Far East Bank An Trust Vs Pacilan JR

SUPREME COURT REPORTS ANNOTATED VOLUME 465 8/16/18, 8:17 AM SUPREME COURT REPORTS ANNOTATED VOLUME 465 8/16/18,
8/16/18, 8:17 AM SUPREME COURT REPORTS ANNOTATED VOLUME 465 8/16/18, 8:17 AM
insufficient funds. No malice or bad faith could be imputed on

petitioner bank for so acting since the records bear out that the
respondent had indeed been improperly and irregularly handling
his account not just a few times but hundreds of times. Under the
circumstances, petitioner bank could not be faulted for exercising
its right in accordance with the express rules and regulations
governing the current accounts of its depositors. Upon the opening
372 SUPREME COURT REPORTS ANNOTATED
of his ac-
Far East Bank and Trust Company vs. Pacilan, Jr.
_______________
25
* SECOND DIVISION.
FAR EAST BANK AND TRUST COMPANY, NOW BANK
OF THE PHILIPPINE ISLANDS, petitioner, vs.
THEMISTOCLES PACILAN, JR., respondent. 373
Actions; Human Relations; Doctrine of Abuse of Rights;

Elements; Words and Phrases; „Good Faith,‰ „Bad Faith‰ and VOL. 465, JULY 29, 2005 373
„Malice,‰ Defined.·The elements of abuse of rights are the
following: (a) the existence of a legal right or duty; (b) which is Far East Bank and Trust Company vs. Pacilan, Jr.
exercised in bad faith; and (c) for the sole intent of prejudicing or
injuring another. Malice or bad faith is at the core of the said count, the respondent had agreed to be bound by these terms and
provision. The law always presumes good faith and any person who conditions.
seeks to be awarded damages due to acts of another has the burden
Same; Same; Same; Same; The act of a bank of accepting a
of proving that the latter acted in bad faith or with ill-motive. Good
deposit made by a depositor the day following the closure of his
faith refers to the state of the mind which is manifested by the acts
account does not constitute bad faith·the same could be
of the individual concerned. It consists of the intention to abstain
characterized as simple negligence by its personnel.·Neither the
from taking an unconscionable and unscrupulous advantage of
fact that petitioner bank accepted the deposit made by the
another. Bad faith does not simply connote bad judgment or simple
respondent the day following the closure of his account constitutes
negligence, dishonest purpose or some moral obliquity and
bad faith or malice on the part of petitioner bank. The same could
conscious doing of a wrong, a breach of known duty due to some
be characterized as simple negligence by its personnel. Said act, by
motives or interest or ill-will that partakes of the nature of fraud.
itself, is not constitutive of bad faith.
Malice connotes ill-will or spite and speaks not in response to duty.
It implies an intention to do ulterior and unjustifiable harm. Malice Same; Same; Damages; Words and Phrases; There is a material
is bad faith or bad motive. distinction between damages and injury·injury is the illegal
invasion of a legal right while damages is the loss, hurt or harm
Same; Same; Same; Banks and Banking; No malice or bad faith
which results from the injury; There can be damage without injury
could be imputed on a bank for closing the account of a depositor for
in those instances in which the loss or harm was not the result of a
frequently drawing checks against insufficient funds.·It is observed
violation of a legal duty·situations often called damnum absque
that nowhere under its rules and regulations is petitioner bank
injuria.·It has not been shown that these acts were done by
required to notify the respondent, or any depositor for that matter,
petitioner bank with the sole intention of prejudicing and injuring
of the closure of the account for frequently drawing checks against
the respondent. It is conceded that the respondent may have
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SUPREME COURT REPORTS ANNOTATED VOLUME 465 8/16/18, 8:17 AM SUPREME COURT REPORTS ANNOTATED VOLUME 465 8/16/18, 8:17 AM
suffered damages as a result of the closure of his current account. the Philippines
1
Islands) seeking the reversal of the
However, there is a material distinction between damages and Decision dated August 30, 2002 of the Court of Appeals
injury. The Court had the occasion to explain the distinction (CA) in CA-G.R. CV No. 36627 which ordered it, together
between damages and injury in this wise: . . . Injury is the illegal with its branch accountant, Roger Villadelgado,
2
to pay
invasion of a legal right; damage is the loss, hurt or harm which respondent Themistocles Pacilan, Jr. the total sum of
results from the injury; and damages are the recompense or P100,000.00 as moral and exemplary damages. The
compensation awarded for the damage suffered. Thus, there can be assailed decision affirmed with modification that of the
damage without injury in those instances in which the loss or harm Regional Trial Court (RTC) of Negros Occidental, Bacolod
was not the result of a violation of a legal duty. In such cases, the City, Branch 54, in Civil Case No. 4908. Likewise sought to
consequences must be borne by the injured person alone, the law be reversed and set aside is the Resolution dated January
affords no remedy for damages resulting from an act which does not 17, 2003 of the appellate court, denying petitioner bankÊs
amount to a legal injury or wrong. These situations are often called motion for reconsideration.
damnum absque injuria. In other words, in order that a plaintiff The case stemmed from the following undisputed facts:
may maintain an action for the injuries of which he complains, he
must establish that such injuries resulted from a breach of duty _______________
which the defendant owed to the plaintiff·a concurrence of injury
to the plaintiff and legal responsibility by the person causing it. The 1 Penned by Associate Justice Oswaldo D. Agcaoili, with Associate
underlying basis for the award of tort damages is the premise that Justices Eliezer R. Delos Santos and Danilo B. Pine, concurring.
the individual was injured in contemplation of law. Thus, there 2 In the Resolution dated July 1, 2004 of the Court of Appeals, the
must first be a breach of some duty and the im- Court was furnished a copy of the Notice of Death of respondent Pacilan,
Jr. In compliance with the CourtÊs Resolution dated September 27, 2004,
374 his counsel averred that the respondent was survived by his children,
namely, Jesus Rey, Jesus Rhoel, Jesus Rene and Jesus Ryan, all
surnamed Pacilan.
374 SUPREME COURT REPORTS ANNOTATED 375

