CHINA BANKING CORP VS ORTEGA
GR L-34964 January 31, 2973
FACTS:
Vicente Acaban won in a civil case for
sum of money against B & B Forest Development Corporation. To satisfy the
judgment, the Acaban sought the garnishment of the bank deposit of the B &
B Forest Development Corporation with the China Banking Corporation (CBC).
Accordingly, a notice of garnishment was issued by the Deputy Sheriff of the
trial court and served on said bank through its cashier, Tan Kim Liong. Liong
was ordered to inform the Court whether or not there is a deposit in the CBC of
B & B Forest Development Corporation, and if there is any deposit, to hold
the same intact and not allow any withdrawal until further order from the
Court. CBC and Liong refuse to comply with a court process garnishing the bank
deposit of a judgment debtor by invoking the provisions of Republic Act No.
1405 ( Secrecy of Bank Deposits Act) which allegedly prohibits the disclosure
of any information concerning to bank deposits.
ISSUES: Whether or
not a banking institution may validly refuse to comply with a court processes
garnishing the bank deposit of a judgment debtor, by invoking the provisions of
Republic Act No. 1405.
RULING:
NO. The lower court did not order an examination of or inquiry into deposit of
B & B Forest Development Corporation, as contemplated in the law. It merely
required Tan Kim Liong to inform the court whether or not the defendant B &
B Forest Development Corporation had a deposit in the China Banking Corporation
only for the purposes of the garnishment issued by it, so that the bank would
hold the same intact and not allow any withdrawal until further order. It is
sufficiently clear that the prohibition against examination of or inquiry into
bank deposit under RA 1405 does not preclude its being garnished to insure
satisfaction of a judgment. Indeed there is no real inquiry in such a case, and
the existence of the deposit is disclosed the disclosure is purely incidental
to the execution process. It is hard to conceive that it was ever within the
intention of Congress to enable debtors to evade payment of their just debts,
even if ordered by the Court, through the expedient of converting their assets
into cash and depositing the same in a bank.
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