Far East Bank & Trust Company v. Intermediate Appellate Court
REITERATIONFacts
The Antecedents: Maria Cristina L. Zaldarriaga and Rufino Faytaren, employees of Far East Bank & Trust Company (FEBTC), were terminated on March 16, 1971. The termination stemmed from the encashment of a P30,000 forged check on November 23, 1970. FEBTC had issued a memorandum on June 13, 1968, outlining strict procedures for check encashment, including requiring approval from at least two of the three top officers for checks P5,000.00 or more. Zaldarriaga alleged that Faytaren presented the forged check to her for encashment and instructed her on how to process it, while Faytaren denied this, claiming he presented a P5,000 check and only approved a cash requisition slip in the ordinary course of duty. Both employees were investigated and subsequently dismissed. Procedural History: Zaldarriaga filed a complaint for illegal dismissal, and Faytaren filed a similar complaint. The Bank filed a complaint for qualified theft against both. The trial court considered Zaldarriaga as having resigned and ordered Faytaren's dismissal unjustified, decreeing his retirement with entitlement to salaries and benefits for five years. Faytaren appealed to the Intermediate Appellate Court (IAC), which initially modified the decision, ordering Faytaren's dismissal and requiring both Faytaren and Zaldarriaga to jointly pay the P30,000 to the Bank. Upon reconsideration, the IAC reversed its decision, ordering Faytaren's reinstatement with full backwages and benefits. FEBTC appealed to the Supreme Court. The Petition: The Bank appealed the IAC's resolution ordering Faytaren's reinstatement, questioning whether Faytaren was illegally dismissed, should be reinstated, and should reimburse the Bank for the forged check.
Issue(s)
Whether the Appellate Court erred in holding that Faytaren was illegally dismissed. Whether Faytaren should be reinstated. Whether Faytaren should reimburse the Bank for the amount of the forged P30,000-check.
Ruling
The Supreme Court affirmed the decision of the Intermediate Appellate Court, as modified. It ordered the reinstatement of Rufino Faytaren to his former position with all the salaries, emoluments, and fringe benefits appertaining thereto, but limited to a period of three (3) years from the date of his dismissal.
Ratio Decidendi
On the issue of illegal dismissal: The Court held that Faytaren was illegally dismissed. The Intermediate Appellate Court found no clear proof of Faytaren's participation in the defraudation. This was based on several observations: Faytaren had no involvement in the issuance of the blank check book from which the forged check was taken; he had no signature or initial on the forged check, and there was evidence he refused to sign it; he denied presenting the forged check to Zaldarriaga, asserting he presented a P5,000 check which was corroborated; none of the Bank's employees substantiated Zaldarriaga's allegation against him; Faytaren had a good service record, receiving a certificate of appreciation shortly before the incident; the criminal charge against him was dismissed; and his investigation by the Bank's committee violated his right to due process as he was not given an opportunity to be heard and defend himself. On the issue of reinstatement: Inasmuch as Faytaren's dismissal was found to be unlawful, the Court upheld the Appellate Court's order for his reinstatement to his former position with all the salaries, emoluments, and fringe benefits. However, consistent with established jurisprudence, the Court limited the award of backwages and benefits to a period of three (3) years from the date of his dismissal, citing cases such as People's Industrial & Commercial Employees & Workers Organization (FFW) vs. People's Industrial & Commercial Corporation. On the issue of reimbursement: The Court did not explicitly order Faytaren to reimburse the Bank for the forged check, as the primary focus was on the legality of his dismissal and his right to reinstatement. The finding that there was no clear proof of his participation in the defraudation implicitly absolved him from direct liability for the loss incurred by the Bank due to the forged instrument.
Main Doctrine
The Court affirmed the Intermediate Appellate Court's resolution ordering the reinstatement of Rufino Faytaren, finding that his dismissal was unlawful due to lack of clear proof of his participation in the defraudation of the Bank and the violation of his right to due process. However, the reinstatement was limited to a period of three (3) years from the date of dismissal.