VOL. 465, JULY 29, 2005 375
position of liability for that breach before damages may be awarded; Far East Bank and Trust Company vs. Pacilan, Jr.
and the breach of such duty should be the proximate cause of the
injury. Respondent Pacilan opened a current account with
petitioner bankÊs Bacolod Branch on May 23, 1980. His
PETITION for review on certiorari of the decision and account was denominated as Current Account No. 53208
resolution of the Court of Appeals. (0052-00407-4). The respondent had since then issued
several postdated checks to different payees drawn against
The facts are stated in the opinion of the Court. the said account. Sometime in March 1988, the respondent
Filomeno B. Tan, Jr. for petitioner. issued Check No. 2434886 in the amount of P680.00 and
Emmanuel G. Vinco for respondent. the same was presented for payment to petitioner bank on
April 4, 1988.
CALLEJO, SR., J.:
Upon its presentment on the said date, Check No.
Before the Court is the petition for review on certiorari 2434886 was dishonored by petitioner bank. The next day,
filed by Far East Bank and Trust Company (now Bank of or on April 5, 1988, the respondent deposited to his current

account the amount of P800.00. The said amount was following normal banking procedure, it (petitioner bank)
accepted by petitioner bank; hence, increasing the balance had until the last clearing hour of the following day, or on
of the respondentÊs deposit to P1,051.43. April 5, 1988, to honor the check or return it, if not funded.
Subsequently, when the respondent verified with In disregard of this banking procedure and practice,
petitioner bank about the dishonor of Check No. 2434866, however, petitioner bank hastily closed the respondentÊs
he discovered that his current account was closed on the current account and dishonored his Check No. 2434886.
ground that it was „improperly handled.‰ The records of The respondent further alleged that prior to the closure
petitioner bank disclosed that between the period of March of his current account, he had issued several other
30, 1988 and April 5, 1988, the respondent issued four postdated checks. The petitioner bankÊs act of closing his
checks, to wit: Check No. 2480416 for P6,000.00; Check No. current account allegedly preempted the deposits that he
2480419 for P50.00; Check No. 2434880 for P680.00 and; intended to make to fund those checks. Further, the
Check No. 2434886 for P680.00, or a total amount of petitioner bankÊs act exposed him to criminal prosecution
P7,410.00. At the time, however, the respondentÊs current for violation of Batas Pambansa Blg. 22.
account with petitioner bank only had a deposit of According to the respondent, the indecent haste that
P6,981.43. Thus, the total amount of the checks presented attended the closure of his account was patently malicious
for payment on April 4, 1988 exceeded the balance of the and intended to embarrass him. He claimed that he is a
respondentÊs deposit in his account. For this reason, Cashier of Prudential Bank and Trust Company, whose
petitioner bank, through its branch accountant, branch office is located just across that of petitioner bank,
Villadelgado, closed the respondentÊs current account and a prominent and respected leader both in the civic and
effective the evening of April 4, 1988 as it then had an banking communities. The alleged malicious acts of
overdraft of P428.57. As a consequence of the overdraft, petitioner bank besmirched the respondentÊs reputation
Check No. 2434886 was dishonored. and caused him „social humiliation, wounded feelings,
On April 18, 1988, the respondent wrote to petitioner insurmountable worries and sleepless nights‰ entitling him
bank complaining that the closure of his account was to an award of damages.
unjustified. When he did not receive a reply from petitioner In their answer, petitioner bank and Villadelgado
bank, the respondent filed with the RTC of Negros maintained that the respondentÊs current account was
Occidental, Bacolod subject to petitioner bankÊs Rules and Regulations
Governing the Establishment and Operation of Regular
376
Demand Deposits which
377
VOL. 465, JULY 29, 2005 377
City, Branch 54, a complaint for damages against petitioner Far East Bank and Trust Company vs. Pacilan, Jr.
bank and Villadelgado. The case was docketed as Civil
Case No. 4908. The respondent, as complainant therein, provide that „the Bank reserves the right to close an
alleged that the closure of his current account by petitioner account if the depositor frequently draws checks against
bank was unjustified because on the first banking hour of insufficient funds and/or uncollected deposits‰ and that
April 5, 1988, he already deposited an amount sufficient to „the Bank reserves the right at any time to return checks of
fund his checks. The respondent pointed out that Check the depositor which
3
are drawn against insufficient funds or
No. 2434886, in particular, was delivered to petitioner bank for any reason.‰
at the close of banking hours on April 4, 1988 and, They showed that the respondent had improperly and

