People's Bank and Trust Company v. Leonidas
REITERATIONFacts
The Antecedents: A woman, identifying herself as Aurora S. de Arabis, purchased appliances from Melchor Samonte using a Philippine American Life Insurance Company (Philamlife) check for P7,716.80 drawn against Far East Bank and Trust Company (FEBTC). Samonte deposited the check into his account with People's Bank and Trust Company (now Bank of the Philippine Islands), which subsequently cleared the check. Procedural History: FEBTC notified People's Bank that the payee's signature on the check was forged, supported by an affidavit from Aurora S. de Arabis stating she had not received the check and used only her thumbmark for signatures as she could not write. People's Bank refunded FEBTC and debited Samonte's account, resulting in an overdraft of P7,679.83, which Samonte refused to pay. The City Court ruled in favor of People's Bank, ordering Samonte to pay. The Court of First Instance reversed this decision. The Petition: People's Bank filed a petition for review on certiorari to annul the decision of the Court of First Instance, which reversed the City Court's ruling and dismissed the bank's claim.
Issue(s)
Whether the affidavit of Aurora S. de Arabis is admissible as evidence. Whether the petitioner bank sufficiently proved the forgery of the payee's signature.
Ruling
The petition is denied for lack of merit. The decision of the Court of First Instance is affirmed.
Ratio Decidendi
On the admissibility of the affidavit of Aurora S. de Arabis: The Court held that the affidavit of Aurora S. de Arabis was inadmissible as evidence due to the hearsay rule. Affidavits are generally considered hearsay because they are often prepared by individuals other than the affiant, potentially misrepresenting the affiant's statements, and crucially, they deprive the adverse party of the opportunity to cross-examine the affiant. The Court emphasized that for an affidavit to be admissible, especially when alleging forgery, the affiant must be presented in court to testify on the matters contained therein and be subject to cross-examination. The failure of the petitioner's counsel to present Aurora S. de Arabis as a witness rendered the affidavit inadmissible. On whether the petitioner bank sufficiently proved the forgery of the payee's signature: The Court ruled that without the admissible affidavit of Aurora S. de Arabis, there was no competent evidence to prove the alleged forgery. The appellate judge correctly noted that the affidavit, being hearsay and incompetent, should not have been admitted. Consequently, the petitioner bank failed to establish the forgery of the payee's signature. As a result, the case filed by the petitioner bank, which was based on this unproven forgery, must necessarily fall. The absence of competent proof of forgery meant that the petitioner's claim could not be sustained.
Main Doctrine
An affidavit is generally inadmissible as hearsay evidence unless the affiant is presented in court to testify thereon and be subject to cross-examination. The failure to present the affiant is fatal to the case.