AFP Retirement and Separation Benefits System vs.

Sanvictores 2. BPI vs Fernandez

Facts: Fernandez claiming the share proceeds of four joints

● On Apr 1994, Eduardo Sanvictores purchase a AND/OR deposits accounts of his husband without the
land on an installment basis from Prime East certificate of deposits.
Properties, Inc. (PEPI) in 1994 and paid a down
payment almost 82k. Facts
● Contract to sell executed between PEPI and •Tarcila Fernandez and her husband, Manuel, along with
AFp, seller and Sanvictores. their children, opened several joint "AND/OR" deposit
● On Feb 1999,Sanvictores fully paid the accounts with BPI.
purchase price (534,378.79 but PEPI and •The certificates of deposit stipulated that their
AFPRSBS failed to execute a deed of absolute endorsement and presentation was required for the
sale and deliver the title accounts' termination.
● On Sept 2000, Sanvictores demanded the •Tarcila attempted to pre-terminate the accounts,
execution of the deed of sale and delivery of the presenting the certificates of deposit, but BPI refused,
title. PEPI claimed the title was with Philippine insisting on contacting Manuel5.
National Bank (PNB) and could not be released •Manuel then requested pre-termination, claiming the
due to the economic crisis. certificates were lost6.
● Sanvictores filed a complaint with the Housing •Few days after, BPI allowed Manuel to pre-terminate
and Land Use Regulatory Board (HLURB) for the accounts based on an affidavit of loss, without
rescission of the contract, refund of payment, contacting the other co-depositors6....
damages, and attorney's fees. - The proceeds were transferred to Sian,
● PEPI argued a lack of cause of action and Manuel's son-in-law, who then signed
invoked force majeure due to the delay in blank withdrawal slips, which Manuel
delivering the title and asserted substantial used to withdraw the funds. Sian's
compliance in good faith. account was closed the same day.
● AFPRSBS argued thy are not was not the • After not receiving her share of the pre-terminated
owner/developer (PEPI was), and that Espina deposits, arguing BPI acted in bad faith for allowing the
was not their authorized representative. pre-termination of the time deposits based on Manuel's
● HLURB and OP and CA ruled PEPI and AFP affidavit of loss when the bank had actual knowledge
are jointly and severally liable to San Victores. that the certificates of deposit were in her possession.
Issue:
ISSUE: WN the Joint AND/OR bank account is a Joint
1. whether AFPRSBS was jointly and severally liable
Obligation.
with PEPI to Sanvictores for failure to deliver the
title of the property after full payment,

No. The joint AND/OR account is a Solidary. the RTC

Ruling:
opined that the AND/OR nature of the accounts indicate
an active solidarity that thus entitled any of the account
Yes. PEPI and AFPRSB are jointly liable to holders to demand from BPI payment of their proceeds.
Sanvictores. Art 1207 does not presume solidary Since Tarcila made the first demand upon BPI,
liabilities unless there is stipulations in the contract, payments should have been made to her. Under Article
1214 of the Civil Code, which provides:
the law or nature require the solidarity. In the said
"Art. 1214. The debtor may pay any one of the solidary
contract.PEPI and AFPRSBS were expressly referred creditors; but if any demand, judicial or extrajudicial, has
to as the "SELLER" while Sanvictores was referred to as been made by one of them, payment should be made to
the "BUYER." Indeed, the contract to sell did not state him."
The RTC did not find merit either in BPI's third-party
"SELLERS" but "SELLER." This could only mean that
complaint against Sian on the ground that he was merely
PEPI and AFPRSBS were considered as one seller in coerced into signing the Indemnity Agreement.24 BPI
the contract. appealed the RTC ruling with the CA.
 ● The Court emphasized that a co-maker’s liability
is not contingent upon receiving benefits from
5.Sinamban v. China Banking Corporation the loan; rather, it arises from the explicit terms
of the promissory note.
G.R. No. 193890 [March 11, 2015] ● The Court affirmed the lower courts’ decisions
holding the Sinambans liable for the deficiency
amount corresponding to the promissory notes
they co-signed.
FACTS:

