Karen Salvacion Vs Bartelli

Karen Salvacion vs.
Central Bank of the Philippines (CBP), China Banking Corporation and Greg Bartelli y Northcott
G.R. No. 94723, August 21, 1997, August 21, 1997
Facts:
Greg Bartelli y Northcott (Greg), an American tourist, coaxed and lured petitioner Karen Salvacion (Karen), then 12 years old to go with
him to his apartment. Greg detained Karen for 4 days and was able to rape the child once on the first day, and three times each day on the
succeeding days. In the last day, after the policemen and people living nearby rescued Karen, Greg was arrested and detained at the Makati
Municipal Jail. The policemen recovered from him a DOLLAR CHECK ($3,903.20), COCOBANK BANK BOOK (Peso Account), DOLLAR
ACCOUNT – CHINA BANKING CORP., IDENTIFICATION CARD, PHILIPPINE MONEY (P 234.00) CASH, DOOR KEYS (6 pieces), STUFFED
DOLL (Teddy Bear) used in seducing the complainant.
The Makati Investigating Fiscal filed against Greg a Criminal Cases for Serious Illegal Detention and 4 counts of rape. Petitioner filed
with the RTC of Makati a Civil case for damages with preliminary attachment against Greg. On the day there was a scheduled hearing for Greg’s
petition for bail, the latter escaped from jail.
In the Civil Case, the Judge issued an order granting the issuance of writ of preliminary attachment. The deputy sheriff of Makati served
a Notice of Garnishment on China Banking Corporation. The China Banking Corporation invoked RA No. 1405 as its answer to the notice of
garnishment served on it. The Deputy Sheriff sent his reply to the bank saying that the garnishment did not violate the secrecy of the bank deposits
since the disclosure is merely incidental to a garnishment properly and legally made by virtue of a Court Order which has placed the subject
deposits in custodial legis. The China Banking Corporation answered invoking Section 113 of Central Bank Circular NO. 960 to the effect that the
dollar deposits of defendant Greg are exempt from attachment, garnishment or any other order or process of any court, legislative body,
government agency or any administrative body, whatsoever.
The counsel for petitioners made an inquiry with the Central Bank on whether Section 113 of CB Circular No. 960 has any exception or
whether said section has been repealed or amended since said section has rendered nugatory the substantive right of the plaintiff to have the
claim sought to be enforced by the civil action secured by way of the writ of preliminary attachment as granted to the plaintiff under Rule 57 of the
Revised Rules of Court.
The court rendered judgment in favor of petitioner. After the decision of the trial court become final, petitioners tried to execute on Greg’s
dollar deposit with China Banking Corporation. Likewise the bank invoked Section 113 of the Central Bank Circular No. 960. Thus this petitioner.
Issue:
Whether or not Section 113 of CB No. 960, pursuant to Section 8 of RA 6426, as amended by PD 1246, otherwise known as the Foreign
Currency Deposit Act be made applicable to a foreign transient?
Held:
The court ruled that Section 113 of CB Circular No. 960 and PD No. 1246, in so far as it amends Section 8 of RA 6426 are held
inapplicable to this case because of its peculiar circumstances.
Ratio:
The law grants exemption from attachment or garnishment to foreign currency deposits for the reason that it is to assure the development
and speedy growth of the Foreign Currency Deposit System and the Offshore Banking System in the Philippines and to encourage the inflow of
foreign currency deposits into the banking institutions thereby placing such institutions more in a position to properly channel the same to loans
and investments in the Philippines, thus directly contributing to the economic development of the country and that the subject section is being
enforced according to the regular methods of procedure; and that it applies to all foreign currency deposits made by any person and therefore
does not violate the Constitution.
The China Banking Corporation, although not unmindful of the inhuman suffering experienced by the minor from the hands of defendant;
that it only too willing to release the dollar deposit to partly mitigate the sufferings of petitioner; but is restrained from doing so in view of RA 6426
and Section 113 of CB Circular No. 960; and that despite the harsh effect of these laws on petitioner, CBC has no other alternative but to follow
the same.
RA No. 6426 was enacted in 1983, at a time when the country’s economy was in shambles; when foreign investments were minimal.
Realities show that the country has recovered economically. The intention of the questioned law may be good when enacted. The law failed to
anticipate the iniquitous effects producing outright injustice and inequality such as this case.
It would be unthinkable, that the questioned Section 113 of CB Circular No. 960 would be used as a device by the accused for wrong
doing, and in so doing, acquitting the guilty at the expense of the innocent.

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