BANKING GUINGONA vs CITY FISCAL of MANILA 1

GENERAL BANKING LAW into a contract of loan and converting the original trust relation between the bank
and private respondent David into an ordinary debtor-creditor relation between the
1. Nature and Safety of Deposit Box petitioners and private respondent. Consequently, the failure of the bank or
petitioners Guingona and Martin to pay the deposits of private respondent would
not constitute a breach of trust but would merely be a failure to pay the obligation
No. L-60033. April 4, 1984.* as a debtor.
TEOFISTO GUINGONA, JR., ANTONIO L. MARTIN, and TERESITA SANTOS,
petitioners, vs. THE CITY FISCAL OF MANILA, HON. JOSE B. FLAMINIANO, Same; Same; Same; Novation of contract of deposit will prevent criminal liability
ASST. CITY FISCAL FELIZARDO N. LOTA and CLEMENT DAVID, where it occurs before filing of information.—Moreover, while it is true that
respondents. novation does not extinguish criminal liability, it may however, prevent the rise of
MAKASIAR, Actg. C.J.: criminal liability as long as it occurs prior to the filing of the criminal information
in court.
About the Case: PETITION for prohibition and injunction to review the order of
the City Fiscal of Manila. Same; Same; Same; Same.—It may be observed in this regard that novation is not
one of the means recognized by the Penal Code whereby criminal liability can be
SYLLABUS: extinguished; hence, the role of novation may only be to either prevent the rise of
criminal liability or to cast doubt on the true nature of the original basic transaction,
Banks; Criminal Law; Contracts; A bank time or savings deposit constitutes a whether or not it was such that its breach would not give rise to penal
simple loan, not a contract of deposit. Non-payment of the said bank deposit does responsibility, as when money loaned is made to appear as a deposit, or other
not constitute estafa.—It must be pointed out that when private respondent David similar disguise is resorted to (cf. Abeto vs. People, 90 Phil. 581; U.S. vs. Villareal,
invested his money on time and savings deposits with the aforesaid bank, the 27 Phil. 481).
contract that was perfected was a contract of simple loan or mutuum and not a
contract of deposit. Same; Same; Central Bank; Petitioners’ contention that they did not engage in
prohibited dollar transactions is meritorious as Clement David’s dollar draft was
Same; Same; Same; Same.—Hence, the relationship between the private first converted to pesos before the money was accepted as bank deposit.—It
respondent and the Nation Savings and Loan Association is that of creditor and appears from the records that when respondent David was about to make a deposit
debtor; consequently, the ownership of the amount deposited was transmitted to the of a bank draft issued in his name in the amount of US$50,000.00 with the Nation
Bank upon the perfection of the contract and it can make use of the amount Savings and Loan Association, the same had to be cleared first and converted into
deposited for its banking operations, such as to pay interests on deposits and to pay Philippine currency. Accordingly, the bank draft was endorsed by respondent
withdrawals. While the Bank has the obligation to return the amount deposited, it David to petitioner Guingona, who in turn deposited it to his dollar account with
has, however, no obligation to return or deliver the same money that was deposited, the Security Bank and Trust Company. Petitioner Guingona merely accommodated
And, the failure of the Bank to return the amount deposited will not constitute the request of the Nation Savings and Loan Association in order to clear the bank
estafa through misappropriation punishable under Article 315, par. 1(b) of the draft through his dollar account because the bank did not have a dollar account.
Revised Penal Code, but it will only give rise to civil liability over which the public Immediately after the bank draft was cleared, petitioner Guingona authorized
respondents have no jurisdiction. Nation Savings and Loan Association to withdraw the same in order to be utilized
by the bank for its operations.
