BSB Group, Inc. vs. Go

Evidence pertaining to a bank deposit is inadmissible under R.A. No. 1405 when the money in the account is not itself the subject matter of the action as alleged in the Information; the subject matter of the litigation must be determined from the charging instrument, not from the evidence sought to be admitted. Additionally, evidence that respondent endorsed and deposited checks into her personal account is irrelevant to a charge of theft of "cash money," because proof of check indorsement and deposit establishes conversion, which characterizes estafa rather than theft.

Petitioner BSB Group, Inc. is a domestic corporation presided by Ricardo Bangayan. Respondent Sally Go, also referred to as Sally Sia Go and Sally Go-Bangayan, is Bangayan's wife and was employed by the company as a cashier, tasked with receiving and accounting for customer payments. In 2002, Bangayan filed a complaint for estafa and/or qualified theft against respondent, alleging that customer checks totaling ₱1,534,135.50 were endorsed by respondent and deposited into her personal account at Security Bank and Trust Company rather than turned over to the company. The assistant city prosecutor recommended filing an Information for qualified theft, and respondent was accordingly charged before the Regional Trial Court of Manila, Branch 36.

Petitioner BSB Group, Inc. is a domestic corporation headed by its president, Ricardo Bangayan. Respondent Sally Go, also known as Sally Sia Go and Sally Go-Bangayan, is Bangayan's wife and was employed by the company as cashier, responsible for receiving and accounting for customer payments. In 2002, Bangayan filed a complaint with the Manila Prosecutor's Office charging respondent with estafa and/or qualified theft, alleging that several checks totaling ₱1,534,135.50 issued by the company's customers in payment of their obligations were, instead of being turned over to the company, indorsed by respondent and deposited into her personal account at Security Bank and Trust Company, Divisoria Branch. The assistant city prosecutor found the evidence uncontroverted and recommended filing an Information for qualified theft.

Respondent was accordingly charged before the Regional Trial Court of Manila, Branch 36, in an Information alleging that between January 1988 and October 1989, respondent willfully and unlawfully, with intent to gain and without the owner's knowledge and consent, took, stole, and carried away cash money in the total amount of ₱1,534,135.50 belonging to BSB Group of Companies, the offense being qualified by grave abuse of confidence, respondent being then employed as cashier and thus entrusted with the said amount. Respondent entered a negative plea at arraignment.

During trial, the prosecution moved for the issuance of subpoena duces tecum/ad testificandum against the managers or records custodians of Security Bank's Divisoria Branch and Asian Savings Bank (later Metrobank) in Jose Abad Santos, Tondo, on the premise that respondent had encashed the subject checks and deposited the proceeds to her personal accounts. The trial court granted the motion. Respondent filed a motion to quash the subpoena addressed to Metrobank, arguing that the complaint-affidavit made no mention of that bank account, while simultaneously waiving objection to the relevancy of the Security Bank account. Petitioner opposed, asserting relevancy of the Metrobank account because the complaint-affidavit showed two checks were allegedly deposited there. Respondent filed a supplemental motion to quash invoking the absolute confidentiality of the Metrobank account under R.A. No. 1405. The trial court denied the motion to quash for lack of merit.

The prosecution then presented the testimony of Elenita Marasigan, Security Bank's representative, who testified that between 1988 and 1989 respondent, while employed as cashier, was able to take checks issued to the company, endorse them, and credit the corresponding amounts to her personal deposit account with Security Bank. The subject checks were presented to Marasigan for identification and marking. Before the testimony could be completed, respondent filed a Motion to Suppress, seeking exclusion of Marasigan's testimony and accompanying documents on grounds of irrelevancy and the privilege of confidentiality under R.A. No. 1405. The trial court denied the motion on September 13, 2004, and denied reconsideration on November 5, 2004. Respondent elevated the matter to the Court of Appeals via petition for certiorari under Rule 65. The Court of Appeals granted the petition, reversed the assailed orders, and ordered Marasigan's testimony stricken from the records. Petitioner's motion for reconsideration was denied, prompting the instant petition under Rule 45.

• Relevance of Bank Account Evidence: Petitioner asserted that the testimony of Marasigan and accompanying documentary evidence had a direct relation to the subject matter of the case for qualified theft, thereby bringing the case within the exception to the confidentiality rule under R.A. No. 1405 where the money deposited is the subject matter of the litigation.
• Subject Matter Determined by Information: Petitioner argued that the subject matter in litigation is to be determined by the allegations in the Information, and alluded to the trial court's November 5, 2004 Order which declared erroneous the limitation of the inquiry merely to what was contained in the Information.
• Equivalence of Cash and Check: Petitioner posited that there is no difference between cash and check for purposes of prosecuting respondent for theft of cash, maintaining that the checks represented the cash money stolen by respondent and that the subject matter included both the cash amount represented by the checks and the checks themselves.
• Sufficiency of the Information: Petitioner asserted the sufficiency of the allegations in the Information for qualified theft, as the same sufficiently alleged the elements of the offense charged, and through Marasigan's testimony the prosecution would establish that the checks had been received by respondent as cashier and thereafter deposited to her personal account.

