Salvacion v. Central Bank of the Philippines (G.R. No. 94723)


Greg Bartelli y Northcott, an American tourist, was charged with serious Illegal detention and Rape of herein petitioner Karen Salvacion. Upon his arrest, it was recovered from him among others, bank books and a dollar account with China Bank Corp. On the day of the hearing of his petition for bail, he was able to escape from jail. Pending his arrest the criminal cases were archived. Meanwhile, in the Civil Case against Bartelli, the Judge granted the prayer of attachment and a notice of garnishment was served on China Bank. China Bank invoked R.A. No. 1405 and later on, Section 113 Central Bank Circular No. 960 to the effect that the dollar deposits of Bartelli are exempt from attachment, garnishment, or any other order or process of any court, legislative body, government agency or any administrative body whatsoever. This prompted petitioner’s counsel to inquire herein respondent whether the said circular has any exception or has been repealed/amended. Respondent cited that the provision is absolute in application. Meanwhile, the court has rendered judgment in favor of petitioners. Petitioners tried to execute on Bartelli’s dollar deposit with China Bank but the bank invoked the CB Circular. Thus, petitioners decided to seek relief from this Court.


Whether or not the secrecy of foreign currency deposits should be made applicable to a foreign transient?

Ruling: NO.

This Court finds the petition to be partly meritorious.

It is worth mentioning that R.A. No. 6426 was enacted in 1983 or at a time when the country’s economy was in a shambles; when foreign investments were minimal and presumably, this was the reason why said statute was enacted. But the realities of the present times show that the country has recovered economically; and even if not, the questioned law still denies those entitled to due process of law for being unreasonable and oppressive. The intention of the questioned law may be good when enacted. The law failed to anticipate the iniquitous effects producing outright injustice and inequality such as the case before us.

In his Comment, the Solicitor General correctly opined, thus:

It is evident from the above [Whereas clauses] that the Offshore Banking System and the Foreign Currency Deposit System were designed to draw deposits from foreign lenders and investors (Vide second Whereas of PD No. 1034; third Whereas of PD No. 1035). It is these deposits that are induced by the two laws and given protection and incentives by them. Obviously, the foreign currency deposit made by a transient or a tourist is not the kind of deposit encouraged by PD Nos. 1034 and 1035 and given incentives and protection by said laws because such depositor stays only for a few days in the country and, therefore, will maintain his deposit in the bank only for a short time.

Respondent Greg Bartelli, as stated, is just a tourist or a transient. He deposited his dollars with respondent China Banking Corporation only for safekeeping during his temporary stay in the Philippines.

For the reasons stated above, the Solicitor General thus submits that the dollar deposit of respondent Greg Bartelli is not entitled to the protection of Section 113 of Central Bank Circular No. 960 and PD No. 1246 against attachment, garnishment or other court processes.

In fine, the application of the law depends on the extent of its justice. Eventually, if we rule that the questioned Section 113 of Central Bank Circular No. 960 which exempts from attachment, garnishment, or any other order or process of any court, legislative body, government agency or any administrative body whatsoever, is applicable to a foreign transient, injustice would result especially to a citizen aggrieved by a foreign guest like accused Greg Bartelli. This would negate Article 10 of the New Civil Code which provides that “in case of doubt in the interpretation or application of laws, it is presumed that the lawmaking body intended right and justice to prevail. “Ninguno non deue enriquecerse tortizeramente con dano de otro.” Simply stated, when the statute is silent or ambiguous, this is one of those fundamental solutions that would respond to the vehement urge of conscience.

IN VIEW WHEREOF, the provisions of Section 113 of CB Circular No. 960 and PD No. 1246, insofar as it amends Section 8 of R.A. No. 6426 are hereby held to be INAPPLICABLE to this case because of its peculiar circumstances.


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