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Ilusorio v. Court of Appeals

This case involves a businessman, Ramon Ilusorio, who sued Manila Banking Corporation for damages after his secretary forged his signature on 17 checks totaling P119,634.34. The Supreme Court ruled in favor of Manila Bank, finding that Ilusorio failed to prove the forgery occurred due to his own negligence in entrusting his secretary with unchecked access to his finances and failing to review his bank statements on a regular basis. The Court held that under these circumstances, Ilusorio could not claim the bank was liable for failing to detect the forged signatures.

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Karen Ryl Lozada Brito
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486 views2 pages

Ilusorio v. Court of Appeals

This case involves a businessman, Ramon Ilusorio, who sued Manila Banking Corporation for damages after his secretary forged his signature on 17 checks totaling P119,634.34. The Supreme Court ruled in favor of Manila Bank, finding that Ilusorio failed to prove the forgery occurred due to his own negligence in entrusting his secretary with unchecked access to his finances and failing to review his bank statements on a regular basis. The Court held that under these circumstances, Ilusorio could not claim the bank was liable for failing to detect the forged signatures.

Uploaded by

Karen Ryl Lozada Brito
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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G.R. No.

139130             November 27, 2002

RAMON K. ILUSORIO
vs.
HON. COURT OF APPEALS, and THE MANILA BANKING CORPORATION

Petitioner Ilusorio, a prominent businessman, was the Managing Director of Multinational


Investment Bancorporation and the Chairman and/or President of several other corporations. He
was a depositor in good standing of respondent bank, the Manila Banking Corporation. As he
was then running about 20 corporations and was going out of the country number of times.
Petitioner entrusted to his secretary, Katherine E. Eugenio, his credit cards and his checkbook
with blank checks. It was also Eugenio who verified and reconciled the statements of said
checking account.

Between the dates September 5, 1980 and January 23, 1981, Eugenio was able to encash and
deposit to her personal account about seventeen (17) checks drawn against the account of the
petitioner at the respondent bank, with an aggregate amount of P119,634.34. Petitioner did not
bother to check his statement of account until a business partner apprised him that he saw
Eugenio use his credit cards. Petitioner fired Eugenio immediately, and instituted a criminal
action against her for estafa thru falsification before the Office of the Provincial Fiscal of Rizal.
Private respondent, through an affidavit executed by its employee, Mr. Dante Razon, also lodged
a complaint for estafa thru falsification of commercial documents against Eugenio on the basis of
petitioner’s statement that his signatures in the checks were forged.

At the trial, several employees of Manila Bank were called to the witness stand as hostile
witnesses. They testified that it is the bank’s standard operating procedure that whenever a check
is presented for encashment or clearing, the signature on the check is first verified against the
specimen signature cards on file with the bank.

Manila Bank also sought the expertise of the National Bureau of Investigation (NBI) in
determining the genuineness of the signatures appearing on the checks. However, petitioner
failed to submit 7 or more additional standard signatures.

RTC: Dismissed the case for finding no sufficient basis for plaintiff's cause against defendant
bank.

CA: The appellate court held that petitioner’s own negligence was the proximate cause of his
loss

ISSUE:
WON Manila Bank is liable for damages for failing to detect a forged check.

RULING:
No. To be entitled to damages, Ilusorio has the burden of proving that the bank was negligent in
failing to detect the discrepancy in the signatures on the checks. Ilusorio had to establish the fact
of forgery which he failed to do by failing to submit his specimen signatures for NBI to
conclusively establish forgery.

Furthermore, the Bank was not negligent in verifying the checks as they verified the drawer’s
signatures against their specimen signatures and in doubt, referred to more experienced verifier
for further verification.

On the contrary, it was Ilusorio who was found to be negligent. He accorded his secretary with
an unusual degree of trust and unrestricted access to his finances. Furthermore, despite the fact
that the bank was regularly sending statements of account, he failed to check them until he found
out that his secretary was using his credit cards.

Sec. 23 of the Negotiable Instruments law provides that a forged check is inoperative, meaning
there was no right to enforce payment against any party. But it also provides an exception:
“unless the party against whom it is sought enforce such right is precluded from setting up the
forgery or want of authority”. This case falls under the exception since Ilusorio is precluded from
setting up forgery due to his own negligence considering that he allowed his secretary access to
his credit cards, checkbook, and allowed his secretary to verify his statements of account.

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