Same; Same; Same; Same; Where a bank’s obligation to a depositor was assumed
by another, the trust relationship is converted into creditor-debtor relationship Same; Same; Same; Same.—It is safe to assume that the U.S. dollars were
which cannot give rise to estafa.—But even granting that the failure of the bank to converted first into Philippine pesos before they were accepted and deposited in
pay the time and savings deposits of private respondent David would constitute a Nation Savings and Loan Association, because the bank is presumed to have
violation of paragraph 1 (b) of Article 315 of the Revised Penal Code, nevertheless followed the ordinary course of the business which is to accept deposits in
any incipient criminal liability was deemed avoided, because when the aforesaid Philippine currency only, and that the transaction was regular and fair, in the
bank was placed under receivership by the Central Bank, petitioners Guingona and absence of a clear and convincing evidence to the contrary (see
Martin assumed the obligation of the bank to private respondent David, thereby paragraphs p and q, Sec. 5, Rule 131, Rules of Court).
resulting in the novation of the original contractual obligation arising from deposit
 BANKING GUINGONA vs CITY FISCAL of MANILA 2
Criminal Procedure; Injunction may issue to enjoin fiscal from prosecuting a case deposits, P13,531.94 on savings account deposits (jointly with his sister, Denise
in extreme cases. —While as a rule, the prosecution in a criminal offense cannot be Kuhne), US$10,000.00 on time deposit, US$15,000.00 under a receipt and
the subject of prohibition and injunction, this Court has recognized the resort to the guarantee of payment and US$50,000.00 under a receipt dated June 8, 1980 (all
extraordinary writs of prohibition and injunction in extreme cases. jointly with Denise Kuhne), that David was induced into making the aforestated
investments by Robert Marshall, an Australian national, who was allegedly a close
THE CASE: associate of petitioner Guingona Jr., then NSLA President, petitioner Martin, then
NSLA Executive Vice-President of NSLA and petitioner Santos, then NSLA
This is a petition for prohibition and injunction with a prayer for the immediate General Manager; that on March 21, 1981 NSLA was placed under receivership by
issuance of restraining order and/or writ of preliminary injunction filed by the Central Bank, so that David filed claims therewith for his investments and those
petitioners on March 26, 1982. of his sister; that on July 22, 1981 David received a report from the Central Bank
that only P305,821.92 of those investments were entered in the records of NSLA;
On March 31, 1982, by virtue of a court resolution issued by this Court on the same that, therefore, the respondents in I.S. No. 81-31938 misappropriated the balance of
date, a temporary restraining order was duly issued ordering the respondents, their the investments, at the same time violating Central Bank Circular No. 364 and
officers, agents, representatives and/or person or persons acting upon their related Central Bank regulations on foreign exchange transactions; that after
(respondents’) orders or in their place or stead to refrain from proceeding with the demands, petitioner Guingona Jr. paid only P200,000.00, thereby reducing the
preliminary investigation in Case No. 81-31938 of the Office of the City Fiscal of amounts misappropriated to P959,078.14 and US$75,000.00.’
Manila (pp. 47-48, rec.). On January 24, 1983, private respondent Clement David
filed a motion to lift restraining order which was denied in the resolution of this “Petitioners, Martin and Santos, filed a joint counter-affidavit (Petition, Annex ‘B’)
Court dated May 18, 1983. in which they stated the following:

As can be gleaned from the above, the instant petition seeks to prohibit public “ ‘That Martin became President of NSLA in March 1978 (after the resignation of
respondents from proceeding with the preliminary investigation of I.S. No. 81- Guingona, Jr.) and served as such until October 30, 1980, while Santos was
31938, in which petitioners were charged by private respondent Clement David, General Manager up to November 1980; that because NSLA was urgently in need
with estafa and violation of Central Bank Circular No. 364 and related regulations of funds and at David’s insistence, his investments were treated as special accounts
regarding foreign exchange transactions principally, on the ground of lack of with interests above the legal rate, and recorded in separate confidential documents
jurisdiction in that the allegations of the charged, as well as the testimony of private only a portion of which were to be reported because he did not want the Australian