• Irrelevance of Security Bank Account: Respondent claimed that the money represented by the Security Bank account was neither relevant nor material to the case, because nothing in the criminal Information suggested that the money deposited therein was the subject matter of the case.
• "Cash Money" Not Synonymous with Checks: Respondent advanced the notion that the term "cash money" stated in the Information was not synonymous with the checks she was purported to have stolen and deposited in her personal banking account, and thus the checks and Marasigan's testimony should be suppressed at least for violating respondent's right to due process.
• Violation of Bank Secrecy Law: Respondent argued that admitting Marasigan's testimony and the evidence pertaining to the Security Bank account would violate the secrecy rule under R.A. No. 1405.

• Relevance of Evidence: Whether the testimony of Marasigan and the accompanying documentary evidence pertaining to respondent's personal Security Bank account are relevant to the prosecution of respondent for qualified theft of cash as charged in the Information.
• Bank Secrecy Confidentiality: Whether the admission of such testimony and documentary evidence constitutes an unallowable inquiry into bank deposits under R.A. No. 1405.

• Relevance of Evidence: No. The testimony and documentary evidence are irrelevant to the charge of qualified theft of cash, because the Information alleged theft of "cash money" and made no factual allegation involving the checks or the bank account; proof that respondent indorsed checks and deposited the proceeds establishes conversion, which characterizes estafa rather than theft.
• Bank Secrecy Confidentiality: Yes, the admission of such evidence constitutes an impermissible inquiry under R.A. No. 1405. The money in respondent's Security Bank account is not the subject matter of the litigation as determined from the Information, and the exception under Section 2 of R.A. No. 1405 does not apply.

• Relevance of Evidence: The elements of theft are: (a) taking of personal property belonging to another; (b) with intent to gain; (c) without the owner's consent; (d) without violence against or intimidation of persons or force upon things; and (e) with abuse of confidence. The fact in issue as alleged in the Information is that respondent took away cash amounting to ₱1,534,135.50 from the coffers of petitioner. Petitioner sought to establish the elemental act of taking by proving that respondent deposited customer checks into her personal Security Bank account. However, petitioner's own line of argument — that respondent fraudulently indorsed and deposited checks in her own name — effectively seeks to establish the commission not of theft but of some other crime, probably estafa. In estafa by conversion, whether the thing converted is cash or check is immaterial, because a check, while not legal tender, is accepted as a substitute for cash and the credit it represents is capable of appropriation; the offense is continuing, and what the offender does with the check subsequent to the unlawful taking becomes material. Theft, however, is not of such character. The act of unlawful taking in theft connotes deprivation of personal property with intent to gain, and it is immaterial whether the offender can freely dispose of the property. Because the Information accuses respondent of stealing cash, proof tending to establish that she indorsed checks and deposited the proceeds becomes not only irrelevant but also immaterial and, on that score, inadmissible.

• Bank Secrecy Confidentiality: R.A. No. 1405, the Bank Secrecy Act of 1955, declares all deposits of whatever nature with banks or banking institutions in the Philippines as absolutely confidential and prohibits their examination, inquiry, or looking into, except in enumerated cases including where the money deposited is the subject matter of the litigation. The subject matter of the action for purposes of this exception must be determined from the indictment that charges respondent with the offense, not from the evidence the prosecution seeks to admit. The Information charges respondent with qualified theft by abusing petitioner's trust and stealing cash amounting to ₱1,534,135.50. It makes no factual allegation involving the checks or the supposed bank account in which the proceeds were allegedly kept. The subject matter of the action is the money alleged to have been stolen, and not the money equivalent of the checks sought to be admitted in evidence. The admission of the testimony and documentary evidence serves no other purpose than to establish the existence, nature, and amount of the bank account — an impermissible inquiry into a deposit protected by law. Any doubts in upholding the absolutely confidential nature of bank deposits against the authority to inquire must be resolved in favor of confidentiality, unless Congress reverses the general state policy.

• Subject Matter of the Litigation under R.A. No. 1405 — For purposes of the exception to the bank secrecy rule allowing inquiry into a deposit "where the money deposited or invested is the subject matter of the litigation," the subject matter must be determined from the allegations in the Information or charging instrument, not from the evidence the prosecution seeks to introduce. The money in a bank account falls within this exception only when the account itself is the ostensible subject of the prosecution's inquiry as reflected in the indictment. In this case, because the Information alleged theft of cash and made no reference to checks or to the Security Bank account, the account was not the subject matter of the litigation and the exception did not apply.

