Citibank N.A. v.
Sabeniano
GR No. 156132 || October 16, 2006
CHICO-NAZARIO, J.
CASE DOCTRINE (with reference to the topic in the syllabus)
A basic rule of evidence states that, “Evidence that one did or did not do a certain thing at one time is not admissible to
prove that he did or did not do the same or similar thing at another time; but it may be received to prove a specific intent or
knowledge, identity, plan, system, scheme, habit, custom or usage, and the like.”
SUMMARY:
Sabeniano had substantial deposits and money market placements with petitioners Citibank and FNCB Finance.
Petitioners alleged that Sabeniano obtained several loans from them, and consequently executed promissory notes
secured by a Declaration of Pledge of her dollar accounts and Deeds of Assignment of her money market placements.
When she failed to pay the loans, petitioners exercised their right to set-off or compensate respondent’s outstanding
loans, which the RTC declared illegal, null and void. When brought up to the CA, it affirmed the RTC decision with
modification, initially absolving Sabeniano of her indebtedness, and eventually, in petitioners’ Motion for Reconsideration,
deleting petitioners’ liability with respect to Sabeniano’s money marketp placements with the Ayala Investment &
Development Corporation. In the assailed CA decision, CA adopted its Third Division’s findings of fact in the Dy case,
which involved Citibank and its herein witness, Mr. Tan, as evidence of similar acts committed by petitioners. The Court,
in this respect, ruled that the CA’s act of taking judicial notice of said decision is unfounded since evidence that one did or
did not do a certain thing at one time is not admissible to prove that he did or did not do the same or similar thing at
another time.
FACTS:
● Sabeniano was a client of both petitioners Citibank N.A. (Citibank) and Investor’s Finance Corporation (FNCB
Finance), an affiliate company of the former.
● Sabeniano claimed to have substantial deposits and money market placements with petitioners, as well as money
market placements with the Ayala Investment and Development Corporation, the proceeds of which were
supposedly deposited and automatically to her account with Citibank She alleged that petitioners refused to return
her deposits and proceeds of her money market placements despite repeated demands, forcing her to file a Civil
Case against petitioners.
● However, petitioners Citibank and FNCB Finance, while admitting tha Sabeniano had deposits and money market
placements with them, alleged that she obtained several loans from Citibank, for which she executed several
Promissory Notes (PNs), secured by (a) a Declaration of Pledge of her dollar accounts in Citibank-Geneva, and
(b) Deeds of Assignment of her money market placements with FNCB Finance.
○ When Sabeniano failed to pay her loans, Citibank exercised its right to off-set or compensate
respondent’s outstanding loans with her deposits and mony market placements, and supposedly informed
Sabeniano of the matter. To their surprise, 6 years later, Sabeniano and her counsel made repeated
requests for the withdrawal of her deposits and moneky market placements with Citibank.
● The RTC ruled that the setoff effected by Citibank is illegal, null and void, and ordered the latter to refund the
amount to Sabeniano. However, it declared that Sabeniano is indebted to Citibank for the loans she failed to pay.
● On appeal to the CA, RTC’s decision was affirmed with modification, absolving Sabeniano of her indebtedness to
Citibank.
● Thus, Citibank filed a Motion for Reconsideration, which was partially granted by the CA.
○ It removed number 3, paragraph (v) of the dispositive portion 1 of the decision.
● Unsatisfied, petitioners filed the present petition for review on certiorari.
1
As defendants-appellants failed to account the following plaintiff-appellant's money market placements, savings account
and current accounts, the former is hereby ordered to return the same, in accordance with the terms and conditions
agreed upon by the contending parties as evidenced by the certificates of investments, to wit:
B2023(YOUR SURNAME) - LAW 110, PROF.
Digester’s Note: to facilitate the discussion on judicial notice, it must be noted that the assailed Decision of the Court of
Appeals took into account the CA’s declaration and conclusions in Sps. Dr. Ricardo L. Dy and Rosalind O. Dy vs. City
Bank, N.A., et al., that Francisco Tan, who was then Citibank’s Account Manager, and herein Citibank’s witness as its
former Assistant Vice-President, is guilty of fraud for his participation in the questionable transactions involving different
parties. However, neither the RTC nor the CA categorically declared Mr. Tan personally responsible for the forgeries.