● On February 19, 1990, spouses Danilo and

Magdalena Manalastas obtained a loan of Spouses Ibañez vs. James Harper
₱700,000 from China Banking Corporation
(Chinabank) for their rice milling business, as Representative of the Heirs of Francisco Muñoz,
secured by a Real Estate Mortgage (REM) on Sr., et al.
two of their properties.
○ Over time, the loan limit was increased, Facts
reaching ₱2,450,000 by March 23,
1994. 1. In October 1996, Spouses Amado and Esther
● The Manalastas spouses executed several Ibañez borrowed ₱1,300,000 from Francisco
promissory notes (PNs) in favor of Chinabank. Muñoz, Sr., Consuelo Estrada, and Ma.
Notably, spouses Estanislao and Africa Consuelo Muñoz. The loan was payable in three
Sinamban co-signed two of these PNs as co- months at an interest rate of 3% per month and
makers. secured by a real estate mortgage on a parcel of
● Upon default by the Manalastas spouses, land covered by TCT No. 202978.
Chinabank foreclosed on the mortgaged 2. By September 1997, Francisco and his co-
properties. creditors claimed that the spouses failed to
○ The foreclosure sale yielded comply with the mortgage conditions since
₱4,600,000, which was insufficient to November 1996. As a result, they foreclosed the
cover the total outstanding obligation, mortgage, leading to a public auction where
resulting in a deficiency of Francisco, Ma. Consuelo, and Consuelo were
₱1,758,427.87. the highest bidders.
● Chinabank filed a complaint for the deficiency 3. On December 8, 1997, the Spouses Ibañez filed
amount against both the Manalastas and a complaint for injunction and damages, arguing
Sinamban spouses. that the mortgage was novated and seeking to
○ The Sinambans contended that they did stop the foreclosure. The RTC of Manila issued
not benefit from the loan proceeds and a status quo order to maintain the situation until
were unaware of the foreclosure further resolution.
proceedings. 4. On June 11, 2002, the parties executed an
Amended Compromise Agreement, wherein the
ISSUE: spouses Ibañez agreed to pay ₱3,000,000 as
settlement, broken down as follows:
Whether or not the Sinamban spouses are solidarily ○ ₱2,000,000 from GSIS loan proceeds,
liable for the whole amount of loan deficiency arising assigned directly to the creditors.
from the promissory notes they co-signed ○ ₱1,000,000 as balance, secured by
another property.
5. The Ibañez spouses executed a Deed of
Assignment for the GSIS loan and created a
RULING: new mortgage to cover the remaining balance.
However, due to the alleged failure to deliver
YES. As co-makers who bound themselves “jointly and necessary documents, the transaction faced
severally” with the principal debtors, the Sinambans are delays and disputes. The situation became more
directly and primarily liable for the debts evidenced by complicated following Francisco's death in June
the promissory notes they co-signed. 2004.
 6. In 2006, the RTC granted a motion for execution
of the Compromise Agreement. However,
Francisco’s heirs contested this, arguing
improper substitution of parties. The RTC initially Philippine National Bank vs. Bal, Jr.
ruled in favor of execution but later reconsidered G.R. No. 207856
its decision upon re-evaluating the issue of Nov 18, 2020
substitution. Facts:
7. Appeals and CA Decision: Francisco’s heirs filed
a Petition for Certiorari, arguing that the The Philippine National Bank sought to hold Lorenzo T.
obligations in the Compromise Agreement were Bal, Jr., a branch manager at the PNB Caloocan Branch,
and Adriano S. Tan, a depositor, jointly and severally
not fully satisfied. The Court of Appeals (CA)
liable for a loss of P520,000.00. This legal dispute
reinstated the RTC’s March 24, 2006 Order, revolves around a series of unauthorized check
lifting the status quo order due to perceived non- withdrawals and the subsequent actions taken by Bal,
fulfillment of obligations by the Ibañez spouses. Tan, and PNB.

