27 Ricardo B. Bangayan vs. Rizal Commercial Banking Corporation

RICARDO B. BANGAYAN vs.
RIZAL COMMERCIAL BANKING AUTHOR: ROJAS

CORPORATION AND PHILIP SARIA NOTES:
[G.R. No. 149193; April 4, 2011]
TOPIC: Banking Law; Bank Secrecy Act
PONENTE: Sereno
CASE LAW/ DOCTRINE: All deposits of whatever nature with banks or banking institutions in the Philippines including investments
in bonds issued by the Government of the Philippines, its political subdivisions and its instrumentalities, are hereby considered as
of an absolutely confidential nature and may not be examined, inquired or looked into by any person, government official, bureau
or office, except upon written permission of the depositor, or in cases of impeachment, or upon order of a competent court in cases
of bribery or dereliction of duty of public officials, or in cases where the money deposited or invested is the subject matter of the
litigation.
FACTS:
1. Petitioner Ricardo Bangayan had a savings account and a current account with one of the branches of respondent Rizal
Commercial Banking Corporation (RCBC). These two accounts had an "automatic transfer" condition wherein checks issued
by the depositor may be funded by any of the two accounts.
2. On 26 June 1992, petitioner Bangayan purportedly signed a Comprehensive Surety Agreement (the Surety Agreement)
with respondent RCBC in favor of nine corporations. Under the Surety Agreement, the funds in petitioner Bangayan’s
accounts with respondent RCBC would be used as security to guarantee any existing and future loan obligations, advances,
credits/increases and other obligations, including any and all expenses that these corporations may incur with respondent
bank.
3. Petitioner Bangayan contests the veracity and due authenticity of the Surety Agreement on the ground that his signature
thereon was not genuine, and that the agreement was not notarized.
4. Respondent RCBC refutes this claim, although it admitted that it was exceptional for a perfected Surety Agreement of the
bank to be without a signature of the witness and to remain unnotarized. Mr. Eli Lao, respondent bank’s Group Head of
Account Management, however, explained that the bank was still in the process of "completing" the Surety Agreement at
that time.
5. transactions of respondent RCBC in relation to the Surety Agreement vis-à-vis the petitioner Bangayan have occurred.
6. On 26 June 1992 (the same day that the Surety Agreement was allegedly signed), two of the corporations whose
performance were guaranteed therein – LBZ Commercial and Peaks Marketing – were issued separate commercial letters
of credit by respondent RCBC for the importation of PVC resin from Korea. Three days later or on 29 June 1992, respondent
RCBC issued a third letter of credit in favor of another corporation, Final Sales Enterprise, whose obligations to respondent
bank were likewise secured by petitioner Bangayan under the Surety Agreement. Mr. Lao claimed that respondent bank
would not have extended the letters of credit in favor of the three corporations without petitioner Bangayan acting as
surety.
7. After all the transaction in relation to the letters of credit issued by RCBC in relation to the surety agreement, Bangayan’s
account was depleted.
8. On 18 September 1992, two of the seven checks that were drawn against petitioner Bangayan’s Current Account were
presented for payment to respondent RCBC
9. RCBC returned with the notation “REFER TO DRAWER”.
10. On the same day, United Pacific, through Me. Dente, Demanded payment from petitioner in the amount of Php 8.15m
which corresponds to the 2 dishonored checks
11. On Oct 9, 1992, Respondent Saria, an acoont officer in the Binondo Branch, executed a statement before the BOC of RCBC
on the LOCs issued in favor of the 3 corporations.
12. Petitioner cited this incident as the basis for the allegation in the Complaint he filed that respondent had disclosed to a
third party (the BOC) information concerning the identity, nature, transaction and deposits including details of transaction
related to and pertaining to his deposits with the said bank, in violation of the Bank Secrecy Act.
13. On 16 October 1992, five checks were also dishonored by respondent RCBC on the ground that they had been drawn
against insufficient funds ("DAIF") and were subsequently returned.
14. Hinomoto Trading Company, one of the payees for two of the dishonored checks, demanded that petitioner Bangayan
make good on his payments. the other payee of the three other dishonored checks, Simplex Merchandising, likewise made
a final demand on petitioner to replace the dishonored instruments.
15. petitioner Bangayan, through counsel, demanded that respondent bank restore all the funds to his account and indemnify
him for damages.
16. Bangayan filed a complaint for damages against RCBC. In its defense, respondent RCBC claims that petitioner Bangayan
signed a Surety Agreement in favor of several companies that defaulted in their payment of customs duties that resulted
in the imposition of a lien over the accounts, particularly for the payment of customs duties assessed by the Bureau of
Customs. Respondent bank further claimed that it had funded the letter of credit availed of by Lotec Marketing to finance
the latter’s importation with the account of petitioner Bangayan, who agreed to guarantee Lotec Marketing’s obligations
under the Surety Agreement; and, that respondent bank applied petitioner Bangayan’s deposits to satisfy part of Lotec
Marketing’s obligation of PhP12,762,600, which resulted in the depletion of the bank accounts.
ISSUE(S): Whether respondent RCBC violated the Bank Secrecy Act?

