International Exchange Bank vs. Jose Co Lee

When a demurrer to evidence is granted as to some defendants while the main case remains pending against others, the proper remedy is a petition for certiorari under Rule 65, not an ordinary appeal. Furthermore, if a demurrer is granted by the trial court but reversed on appeal, the movant is deemed to have waived the right to present evidence, and the appellate court must render judgment on the merits based solely on the plaintiff's evidence.

A bank employee fraudulently transferred client investment proceeds to her boyfriend's account, who then transferred portions of the funds to the accounts of family members. The bank sued to recover the money, impleading the family members based on their receipt and use of the funds.

• Original Filing: RTC of Makati City, Branch 58, Civil Case No. 03-1361
• Lower Court Decision: March 1, 2017 — RTC granted respondents' Demurrer to Evidence, dismissing the complaint against Jose and Angela for insufficiency of evidence. May 22, 2017 — RTC denied UnionBank's Motion for Partial Reconsideration.
• Appeal: UnionBank filed a Notice of Appeal and Motion for Leave to Allow Notice of Appeal. Due to the RTC's inordinate delay in acting on the Motion for Leave, UnionBank withdrew its Notice of Appeal and filed a Petition for Certiorari with the CA (CA-G.R. SP No. 151834).
• CA Decision: August 17, 2018 — CA dismissed the certiorari petition, ruling that appeal was the proper remedy and the RTC committed no grave abuse of discretion. November 13, 2018 — CA denied reconsideration.
• SC Action: UnionBank filed a Petition for Review on Certiorari under Rule 45.

• The Fraud: Christina, iBank's treasury products sales associate, fraudulently informed her superior that clients Sy and Spouses Co intended to pre-terminate their Forward Foreign Exchange Placement Accounts. She tricked her superior into believing the funds in the settlement account belonged to her boyfriend, Jeffrey, resulting in the transfer of P8,800,000.00 and P8,244,645.27 to Jeffrey's account.
• The Transfers to Family Accounts: Jeffrey transferred portions of the fraudulently obtained funds to the accounts of Karin, Jose, and Angela. When iBank discovered the deceit, it reinstated the withdrawn amounts to the clients' accounts.
• The Demurrer: iBank sued Christina, Jeffrey, Violeta, Karin, Jose, and Angela. After iBank presented its evidence, Jose and Angela filed a Demurrer to Evidence. The RTC granted it, finding that iBank failed to prove Jose and Angela's participation in the fraud, failed to present the defrauded clients as witnesses, and failed to send a demand letter to Jose and Angela.
• Procedural Wrangle: UnionBank filed a Motion for Partial Reconsideration (denied) and then a Notice of Appeal with a Motion for Leave to Allow Notice of Appeal. The RTC failed to act on the Motion for Leave for over two months. Facing the expiration of the reglementary period for a certiorari petition, UnionBank withdrew its Notice of Appeal and filed a Petition for Certiorari with the CA. The CA dismissed the petition, holding that appeal was the proper remedy and the RTC committed no grave abuse of discretion.

• A petition for certiorari under Rule 65 was the correct remedy because a demurrer to evidence is akin to a motion to dismiss, and the dismissal was only against some parties while the main case remained pending (citing Rule 41, Section 1(g)).
• Certiorari was also justified due to the RTC's unjustifiable delay in acting on the Motion for Leave to file a Notice of Appeal, leaving no other recourse.
• The RTC gravely abused its discretion in granting the demurrer because there was sufficient prima facie evidence against Jose, specifically that he received P1,200,000.00 from Jeffrey and issued a check for the exact same amount on the same day, despite having only P25,000.00 prior to the transfer.

• The petition raises questions of fact, not errors of law, which the SC cannot review under Rule 45.
• Appeal was the proper remedy; certiorari cannot substitute for a lost appeal.
• The RTC committed no grave abuse of discretion; the evidence showed Christina and Jeffrey orchestrated the fraud, but failed to substantiate Jose and Angela's participation or awareness.

• Procedural Issues: Whether a petition for certiorari under Rule 65 was the correct remedy to contest the RTC's grant of the demurrer to evidence.
• Substantive Issues: Whether petitioner established by sufficient evidence its entitlement to the relief sought against respondents in its complaint for sum of money and damages.

• Procedural: The SC held that certiorari was the correct remedy. Under Rule 41, Section 1(g), no appeal may be taken from a judgment or final order for or against one of several parties while the main case is pending; the aggrieved party must file a special civil action under Rule 65. Because the RTC's dismissal only covered Jose and Angela while the case against Christina, Jeffrey, and Karin remained pending, the order fell under this exception. Furthermore, the RTC's inordinate delay in acting on the motion for leave to appeal left UnionBank with no plain, adequate, and speedy remedy, justifying certiorari.
• Substantive: The SC held that the demurrer should not have been granted as to Jose, but was properly granted as to Angela. While the SC generally defers to the factual findings of the CA, an exception applies when the CA's finding is premised on the supposed absence of evidence but contradicted by the record. The evidence showed Jose received P1,200,000.00 from Jeffrey and immediately issued a check for the exact same amount to Triangle Ace Corporation on the same day, despite having a balance of only P25,000.00 prior. This circumstantial evidence strongly suggests complicity. In contrast, no similar evidence of awareness or use of funds was presented against Angela. Because the demurrer is reversed as to Jose, and under Rule 33 Section 1 a movant whose demurrer is reversed on appeal is deemed to have waived the right to present evidence, the SC resolved the case on the merits based solely on UnionBank's evidence, finding Jose liable to return the fraudulently transferred funds.

• Remedy for Grant of Demurrer to Evidence — Generally, an appeal is the proper remedy to question the grant of a demurrer to evidence. However, when the grant of a demurrer leaves the main case pending before the trial court (i.e., dismissing the case only against some defendants), the aggrieved party may resort to a petition for certiorari under Rule 65.
• Waiver of Right to Present Evidence (Rule 33, Section 1) — If a demurrer to evidence is granted by the trial court but reversed on appeal, the movant is deemed to have waived the right to present evidence. The appellate court must then render judgment on the merits based solely on the plaintiff's evidence. This avoids remanding the case for retrial and further congestion in the lower courts.
• Admissibility vs. Probative Weight — Admissibility refers to whether evidence is to be considered at all, while probative value refers to whether it proves an issue. Courts must act with caution when resolving a demurrer to evidence, which tests the sufficiency of evidence, and cannot arbitrarily disregard evidence.
• Exceptions to Factual Findings of the CA — The SC may review questions of fact in a Rule 45 petition when the CA's finding of fact is premised on the supposed absence of evidence and is contradicted by the evidence on record.

• Rule 33, Section 1, Rules of Civil Procedure — Governs Demurrer to Evidence. Applied to establish that an order granting a demurrer may be appealed, and to enforce the rule that a movant whose granted demurrer is reversed on appeal waives the right to present evidence.
• Rule 41, Section 1, Rules of Civil Procedure — Governs the Subject of Appeal. Applied to identify the exception in paragraph (g): no appeal may be taken from a judgment for/against one of several parties while the main case is pending, making Rule 65 certiorari the proper remedy.
• Rule 45, Rules of Court — Governs Petition for Review on Certiorari to the SC. Applied to limit review to questions of law, subject to recognized exceptions for questions of fact.