BPI vs.

IAC and Zshornack (1988)

FACTS:

The original parties to this case were Zshornack and Comtrust. In 1980, Comtrust was absorbed by BPI and was substituted as party to
the case.

Rizaldy Zshornack (Zshornack) maintained a dollar savings account and peso current account in Commercial
Bank and Trust Company of the Philippines (Comtrust).

Zshornack entrusted to Comtrust, through Assistant Branch Manager Virgilio V. Garcia (Garcia), $3,000 cash
(greenbacks) for safekeeping. This agreement was embodied in a document.

Five months later, Zshornack demanded the return of the greenbacks. The bank refused. Zshornack filed a
complaint in the trial court.

In its defense, petitioner bank explained the sum was disposed of by selling the greenbacks and depositing the
proceeds to Zshornack’s current account. It appears that at the time, there was a Central Bank Circular prohibiting
banks from foreign transactions except in cases where it sells it within 1 day to the Central Bank.

ISSUE:

W/N the contract entered into is a deposit.

W/N such deposit was valid
W/N petitioner bank is liable for the deposit.

HELD:

Yes. The document and the subsequent acts of the parties show that the intent of the parties was for the bank to
safely keep the dollars and return it to Zshornack at a later time.

Art. 1962. A deposit is constituted from the moment a person receives a thing belonging to another, with the
obligation of safely keeping it and of returning the same. If the safekeeping of the thing delivered is not the
principal purpose of the contract, there is no deposit but some other contract.

The deposit was not valid. Since the mere safekeeping of the greenbacks, without selling them to the Central
Bank within one business day from receipt, is a transaction which is not authorized by CB Circular No. 20, it
must be considered as one which falls under the general class of prohibited transactions. Hence, pursuant to
Article 5 of the Civil Code, it is void, having been executed against the provisions of a mandatory/prohibitory
law.

No. Having been executed against the provisions of a mandatory/prohibitory law, it affords neither of the parties
a cause of action against the other.

Art. 1411. When the nullity proceeds from the illegality of the cause or object of the contract, and the act
constitutes a criminal offense, both parties being in pari delicto, they shall have no cause of action against each
other. . .

Note: In the first cause of action, there was an unauthorized withdrawal of $1,000 from Zshornack’s account
when the bank issued a check payable to a certain Leovigilda Dizon (Dizon). The supreme court held that the
petitioner bank must be held liable for the unauthorized withdrawal.
Bishop of Jaro v. De la Peña (1913)

FACTS:

In 1898, Father De la Peña deposited P19,000 in his personal account in the Hongkong and Shanghai Bank at
Iloilo. Among the money deposited was P6,641 which he had on hand as trustee of a charitable bequest made for
the construction of a leper hospital.

During the war of the revolution, he was arrested as a political prisoner and the funds in his personal account
were confiscated. The military authorities claimed that he was an insurgent and the amount was collected for
revolutionary purposes.

ISSUE:

W/N Father De la Peña was liable to repay the money

HELD:

No. The Civil Code states that “a person obliged to give something is also bound to preserve it with the diligence
pertaining to a good father of the family.” It also provides that “no one shall be liable for events which could not
be foreseen, or which having been foreseen were inevitable, with the exception of the cases expressly mentioned
in the law or those in which the obligation so declares.”

By placing the money in the bank and mixing it with his personal funds De la Peña did not thereby assume an
obligation different from that under which he would have lain if such deposit had not been made, nor did he
thereby make himself liable to repay the money at all hazards. If the had been forcibly taken from his pocket or
from his house by the military forces of one of the combatants during a state of war, it is clear that under the
provisions of the Civil Code he would have been exempt from responsibility. The fact that he placed the trust
fund in the bank in his personal account does not add to his responsibility. Such deposit did not make him a debtor
who must respond at all hazards.