The Supreme Court has ruled that banking institutions cannot compel depositors to return money withdrawn due to the bank’s own gross negligence as it rejected claims of unjust enrichment when the financial loss stems from a failure to follow standard internal procedures.
In a decision penned by Associate Justice Japar B. Dimaampao, the High Tribunal’s Third Division denied the petition filed by BDO Unibank, Inc. (BDO) and held that the bank’s disregard for its clearing policies constituted gross negligence that barred it from recovering funds from a client.
The case stemmed after depositor Cristina Barcellano deposited a P 151,200 regional check from a Landbank branch in Albay into her savings account at BDO’s Lucena City branch.
A BDO teller mistakenly validated the regional check as a local check and released the credited funds after only three banking days instead of the required seven-day clearing period.
Relying on the available balance reflected in her account, Barcellano withdrew P 76,000.
But shortly after, BDO received a stop payment order on the check and demanded that Barcellano return the withdrawn amount.
Although she initially agreed, she ultimately did not repay the sum.
In response, BDO withheld her remaining account balance and initiated a criminal complaint for estafa.
The Regional Trial Court acquitted Barcellano of criminal charges after finding no evidence of fraud, deceit, or abuse of confidence and ruled that the premature withdrawal was caused entirely by BDO’s operational lapse.
The Court of Appeals subsequently affirmed the trial court’s ruling, prompting BDO to bring the civil aspect of the case before the SC.
BDO contended that despite Barcellano’s criminal acquittal, she remained obligated to return the P 76,000 under the principle of solutio indebiti, a legal doctrine dictating the return of payments made by mistake, and to prevent unjust enrichment.
The SC rejected BDO’s argument after it ruled that while acknowledging that civil liability can persist under civil law concepts even after a criminal acquittal, the Court stressed that BDO failed to demonstrate that Barcellano acted in bad faith or held knowledge that the check would ultimately be dishonored.
Instead, the justices found that she withdrew the funds in good faith after the bank made the balance accessible.
The SC explained that BDO’s own gross negligence produced the loss when it prematurely credited the regional check, misclassified its clearing status, and overlooked basic security safeguards until the stop payment order arrived.
Consequently, the court ruled that the doctrine of solutio indebiti cannot be invoked when the payor’s error directly arises from a failure to exercise extraordinary diligence.
Citing the fiduciary nature of the banking sector, the SC reiterated that banks are businesses imbued with public interest and are bound to observe the highest degree of care.
Prematurely disbursing funds from an uncleared check and bypassing established banking protocols fall well short of this legal standard.#