irregularly handled his current account. For example, in put up sufficient funds for a check that was taken as a
1986, the respondentÊs account was overdrawn 156 times, returned item for insufficient funds the day following the
in 1987, 117 times and in 1988, 26 times. In all these receipt of said check from the clearing office. In fact, the
instances, the account was overdrawn due to the issuance said check could still be recleared for one more time. In
of checks against insufficient funds. The respondent had previous instances, petitioner bank notified the respondent
also signed several checks with a different signature from when he incurred an overdraft and he would then deposit
the specimen on file for dubious reasons. sufficient funds the following day to cover the overdraft.
When the respondent made the deposit on April 5, 1988, Petitioner bank thus acted unjustifiably when it
it was obviously to cover for issuances made the previous immediately closed the respondentÊs account on April 4,
day against an insufficiently funded account. When his 1988 and deprived him of the opportunity to reclear his
Check No. 2434886 was presented for payment on April 4, check or deposit sufficient funds therefor the following day.
1988, he had already incurred an overdraft; hence, As a result of the closure of his current account, several
petitioner bank rightfully dishonored the same for of the respondentÊs checks were subsequently dishonored
insufficiency of funds. and because of this, the respondent was humiliated,
After due proceedings, the court a quo rendered embarrassed and lost his credit standing in the business
judgment in favor of the respondent as it ordered the community. The court a quo further ratiocinated that even
petitioner bank and Villadelgado, jointly and severally, to granting arguendo that petitioner bank had the right to
pay the respondent the amounts of P100,000.00 as moral close the respondentÊs account, the manner which attended
damages and P50,000.00 as exemplary damages and costs the closure constituted an abuse of the said right. Citing
of suit. In so ruling, the court a quo also cited petitioner Article 19 of the Civil Code of the Philippines which states
bankÊs rules and regulations which state that „a charge of that „[e]very person must, in the exercise of his rights and
P10.00 shall be levied against the depositor for any check in the performance of his duties, act with justice, give
that is taken up as a returned item due to Âinsufficiency of everyone his due, and observe honesty and good faith‰ and
fundsÊ on the date of receipt from the clearing office even if Article 20 thereof which states that „[e]very person who,
said check is honored and/or covered by sufficient deposit contrary to law, willfully or negligently causes damage to
the following banking day.‰ The same rules and regulations another, shall indemnify the latter for the same,‰ the court
also provide that „a check returned for insufficiency of a quo adjudged petitioner bank of acting in bad faith. It
funds for any reason of held that, under the foregoing circumstances, the
respondent is entitled to an award of moral and exemplary
_______________ damages.
The decretal portion of the court a quoÊs decision reads:
3 Exhibit „1,‰ Records, p. 195 (Vol. I).
„WHEREFORE, PREMISES CONSIDERED, judgment is hereby
378 rendered:
379
Far East Bank and Trust Company vs. Pacilan, Jr. VOL. 465, JULY 29, 2005 379
similar import may be subsequently recleared for one more
time only, subject to the same charges.‰
1. Ordering the defendants [petitioner bank and Villadelgado],
According to the court a quo, following these rules and
