Digested by: Kathleen Pearl C. Samson Bank of the Philippine Islands v.

Roxas 536 SCRA 168 October 15, 2007

FACTS: Gregorio Roxas, as trader, delivered stocks of vegetable oil to Spouses Rodrigo and Marissa Cawili. As payment, they issued a personal check amounting to PHP348,805.50 which was dishonored by the drawee bank when respondent tried to encash. The Spouses Cawili replaced the check with a cashier's check from Bank of the Philippine Island (Petitioner). The cashier's check was drawn against the account of Marissa Cawili. The Cashier Check was wanded to respondent by Rodrigo Cawili. When respondent tried to encash the Cashier Check, it was dishonored on the ground that the account of Marissa was closed on the same date that respondent tried to encash. Respondent thereafter filed a complaint with the Regional Trial Court for a sum of money praying that petitioner pay him the amount of the chack, damages and cost of the suit. The RTC in its decision held that Petitioner is liable to pay the face value of the cashier's check amounting to PHP 384, 805.50. On appeal, the CA affirmed the decision of the RTC. Hence, the filing of the Petition for Certiorari by the petitioner. LAW INVOLVED: Sec 50 and Sec. 25 of NIL

ISSUE: (1) Whether or not the respondent is a holder in due course? (2) Whether or not petitioner is liable to respondent for the amount of the cashiers check? HELD: The petition is DENIED. The assailed Decision of the Court of Appeals (Fourth Division) is AFFIRMED. Held [1]: Petitioner contends that the element of "value" is not present, therefore, respondent could not be a holder in due course. There is no dispute that respondent received Rodrigo Cawilis cashiers check as payment for the formers vegetable oil. The fact that it was Rodrigo who purchased the cashiers check from petitioner will not affect respondents status as a holder for value since the check was delivered to him as payment for the vegetable oil he sold to spouses Cawili. Verily, the Court of Appeals did not err in

concluding that respondent is a holder in due course of the cashiers check. Held [2]: 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. Petitioner bank became liable to respondent 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.