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[G.R. No. 121413.January 16, 2002]

PCIB vs. HON. COURT OF APPEALS, et al.

SECOND DIVISION

Gentlemen:

Quoted hereunder, for your information, is a resolution of this Court dated JAN 16 2002.

����������� G.R. Nos. 121413, 121479 & 128604 (Philippine Commercial International Bank (formerly Insular Bank of Asia and America) vs. Hon. Court of Appeals, Ford Philippines, Inc., and Citibank, N.A.)

Before us are the motions for reconsideration of Philippine Commercial International Bank (PCIBank), Ford Philippines and Citibank of our decision in G.R. Nos. 121413, 121479 and 128604, promulgated on January 29, 2001, the consolidated cases favoring Ford Philippines and ordering PCIBank and Citibank to pay a total of P10,827,763.46 and P6,081,649.05 respectively, plus damages.

In G.R. Nos. 121413 and 121479, we held PCIBank solely responsible for the loss of the proceeds of Citibank Check No. SN-04 867 in the amount of P4,746,114.41 plus six percent (6%) interest thereon from the date when the original complaint was filed until said amount was fully paid.

In G.R. No. 128604 meanwhile, we held both PCIBank and Citibank liable for the loss of Citibank Check Nos. SN-10597 and 16508 totalling P12,163,298.10 and ordered both to pay Ford on a fifty-fifty ratio basis, i.e., P6,081,649.05 each with six percent (6%) interest thereon, from the date the complaint was filed until full payment of said amount.

The original actions a quo were instituted by Ford Philippines to recover from the drawee-bank Citibank and collecting-bank PCIBank the value of several checks payable to the Commissioner of Internal Revenue which was embezzled by its employees.

In G.R. Nos. 121413 and 121479, the check involved was Citibank Check No. SN-04867 in the amount of P4,746,114.41 drawn and issued by Ford from its account in favor of the Commissioner of Internal Revenue as payment of its taxes for the third quarter of 1977. This check, which was a crossed check with the phrase "Payee's account only", was deposited with PCIBank which accepted it. PCIBank then sent the same to the Central Clearing House with an indorsement at the back "all prior indorsements and/or lack of indorsements guaranteed." The check was subsequently cleared, and upon presentment with Citibank, the proceeds thereof was paid to PCIBank. Consequently, the amount of P4,746,114.41 was debited from plaintiff's account. The proceeds of said check, however, was never paid to or received by the payee, the CIR. As a consequence, Ford was compelled to make a second payment for its taxes. Ford sent letters to PCIBank and Citibank dated October 26, 1979 demanding reimbursement for said amount. Due to the refusal of the two banks, Ford filed an action in the lower court for the recovery of the amount plus damages.

The trial court rendered judgment ordering Citibank and PCIBank jointly and severally to pay Ford the amount of the check with interest thereon at the legal rate starting January 20, 1983, the date when the original complaint was filed. Both appealed to the Court of Appeals which modified the decision and held PClBank solely liable for the amount representing the face value of the check. PCIBank and Ford then went to this Court on a petition for review on certiorari. The dispositive portion of our decision reads:

WHEREFORE, the assailed Decision and Resolution of the Court of Appeals in CA-G.R. CV No. 25017 are AFFIRMED.PCIBank, known formerly as Insular Bank of Asia and America, is declared solely responsible for the loss of the proceeds of Citibank Check No. SN 04867 in the amount P4,746,114.41, which shall be paid together with six percent (6%) interest thereon to Ford Philippines Inc. from the date when the original complaint was filed until said amount is fully paid.

In G.R. No. 128604, the checks involved were Citibank Check No. SN-10597 in the amount of P5,851,706.37 representing the percentage tax due for the second quarter of 1978, and Citibank Check No. SN-16508 in the amount of P6,311,591.73 representing the payment of percentage tax for the first quarter of 1979 both payable to the Commissioner of Internal Revenue. These were also crossed checks with the phrase "payable to the payee's account only." Like the check in the previous cases, these never reached the CIR. Ford was forced to pay the BIR anew and file an action against Citibank and PCIBank for the recovery of the amount of Citibank Check Nos. SN-10597 and 16508.

As found by the trial court, the amounts of these checks were embezzled by Godofredo Rivera who was employed with Ford as its General Ledger Accountant in connivance with a Remberto Castro who was a pro-manager of PCIBank San Andres Branch, and a certain Winston Dulay. These persons, unfortunately, were able to abscond with the amount involved beyond the reach of the complainant. The cases being reconsidered therefore focus on who should bear the loss of the amount of the embezzled checks.

The trial court held drawee-bank Citibank liable for the value of the two checks while absolving PCIBank from any liability. Both Ford and Citibank appealed to the Court of Appeals which affirmed in toto the decision of the trial court. The two then went to this Court and we held:

. the Decision and Resolution of the Court of Appeals in CA-G.R. No. 28430 are MODIFIED as follows: PCIBank and Citibank are adjudged liable for and must share the loss, (concerning the proceeds of Citibank Check Numbers SN 10598 and 16508 totalling P12,163,298.10) on a fifty-fifty ratio, and each bank is ORDERED to pay Ford Philippines Inc. P6,08 1,649.05, with six percent (6%) interest thereon, from the date the complaint was filed until full payment of said amount.

All three parties filed their respective motions for reconsideration, Ford and PCIBank in regard to all the cases while Citibank regarding G.R. No. 128604 only.

In its motion for partial reconsideration, Ford claimed that: (1) the interest on the amounts due to it should be computed not from the date when the original complaint was filed or from the date of judicial demand, but rather, from the date of first written demand or from the date of extra-judicial demand; and (2) for G.R. Nos. 121479 and 128604, Citibank and PCIBank as joint tortfeasors should be jointly and severally liable in accordance with Article 2194 of the Civil Code.

PCIBank, meanwhile, claimed that it is not guilty of fraud or negligence and that it is Ford which should be found guilty of contributory negligence, in its motion for reconsideration of G.R. Nos. 121413 and 121479. For G.R. No. 128604, it claimed that (1) it has no liability at all for the fraud committed against Ford in the total amount of P12,163,298.10 which had already been decided with finality by this Court; (2) Ford cannot now argue for Citibank in the present petition especially in the light of its own allegations in its complaint of Citibank's own fraudulent acts and/or negligence; (3) Ford has no more personality to pursue this claim which is a very serious matter; and (4) the fraud and negligence that gave rise to this case was initiated, pursued and covered up by petitioner's employees and thus estops Ford from claiming reimbursement against PCIBank.

Finally, Citibank filed its motion for reconsideration of G.R. No. 128604, contending that it should not be held liable because it was not guilty of any negligence.

Considering these motions respectively filed by the parties, we find them without merit. The basic issues in the cases have already been passed upon by this Court, and no new and substantial arguments have been raised. These motions merely serve to delay, but do not warrant any change in our decision in these cases.

WHEREFORE , the motions for reconsideration of Ford Philippines, PCIBank, and Citibank of our decision in G.R. Nos. 121413, 121479 & 128604 are hereby DENIED WITH FINALITY.Let judgment be entered in due course.

SO ORDERED.

Very truly yours,

(Sgd.) TOMASITA B. MAGAY-DRIS

Clerk of Court

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