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ALLIED BANKING CORPORATION vs. BPI

February 27, 2013

FACT!

On October 10, 2002, a check for P1,000,000 payable to Mateo Mgt. Group

International (MMGI) wa preente! for !epoit an! accepte! at "llie! #ank$ %awit

#ranch.

&he check, pot'!ate! Oct. , 200*+, wa !rawn fro the account of Marciano -ila,

/r. with #PI #el'"ir #ranch. #PI cleare! the check an! cre!ite! P1 illion to MMGI.

On October 22, 2002, MMGI$ account wa cloe! an! all fun! with!rawn.

One onth later, -ila !icoere! the P1 illion !ebit fro hi account. e

coplaine! an! #PI cre!ite! hi account with ai! aount.

#PI returne! a photocopy of the check to "llie! #ank for the reaon that it wa pot'

!ate!. oweer, "llie! bank refue! to accept an! the charge lip wa toe! eeral

tie between the two bank.

#PI reuete! P to take cuto!y of the original check an! to plit it 30430

becaue it wa ub5ect of a ping'pong controery.

"llie! #ank coplaine! before the "rbitration oittee, alleging that #PI houl!

olely bear the entire face alue of the check !ue to it negligence in failing to return

the check to "llie! within the 26'regleentary perio! a proi!e! in -ection 20.1 of

77 200. "llie! #ank praye! that #PI reibure it P300,000 with 128 interet, plu

attorney$ fee an! arbitration e9pene.

#PI, in it "nwer with ounterclai, charge! "llie! #ank with gro negligence for

accepting the pot'!ate! check in the :rt place. #PI conten!e! that "llie! #ank$

a!itte! negligence wa the ole an! pro9iate caue of the lo.

In 2006, the "rbitration oittee rule! in faor of "llie! #ank, aying that theituation wa not a ping'pong controery an! the check wa not returne! by #PI

within the 26'hour regleentary perio!. Or coure! through the clearing facilitie of

the P.

"ccor!ing to the "rbitration oittee, #PI ha! the lat clear chance of aoi!ing the

lo. ence, it houl! alone houl!er the lo.

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I"E!

#ON A$$%e& Ba'( )r BPI *as 'e+$%+e'- B)/ *ere 'e+$%+e'

#ON /e D)r%'e ) Las C$ear C/a'e A$%es %' /e ase a bar- es. BPI

/a& /e $as $ear /a'e.

4ELD!

" well etablihe! by the recor!, both #PI an! "llie! #ank were a!itte!ly

negligent in the encahent of a check pot'!ate! one year fro it preentent.

In thi cae, the ei!ence clearly how that the pro9iate caue of the unwarrante!encahent of the ub5ect check wa the negligence of #PI who cleare! a pot'!ate!

check ent to it thru the P clearing facility without obering it own eri:cation

proce!ure. " correctly foun! by the P an! uphel! by the 7&, if only repon!ent

e9ercie! or!inary care in the clearing proce, it coul! hae eaily notice! the

glaring !efect upon eeing the !ate written on the face of the check ;Oct. , 200*;.

#PI coul! hae then proptly returne! the check an! with the check thu !ihonore!,

"llie! #ank woul! hae not cre!ite! the aount thereof to the payee$ account.

&hu, notwithtan!ing the antece!ent negligence of the "llie! #ank in accepting the

pot'!ate! check for !epoit, it can eek reibureent fro #PI the aount

cre!ite! to the payee$ account coering the check.

"'&er Ar%$e 2175 ) /e Ne* C%v%$ C)&e,when the plainti

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/e(s. >n!er thee circutance, we apply Ar%$e 2175 ) /e C%v%$ C)&e to

the e