Costly arrogance

Moral damages are awarded to enable the injured party to obtain means diversions or amusements that will serve to alleviate the moral suffering he/she has undergone by reason of the culpable action of another person.There is no hard and fast rule in determining the proper amount of the award but it must be proportionate to the suffering inflicted to achieve a "spiritual status quo". So each case must be governed by its own peculiar circumstances. This case of Virgilio is an example of the award of moral damages due to gross negligence of the bank in the handling of its client’s deposit accounts.

Virgilio was a businessman and the highest lay person of a methodist church. He had a savings deposit with a bank well known for its Express Teller System, a twenty four hour banking service. On Aug. 20, 1990, when his savings deposit account had a remaining balance of P367.78 only, he deposited a check in the amount of P3,500. Four days later, on Aug. 24, 1990 when the check deposit was supposed to have been cleared already, he asked his daughter to withdraw P2,000 to fulfill his obligation to a valued creditor. But the withdrawal was declined twice as the Express Teller Transaction record showed: "Sorry, Insufficient Funds". So he could not then and there produce the required cash with which to fulfill his commitment and monetary obligation to his valued creditor who was waiting at his residence. As a result, his credit line was cut off.

Three weeks later, when Virgilio deposited another amount of P5,500, he found out that his earlier check deposit of P3,500 had not yet been reflected in his deposit account as his balance was only P342.38 after deducting a penalty of P25. Virgilio complained to the bank about the discrepancy. The bank confirmed that there was a check deposit but the deposit envelope was missing. It did not, however, investigate until Virgilio himself informed them that his P3,500 check was encashed by the bank’s security guard. The bank’s indifference was further aggravated by the discourtesy and arrogance of its officers when it finally credited his account for the missing P3,500 after Virgilio’s persistent prompting.

Thus, Virgilio still sued the bank for recovery moral damages. After trial, the Regional Trial Court (RTC) ruled in favor of Virgilio and awarded him P200,000 moral damages. The Court of Appeals (CA) affirmed the ruling of the lower court. The CA said that the bank was indeed grossly negligent amounting to bad faith in its failure to observe the required degree of care. But it reduced the award of moral damges from P200,000 to P50,000 because Virgilio’s claim of only P3,500 had already been credited to his savings account.

Was the CA correct ?

Partly correct.

Moral damages are meant to compensate claimant for any physical suffering, mental anguish, fright, serious anxiety, besmirch reputation, wounded feelings, moral shock, social humiliation and similar injuries unjustly caused. Trial courts are given the discretion in determining the amount, with the limitation that it should not be palpably and scandalously excessive. It must be commensurate to the loss or injury suffered and the social standing of the aggrieved party so that the goal of enabling him to obtain means, diversions, or amusements to restore him to the spiritual status quo ante would be achieved.

In this case the award should be increased to P100,000 considering that (1) Virgilio was a businessman, and the highest lay person in his Church; (2) he was treated by the bank and its officer with arrogance and condescension; and (3) the bank has successfully postponed compensating him for more than a decade of court litigation. The amount is more than the P50,000 granted by the CA but not as much as the P200,000 granted by the RTC.

Though the amount of P3,500 was already credited back to his account, this step was made only after his persistent prompting. Prior to this development, he suffered damages that could no longer be reversed by the belated restoration of the amount lost. It is for this suffering that moral damages are due (Samson, Jr. vs. Bank of P.I. G.R. 150487 July 10, 2003).

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