HELD: No
IN VIEW OF THE FOREGOING, the instant Petition for Review on Certiorari filed by Ricardo B. Bangayan is DENIED. The Decisions of
the trial court and appellate court dismissing the Complaint for damages filed by Bangayan against respondents Rizal Commercial
Banking Corporation and Philip Saria are hereby AFFIRMED.
RATIO:
 In his Memorandum, petitioner Bangayan argues that there was a wrongful disclosure by respondents RCBC and Philip
Saria of confidential information regarding his bank accounts in violation of the Bank Secrecy Act. However, petitioner
failed to identify which confidential information respondents divulged before the BOC that would make them liable under
the said law.
 Section 2 of the Bank Secrecy Act provides:
All deposits of whatever nature with banks or banking institutions in the Philippines including investments in bonds issued
by the Government of the Philippines, its political subdivisions and its instrumentalities, are hereby considered as of an
absolutely confidential nature and may not be examined, inquired or looked into by any person, government official,
bureau or office, except upon written permission of the depositor, or in cases of impeachment, or upon order of a
competent court in cases of bribery or dereliction of duty of public officials, or in cases where the money deposited or
invested is the subject matter of the litigation.
 Petitioner Bangayan claims that respondent Saria divulged confidential information through the Affidavit he submitted to
the BOC. However, nothing in respondent Sarias Affidavit before the BOC showed that details of petitioner Bangayans
bank accounts with respondent bank was disclosed. If at all, respondent Saria merely discussed his functions as an account
officer in respondent bank and identified petitioner as the one who had guaranteed the payment or obligations of the
importers under the Surety Agreement.
 According to petitioner Bangayan, the responses of respondent RCBCs officers in relation to the BOCs actions led to
unsavory news reports that disparaged petitioners good character and reputation and exposed him to public ridicule and
contempt. However, as the appellate court correctly found, the humiliation and embarrassment that petitioner Bangayan
suffered in the business community was not brought about by the alleged violation of the Bank Secrecy Act; it was due to
the smuggling charges filed by the Bureau of Customs which found their way in the headlines of newspapers.

 Both the trial and appellate courts correctly found that petitioner Bangayan did not satisfactorily introduce evidence to
substantiate his claim that defendant bank gave any classified information in violation of the Bank Secrecy Act. Failing to
adduce further evidence in the instant Petition with respect to the banks purported disclosure of confidential information
as regards his accounts, petitioner cannot be awarded any damages arising from an unsubstantiated and unproved
violation of the Bank Secrecy Act.

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RICARDO B. BANGAYAN vs.

RIZAL COMMERCIAL BANKING AUTHOR: ROJAS

ISSUE(S): Whether respondent RCBC violated the Bank Secrecy Act?

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