GR L 2861; (February, 1951) (Digest)
G.R. No. L-2861; February 26, 1951
ENRIQUE P. MONTINOLA, plaintiff-appellant, vs. THE PHILIPPINE NATIONAL BANK, ET AL., defendants-appellees.
FACTS
In August 1947, Enrique P. Montinola filed a complaint against the Philippine National Bank and the Provincial Treasurer of Misamis Oriental to collect P100,000, the amount of Check No. 1382 issued on May 2, 1942. The check was issued by Provincial Treasurer Ubaldo D. Laya to Mariano V. Ramos, who was the assistant agent of the PNB branch and a USAFFE disbursing officer. The check was drawn against a deposit of emergency currency notes. Ramos allegedly endorsed the check to Montinola in late December 1944 or early January 1945. Montinola claimed he purchased the check for P850,000 in Japanese military notes, paid partly in cash and partly in medicine. Ramos contested this, asserting he only sold P30,000 of the check’s value to Montinola for P90,000 in Japanese military notes, with the balance to be deposited to his credit, and that Montinola did not pay the full amount. The check presented at trial was badly mutilated—torn, burned, blotted, and pasted with cellophane. Montinola explained the mutilation was to discourage Ramos from reclaiming it. The original endorsement described by Ramos was not on the check; instead, a different endorsement in favor of Montinola appeared. The trial court dismissed Montinola’s complaint.
ISSUE
Whether Enrique P. Montinola is entitled to collect the sum of P100,000 from the defendants based on Check No. 1382.
RULING
No. The Supreme Court affirmed the trial court’s decision dismissing the complaint. The Court found that the check was issued to Ramos in his capacity as a USAFFE disbursing officer, not in his personal capacity. Therefore, Ramos had no right to endorse it personally to Montinola, and the negotiation was in breach of trust. As an assignee, Montinola was subject to all defenses available against Ramos, the assignor. The Court also agreed with the trial court’s findings regarding the disputed endorsement, implying the check had been altered. Furthermore, the Court ordered that after the decision became final, the check and pertinent documents be transmitted to the city fiscal for appropriate action.