jointly and severally, to pay plaintiff [the respondent] the
regulations, the respondent, as depositor, had the right to

sum of P100,000.00 as moral damages; 380 SUPREME COURT REPORTS ANNOTATED

2. Ordering the defendants, jointly and severally, to pay Far East Bank and Trust Company vs. Pacilan, Jr.
plaintiff the sum of P50,000.00 as exemplary damages plus
costs and expenses of the suit; and
deposit sufficient to cover the said check, is contrary to its
3. Dismissing [the] defendantsÊ counterclaim for lack of merit. duty to handle the respondentÊs account with utmost
4 fidelity. The exercise of the right is not absolute and good
SO ORDERED.‰
faith, at least, is required. The manner by which petitioner
On appeal, the CA rendered the Decision dated August 30, bank closed the account of the respondent runs afoul of
2002, affirming with modification the decision of the court Article 19 of the Civil Code which enjoins every person, in
a quo. the exercise of his rights, „to give every one his due, and
The appellate court substantially affirmed the factual observe honesty and good faith.‰
findings of the court a quo as it held that petitioner bank The CA concluded that petitioner bankÊs precipitate and
unjustifiably closed the respondentÊs account imprudent closure of the respondentÊs account had caused
notwithstanding that its own rules and regulations allow him, a respected officer of several civic and banking
that a check returned for insufficiency of funds or any associations, serious anxiety and humiliation. It had,
reason of similar import, may be subsequently recleared for likewise, tainted his credit standing. Consequently, the
one more time, subject to standard charges. Like the court award of damages is warranted. The CA, however, reduced
a quo, the appellate court observed that in several the amount of damages awarded by the court a quo as it
instances in previous years, petitioner bank would inform found the same to be excessive:
the respondent when he incurred an overdraft and allowed „We, however, find excessive the amount of damages awarded by
him to make a timely deposit to fund the checks that were the RTC. In our view the reduced amount of P75,000.00 as moral
initially dishonored for insufficiency of funds. However, on damages and P25,000.00 as exemplary damages are in order.
April 4, 1988, petitioner bank immediately closed the Awards for damages are not meant to enrich the plaintiff-appellee
respondentÊs account without even notifying him that he [the respondent] at the expense of defendants-appellants [the
had incurred an overdraft. Even when they had already petitioners], but to obviate the moral suffering he has undergone.
closed his account on April 4, 1988, petitioner bank still The award is aimed at the restoration, within limits possible, of the
accepted the deposit that the respondent made on April 5, status quo ante, and should be proportionate to the suffering
5
1988, supposedly to cover his checks. inflicted.‰
Echoing the reasoning of the court a quo, the CA
declared that even as it may be conceded that petitioner The dispositive portion of the assailed CA decision reads:
bank had reserved the right to close an account for
repeated overdrafts by the respondent, the exercise of that „WHEREFORE, the decision appealed from is hereby AFFIRMED,
right must never be despotic or arbitrary. That petitioner subject to the MODIFICATION that the award of moral damages is
bank chose to close the account outright and return the reduced to P75,000.00 and the award of exemplary damages
check, even after accepting a reduced to P25,000.00.
6
SO ORDERED.‰
_______________
_______________
4 Records, p. 344 (Vol. II).
5 Rollo, p. 21.
380 6 Ibid.

