GR No.
183204, 13 Jan 2014
Metropolitan Bank and Trust Company
Vs.
Ana Grace Rosales and Yo Yuk To
FACTS
In 2000, respondent Ana Grace Rosales, an owner of a travel agency, and her mother Yo Yuk To
opened a Joint Peso Account10 with petitioner bank. In May 2002, respondent Rosales accompanied
her client Liu Chiu Fang, a Taiwanese National applying for a retiree’s visa from the Philippine Leisure
and Retirement Authority (PLRA), to petitioner’s branch in Escolta to open a savings account.
On 31 July 2003, petitioner issued a "Hold Out" order against respondents’ accounts. On 3 Sept
2003, petitioner filed a criminal case for Estafa through False Pretences, Misrepresentation, Deceit and
Use of Falsified Documents against the respondent. It was alleged that the respondents are the one
responsible for the unauthorized withdrawal fo $75,000 from Liu Chiu Fang’s account. Petitioner alleged
that on 5 Feb 2003, it received from the PLRA a Withdrawal Clearance for the account of Liu Chiu Fang,
that in the afternoon of the same day, respondents went to inform the branch head Gutierrez that Liu
Chiu Fang was going to withdraw her deposits in cash. Gutierrez told respondents to come back the
following day for the bank did not have enough dollars. On 6 Feb, respondents accompanied an
unidentified impostor to the bank with enabled them to withdraw Liu Chiu Fang’s dollar deposit.
On 3 Mar 2003, respondents opened a Joint Dollar Account with petitioner bank with an initial
deposit of $14,000. The bank later discovered that the serial numbers of the dollar notes deposited by
respondents were the same as those withdrawn by the impostor.
On 10 Sept 2004, respondents filed before the RTC of Manila a Complaint for Breach of
Obligation and Contract with Damages, against petitioner. Respondents alleged that they attempted
several times to withdraw their deposits but were unable to because petitioner had placed their
accounts under "Hold Out" status. No explanation, however, was given by petitioner as to why it issued
the "Hold Out" order. Petitioner alleged that respondents have no cause of action because it has a valid
reason for issuing the "Hold Out" order. It averred that due to the fraudulent scheme of respondent
Rosales, it was compelled to reimburse Liu Chiu Fang the amount of US$75,000.0050 and to file a
criminal complaint for Estafa against respondent Rosales.
ISSUE
Whether or not the Metrobank breached its contract with respondents Rosales.
HELD
Yes. The Court held that Metrobank’s reliance on the “Hold Out” clause in the Application and
Agreement for Deposit Account is misplaced. Bank deposits, which are in the nature of a simple loan or
mutuum, must be paid upon demand by the depositor.
The “Hold Out” clause applies only if there is a valid and existing obligation arising from any of the
sources of obligation enumerated in Article 1157 of the Civil Code, to wit: law, contracts, quasi-
contracts, delict, and quasi-delict. In this case, petitioner failed to show that respondents have an
obligation to it under any law, contract, quasi-contract, delict, or quasi-delict. And although a criminal
case was filed by petitioner against respondent Rosales, this is not enough reason for petitioner to issue
a “Hold Out” order as the case is still pending and no final judgment of conviction has been rendered
against respondent Rosales.
In fact, it is significant to note that at the time petitioner issued the “Hold Out” order, the criminal
complaint had not yet been filed. Thus, considering that respondent Rosales is not liable under any of
the five sources of obligation, there was no legal basis for petitioner to issue the “Hold Out” order.
Accordingly, we agree with the findings of the RTC and the CA that the “Hold Out” clause does not apply
in the instant case.
In view of the foregoing, the Court found that petitioner is guilty of breach of contract when it
unjustifiably refused to release respondents’ deposit despite demand. Having breached its contract with
respondents, petitioner is liable for damages.