Issues The incident began when Tan, a depositor with PNB,

issued checks that had not yet cleared. Bal, despite this,
1. Whether Francisco Muñoz, Sr. was a real party approved the withdrawals against the uncollected
in interest. deposits. When the checks were dishonored, Bal
2. Was there a valid substitution of parties after allowed Tan to deposit more checks to cover the
withdrawals, but these replacement checks were also
Francisco’s death?
dishonored due to insufficient funds. PNB alleged that
this action violated the bank’s policies and was beyond
Ruling Bal's authority as a branch manager. Furthermore, PNB
claimed that Tan acknowledged his debt and issued
1. Real Party in Interest promissory notes for the amount of P520,000.00, while
○ The Supreme Court affirmed that Bal’s actions were deemed to have facilitated these
Francisco Muñoz, Sr. was a real party in unauthorized transactions.
interest as he was one of the original
creditors directly involved in the loan. Bal's defense centered on the argument that the court
lacked jurisdiction over the complaint, as the matter was
○ His heirs inherited his rights, making
an administrative issue. He also argued that he had
them rightful successors in interest in already been penalized by the bank's Administrative
the litigation. Adjudication Panel, which imposed a four-month
2. Substitution of Parties suspension for the same actions. Bal denied any
○ The Court held that failure to substitute involvement in the transaction beyond approving the
Francisco’s heirs formally did not checks and contended that Tan should bear full
invalidate the proceedings. responsibility for the debt.
○ The heirs had actively participated in
subsequent motions and filings, The Regional Trial Court (RTC) dismissed PNB's
complaint against Bal, ruling that PNB had failed to
amounting to substantial compliance prove Bal’s civil liability. The court found that Tan was
under the Rules of Court. solely responsible for the P520,000.00 loss and ordered
○ The Court ruled that the obligations him to pay legal interest. Additionally, the RTC ruled that
under the Compromise Agreement were Tan must pay P50,000 in attorney’s fees to both Bal and
not fully met by the spouses Ibañez. PNB, and dismissed Bal’s cross-claim.
○ Payment to Francisco Muñoz, Sr.
remained incomplete, justifying the The Court of Appeals (CA) upheld the RTC’s ruling,
Court of Appeals’ decision to reinstate asserting that although Bal exceeded his authority, there
was insufficient evidence to show that he had personally
the execution order.
benefited or colluded with Tan. The CA emphasized that
Tan was the one who received the money and
acknowledged his debt through promissory notes. It
affirmed that Bal’s role in approving the withdrawals did
not make him liable for the loss.

Issue:
Whether Lorenzo T. Bal, Jr., as branch manager,
could be held personally liable for the P520,000 loss
incurred by PNB due to drawings against uncollected
check deposits, given his violation of the bank's existing
policies.
Facts
Ruling:
•Philippine National Bank (PNB) filed a complaint against
The Supreme Court ruled that Bal is not personally Lorenzo T. Bal, Jr., a branch manager, and Adriano S.
liable for the loss. The Court upheld the rulings of both Tan, a depositor2.
the Court of Appeals (CA) and the Regional Trial Court •PNB alleged that Bal approved cash withdrawals for
(RTC), stating that: Tan against checks that had not yet been cleared. When
1. Bal's Discretion as Branch Manager: The these checks were dishonored, Bal allowed Tan to
Court emphasized that Bal acted within his deposit more checks to cover the withdrawals, but these
discretion as the branch manager. When were also dishonored2.
approving the check deposit, Bal based his •PNB claimed Bal violated bank policy against drawing
decision on his assessment of Tan’s banking on uncollected deposits and exceeded his authority in
history. The Court noted that banks have the approving the encashment of other bank checks3. PNB
discretion to honor checks even before they are sought to hold Bal personally liable for losses of
cleared, and Bal exercised this discretion in line P520,0003....
with his managerial role.
•Bal argued the court lacked jurisdiction, as he had
2. Administrative Penalty: The Court also already been administratively penalized with a four-
considered that Bal had already been month suspension4.... He claimed he did not
administratively penalized by PNB with a four- acknowledge the obligation or participate in the
month suspension for the same infraction. The transactions that led to it4.
Court concluded that holding Bal personally
liable in a court action would amount to double •The Regional Trial Court (RTC) dismissed the complaint
jeopardy, as he had already been penalized for against Bal, holding Tan solely liable for P520,0006. The
the misconduct by the bank. Court of Appeals (CA) upheld the RTC's decision, stating
PNB failed to prove Bal gained financially or colluded
3. Recovery from Tan: The Court referenced the with Tan7....
Administrative Adjudication Panel's suggestion
that recovery should be sought from the Issue
individual who actually benefitted from the
unauthorized withdrawals—Tan, who •The central issue was whether Bal could be held
acknowledged his debt of P520,000 and issued personally liable for the P520,000 due to violations of
promissory notes. The Court made it clear that PNB's policies regarding drawings against uncollected
PNB should direct its efforts to recover the check deposits9.
amount from Tan, as he was the one who Ruling
received the money.
•The Supreme Court denied PNB's petition, affirming the
4. Solidarity Not Presumed: The Court also CA's decision10.... The Court held that Bal was not
emphasized that solidarity in liability is not personally liable for the uncollected bank deposits10.
presumed. Since there was no explicit provision
indicating that Bal was solidarily liable for the •Bal's approval of the withdrawals was within his
loss, and the nature of the obligation did not discretion as a branch manager, based on his
require it, the Court ruled that Bal could not be assessment of Tan's banking history10....
held jointly liable with Tan.
•PNB's Administrative Adjudication Panel had already
In conclusion, the Supreme Court affirmed that Tan, not penalized Bal for the same infraction with a four-month
Bal, was the party liable for the P520,000 loss, as he suspension5. Holding him personally liable would be
was the one who benefited from the withdrawals and double punishment for the same offense13.
acknowledged the debt. Bal, having acted within his
discretion and already facing administrative penalties, •
was not personally liable for the financial loss. Solidary liability was not applicable because it was not
stated in an obligation, nor required by law or the nature
of the obligation
 that new titles should reflect the reduced
measurement14....

