24/08/2026
The Supreme Court (SC) has ruled that a bank cannot require a depositor to return money they already withdrew on the ground of unjust enrichment when the loss was caused by the bank’s own gross negligence.
In a Decision written by Associate Justice Japar B. Dimaampao, the SC’s Third Division denied the petition filed by BDO Unibank, Inc. (BDO), holding that the bank’s disregard of its own banking policy amounted to gross negligence.
The case stemmed from Cristina Barcellano’s (Barcellano) deposit of a regional check worth PHP 151,200 from an Albay branch of Landbank into her savings account at BDO’s Lucena City branch.
The BDO teller mistakenly validated the check as local instead of regional, allowing the amount to be credited after only three banking days instead of the required seven.
Believing the funds were available, Barcellano withdrew PHP 76,000. Shortly after, BDO received a stop payment order on the check and demanded that she return the money. Although Barcellano initially agreed, she never repaid the amount. BDO later refused to release the remaining balance and filed a criminal complaint for estafa.
Both the Regional Trial Court and the Court of Appeals acquitted Barcellano, finding no fraud, deceit, or abuse of confidence on her part and blamed BDO’s own negligence.
Before the SC, BDO asked for a review of the civil aspect of the case, arguing that despite Barcellano's acquittal, she should still be required to return the money. BDO argued that her refusal amounted to unjust enrichment and that since the funds were released due to its error in processing the check, Barcellano was required to return them based on the principle of 𝘴𝘰𝘭𝘶𝘵𝘪𝘰 𝘪𝘯𝘥𝘦𝘣𝘪𝘵𝘪, which requires the repayment of money received by mistake.
The SC disagreed, ruling that there was no unjust enrichment because BDO failed to prove that Barcellano knowingly received and retained a benefit to which she was not entitled.
SC declared that the bank did not explain why the stop payment order was issued or show that Barcellano knew the check would not be honored. Instead, the evidence showed that she withdrew the money in good faith after BDO itself made the funds available in her account.
The SC also ruled that BDO’s own gross negligence caused its loss. It found that the bank credited the check before it had properly cleared it, incorrectly treated a regional check as a local check, and failed to detect the error until after receiving the stop payment order. These lapses showed a failure to observe basic safeguards meant to protect the bank from the risks of invalid checks.
The SC also rejected BDO’s reliance on solutio indebiti. Although the doctrine generally requires the return of money received by mistake, it does not apply when the mistake resulted from the payor’s own gross negligence. Here, BDO’s error stemmed from its failure to exercise the extraordinary diligence and reasonable prudence required of banks.
Read the full text of the press release at https://sc.judiciary.gov.ph/?p=171657
Read the full text of the Decision at https://sc.judiciary.gov.ph/261264-bdo-unibank-inc-vs-cristina-barcellano-y-riego/
Copying of this content is subject to the SC PIO’s Credit Attribution Policy: https://sc.judiciary.gov.ph/credit-attribution