respondent’s principal witness and the evidence through said witness, showed that government to tax his total earnings (nor) to know his total investments; that all
petitioners’ obligation is civil in nature. transactions with David were recorded except the sum of US$15,000.00 which was
a personal loan of Santos; that David’s check for US$50,000.00 was cleared
For purposes of brevity, We hereby adopt the antecedent facts narrated by the through Guingona, Jr.’s dollar account because NSLA did not have one, that a draft
Solicitor General in its Comment dated June 28, 1982, as follows: of US$30,000.00 was placed in the name of one Paz Roces because of a pending
“On December 23, 1981, private respondent David filed I.S. No. 81-31938 in the transaction with her; that the Philippine Deposit Insurance Corporation had already
Office of the City Fiscal of Manila, which case was assigned to respondent Lota for reimbursed David within the legal limits; that majority of the stockholders of
preliminary investigation (Petition, p. 8). NSLA had filed Special Proceedings No. 82-1695 in the Court of First Instance to
contest its (NSLA’s) closure; that after NSLA was placed under receivership,
“In I.S. No. 81-31938, David charged petitioners (together with one Robert Martin executed a promissory note in David’s favor and caused the transfer to him
Marshall and the following directors of the Nation Savings and Loan Association, of a nine and one-half (9½) carat diamond ring with a net value of P510,000.00;
Inc., namely Homero Gonzales, Juan Merino, Flavio Macasaet, Victor Gomez, Jr., and, that the liabilities of NSLA to David were civil in nature.’
Perfecto Mañalac, Jaime V. Paz, Paulino B. Dionisio, and one John Doe) with
estafa and violation of Central Bank Circular No. 364 and related Central Bank “Petitioner, Guingona, Jr., in his counter-affidavit (Petition, Annex ‘C’) stated the
regulations on foreign exchange transactions, allegedly committed as follows following:
(Petition, Annex ‘A’):
“ ‘That he had no hand whatsoever in the transactions between David and NSLA
“ ‘From March 20, 1979 to March, 1981, David invested with the Nation Savings since he (Guingona Jr.) had resigned as NSLA president in March 1978, or prior to
and Loan Association, (hereinafter called NSLA) the sum of P1,145,546.20 on time those transactions; that he assumed a portion of the liabilities of NSLA to David
 BANKING GUINGONA vs CITY FISCAL of MANILA 3
because of the latter’s insistence that he placed his investments with NSLA because by Bankers Acceptances and Certificates of Time Deposits and the sum of
of his faith in Guingona, Jr.; that in a Promissory Note dated June 17, 1981 P13,531.94 on savings account deposits covered by passbook nos. 6-632 and 29-
(Petition, Annex “D”) he (Guingona, Jr.) bound himself to pay David the sums of 742, or a total of P1,159,078.14 (pp. 15-16, rec.). It appears further that private
P668,307.01 and US$37,500.00 in stated installments; that he (Guingona, Jr.) respondent David, together with his sister, made investments in the aforesaid bank
secured payment of those amounts with second mortgages over two (2) parcels of in the amount of US$75,000.00 (p. 17, rec.).
land under a deed of Second Real Estate Mortgage (Petition, Annex “E”) in which
it was provided that the mortgage over one (1) parcel shall be cancelled upon Moreover, the records reveal that when the aforesaid bank was placed under
payment of one-half of the obligation to David; that he (Guingona, Jr.) paid receivership on March 21, 1981, petitioners Guingona and Martin, upon the request
P200,000.00 and tendered another P300,000.00 which David refused to accept, of private respondent David, assumed the obligation of the bank to private
hence, he (Guingona, Jr.) filed Civil Case No. Q-33865 in the Court of First respondent David by executing on June 17, 1981 a joint promissory note in favor of
Instance of Rizal at Quezon City, to effect the release of the mortgage over one (1) private respondent acknowledging an indebtedness of P1,336,614.02 and
of the two parcels of land conveyed to David under second mortgages.’ US$75,000.00 (p. 80, rec.). This promissory note was based on the statement of
account as of June 30, 1981 prepared by the private respondent (p. 81, rec.). The
“At the inception of the preliminary investigation before respondent Lota, amount of indebtedness assumed appears to be bigger than the original claim
petitioners moved to dismiss the charges against them for lack of jurisdiction because of the added interest and the inclusion of other deposits of private
because David’s claims allegedly comprised a purely civil obligation which was respondent’s sister in the amount of P116,613.20.
itself novated. Fiscal Lota denied the motion to dismiss (Petition, p. 8).
