Republic of the Philippines SUPREME COURT Manila EN BANC

G.R. No. L-34964 January 31, 1973 CHIN ! N"ING CORPOR TION an# T N "IM LIONG, petitioners-appellants, vs. HON. $ENCESL O ORTEG , a% Pr&%'#'n( Ju#(& o) *+& Cour* o) ,'r%* In%*an-& o) Man'.a, !ran-+ /III, an# /ICENTE G. C ! N, respondents-appellees. Sy Santos, Del Rosario and Associates for petitioners-appellants. Tagalo, Gozar and Associates for respondents-appellees.

M " LINT L, J.: The only issue in this petition for certiorari to revie the orders dated March !, "#$% and March %$, "#$%, respectively, of the Court of &irst 'nstance of Manila in its Civil Case No. $(")*, is hether or not a ban+in, institution -ay validly refuse to co-ply ith a court process ,arnishin, the ban+ deposit of a .ud,-ent debtor, by invo+in, the provisions of Republic Act No. "!/(. 0 0n 1ece-ber "$, "#2* 3icente Acaban filed a co-plaint in the court a quo a,ainst Bautista 4o,,in, Co., 'nc., B 5 B &orest 1evelop-ent Corporation and Marino Bautista for the collection of a su- of -oney. 6pon -otion of the plaintiff the trial court declared the defendants in default for failure to ans er ithin the re,le-entary period, and authori7ed the Branch Cler+ of Court and8or 1eputy Cler+ to receive the plaintiff9s evidence. 0n :anuary %/, "#$/ .ud,-ent by default as rendered a,ainst the defendants. To satisfy the .ud,-ent, the plaintiff sou,ht the ,arnish-ent of the ban+ deposit of the defendant B 5 B &orest 1evelop-ent Corporation ith the China Ban+in, Corporation. Accordin,ly, a notice of ,arnish-ent as issued by the 1eputy ;heriff of the trial court and served on said ban+ throu,h its cashier, Tan <i- 4ion,. 'n reply, the ban+9 cashier invited the attention of the 1eputy ;heriff to the provisions of Republic Act No. "!/( hich, it as alle,ed, prohibit the disclosure of any infor-ation relative to ban+ deposits. Thereupon the plaintiff filed a -otion to cite Tan <i- 4ion, for conte-pt of court. 'n an order dated March !, "#$% the trial court denied the plaintiff9s -otion. =o ever, Tan <i- 4ion, as ordered >to infor- the Court ithin five days fro- receipt of this order hether or not there is a deposit in the China Ban+in, Corporation of defendant B 5 B &orest 1evelop-ent Corporation, and if there is any deposit, to hold the sa-e intact and not allo any ithdra al until further order frothis Court.> Tan <i- 4ion, -oved to reconsider but as turned do n by order of March %$, "#$%. 'n the sa-e order he as directed >to co-ply ith the order of this Court dated March !, "#$% ithin ten ?"/@ days fro- the receipt of copy of this order, other ise his arrest and confine-ent ill be

ordered by the Court.> Resistin, the t o orders, the China Ban+in, Corporation and Tan <i- 4ion, instituted the instant petition. The pertinent provisions of Republic Act No. "!/( relied upon by the petitioners readsA ;ec. %. All deposits of hatever nature ith ban+s or ban+in, institutions in the Philippines includin, invest-ents in bonds issued by the Bovern-ent of the Philippines, its political subdivisions and its instru-entalities, are hereby considered as of absolutely confidential nature and -ay not be eCa-ined, inDuired or loo+ed into by any person, ,overn-ent official, bureau or office, eCcept upon ritten per-ission of the depositor, or in cases of i-peach-ent, or upon order of a co-petent court in cases of bribery or dereliction of duty of public officials, or in cases here the -oney deposited or invested is the sub.ect -atter of the liti,ation. ;ec ). 't shall be unla ful for any official or e-ployee of a ban+in, institution to disclose to any person other than those -entioned in ;ection t o hereof any infor-ation concernin, said deposits. ;ec. (. Any violation of this la ill sub.ect offender upon conviction, to an i-prison-ent of not -ore than five years or a fine of not -ore than t enty thousand pesos or both, in the discretion of the court. The petitioners ar,ue that the disclosure of the infor-ation reDuired by the court does not fall ithin any of the four ?!@ eCceptions enu-erated in ;ection %, and that if the Duestioned orders are co-plied ith Tan <i- 4ion, -ay be cri-inally liable under ;ection ( and the ban+ eCposed to a possible da-a,e suit by B 5 B &orest 1evelop-ent Corporation. ;pecifically referrin, to this case, the position of the petitioners is that the ban+ deposit of .ud,-ent debtor B 5 B &orest 1evelop-ent Corporation cannot be sub.ect to ,arnish-ent to satisfy a final .ud,-ent a,ainst it in vie of the aforeDuoted provisions of la . Ee do not vie the situation in that li,ht. The lo er court did not order an eCa-ination of or inDuiry into the deposit of B 5 B &orest 1evelop-ent Corporation, as conte-plated in the la . 't -erely reDuired Tan <i- 4ion, to infor- the court hether or not the defendant B 5 B &orest 1evelop-ent Corporation had a deposit in the China Ban+in, Corporation only for purposes of the ,arnish-ent issued by it, so that the ban+ ould hold the sa-e intact and not allo any ithdra al until further order. 't ill be noted fro- the discussion of the conference co--ittee report on ;enate Bill No. )(" and =ouse Bill No. )#$$, hich later beca-e Republic Act "!/(, that it as not the intention of the la -a+ers to place ban+ deposits beyond the reach of eCecution to satisfy a final .ud,-ent. ThusA Mr. MARC0;. No , for purposes of the record, ' should li+e the Chair-an of the Co--ittee on Eays and Means to clarify this further. ;uppose an individual has a taC case. =e is bein, held liable by the Bureau of 'nternal Revenue for, say, P",///.// orth of taC liability, and because of this the deposit of this individual is attached by the Bureau of 'nternal Revenue. Mr. RAM0;. The attach-ent ill only apply after the court has pronounced sentence declarin, the liability of such person. But here the pri-ary ai- is to deter-ine hether he has a ban+ deposit in order to brin, about a proper assess-ent by the Bureau of 'nternal Revenue, such inDuiry is not authori7ed by this proposed la . Mr. MARC0;. But under our rules of procedure and under the Civil Code, the attach-ent or ,arnish-ent of -oney deposited is allo ed. 4et us assu-e, for