381 the respondentÊs favor was anchored mainly on Article 19 of

the Civil Code which, quoted anew below, reads:
VOL. 465, JULY 29, 2005 381 382
Petitioner bank sought the reconsideration of the said Far East Bank and Trust Company vs. Pacilan, Jr.
decision but in the assailed Resolution dated January 17,
2003, the appellate court denied its motion. Hence, the
Art. 19. Every person must, in the exercise of his rights and in the
recourse to this Court.
performance of his duties, act with justice, give everyone his due,
Petitioner bank maintains that, in closing the account of
and observe honesty and good faith.
the respondent in the evening of April 4, 1988, it acted in
good faith and in accordance with the rules and regulations The elements of abuse of rights are the following: (a) the
governing the operation of a regular demand deposit which existence of a legal right or duty; (b) which is exercised in
reserves to the bank „the right to close an account if the bad faith; and (c) for the sole intent of prejudicing or
7
depositor frequently draws checks against insufficient injuring another. Malice or bad faith is at the core of the
8
funds and/or uncollected deposits.‰ The same rules and said provision. The law always presumes good faith and
regulations also provide that „the depositor is not entitled, any person who seeks to be awarded damages due to acts of
as a matter of right, to overdraw on this deposit and the another has the burden of proving that the latter acted in
9
bank reserves the right at any time to return checks of the bad faith or with ill-motive. Good faith refers to the state
depositor which are drawn against insufficient funds or for of the mind which is manifested by the acts of the
any reason.‰ individual concerned. It consists of the intention to abstain
It cites the numerous instances that the respondent had from taking an unconscionable and unscrupulous
10
overdrawn his account and those instances where he advantage of another. Bad faith does not simply connote
deliberately signed checks using a signature different from bad judgment or simple negligence, dishonest purpose or
the specimen on file. Based on these facts, petitioner bank some moral obliquity and conscious doing of a wrong, a
was constrained to close the respondentÊs account for breach of known duty due to some motives11 or interest or ill-
improper and irregular handling and returned his Check will that partakes of the nature of fraud. Malice connotes
No. 2434886 which was presented to the bank for payment ill-will or spite and speaks not in response to duty. It
on April 4, 1988. implies an intention to do ulterior and unjustifiable harm.
12
Petitioner bank further posits that there is no law or Malice is bad faith or bad motive.
rule which gives the respondent a legal right to make good Undoubtedly, petitioner bank has the right to close the
his check or to deposit the corresponding amount to cover account of the respondent based on the following provisions
said check within 24 hours after the same is dishonored or of its Rules and Regulations Governing the Establishment
returned by the bank for having been drawn against and Operation of Regular Demand Deposits:
insufficient funds. It vigorously denies having violated
Article 19 of the Civil Code as it insists that it acted in good
_______________
faith and in accordance with the pertinent banking rules
and regulations. 7 Development Bank of the Philippines v. Court of Appeals, G.R. No.
The petition is impressed with merit. 137916, 8 December 2004, 445 SCRA 500.
A perusal of the respective decisions of the court a quo 8 ABS-CBN Broadcasting Corporation v. Court of Appeals, G.R. No.
and the appellate court show that the award of damages in 128690, 21 January 1999, 301 SCRA 572.