Thereafter, or on July 17, 1981, petitioners Guingona and Martin agreed to divide
“But, after the presentation of David’s principal witness, petitioners filed the instant the said indebtedness, and petitioner Guingona executed another promissory note
petition because: (a) the production of the Promissory Notes, Banker’s Acceptance, antedated to June 17, 1981 whereby he personally acknowledged an indebtedness
Certificates of Time Deposits and Savings Account allegedly showed that the of P668,307.01 (½ of P1,336,614.02) and US$37,500.00 (½ of US$75,000.00) in
transactions between David and NSLA were simple loans, i.e., civil obligations on favor of private respondent (p. 25, rec.). The aforesaid promissory notes were
the part of NSLA which were novated when Guingona, Jr. and Martin assumed executed as a result of deposits made by Clement David and Denise Kuhne with the
them; and (b) David’s principal witness allegedly testified that the duplicate Nation Savings and Loan Association.
originals of the aforesaid instruments of indebtedness were all on file with NSLA,
contrary to David’s claim that some of his investments were not recorded (Petition, Furthermore, the various pleadings and documents filed by private respondent
pp. 8-9). David before this Court indisputably show that he has indeed invested his money
on time and savings deposits with the Nation Savings and Loan Association.
“Petitioners alleged that they did not exhaust available administrative remedies
because to do so would be futile (Petition, p. 9)” [pp. 153-157, rec.]. It must be pointed out that when private respondent David invested his money on
As correctly pointed out by the Solicitor General, the sole issue for resolution is time and savings deposits with the aforesaid bank, the contract that was perfected
whether public respondents acted without jurisdiction when they investigated the was a contract of simple loan or mutuum and not a contract of deposit. Thus,
charges (estafa and violation of CB Circular No. 364 and related regulations Article 1980 of the New Civil Code provides that:
regarding foreign exchange transactions) subject matter of I.S. No. 81-31938. “Article 1980. Fixed, savings, and current deposits of money in banks and similar
institutions shall be governed by the provisions concerning simple loan.”
There is merit in the contention of the petitioners that their liability is civil in nature
and therefore, public respondents have no jurisdiction over the charge of estafa. In the case of Central Bank of the Philippines vs. Morfe (63 SCRA 114, 119
[1975], We said:
A casual perusal of the December 23, 1981 affidavit-complaint filed in the Office
of the City Fiscal of Manila by private respondent David against petitioners “It should be noted that fixed, savings, and current deposits of money in banks and
Teopisto Guingona, Jr., Antonio L. Martin and Teresita G. Santos, together with similar institutions are not true deposits. They are considered simple loans and, as
one Robert Marshall and the other directors of the Nation Savings and Loan such, are not preferred credits (Art. 1980 Civil Code; In re Liquidation of
Association, will show that from March 20, 1979 to March, 1981, private Mercantile Bank of China: Tan Tiong Tick vs. American Apothecaries Co., 65
respondent David, together with his sister, Denise Kuhne, invested with the Nation Phil. 414; Pacific Coast Biscuit Co. vs. Chinese Grocers Association, 65 Phil.
Savings and Loan Association the sum of P1,145,546.20 on time deposits covered 375; Fletcher American National Bank vs. Ang Cheng Lian, 65 Phil. 385; Pacific
 BANKING GUINGONA vs CITY FISCAL of MANILA 4
Commercial Co. vs. American Apothecaries Co., 65 Phil. 429; Gopoco Grocery vs.
Pacific Coast Biscuit Co., 65 Phil. 443).” “ ‘Commodatum is essentially gratuitous.
