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    San Carlos Milling Vs BPI, 1933

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    Jesa Formaran
    San Carlos Milling sued the Bank of the Philippine Islands (BPI) to recover ₽200,000 and ₽1 that were withdrawn using two forged checks bearing the forged signature of Newland Baldwin. The court held that BPI, not the China Banking Corporation, was responsible for verifying the endorsements on the cashier's check since it was the bank that cashed the check. While the China Banking Corporation drew its cashier's check payable to San Carlos Milling, it had the right to rely on BPI's endorsement when crediting BPI for the check. Therefore, the court affirmed the lower court's ruling absolving the China Banking Corporation of responsibility and holding that

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    San Carlos Milling Vs BPI, 1933

    Uploaded by

    Jesa Formaran
    65 views2 pages
    San Carlos Milling sued the Bank of the Philippine Islands (BPI) to recover ₽200,000 and ₽1 that were withdrawn using two forged checks bearing the forged signature of Newland Baldwin. The court held that BPI, not the China Banking Corporation, was responsible for verifying the endorsements on the cashier's check since it was the bank that cashed the check. While the China Banking Corporation drew its cashier's check payable to San Carlos Milling, it had the right to rely on BPI's endorsement when crediting BPI for the check. Therefore, the court affirmed the lower court's ruling absolving the China Banking Corporation of responsibility and holding that

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    San Carlos Milling vs BPI, 1933

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    San Carlos Milling sued the Bank of the Philippine Islands (BPI) to recover ₽200,000 and ₽1 that were withdrawn using two forged checks bearing the forged signature of Newland Baldwin. The court held that BPI, not the China Banking Corporation, was responsible for verifying the endorsements on the cashier's check since it was the bank that cashed the check. While the China Banking Corporation drew its cashier's check payable to San Carlos Milling, it had the right to rely on BPI's endorsement when crediting BPI for the check. Therefore, the court affirmed the lower court's ruling absolving the China Banking Corporation of responsibility and holding that

    Copyright:

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

    San Carlos Milling Vs BPI, 1933

    Uploaded by

    Jesa Formaran
    San Carlos Milling sued the Bank of the Philippine Islands (BPI) to recover ₽200,000 and ₽1 that were withdrawn using two forged checks bearing the forged signature of Newland Baldwin. The court held that BPI, not the China Banking Corporation, was responsible for verifying the endorsements on the cashier's check since it was the bank that cashed the check. While the China Banking Corporation drew its cashier's check payable to San Carlos Milling, it had the right to rely on BPI's endorsement when crediting BPI for the check. Therefore, the court affirmed the lower court's ruling absolving the China Banking Corporation of responsibility and holding that

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    Topic:

    Forged Checks

    San Carlos Milling vs BPI


    G.R. No. L-37467
    December 11, 1933

    FACTS:
    The business of the Philippine Islands was in the hands of Alfred D. Cooper, its agent
    under general power of attorney with authority of substitution. The principal employee in the
    Manila office was one Joseph L. Wilson, to whom had been given a general power of attorney
    but without power of substitution. In 1926 Cooper, desiring to go on vacation, gave a general
    power of attorney to Newland Baldwin and at the same time revoked the power of Wilson
    relative to the dealings with the Bank of the Philippine Islands, one of the banks in Manila in
    which plaintiff maintained. About a year thereafter Wilson, conspiring together with one
    Alfredo Dolores, a messenger-clerk in plaintiff’s Manila office, sent a cablegram in code to the
    company in Honolulu requesting a telegraphic transfer to the China Banking Corporation of
    Manila of $100,000. The money was transferred by cable, and upon its receipt the China
    Banking Corporation, likewise a bank in which plaintiff maintained a deposit, sent an exchange
    contract to plaintiff corporation offering the sum of P201,000, which was then the current rate
    of exchange. On this contract was forged the name of Newland Baldwin
    Shortly thereafter the crime was discovered, and upon the defendant bank refusing to
    credit plaintiff with the amount withdrawn by the two forged checks of P200,000 and P1, suit
    was brought against the Bank of the Philippine Islands, and finally on the suggestion of the
    defendant bank, an amended complaint was filed by plaintiff against both the Bank of the
    Philippine Islands and the China Banking Corporation.
    At the trial the China Banking Corporation contended that they had drawn a check to the credit
    of the plaintiff company, that the check had been endorsed for deposit, and that as the prior
    endorsement had in law been guaranteed by the Bank of the Philippine Islands, when they
    presented the cashier’s check to it for payment, the China Banking Corporation was absolved
    even if the endorsement of Newland Baldwin on the check was a forgery.

    ISSUE:
    WON San Carlos Milling may recover the amount of ₽200,00 and ₽1 from BPI
    HELD:
    The proof as to the falsity of the questioned signatures of Baldwin places the matter
    beyond reasonable doubt, nor is it believed that Baldwin signed checks in blank and turned
    them over to Wilson. As to the China Banking Corporation, it will be seen that it drew its check
    payable to the order of plaintiff and delivered it to plaintiff’s agent who was authorized to
    receive it. A bank that cashes a check must know to whom it pays. In connection with the
    cashier’s check, this duty was therefore upon the Bank of the Philippine Islands, and the China
    Banking Corporation was not bound to inspect and verify all endorsements of the check, even if
    some of them were also those of depositors in the bank. It had a right to rely upon the
    endorsement of the Bank of the Philippine Islands when it gave the latter bank credit for its
    own cashier’s check. Even if the court would treat the China Banking Corporation’s cashier’s
    check the same as the check of a depositor and attempt to apply the doctrines of the great
    Eastern Life Insurance Co. v. Hongkong & Shanghai Banking Corporation and National Bank and
    hold the China Banking Corporation indebted to plaintiff, we would at the same time have to
    hold that the Bank of the Philippine Islands was indebted to the China Banking Corporation in
    the same amount. As, however, the money was in fact paid to plaintiff corporation.
    Hence, the court hold that the China Banking Corporation is indebted neither to plaintiff
    not to the Bank of the Philippine Islands, and the judgment of the lower court so far as it
    absolved the China Banking Corporation from responsibility is affirmed.

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