• Distinction Between Theft and Estafa by Conversion — In theft, the act of unlawful taking connotes deprivation of personal property with intent to gain, and it is immaterial whether the offender can freely dispose of the property. In estafa by conversion, whether the thing converted is cash or check is immaterial, because a check is accepted as a substitute for cash and the credit it represents is capable of appropriation; the offense is continuing, and what the offender does with the check after the unlawful taking is material. Evidence proving that an accused indorsed checks and deposited the proceeds into her personal account establishes conversion, which is characteristic of estafa, not theft. Where the Information charges theft of cash, such evidence is irrelevant and inadmissible.

• Presumption in Favor of Bank Deposit Confidentiality — Where doubts arise in upholding the absolutely confidential nature of bank deposits against the authority to inquire into such accounts, such doubts must be resolved in favor of confidentiality. This attitude persists unless Congress reverses the general state policy respecting the absolutely confidential nature of bank deposits.

• "The subject matter of the action in the case at bar is to be determined from the indictment that charges respondent with the offense, and not from the evidence sought by the prosecution to be admitted into the records." — This passage articulates the controlling rule for identifying the subject matter of litigation under R.A. No. 1405, anchoring the determination in the charging instrument rather than the proffered evidence.

• "In other words, it can hardly be inferred from the indictment itself that the Security Bank account is the ostensible subject of the prosecution's inquiry. Without needlessly expanding the scope of what is plainly alleged in the Information, the subject matter of the action in this case is the money amounting to ₱1,534,135.50 alleged to have been stolen by respondent, and not the money equivalent of the checks which are sought to be admitted in evidence." — This clarifies that the subject matter is confined to what the Information alleges, precluding the prosecution from expanding the scope of inquiry through its evidence.

• "Should there be doubts in upholding the absolutely confidential nature of bank deposits against affirming the authority to inquire into such accounts, then such doubts must be resolved in favor of the former." — This is the canonical formulation of the presumption favoring bank deposit confidentiality, frequently cited in subsequent jurisprudence on R.A. No. 1405.

• China Banking Corporation vs. Ortega, G.R. No. L-34964, January 31, 1973 — Addressed whether the prohibition against examination of bank deposits precludes garnishment in satisfaction of a judgment. The Court held it does not, drawing on legislative deliberations to explain that the absolute confidentiality rule aims at protection from unwarranted inquiry into the existence, nature, and amount of a deposit, not at placing deposits beyond execution to satisfy a final judgment. In the present case, this precedent was relied upon to explain the measure of protection afforded by R.A. No. 1405.

• Union Bank of the Philippines vs. Court of Appeals, G.R. No. 134699, December 23, 1999 — Noted that the inquiry into bank deposits allowable under R.A. No. 1405 must be premised on the fact that the money deposited in the account is itself the subject of the action. This case was the controlling authority for determining what constitutes the subject matter of litigation under Section 2 of R.A. No. 1405.

• Mathay vs. Consolidated Bank and Trust Co., G.R. No. L-23136, August 26, 1974 — Explained what the subject matter of an action is, referring to the physical facts, things real or personal, money, lands, chattels, and the like, in relation to which the suit is prosecuted. The Court distinguished this case, noting it was decided in the context of determining whether a class suit was properly brought, and found petitioner's reliance on it off-tangential.

• Valenzuela vs. People, G.R. No. 160188, June 21, 2007 — Cited for the principle that in theft, the act of unlawful taking connotes deprivation of personal property with intent to gain, and it is immaterial whether the offender can freely dispose of the property stolen.

• Galvez vs. Court of Appeals, G.R. No. L-22760, November 29, 1971 — Cited for the principle that in estafa by conversion, whether the thing converted is cash or check is immaterial, and the offense is continuing such that what the offender does with the check after the unlawful taking is material.

• Section 2, Republic Act No. 1405 (Bank Secrecy Act of 1955) — Declares all deposits of whatever nature with banks or banking institutions in the Philippines as absolutely confidential and prohibits their examination, inquiry, or looking into, except upon written permission of the depositor, in cases of impeachment, upon order of a competent court in cases of bribery or dereliction of duty of public officials, or in cases where the money deposited or invested is the subject matter of the litigation. The Court applied this provision to exclude the testimony and documentary evidence pertaining to respondent's Security Bank account, holding that the account was not the subject matter of the litigation as alleged in the Information.

• Section 3, Rule 128 of the Rules of Court — Provides that evidence is admissible when it is relevant to the issue and is not excluded by law or the rules. The Court applied this provision to test the relevance and competency of the proffered evidence, finding it irrelevant to the charge of theft of cash and excluded by operation of R.A. No. 1405.

• Section 4, Rule 128 of the Rules of Court — Defines relevant evidence as evidence having such direct relation to the fact in issue as to induce belief in its existence or non-existence, or relating collaterally to a fact from which an inference may be made as to the existence or non-existence of the fact in issue. The Court used this standard to assess whether Marasigan's testimony and the checks had a logical and reasonable connection to the prosecution of respondent for qualified theft, concluding they did not.

Renato C. Corona (Chairperson), Presbitero J. Velasco, Jr., Antonio Eduardo B. Nachura, and Jose Catral Mendoza concurred.