This Court also declared in the recent case of Serrano vs. Central Bank of the
Philippines (96 SCRA 96, 102 [1980]) that: “ ‘Simple loan may be gratuitous or with a stipulation to pay interest.

“Bank deposits are in the nature of irregular deposits. They are really loans because “ ‘In commodatum the bailor retains the ownership of the thing loaned, while in
they earn interest. All kinds of bank deposits, whether fixed, savings, or current are simple loan, ownership passes to the borrower.
to be treated as loans and are to be covered by the law on loans (Art. 1980, Civil
Code; Gullas vs. Phil. National Bank, 62 Phil. 519). Current and savings deposits “ ‘Art. 1953.—A person who receives a loan of money or any other fungible thing
are loans to a bank because it can use the same. The petitioner here in making time acquires the ownership thereof, and is bound to pay to the creditor an equal amount
deposits that earn interests with respondent Overseas Bank of Manila was in reality of the same kind and quality.’
a creditor of the respondent Bank and not a depositor. The respondent Bank was in
turn a debtor of petitioner. Failure of the respondent Bank to honor the time “It can be readily noted from the above-quoted provisions that in simple loan
deposit is failure to pay its obligation as a debtor and not a breach of trust arising (mutuum), as contrasted to commodatum, the borrower acquires ownership of the
from a depositary’s failure to return the subject matter of the deposit” (italics money, goods or personal property borrowed. Being the owner, the borrower can
supplied). dispose of the thing borrowed (Article 248, Civil Code) and his act will not be
considered misappropriation thereof’ (Yam vs. Malik, 94 SCRA 30, 34 [1979];
Hence, the relationship between the private respondent and the Nation Savings and italics supplied).
Loan Association is that of creditor and debtor; consequently, the ownership of the
amount deposited was transmitted to the Bank upon the perfection of the contract But even granting that the failure of the bank to pay the time and savings deposits
and it can make use of the amount deposited for its banking operations, such as to of private respondent David would constitute a violation of paragraph 1(b) of
pay interests on deposits and to pay withdrawals. While the Bank has the obligation Article 315 of the Revised Penal Code, nevertheless any incipient criminal liability
to return the amount deposited, it has, however, no obligation to return or deliver was deemed avoided, because when the aforesaid bank was placed under
the same money that was deposited. And, the failure of the Bank to return the receivership by the Central Bank, petitioners Guingona and Martin assumed the
amount deposited will not constitute estafa through misappropriation punishable obligation of the bank to private respondent David, thereby resulting in the
under Article 315, par. 1(b) of the Revised Penal Code, but it will only give rise to novation of the original contractual obligation arising from deposit into a contract
civil liability over which the public respondents have no jurisdiction. of loan and converting the original trust relation between the bank and private
respondent David into an ordinary debtor-creditor relation between the petitioners
WE have already laid down the rule that: and private respondent. Consequently, the failure of the bank or petitioners
Guingona and Martin to pay the deposits of private respondent would not constitute
“In order that a person can be convicted under the above-quoted provision, it must a breach of trust but would merely be a failure to pay the obligation as a debtor.
be proven that he has the obligation to deliver or return the same money, goods or
personal property that he received. Petitioners had no such obligation to return the Moreover, while it is true that novation does not extinguish criminal liability, it
same money, i.e., the bills or coins, which they received from private respondents. may however, prevent the rise of criminal liability as long as it occurs prior to the
This is so because as clearly stated in criminal complaints, the related civil filing of the criminal information in court. Thus, in Gonzales vs. Serrano (25 SCRA
complaints and the supporting sworn statements, the sums of money that petitioners 64, 69 [1968]) We held that:
received were loans.