9 Chua v. Court of Appeals, G.R. No. 112660, 14 March 1995, 242 using a signature different16 from his specimen signature on
SCRA 341. file with petitioner bank. All these circumstances taken
10 Saber v. Court of Appeals, G.R. No. 132981, 31 August 2004, 437 together justified the petitioner bankÊs closure of the
SCRA 259. respondentÊs account on April 4, 1988 for „improper
11 Id., at pp. 278-279. handling.‰
12 Id., at p. 279.
_______________
383
13 Exhibits „3‰ up to „3-X,‰ Records, pp. 197-221 (Vol. I).
VOL. 465, JULY 29, 2005 383 14 Exhibits „4‰ up to „4-U,‰ Id., at pp. 222-243 (Vol. I).
15 Exhibits „5‰ up to „5-E,‰ Id., at pp. 244-249.
Far East Bank and Trust Company vs. Pacilan, Jr. 16 Exhibits „6‰ up to „6-C,‰ Id., at pp. 250-253.
10) The Bank reserves the right to close an account if the depositor 384
frequently draws checks against insufficient funds and/or
uncollected deposits. 384 SUPREME COURT REPORTS ANNOTATED
...
12) . . . Far East Bank and Trust Company vs. Pacilan, Jr.
However, it is clearly understood that the depositor is not
entitled, as a matter of right, to overdraw on this deposit and the It is observed that nowhere under its rules and regulations
bank reserves the right at any time to return checks of the is petitioner bank required to notify the respondent, or any
depositor which are drawn against insufficient funds or for any depositor for that matter, of the closure of the account for
other reason. frequently drawing checks against insufficient funds. No
malice or bad faith could be imputed on petitioner bank for
The facts, as found by the court a quo and the appellate so acting since the records bear out that the respondent
court, do not establish that, in the exercise of this right, had indeed been improperly and irregularly handling his
petitioner bank committed an abuse thereof. Specifically, account not just a few times but hundreds of times. Under
the second and third elements for abuse of rights are not the circumstances, petitioner bank could not be faulted for
attendant in the present case. The evidence presented by exercising its right in accordance with the express rules
petitioner bank negates the existence of bad faith or malice and regulations governing the current accounts of its
on its part in closing the respondentÊs account on April 4, depositors. Upon the opening of his account, the respondent
1988 because on the said date the same was already had agreed to be bound by these terms and conditions.
overdrawn. The respondent issued four checks, all due on Neither the fact that petitioner bank accepted the
April 4, 1988, amounting to P7,410.00 when the balance of deposit made by the respondent the day following the
his current account deposit was only P6,981.43. Thus, he closure of his account constitutes bad faith or malice on the
incurred an overdraft of P428.57 which resulted in the part of petitioner bank. The same could be characterized as
dishonor of his Check No. 2434886. Further, petitioner simple negligence by its personnel. Said act, by itself, is not
bank showed that in 1986, the current account of the constitutive of bad faith.
respondent was overdrawn 156 times13 due to his issuance of The respondent had thus failed to discharge his burden
checks against insufficient funds. In 1987, the said 14 of proving bad faith on the part of petitioner bank or that it
account was overdrawn 117 15times for the same reason. was motivated by ill-will or spite in closing his account on
Again, in 1988, 26 times. There were also several April 4, 1988 and in inadvertently accepting his deposit on
instances when the respondent issued checks deliberately April 5, 1988.

