended credit to petitioner for the airplane tickets of his clients, with the total amount of such indebtedness under the credit extensions eventually reaching P510,035.47.To cover payment of the obligations, petitioner issued five checks to North Star. When presented for payment, the checks in the amount of P1,500,000 and P35,000 were dishonored for insufficiency of funds while the other three checks were dishonored because of a stop payment order from petitioner. North Star, through its counsel, wrote petitioner informing him that the checks he issued had been dishonored. North Star demanded payment, but petitioner failed to settle his obligations. Statement of the Case: Respondent North Star initiated a BP 22 case in the MeTC of Makati City against petitioner. Thus, MeTC convicted Cayanan for violation of BP22; Cayanan appealed to the RTC and acquitted petitioner of the criminal charges. The RTC also held that there is no basis for the imposition of the civil liability on petitioner; Aggrieved, North Star elevated the case to the CA. The decision of the RTC was reversed insofar as the civil aspect is concerned and held petitioner civilly liable for the value of the subject checks, hence; Petitioner Engr. Jose E. Cayanan appeals the decision of the Court of Appeals (CA) finding him civilly liable for the value of the five checks which are the subject of Criminal Case Nos. 166549-53. Issue: Whether or not petitioner is still liable civilly for the 5 checks issued despite his acquittal in the criminal case. Ruling: Yes. The contention of petitioner that there was no valuable consideration for the checks he issued is bereft of merit. We have held that upon issuance of a check, in the absence of evidence to the contrary, it is presumed that the same was issued for valuable consideration which may consist either in some right, interest, profit or benefit accruing to the party who makes the contract, or some forbearance, detriment, loss or some responsibility, to act, or labor, or service given, suffered or undertaken by the other side. Under the Negotiable Instruments Law, it is presumed that every party to an instrument acquires the same for a consideration or for value. As petitioner alleged that there was no consideration for the issuance of the subject checks, it devolved upon him to present convincing evidence to overthrow the presumption and prove that the checks were in fact issued without valuable consideration. Sadly, however, petitioner has not presented any credible evidence to rebut the presumption, as well as North Stars assertion, that the checks were issued as payment for the US$85,000 petitioner owed.