Land Bank of the Philippines vs. Belle Corporation case,

covering the facts, issue, and ruling based on the source
provided.
Issue
Facts
• whether Belle Corporation was bound by the joint
•Belle Corporation, engaged in leisure and recreational verification survey,
projects in Tagaytay City, filed a complaint against
Florosa A. Bautista and the Register of Deeds of whether the Court of Appeals erred in its application of
Tagaytay City for quieting of title and damages, alleging the Rules of Court,
ownership and possession of four parcels of land1.... whether Land Bank was a mortgagee in good faith, and
•Bautista claimed that Belle Corporation had illegally Ruling
constructed a road on a portion of land she owned,
posting a signboard to notify the public of her property •The Supreme Court denied Land Bank's petition,
rights2.... affirming the Court of Appeals' decision with
modification17.
•Belle sought to cancel Bautista's free patent, arguing its
title to a portion of the land was registered earlier3.... •The Court agreed that the entries on Belle Corporation's
Belle Corporation traced its title back to 1959, while titles inaccurately recorded the origin of said titles18.
Bautista's title originated from a free patent issued in The origins of Belle Corporation's titles could be traced
19774.... back to OCT Nos. 0-216 and 55, which predated
Bautista's title19....
•During the trial, it was revealed that Land Bank of the
Philippines had foreclosed on Bautista's property and •The Supreme Court found that Land Bank was not a
TCT No. P-3663 was issued in the bank's name6. Belle mortgagee in good faith because it failed to conduct a
then amended its petition to include Land Bank as an thorough investigation despite the presence of an
indispensable party6. access road on the property21....

•Land Bank claimed it was an innocent mortgagee for •The Court modified the CA decision, clarifying that only
value, having verified Bautista's title before approving a Liezel's Garments, Inc. was liable to pay Land Bank the
loan7. amount for which the disputed property was sold at
public auction17. The Court emphasized that Bautista
•The Regional Trial Court (RTC) ruled in favor of was a third-party mortgagor and not solidarily bound with
Bautista, declaring Belle Corporation's title void insofar the principal obligor23....
as it overlapped Bautista's property8.... The RTC relied
on a DENR verification survey that favored Bautista's
earlier title registration date9.

•The Court of Appeals (CA) annulled the RTC decision,

declaring Belle Corporation the legitimate owner and
voiding Bautista's and Land Bank's titles10. The CA
found that Belle Corporation's mother title predated
Bautista's and that Land Bank was not a mortgagee in
good faith11....

•The CA ordered Bautista and Liezel's Garments, Inc. to

pay Land Bank the amount for which the property was
sold at public auction and ordered Bautista and Land
Bank to pay Belle Corporation attorney's fees11....

•The CA modified its decision to specify that only the

7,693 sq. m. portion overlapping Belle Corporation's land
was voided from Bautista's and Land Bank's titles and