Insular Investments v. Capital One

Insular Investment and Trust Corporation vs. Capital One Equities Corp G.R. No.183308 April 2! 2012  ".  ". #endo$a

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Insular Investment and Trust Corporation (IITC) and Capital One Equities Corp. (COEC) and Planters Development Bank (PDB) have been regularl engaged in trading! sale and pur"hase o# Philippine Treasur bills. On  various dates! IITC had pur"hased #rom COEC. COEC. IITC pur"hased #rom COEC treasur bills $orth P %&'! &! *%.+, and $as able to deliver onl onl ,%,! ,%,! '+'! '+'!'' '''. '. On -a -a %! ,** ,**!! COEC COEC pur" pur"ha hase sed d #rom #rom IITC IITC P ,&!/*'!''' $orth o# treasur bills. PDC issued "on0rmation on the sale in #avor o# IITC. On -a -a ,'! ,'! ,** ,**!! COEC COEC dema demand nded ed a lett letter er #rom #rom IITC IITC th the e phs phsi" i"al al deliver o# the se"urities last -a %! ,**. Then! on its -a ,! ,** letter to PDB! IITC requested! on behal# o# COEC! the deliver o# IITC trea treasu sur r bill bills! s! $h $hi" i"h h had had been been #ull #ull  paid paid.. On -a -a '! '! ,** ,**!! COEC COEC protested the tenor o# IITC1s letter to PDB and took e2"eption to IITC1s assertion that it merel a"ted as a #a"ilitator $ith regard to the sale o#  the treasur bills. IITC IITC sent sent COEC COEC a lett letter er date dated d 3u 3une ne ! ,** ,**!! dema demand ndin ing g th that at COEC COEC deliver to it (IITC) the P,*!!*%.'' $orth o# treasur bills or return the #ull pur"hase pri"e. In either "ase! it also demanded that COEC (,) pa IITC the amount o# P,!/%*!'&*.+' representing business opportunit lost due to the non4deliver o# the treasur bills! and (%) deliver treasur bill bills s $o $ort rth h P,%, P,%,!' !'+' +'!' !''' '' $i $ith th th the e same same matu maturi rit t date dates s orig origin inal all l pur"hased b IITC. COEC COEC sent ent a let letter4r er4re epl pl dated ated 3une une *! ,** ** to IIT IITC in $h $hi" i"h h it a"kno "kno$l $led edge ged d its its obli bligati gation on to deliv eliver er the trea treasu surr bill ills $o $orrth P,* P,*! ! ! !*% *%.' .'' ' $h $hi" i"h h it sold sold to IITC IITC and and #orm #ormal all l dema demand nded ed th the e deliver o# the treasur bills $orthP,&!//!/*.* $hi"h it pur"hased #rom #rom IITC IITC.. COEC COEC also also dema demand nded ed th the e pam pamen entt o# lost lost pro0 pro0ts ts in th the e amount amount o#P!% o#P!%+! +!%+' %+'.'' .''.. Consid Consideri ering ng that that COEC COEC and and IITC IITC both both have have "lai "laims ms agai agains nstt ea"h ea"h othe otherr #or #or th the e deli delive ver r o# trea treasu sur r bill bills! s! COEC COEC proposed that a legal set4o5 be e5e"ted! $hi"h $ould result in IITC o$ing COEC the di5eren"e o# P&!*,!&.*. In its 3une ,! ,** letter to COEC! IITC re6e"ted the suggestion #or a lega legall sett settin ing4 g4o5 o5 o# obli obliga gati tion ons! s! alle allegi ging ng th that at it mere merel l a"te a"ted d as a #a"ilitator bet$een PDB and COEC. Despite repeated demands! ho$ever! PDB #ailed to deliver the balan"e o# P,&!/*'!'''.'' $orth o# treasur bills $hi"h IITC pur"hased #rom PDB allegedl #or COEC. COEC $as like like$i $ise se unab unable le to deliv deliver er th the e rema remain inin ing g IITC IITC T4Bil 4Bills ls amou amount ntin ing g to

P,,*!&!*%.''. 7either PDB and COEC returned the pur"hase pri"e #or the dul paid treasur bills. Thus COEC 0led a "omplaint $ith the 8TC $hi"h #ound that COEC still has obligations to pa IITC IITC P,,*!&!*%.'' $orth o# treasur bills. 9o$ever! sin"e IITC and COEC $ere both debtors and "reditors o# ea"h other! the 8TC o54set their debts! resulting in a di5eren"e o#  P,/!'+&!&'.'' in #avor o# COEC. :s to PDB1s liabilit! it ruled that PDB had the obligation to pa P,&!/*'!'''.'' to IITC. Thus! the trial "ourt ordered (a) IITC to pa COEC P,/!'+&!&'.'' $ith interest at the rate o#  &; #rom 3une ,'! ,** until #ull pament and (b) PDB to pa IITC P,&!/*'!'''.'' $ith interest at the rate o# &; #rom -ar"h %,! ,**+ until #ull pament. The aggrieved parties appealed $ith the C: and a5irmed the de"ision o# the 8TC and absolved PDB #rom an liabilit be"ause PDB $as not involved $ith an o# the transa"tions.

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