MARGALLO, Vener Angelo C.
Bank of the Philippine Island and FGU Insurance Corporation v. Yolanda
Laingo
TOPIC: Notice of Loss
DOCTRINE
The "doctrine of representation," provides that notice to the agent is notice to
the principal. It is the duty of the agent to act in good faith for the
advancement of the interests of the principal.
“Art. 1884. The agent is bound by his acceptance to carry out the agency and is liable
for the damages which, through his non-performance, the principal may suffer. He
must also finish the business already begun on the death of the principal, should delay
entail any danger.
Art. 1887. In the execution of the agency, the agent shall act in accordance with the
instructions of the principal.”
FALLO: WHEREFORE, we DENY the petition. We AFFIRM the Decision of
the Court of Appeals.
FACTS:
 Rheozel Laingo (Rheozel), the son of respondent Yolanda Laingo
(Laingo), opened a "Platinum 2-in-1 Savings and Insurance" account with
petitioner Bank of the Philippine Islands (BPI). A Personal Accident
Insurance Coverage was also issued by FGU Insurance in the name of
Rheozel with Laingo as his named beneficiary.
 Rheozel died due to a vehicular accident as evidenced by a Certificate of
Death.
 Laingo instructed the family's personal secretary, Alice Torbanos (Alice)
to go to BPI h and inquire about the savings account of Rheozel. Laingo
wanted to use the money in the savings account for Rheozel's burial and
funeral expenses. Due to Laingo's credit standing and relationship with
BPI, BPI accommodated Laingo who was allowed to withdraw P995,000
from the account of Rheozel.
 More than two years later, Rheozel's sister, Rhealyn Laingo-Concepcion,
while arranging Rheozel's personal things in his room found the Personal
Accident Insurance Coverage Certificate issued by FGU Insurance.
Rhealyn immediately conveyed the information to Laingo.
 Laingo sent two letters to BPI an FGU Insurance requesting them to
process her claim as beneBciary of Rheozel's insurance policy. FGU
Insurance sent a reply-letter to Laingo denying her claim. FGU Insurance
stated that Laingo should have Bled the claim within three calendar
months from the death of Rheozel as required under Paragraph 15 of the
Personal Accident Certificate of Insurance.
 RTC Decision: In favor of respondents. The trial court ruled that the
prescriptive period of 90 days shall commence from the time of death of
the insured and not from the knowledge of the beneficiary.
 CA: Reversed the ruling of the trial court. The Court of Appeals ruled
that Laingo could not be expected to do an obligation which she did not
know existed.
ISSUE:
Whether or not Laingo, as named beneficiary who had no knowledge of the
existence of the insurance contract, is bound by the three-calendar month
deadline for Bling a written notice of claim upon the death of the insured?
RATIO:
 Laingo argues that she dealt with BPI after her son's death, when she was
allowed to withdraw funds from his savings account in the amount of
P995,000. However, BPI did not notify her of the attached insurance
policy.
 As the main proponent of the 2-in-1 deposit account, BPI tied up with its
affiliate, FGU Insurance, as its partner. Any customer interested to open
a deposit account under this 2-in-1 product, after submitting all the
required documents to BPI and obtaining BPI's approval, will
automatically be given insurance coverage. Thus, BPI acted as agent of
FGU Insurance with respect to the insurance feature of its own marketed
product.
 An insurance company has the duty to communicate with the beneficiary
upon receipt of notice of the death of the insured. This notification is how
a good father of a family should have acted within the scope of its
business dealings with its clients.
 Since BPI is the agent of FGU Insurance, then such notice of death to BPI
is considered as notice to FGU Insurance as well. FGU Insurance cannot
now justify the denial of a beneficiary's insurance claim for being Bled
out of time when notice of death had been communicated to its agent
MARGALLO, Vener Angelo C.

within a few days after the death of the depositor-insured. In short, there
was timely notice of Rheozel's death given to FGU Insurance within three
months from Rheozel's death as required by the insurance company.
 Since BPI, as agent of FGU Insurance, fell short in notifying Laingo of the
existence of the insurance policy, Laingo had no means to ascertain that
she was entitled to the insurance claim.