FACTS:

Emme Herrero filed a complaint for damages against Citytrust Banking Corporation. She alleged that she regularly made deposits with Citytrust and on May 15, 1980, she deposited P31,500.00 to cover six postdated checks she issued. However, when the checks were presented for encashment, they were dishonored except for the last check which Herrero personally redeemed in cash. Citytrust contended that the dishonor of the checks was Herrero's fault because she inaccurately wrote her account number on the deposit slip. The trial court dismissed the complaint, but the Court of Appeals reversed the decision, ordering Citytrust to pay Herrero nominal damages, temperate and moderate damages, and attorney's fees. Citytrust seeks review of the case before the Supreme Court.

ISSUES:

1. Whether the petitioner bank should be held liable for dishonoring the postdated checks due to incorrect account number indicated in the deposit slip.

RULING:

1. The Supreme Court ruled in favor of the respondent and affirmed the decision of the Court of Appeals. The petitioner bank was held liable for dishonoring the postdated checks. The Court held that even if there was an error on the part of the respondent in omitting a zero in her account number, her name was clearly written on the deposit slip. The use of numbers by the bank is simply for convenience, but it should not disregard the real name of its depositors. The bank has the duty to protect its clients and depositors by ensuring that all funds are properly accounted for and posted in its ledgers. The bank teller should not have accepted the deposit without correcting the inaccurate account number on the deposit slip.

PRINCIPLES:

• Banks have the obligation to honor checks that are sufficiently funded and to protect their clients and depositors.

• The name of the depositor is controlling in determining in whose account the deposit is made or should be posted, as it is less likely to commit an error in one's name compared to numbers.

• The use of numbers in bank transactions is for convenience and should not disregard the real name of the depositors.

• Bank tellers have the duty to ensure that all information provided by depositors is accurate and to correct any errors before accepting the deposit.