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    Equitable PCI Bank v. Ong

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    AntonJohnVincentFrias
    PCI Bank is liable to pay the questioned manager's check. By clearing the initial check deposited by Sarande and issuing a manager's check to Ong in exchange, PCI Bank committed an error but its liability was fixed. As the bank had certified the manager's check, this was equivalent to acceptance, binding the bank on the instrument. As a holder in due course, Ong could not be subject to defenses between previous parties such as lack of consideration. A manager's check is regarded as substantially as good as cash, standing on the same footing as a certified check where certification is equivalent to acceptance. By accepting the initial check and issuing the manager's check, PCI Bank assumed the liabilities of an acceptor.

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    Equitable PCI Bank v. Ong

    Uploaded by

    AntonJohnVincentFrias
    1K views2 pages
    PCI Bank is liable to pay the questioned manager's check. By clearing the initial check deposited by Sarande and issuing a manager's check to Ong in exchange, PCI Bank committed an error but its liability was fixed. As the bank had certified the manager's check, this was equivalent to acceptance, binding the bank on the instrument. As a holder in due course, Ong could not be subject to defenses between previous parties such as lack of consideration. A manager's check is regarded as substantially as good as cash, standing on the same footing as a certified check where certification is equivalent to acceptance. By accepting the initial check and issuing the manager's check, PCI Bank assumed the liabilities of an acceptor.

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    The digest is not mine. :D

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    PCI Bank is liable to pay the questioned manager's check. By clearing the initial check deposited by Sarande and issuing a manager's check to Ong in exchange, PCI Bank committed an error but its liability was fixed. As the bank had certified the manager's check, this was equivalent to acceptance, binding the bank on the instrument. As a holder in due course, Ong could not be subject to defenses between previous parties such as lack of consideration. A manager's check is regarded as substantially as good as cash, standing on the same footing as a certified check where certification is equivalent to acceptance. By accepting the initial check and issuing the manager's check, PCI Bank assumed the liabilities of an acceptor.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    1K views2 pages

    Equitable PCI Bank v. Ong

    Uploaded by

    AntonJohnVincentFrias
    PCI Bank is liable to pay the questioned manager's check. By clearing the initial check deposited by Sarande and issuing a manager's check to Ong in exchange, PCI Bank committed an error but its liability was fixed. As the bank had certified the manager's check, this was equivalent to acceptance, binding the bank on the instrument. As a holder in due course, Ong could not be subject to defenses between previous parties such as lack of consideration. A manager's check is regarded as substantially as good as cash, standing on the same footing as a certified check where certification is equivalent to acceptance. By accepting the initial check and issuing the manager's check, PCI Bank assumed the liabilities of an acceptor.

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    Equitable PCI Bank v.

    Ong
    G.R. No. 156207, September 15, 2006

    CHICO-NAZARIO, J.:

    Facts:
    Warliza Sarande deposited in her account at Philippine Commercial
    International Bank a check in the amount of P225,000.00. Sarande was then
    informed that said check has been cleared. Relying on such assurance, she
    issued two (2) checks where one was issued to respondent Rowena Ong
    Owing to a business transaction. The latter then requested PCI Bank to
    convert the proceeds thereof into a manager's check, which the PCI Bank
    obliged. When Ong deposited the manager's check in her account with
    Equitable Banking Corporation, she received a check return-slip informing her
    that PCI Bank had stopped the payment of the said check on the ground of
    irregular issuance. Ong then filed a complaint for sum of money against herein
    petitioner. Petitioner countered that the check was returned as the account
    against which it was drawn was already closed.

    Issue:
    Is petitioner Bank liable to pay the questioned check?

    Held:

    Yes.

    By admitting it committed an error, clearing the manager's check of


    Sarande and issuing in favor of Ong not just any check but a manager's check
    for that matter, PCI Bank's liability is fixed.

    Since the Bank had certified that check, such certification is equivalent
    to acceptance and petitioner bank as drawee bank is bound on the instrument
    upon certification and it is immaterial to such liability in favor of the plaintiff
    who is a holder in due course whether the drawer had funds or not with the
    defendant-bank or the drawer was indebted to the bank for more than the
    amount of the check.

    The certifying bank has all the liabilities under Sec. 62 of the Negotiable
    Instruments Law which refers to liability of acceptor. It may be true that said
    check was actually not funded but since plaintiff became a holder in due
    course, defendant-bank cannot interpose a defense of want or lack of
    consideration because that defense is equitable or personal and cannot
    prosper against a holder in due course pursuant to Section 28 of the
    Negotiable Instruments Law.

    Therefore, when the aforementioned check was endorsed and


    presented by the plaintiff and certified to and accepted by defendant-bank in
    the purchase of PCIB Manager's Check No. 1983 in the amount of
    P132,000.00, there was a valid consideration.

    Moreover, what Ong obtained from PCI Bank was not just any ordinary
    check but a manager's check.

    A manager's check is an order of the bank to pay, drawn upon itself,


    committing in effect its total resources, integrity and honor behind its
    issuance. By its peculiar character and general use in commerce, a manager's
    check is regarded substantially to be as good as the money it represents.

    A manager's check stands on the same footing as a certified check. The


    effect of certification is found in Section 187, Negotiable Instruments Law.
    which provides: "Where a check is certified by the bank on which it is drawn,
    the certification is equivalent to an acceptance." By accepting said check and
    issuing in turn a manager's check in exchange thereof, PCI Bank assumed the
    liabilities of an acceptor under Section 62 of the Negotiable Instruments Law.

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