510 SCRA 259



Cablizo maintained an account with petitioner.  It drew a check payable to cash payable to a certain Marquez, for the latter’s sales commission.  The check  was  subsequently  deposited  in  Westmont  bank  and  the  latter submitted it with Metrobank for clearing.  The check was cleared.   
Thereafter, the bank’s representative asked Cablizo if he issued a check for P91,000.  The answer was in the negative.  This prompted Cablizo to call Metrobank  and  ask  for  the  recrediting  of  P90,000  but  petitioner  failed  to recredit the amount prompting Cablizo to file an action against it.   


An alteration is said to be material if it alters the effect of the instrument.  It means an unauthorized change in the instrument that purports to modify in  any  respect  the  obligation  of  a  party  or  an  unauthorized  addition  of words or numbers or other change to an incomplete instrument relating to the  obligation  of  the  party.    In  other  words,  a  material  alteration  is  one which changes the items which are required to be stated under Section 1 of the NIL.   
The check in issue was materially altered when its amount was increased from P1000 to P91000.  Cablizo was not the one who authorized or made such  increase.    There  is  no  showing  that  he  was  negligent  in  exercising what was due in a prudent man which could have otherwise prevented the
loss.    Cablizo  was  never  remiss  in  the  preparation  and  issuance  of  the check.

The  doctrine  of  equitable  estoppel  is  inapplicable  against  Cablizo.    This doctrine states that when one of the two innocent person, each guiltiness of an intentional or moral wrong, must suffer a loss, it must be borne by the one whose erroneous conduct, either by omission or commission, was the cause of the injury.  Negligence is never presumed.
Metrobank  was  actually  the  one  remiss  in  its  duties.    The  CA  took  into consideration that  the alterations were actually visible in the eye and yet the bank allowed someone not acquainted with the examination of checks to  do  the  same.    Furthermore,  it  cannot  rely  on  the  indorsement  of
Westmont Bank of the check.  It should have exercised meticulous care in handling the affairs of its clients especially if the client’s money is involved.