instance, that there is a preli-inary attach-ent hich is for ,arnish-ent or for holdin, liable all -oneys deposited belon,in, to a certain individual, but such attach-ent or ,arnish-ent ill brin, out into the open the value of such deposit. 's that prohibited by this a-end-ent or by this la F Mr. RAM0;. 't is only prohibited to the eCtent that the inDuiry is li-ited, or rather, the inDuiry is -ade only for the purpose of satisfyin, a taC liability already declared for the protection of the ri,ht in favor of the ,overn-entG but hen the ob.ect is -erely to inDuire hether he has a deposit or not for purposes of taCation, then this is fully covered by the la . Mr. MARC0;. And it protects the depositor, does it notF Mr. RAM0;. Hes, it protects the depositor. Mr. MARC0;. The la prohibits a -ere investi,ation into the eCistence and the a-ount of the deposit. Mr. RAM0;. 'nto the very nature of such deposit. Mr. MARC0;. ;o ' co-e to -y ori,inal Duestion. Therefore, preli-inary ,arnish-ent or attach-ent of the deposit is not allo edF Mr. RAM0;. No, ithout .udicial authori7ation. Mr. MARC0;. ' a- ,lad that is clarified. ;o that the established rule of procedure as ell as the substantive la on the -atter is a-endedF Mr. RAM0;. Hes. That is the effect. Mr. MARC0;. ' see. ;uppose there has been a decision, definitely establishin, the liability of an individual for taCation purposes and this .ud,-ent is sou,ht to be eCecuted ... in the eCecution of that .ud,-ent, does this bill, or this proposed la , if approved, allo the investi,ation or scrutiny of the ban+ deposit in order to eCecute the .ud,-entF Mr. RAM0;. To satisfy a .ud,-ent hich has beco-e eCecutory.

Mr. MARC0;. Hes, but, as ' said before, suppose the taC liability is P",///,/// and the deposit is half a -illion, ill this bill allo scrutiny into the deposit in order that the .ud,-ent -ay be eCecutedF Mr. RAM0;. Merely to deter-ine the a-ount of such -oney to satisfy that obli,ation to the Bovern-ent, but not to deter-ine hether a deposit has been -ade in evasion of taCes. CCC CCC CCC Mr. MACAPABA4. But let us suppose that in an ordinary civil action for the recovery of a su- of -oney the plaintiff ishes to attach the properties of the defendant to

insure the satisfaction of the .ud,-ent. 0nce the .ud,-ent is rendered, does the ,entle-an -ean that the plaintiff cannot attach the ban+ deposit of the defendantF Mr. RAM0;. That as the Duestion raised by the ,entle-an fro- Pan,asinan to hich ' replied that outside the very purpose of this la it could be reached by attach-ent. Mr. MACAPABA4. Therefore, in such ordinary civil cases it can be attachedF Mr. RAM0;. That is so. ?3ol. '', Con,ressional Record, =ouse of Representatives, No. "%, pp. )*)#-)*!/, :uly %$, "#((@. 't is sufficiently clear fro- the fore,oin, discussion of the conference co--ittee report of the t o houses of Con,ress that the prohibition a,ainst eCa-ination of or inDuiry into a ban+ deposit under Republic Act "!/( does not preclude its bein, ,arnished to insure satisfaction of a .ud,-ent. 'ndeed there is no real inDuiry in such a case, and if the eCistence of the deposit is disclosed the disclosure is purely incidental to the eCecution process. 't is hard to conceive that it as ever ithin the intention of Con,ress to enable debtors to evade pay-ent of their .ust debts, even if ordered by the Court, throu,h the eCpedient of convertin, their assets into cash and depositin, the sa-e in a ban+. E=ERE&0RE, the orders of the lo er court dated March ! and %$, "#$%, respectively, are hereby affir-ed, ith costs a,ainst the petitioners-appellants. Zaldivar, Castro, ernando, !arredo, "a#asiar, Antonio and $sguerra, %%., concur. Concepcion, C.%. and Tee&an#ee, %., too# no part.

,oo*no*&% I An Act Probihitin, 1isclosure of or 'nDuiry into, 1eposits 'nstitution and Providin, Penalty Therefor. ith any Ban+in,