Further, it has not been shown that these acts were done case is clearly one of damnum absque injuria.
by petitioner bank with the sole intention of prejudicing WHEREFORE, the petition is GRANTED. The Decision
and injuring the respondent. It is conceded that the dated August 30, 2002 and Resolution dated January 17,
respondent may have suffered damages as a result of the 2003 of the Court of Appeals in CA-G.R. CV No. 36627 are
closure of his current account. However, there is a material REVERSED AND SET ASIDE.
distinction between damages and injury. The Court had the SO ORDERED.
occasion to explain the distinction between damages and
injury in this wise: Puno (Chairman), Austria-Martinez, Tinga and
Chico-Nazario, JJ., concur.
. . . Injury is the illegal invasion of a legal right; damage is the loss,
hurt or harm which results from the injury; and damages are the Petition granted, judgment and resolution reversed and
recompense or compensation awarded for the damage suffered. set aside.
Thus, there can be damage without injury in those instances in
_______________
385
17 BPI Express Card Corporation v. Court of Appeals, G.R. No. 120639,
25 September 1998, 296 SCRA 260.
VOL. 465, JULY 29, 2005 385
Far East Bank and Trust Company vs. Pacilan, Jr. 386
which the loss or harm was not the result of a violation of a legal
duty. In such cases, the consequences must be borne by the injured
person alone, the law affords no remedy for damages resulting from Suelto vs. Sison
an act which does not amount to a legal injury or wrong. These
situations are often called damnum absque injuria. Notes.·The principle of abuse of rights stated in
In other words, in order that a plaintiff may maintain an action Article 19 of the Civil Code departs from the classical
for the injuries of which he complains, he must establish that such theory that „he who uses a right injures no one‰·the
injuries resulted from a breach of duty which the defendant owed to modern tendency is to grant indemnity for damages in
the plaintiff·a concurrence of injury to the plaintiff and legal cases where there is an abuse of rights, even when the act
responsibility by the person causing it. The underlying basis for the is not illicit. (Sea Commercial Company, Inc. vs. Court of
award of tort damages is the premise that the individual was Appeals, 319 SCRA 210 [1999])
injured in contemplation of law. Thus, there must first be a breach Article 19 of the Civil Code, known to contain what is
of some duty and the imposition of liability for that breach before commonly referred to as the principle of abuse of rights, is
damages may be awarded; and the breach of such duty should be not a panacea for all human hurts and social grievances,
17
the proximate cause of the injury. the object of the article being to set certain standards
which must be observed not only in the exercise of oneÊs
Whatever damages the respondent may have suffered as a rights but also in the performance of oneÊs duties. (Nikko
consequence, e.g., dishonor of his other insufficiently Hotel Manila Garden vs. Reyes, 452 SCRA 532 [2005])
funded checks, would have to be borne by him alone. It was
the respondentÊs repeated improper and irregular handling ··o0o··
of his account which constrained petitioner bank to close
the same in accordance with the rules and regulations
governing its depositorsÊ current accounts. The respondentÊs

SUPREME COURT REPORTS ANNOTATED VOLUME 465 8/16/18, 8:17 AM
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SUPREME COURT REPORTS ANNOTATED VOLUME 465 8/16/18, 8:17 AM SUPREME COURT REPORTS ANNOTATED VOLUME 465 8/16/18,

insufficient funds. No malice or bad faith could be imputed on

Actions; Human Relations; Doctrine of Abuse of Rights;

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374 SUPREME COURT REPORTS ANNOTATED 375

Far East Bank and Trust Company vs. Pacilan, Jr.

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sum of P100,000.00 as moral damages; 380 SUPREME COURT REPORTS ANNOTATED

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381 the respondentÊs favor was anchored mainly on Article 19 of

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