“As pointed out in People vs. Nery, novation prior to the filing of the criminal
“The nature of simple loan is defined in Articles 1933 and 1953 of the Civil Code. information—as in the case at bar—may convert the relation between the parties
into an ordinary creditor-debtor relation, and place the complainant in estoppel to
“ ‘Art. 1933.—By the contract of loan, one of the parties delivers to another, either insist on the original transaction or ‘cast doubt on the true nature’ thereof.”
something not consumable so that the latter may use the same for a certain time and
return it, in which case the contract is called a commodatum; or money or other Again, in the latest case of Ong vs. Court of Appeals (L-58476, 124 SCRA 578,
consumable thing, upon the condition that the same amount of the same kind and 580-581 [1983]), this Court reiterated the ruling in People vs. Nery (10 SCRA
quality shall be paid, in which case the contract is simply called a loan or mutuum. 244 [1964]), declaring that:
 BANKING GUINGONA vs CITY FISCAL of MANILA 5
accommodated the request of the Nation Savings and Loan Association in order to
“The novation theory may perhaps apply prior to the filing of the criminal clear the bank draft through his dollar account because the bank did not have a
information in court by the state prosecutors because up to that time the original dollar account. Immediately after the bank draft was cleared, petitioner Guingona
trust relation may be converted by the parties into an ordinary creditor-debtor authorized Nation Savings and Loan Association to withdraw the same in order to
situation, thereby placing the complainant in estoppel to insist on the original trust. be utilized by the bank for its operations.
But after the justice authorities have taken cognizance of the crime and instituted
action in court, the offended party may no longer divest the prosecution of its 2.It is safe to assume that the U.S. dollars were converted first into Philippine pesos
power to exact the criminal liability, as distinguished from the civil. The crime before they were accepted and deposited in Nation Savings and Loan Association,
being an offense against the state, only the latter can renounce it (People vs. because the bank is presumed to have followed the ordinary course of the business
Gervacio, 54 Off. Gaz. 2898; People vs. Velasco, 42 Phil. 76; U.S. vs. Montañes, 8 which is to accept deposits in Philippine currency only, and that the transaction was
Phil. 620). regular and fair, in the absence of a clear and convincing evidence to the contrary
(see paragraphs p and q, Sec. 5, Rule 131, Rules of Court).
“It may be observed in this regard that novation is not one of the means recognized
by the Penal Code whereby criminal liability can be extinguished; hence, the role 3.Respondent David has not denied the aforesaid contention of herein petitioners
of novation may only be to either prevent the rise of criminal liability or to cast despite the fact that it was raised in petitioners’ reply filed on May 7, 1982 to
doubt on the true nature of the original basic transaction, whether or not it was such private respondent’s comment and in the July 27, 1982 reply to public respondents’
that its breach would not give rise to penal responsibility, as when money loaned is comment and reiterated in petitioners’ memorandum filed on October 30, 1982,
made to appear as a deposit, or other similar disguise is resorted to (cf.  Abeto vs. thereby adding more support to the conclusion that the US$75,000.00 were really
People, 90 Phil. 581; U.S. vs. Villareal, 27 Phil. 481).” converted into Philippine currency before they were accepted and deposited into
Nation Savings and Loan Association. Considering that this might adversely affect
In the case at bar, there is no dispute that petitioners Guingona and Martin executed his case, respondent David should have promptly denied petitioners’ allegation.
a promissory note on June 17, 1981 assuming the obligation of the bank to private
respondent David; while the criminal complaint for estafa was filed on December
23, 1981 with the Office of the City Fiscal. Hence, it is clear that novation occurred In conclusion, considering that the liability of the petitioners is purely civil in
long before the filing of the criminal complaint with the Office of the City Fiscal. nature and that there is no clear showing that they engaged in foreign exchange
transactions, We hold that the public respondents acted without jurisdiction when
Consequently, as aforestated, any incipient criminal liability would be avoided but they investigated the charges against the petitioners. Consequently, public
there will still be a civil liability on the part of petitioners Guingona and Martin to respondents should be restrained from further proceeding with the criminal case for
pay the assumed obligation. to allow the case to continue, even if the petitioners could have appealed to the
Ministry of Justice, would work great injustice to petitioners and would render
Petitioners herein were likewise charged with violation of Section 3 of Central meaningless the proper administration of justice.
