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SCCPI vs FEBTC & CA

SAMSUNG CONSTRUCTION COMPANY PHILIPPINES, INC., Petitioner, - versus - FAR EAST BANK AND TRUST COMPANY AND COURT OF APPEALS, Respondents.

G.R. No. 129015 | 2004-08-13

D E C I S I O N


Tinga, J.:



Called to fore in the present petition is a classic textbook question - if a bank pays out on a forged check, is it liable to reimburse the drawer from whose account the funds were paid out? The Court of Appeals, in reversing a trial court decision adverse to the bank, invoked tenuous reasoning to acquit the bank of liability. We reverse, applying time-honored principles of law.





The salient facts follow.





Plaintiff Samsung Construction Company Philippines, Inc. ("Samsung Construction"), while based in Biñan, Laguna, maintained a current account with defendant Far East Bank and Trust...