Scribd Logo
Upload

Welcome to Scribd!

  • 149 views

    Allied Banking Corp V Lim Sio Wan

    Uploaded by

    Debroah Faith Pajarillo
    Lim Sio Wan deposited money in Allied Bank but then a person claiming to be her instructed the bank to terminate the deposit and issue a check. The check was deposited into another bank account with a forged signature. Allied Bank was sued for releasing the funds without verifying the signature. Allied Bank then sued other banks involved claiming unjust enrichment. The Supreme Court found Producers Bank was unjustly enriched as Lim Sio Wan's deposit was withdrawn without consent and the funds went to pay off Producers Bank's mature obligation, so Producers Bank was ordered to pay damages

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd

    Allied Banking Corp V Lim Sio Wan

    Uploaded by

    Debroah Faith Pajarillo
    149 views2 pages
    Lim Sio Wan deposited money in Allied Bank but then a person claiming to be her instructed the bank to terminate the deposit and issue a check. The check was deposited into another bank account with a forged signature. Allied Bank was sued for releasing the funds without verifying the signature. Allied Bank then sued other banks involved claiming unjust enrichment. The Supreme Court found Producers Bank was unjustly enriched as Lim Sio Wan's deposit was withdrawn without consent and the funds went to pay off Producers Bank's mature obligation, so Producers Bank was ordered to pay damages

    Original Description:

    Case Digest

    Original Title

    Allied Banking Corp v Lim Sio Wan

    Copyright

    © © All Rights Reserved

    Available Formats

    DOCX, PDF, TXT or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    Lim Sio Wan deposited money in Allied Bank but then a person claiming to be her instructed the bank to terminate the deposit and issue a check. The check was deposited into another bank account with a forged signature. Allied Bank was sued for releasing the funds without verifying the signature. Allied Bank then sued other banks involved claiming unjust enrichment. The Supreme Court found Producers Bank was unjustly enriched as Lim Sio Wan's deposit was withdrawn without consent and the funds went to pay off Producers Bank's mature obligation, so Producers Bank was ordered to pay damages

    Copyright:

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

    Allied Banking Corp V Lim Sio Wan

    Uploaded by

    Debroah Faith Pajarillo
    Lim Sio Wan deposited money in Allied Bank but then a person claiming to be her instructed the bank to terminate the deposit and issue a check. The check was deposited into another bank account with a forged signature. Allied Bank was sued for releasing the funds without verifying the signature. Allied Bank then sued other banks involved claiming unjust enrichment. The Supreme Court found Producers Bank was unjustly enriched as Lim Sio Wan's deposit was withdrawn without consent and the funds went to pay off Producers Bank's mature obligation, so Producers Bank was ordered to pay damages

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 2

    Allied Banking Corp v.

    Lim Sio Wan, 549 SCRA 504 (2008)

    Facts: On November 14, 1983, Lim Sio Wan deposited a money market placement
    worth P 1,152,597.35 to Allied Bank for a term of 31 days to mature on December 15,
    1983. On December 5, 1983, a person claiming to be Lim Sio Wan called up Cristina
    So, an officer of Allied Bank, and instructed her to preterminate the money market
    placement and to issue a manager’s check representing the proceeds from the
    placement and to give the check to one Deborah Dee Santos, who would pick up the
    check.

    Santos arrived at the bank and signed the application form for a manager’s check to
    be issued. The check was cross-checked for Payees Account Only and given to
    Santos. Then the check was deposited to the account of Filipinas Cement Corporation
    (FCC) at Metrobank, with the forged signature of Lim Sio Wan.

    Earlier, on September 21, 1983, FCC had deposited a money market placement
    forPhp2 million to Producers Bank. Santos was the money market trader assigned to
    handle FCC’s account. The placement matured on October 25, 1983, and was rolled
    over until December 5, 1983. The Allied check was deposited with Metrobank in the
    account of FCC as Producers Bank’s payment of its obligation to FCC.

    Metrobank stamped a guaranty on the check in compliance with the requirements of


    the Philippine Clearing House Corporation (PCHC) Rules and Regulations. The
    guaranty read: All prior endorsements and/or lack of endorsement guaranteed. The
    check was then sent to Allied Bank through the PCHC. Upon the presentment of the
    check, Allied funded it even without checking the authenticity of Lim Sio Wan’s
    purported indorsement. The amount of the check was credited to the account of FCC.

    In 1983, Lim Sio Wan went to Allied Bank to withdraw the money market placement.
    When she was informed that the placement has been terminated upon her instructions,
    she took action. She filed a complaint with the RTC against Allied to recover the
    proceeds of the money market placement.

    Allied filed a third party complaint against Metrobank and Santos. In turn, Metrobank
    filed a fourth party complaint against FCC. Then FCC filed a fifth party complaint
    against Producers Bank. Six months after the funding of the check, Allied informed
    Metrobank that the signature in the check was forged. Thus, Metrobank withheld the
    amount but later on agreed to release it to FCC after the latter executed an
    undertaking, promising to indemnify Metrobank in case it was made to reimburse the
    amount.

    Lim Sio Wan then filed an amended complaint, adding Metrobank as party-
    defendant along with Allied. Allied alleged that there was unjust enrichment
    on the part of Producers Bank.

    Issue: Whether Allied Bank is correct in saying that Producers Bank was unjustly
    enriched

    Held: Yes. Under Article 22 of the Civil Code, there is unjust enrichment when: 1) a
    person is unjustly benefited and 2) such benefit is derived at the expense of or with
    damages to another.

    In the instant case, Lim Sio Wans money market placement in Allied Bank was
    preterminated and withdrawn without her consent. Moreover, the proceeds of the
    placement were deposited in Producers Banks account in Metrobank without any
    justification. It cannot be validly claimed that FCC, and not Producers Bank, should be
    considered as having been unjustly enriched. It must be remembered that FCCs money
    market placement with Producers Bank was already due and demandable; thus,
    Producers Banks payment thereof was justified.

    Clearly, Producers Bank must be held liable to Allied and Metrobank for the amount
    of the check plus 12% interest per annum, moral damages, attorney’s fees, and costs
    of suit which Allied and Metrobank are adjudged to pay Lim Sio Wan based on a
    proportion of 60:40.

    Thus, the Supreme Court held that the CA’s ruling be upheld with modification.
    Producers Bank was ordered to pay Allied and Metrobank the amounts.

    You might also like