Bank Circular No. 364 and other related regulations regarding foreign exchange
transactions by accepting foreign currency deposit in the amount of US$75,000.00 While as a rule, the prosecution in a criminal offense cannot be the subject of
without authority from the Central Bank. They contend however, that the US prohibition and injunction, this court has recognized the resort to the extraordinary
dollars intended by respondent David for deposit were all converted into Philippine writs of prohibition and injunction in extreme cases, thus:
currency before acceptance and deposit into Nation Savings and Loan Association. “On the issue of whether a writ of injunction can restrain the proceedings in
Criminal Case No. 3140, the general rule is that ‘ordinarily, criminal prosecution
Petitioners’ contention is worthy of belief for the following reasons: may not be blocked by court prohibition or injunction.’ Exceptions, however, are
allowed in the following instances:
1.It appears from the records that when respondent David was about to make a “ ‘1.for the orderly administration of justice;
deposit of bank draft issued in his name in the amount of US$50,000.00 with the “ ‘2.to prevent the use of the strong arm of the law in an oppressive and vindictive
Nation Savings and Loan Association, the same had to be cleared first and manner;
converted into Philippine currency. Accordingly, the bank draft was endorsed by “ ‘3.to avoid multiplicity of actions;
respondent David to petitioner Guingona, who in turn deposited it to his dollar “ ‘4.to afford adequate protection to constitutional rights;
account with the Security Bank and Trust Company. Petitioner Guingona merely
 BANKING GUINGONA vs CITY FISCAL of MANILA 6
“ ‘5.in proper cases, because the statute relied upon is unconstitutional or was held
invalid’ ” (Primicias vs. Municipality of Urdaneta, Pangasinan, 93 SCRA 462, 469-
470 [1979]; citing Ramos vs. Torres, 25 SCRA 557 [1968]; and Hernandez vs.
Albano, 19 SCRA 95, 96 [1967]).

Likewise, in Lopez vs. The City Judge, et al. (18 SCRA 616, 621-622 [1966]),

We held that;

“The writs of certiorari and prohibition, as extraordinary legal remedies, are in the
ultimate analysis, intended to annul void proceedings; to prevent the unlawful and
oppressive exercise of legal authority and to provide for a fair and orderly
administration of justice. Thus, in Yu Kong Eng vs. Trinidad, 47 Phil. 385, We
took cognizance of a petition for certiorari and prohibition although the accused in
the case could have appealed in due time from the order complained of, our action
in the premises being based on the public welfare and the advancement of public
policy. In Dimayuga vs. Fajardo, 43 Phil. 304, We also admitted a petition to
restrain the prosecution of certain chiropractors although, if convicted, they could
have appealed. We gave due course to their petition for the orderly administration
of justice and to avoid possible oppression by the strong arm of the law. And
in Arevalo vs. Nepomuceno, 63 Phil. 627, the petition for certiorari challenging the
trial court’s action admitting an amended information was sustained despite the
availability of appeal at the proper time.”
WHEREFORE, THE PETITION IS HEREBY GRANTED; THE TEMPORARY
RESTRAINING ORDER PREVIOUSLY ISSUED IS MADE PERMANENT.
COSTS AGAINST THE PRIVATE RESPONDENT. SO, ORDERED.

Concepcion, Jr., Guerrero, De Castro and Escolin, JJ., concur.

Petition granted.

Notes. —An agreement to pay a promissory note in dollars while null and void
does not defeat a creditor’s claim who shall then be paid in Philippine Currency.
(Ponce vs. Court of Appeals, 90 SCRA 533.)

Funds of a bank are, in a sense, held in trust. (Banco de Oro vs. Bayuga, 93 SCRA
443.)

All kinds of bank deposits, whether fixed savings, or current are to be treated as
loans and are to be recovered by law on loans. Current and saving deposits are
loans to a bank because it can use the same. (Serrano vs. Central Bank of the
Philippines, 96 SCRA 96.)