In the present petition, Sabeniano dealt with Mr. Tan directly, and there was no third party involved who could have
perpetrated fraud or forgery in her loan transactions. Sabeniano attempted to raise suspicion as to the authenticity of her
signatures, but the same was not corroborated by evidence and were nothing more than naked allegations.
ISSUE(S), HOLDING, AND RATIO:
RULING RATIO
WON the Court can take judicial notice of the ● A basic rule of evidence states that evidence that one did or
Decision of the Court of Appeals in the Dy did not do a certain thing at one time is not admissible to prove
case as evidence of similar acts committed by that he did or did not do the same or similar thing at another
petitioner Citibank and Mr. Tan? -- NO time.
○ This rule is founded upon reason, public policy,
justice, and judicial convenience. The fact that a
person ascommitted the same or similar acts at some
prior time afford, as a general rule, no logical guaranty
that he commited the act in question. Subjectively, a
man’s mind and his modes of life may change;
objectively, the conditions under which he may find
himself at any given time may likewise chang and thus
indce him to act in a different way.
○ While the CA can take judicial notice of the Decision of
its Third Division in the Dy case, it should not have
done so in the assailed Decision, giving it much
weight, when the former does not constitute a
precedent. First, the CA did not apply any legal
argument or principle established in the Dy case, but
rather adopted the findings therein of wrongdoing or
misconduct against Citibank and Mr. Tan. Second, the
factual backgrounds of the two cases are so different
and unrelated that the Dy case cannot be used to
prove any intent, knowledge, identity, plan, system,
scheme, habit, custom, or usage on the part of
petitioner Citibank or Mr. Tan, to defraud herein
respondent.
○ Any finding of wrongdoing or misconduct as against
herein petitioners should be made based on the
factual background and pieces of evidence submitted
in this case.
DISPOSITIVE:
(v) The Two Million (P2,000,000.00) money market placements of Ms. Sabeniano with the Ayala Investment &
Development Corporation (AIDC) with legal interest at the rate of twelve percent (12%) per annum compounded yearly,
from 30 September 1976 until fully paid;
B2023(YOUR SURNAME) - LAW 110, PROF.
IN VIEW OF THE FOREGOING, the instant Petition is PARTLY GRANTED. The assailed Decision of the Court of
Appeals in CA-G.R. No. 51930, dated 26 March 2002, as already modified by its Resolution, dated 20 November 2002, is
hereby AFFIRMED WITH MODIFICATION, as follows —
1. PNs No. 23356 and 23357 are DECLARED subsisting and outstanding. Petitioner Citibank is ORDERED to return to
respondent the principal amounts of the said PNs, amounting to Three Hundred Eighteen Thousand Eight Hundred
Ninety-Seven Pesos and Thirty-Four Centavos (P318,897.34) and Two Hundred Three Thousand One Hundred Fifty
Pesos (P203,150.00), respectively, plus the stipulated interest of Fourteen and a half percent (14.5%) per annum,
beginning 17 March 1977;
2. The remittance of One Hundred Forty-Nine Thousand Six Hundred Thirty Two US Dollars and Ninety-Nine Cents
(US$149,632.99) from respondent's Citibank-Geneva accounts to petitioner Citibank in Manila, and the application of the
same against respondent's outstanding loans with the latter, is DECLARED illegal, null and void. Petitioner Citibank is
ORDERED to refund to respondent the said amount, or its equivalent in Philippine currency using the exchange rate at
the time of payment, plus the stipulated interest for each of the fiduciary placements and current accounts involved,
beginning 26 October 1979;
3. Petitioner Citibank is ORDERED to pay respondent moral damages in the amount of Three Hundred Thousand Pesos
(P300,000.00); exemplary damages in the amount of Two Hundred Fifty Thousand Pesos (P250,000.00); and attorney's
fees in the amount of Two Hundred Thousand Pesos (P200,000.00); and
4. Respondent is ORDERED to pay petitioner Citibank the balance of her outstanding loans, which, from the respective
dates of their maturity to 5 September 1979, was computed to be in the sum of One Million Sixty-Nine Thousand Eight
Hundred Forty-Seven Pesos and Forty Centavos (P1,069,847.40), inclusive of interest. These outstanding loans shall
continue to earn interest, at the rates stipulated in the corresponding PNs, from 5 September 1979 until payment thereof.
B2023(YOUR SURNAME) - LAW 110, PROF.
