G.R. No. 251157 , September 29, 2021
Danilo A. David, Petitioner, vs. Bank of the Philippine Islands, Respondent.

FACTS

Respondent Bank of the Philippine Islands (BPI) issued petitioner Danilo A. David a pre-approved credit card. Petitioner availed of the credit accommodation and initially paid on time but started delaying payments by 2007. Per a Statement of Account dated August 12, 2008, he had a total charge of P404,733.03. Demands for payment went unheeded, prompting BPI to sue for sum of money. In his answer, petitioner admitted using the card but denied agreeing to the interest and penalty terms, claiming his outstanding balance was only P30,000.00. During trial, BPI’s Account Specialist Michael Alvin Gianan testified that per the bank’s internal record, the reference amount for computing petitioner’s obligation was P223,000.00 (the actual document reflected P223,749.48). Petitioner marked this internal record as “Exhibit 1,” but neither party formally offered it in evidence. Petitioner submitted various Statements of Account, including one dated January 14, 2007, showing a balance of P278,649.87. The Metropolitan Trial Court (MeTC) initially ruled the unpaid obligation was P194,682.99, using P278,649.87 as the starting reference but reduced interest and penalty charges. On reconsideration, the MeTC reduced the obligation to P97,428.51, holding that the starting reference should be P223,749.48 from the bank’s internal record and deleted penalty charges for lack of proof of agreement, retaining 12% annual interest. The Regional Trial Court (RTC) affirmed. The Court of Appeals modified, rejecting the internal record for not being formally offered and using P278,649.87 from the January 14, 2007 Statement of Account as the reckoning point, fixing the final obligation at P63,074.89.

ISSUE

1. Which amount—P223,000.00, P223,749.48, or P278,649.87—should be the reckoning point of petitioner’s obligation?
2. How much is the unpaid obligation of petitioner?

RULING

1. The reckoning point is P223,749.48 from the bank’s internal record. The Supreme Court held that although the internal record was not formally offered, the trial court could consider it under the exception in Sabay v. People, as it was duly identified by testimony (by Account Specialist Gianan) and incorporated in the case records. The amount in the document (P223,749.48) prevails over the rounded-off testimony (P223,000.00), as the document is the best evidence. The Court of Appeals erred in using P278,649.87 from the Statement of Account because: (a) the bank, through its witness, deemed the internal record amount as correct, effectively correcting the Statement of Account; (b) the bank did not appeal the MeTC and RTC rulings adopting the lower amount; and (c) the witness’s testimony favoring the lower amount was a declaration against interest entitled to high probative weight. The issue of the Statement of Account amount was not raised by the parties on appeal.
2. The unpaid obligation is P97,428.51 as computed by the MeTC in its Resolution of May 25, 2015. The Supreme Court affirmed the MeTC’s computation, which used P223,749.48 as the principal starting amount, applied a 12% annual interest (as reduced from the stipulated rate), and excluded penalty charges due to lack of proof that petitioner agreed to them. The Court upheld the reduction of interest to the legal rate, citing Eastern Shipping Lines, Inc. v. Court of Appeals, and confirmed that the total payments made by petitioner were correctly accounted for, resulting in the net obligation of P97,428.51. Attorney’s fees were deleted for lack of basis.