Philippine Banking Corporation v. Court of Appeals

Summary

Philippine Banking Corporation sued Amalio L. Sarmiento for P4,126,000 based on promissory note no. 626-84. While Sarmiento admitted signing the promissory note, he denied receiving the loan proceeds. The evidence revealed that on the same day the bank credited the loan amount to Sarmiento's account, it was debited/withdrawn by the bank upon instructions from its head office. All three court levels dismissed the bank's complaint, finding insufficient evidence that Sarmiento actually received the loan proceeds. The Supreme Court affirmed, emphasizing that contracts without consideration do not exist under Article 1352 of the Civil Code, and that the bank's own actions of simultaneously crediting and debiting the amount negated its claim. The case demonstrates the principle that the existence of a promissory note alone is insufficient without proof that the borrower received the consideration.