BPI vs Casa Montessori, G.R. No.

149454
May 28, 2004, J. Panganiban

FACTS: CASA Montessori International opened Current Account with BPI with CASA’s
President Lebron as one of its authorized signatories. In 1991, after conducting
an investigation, CASA discovered that nine of its checks had been encashed by
a certain Sonny D. Santos since 1990 in the total amount of P782,000.00. It
turned out that ‘Sonny D. Santos’ with account at BPI’s Greenbelt Branch [was]
a fictitious name used by third party defendant Leonardo T. Yabut who worked
as external auditor of CASA. Third party defendant voluntarily admitted that he
forged the signature of Ms. Lebron and encashed the checks. CASA filed
Complaint for Collection with Damages against defendant bank praying that the
latter be ordered to reinstate the amount of P782,500.00 with interest. RTC
rendered decision in favor of CASA. CA modified decision holding CASA as
contributory negligent hence ordered Yabut to reimburse BPI half the total
amount claimed and CASA, the other half. It also disallowed attorney’s fees and
moral and exemplary damages.

ISSUE: WON moral and exemplary damages and attorney’s fees should be awarded.

RULING: Moral and exemplary damages denied but atty.’s fees granted.

In the absence of a wrongful act or omission, or of fraud or bad faith, moral

damages cannot be awarded. The adverse result of an action does not per se
make the action wrongful, or the party liable for CASA was unable to identify
the particular instance upon which its claim for moral damages is predicated.
Neither bad faith nor negligence so gross that it amounts to malice can be
imputed to BPI.

Imposed by way of correction for the public good, exemplary damages cannot
be recovered as a matter of right. There is no bad faith on the part of BPI for
paying the checks of CASA upon forged signatures. Therefore, the former
cannot be said to have acted in a wanton, fraudulent, reckless, oppressive or
malevolent manner. The latter, having no right to moral damages, cannot
demand exemplary damages.

When the act or omission of the defendant has compelled the plaintiff to incur
expenses to protect the latter’s interest, or where the court deems it just and
equitable, attorney’s fees may be recovered. In the present case, BPI
persistently denied the claim of CASA under the NIL to recredit the latter’s
account for the value of the forged checks. This denial constrained CASA to
incur expenses and exert effort for more than ten years in order to protect its
corporate interest in its bank account.