By Atty. Julius Gregory B. Delgado
CITIBANK SAVINGS, INC., ET AL. VS. BRENDA ROGAN, G.R. NO. 220903 (MARCH 29, 2023):
EXTRAORDINARY DILIGENCE REQUIRED OF BANK EMPLOYEES MAKES THEIR POSITIONS IMBUED WITH
TRUST AND CONFIDENCE
Respondent Brenda Rogan (“Rogan”) was hired by petitioner Citibank Savings, Inc. (“CSI”) as a
bank teller on January 23, 1995. She rose through the ranks and became the Branch Cash/Operations
(CSO) of CSI’s Legaspi Village, Makati Branch with the following duties: 1) monitor and oversee tellering functions and provide consistent and superior service delivery standards; 2) ensure accurate and timely processing of customer transactions to effectively build customer trust and loyalty; 3) ensure all
investigations and/or inquiries are satisfactorily handled; 4) proactively look for ways to enhance processes and improve service levels; 5) reinforce CSR strengths and assess areas for improvement through timely and constructive feedback and regular coaching sessions; 6) recommend process improvement with the end view of eliminating work duplication; and 7) continue to work in achieving
healthy environment that fosters open and honest communication within and among the units.
On March 18, 2008, Rogan was issued a show cause memo for failing to conduct an actual cash
count of the branch’s automated teller machine for the date January 29, 2008 and signing false
certification to that effect. Rogan admitted the accusation and attributed the same to heavy workload
and lack of personnel. She was suspended for three (3) days with a warning that a repetition of the offense will be dealt with more severely.
On October 19, 2009, petitioner CSI received a query from a client of its Legaspi Village Branch
regarding a time deposit. In response to the query, CSI reviewed client’s records and it was discovered
that it only had a savings account. Deeming this irregular, CSI investigated the matter. It was found out
that the Branch Account Officer, Yvette Axalan, solely transacted and there were no existing records.
Bank investigation found also that this have not been possible without Rogan’s approval who failed to
verify the client’s signatures. The investigation found out that Demand Draft was made to appear as
having been executed at the branch, when in fact, the client did not go and was not at the bank on that
day. A Show Cause Memorandum was issued against Rogan and administrative hearing was conducted.
She admitted and asked for apology. She also asked that she be allowed to resign. Rogan was issued a
Notice of Termination; hence, she filed a case for illegal dismissal.
The Labor Arbiter dismissed his complaint finding habitual neglect in the performance of her
duty as evidenced by the fact that Axalan was able to process multiple suspect transactions. The
National Labor Relations Commission affirmed the ruling of the Labor Arbiter ruling that Rogan
approved the suspect transactions with full knowledge that the signatures therein were not verified by a
teller in violation of CSI’s policy on Separation of Functions. The Court of Appeals, however, reversed the
rulings of the Labor Arbiter and the NLRC stating that there was no ill motive on the part of Rogan and
that she was motivated solely by her desire to assist clients with the end view of winning their loyalty
and continuing patronage. Having motivated for the best interest of the bank, the penalty of dismissal is
harsh and should be meted by one (1) month suspension only.
When the case reached the Supreme Court, it was held that the acts of Rogan did not amount to
gross and habitual neglect these do not amount to “flagrant and culpable refusal or unwillingness of a
person to perform a duty”. Anchoring on her defenses of the following: 1) that signature verification is
not her duty; 2) that Axalan was her superior officer, and she could not therefore stop the former’s
transactions; 3) the joint account transactions were exempt from the signature verification
requirements; and 4) CSI had no prohibition against its employees transacting on behalf of its clients,
the Court held:
“At the outset, we reiterate that while CSI blames Rogan for lapses in connection with three
separate incidents, there is evidence on record for only one of those incidents: the series of transactions
involving a joint account. These four transactions were processes within a time frame of five (5) months
in a single year, without any report of loss or damage to the bank or its clients. The transactions all
involved transfers between accounts owned by the same joint depositors, who did not raise any
complaint in connection therewith. Given this factual context, we agree with the CA that these
transactions were deliberately processed by Axalan in the name of customer convenience and
satisfaction, in the process bypassing the signature verification and Separation of Functions polices of the
bank.” The Court, however, found Rogan to have breached the trust and confidence repose upon her
by CSI. The Court restated the just cause to terminate employment based on loss of trust and
confidence which provides that, “While loss of trust and confidence should be genuine, it does not require proof beyond reasonable doubt, it being sufficient that there is some basis for the misconduct and that the nature of the employee’s participation therein rendered him unworthy of the trust and confidence demanded by his position.” The Court held that in Rogan’s case, her functions relate to the implementation of CSI’s policies on tellering and transaction management. The Court held that it is settled that the relationship between a bank and its depositors is a simple loan, whereby the amounts deposited within the bank become its property. As her job involves ensuring the promptness and accuracy of the bank’s cash transfer, Rogan is essentially a custodian of bank’s property and she therefore occupies a position of trust and confidence within CSI, as she is charged with overseeing the proper flow of cash transfers within her branch.
The Court also underscored that banks are required to exercise elevated standards of diligence
in almost all aspects of their operations; from the handling of deposits to their dealings in real property, and selection and supervision of their employees as it is enshrined in RA 8791 the fiduciary nature of banking requiring high standards of integrity and performance. In breaching this trust and confidence reposed upon her by CSI, the Court held: “As explained above, there is substantial evidence of several noncompliant transactions that
were processed in CSI’s Legaspi Village Branch under Rogan’s watch. Verily, Rogan was remiss in the implementation of CSI’s MIFT Policy with respect to the transactions in question, even if she could have merely been motivated by the desire to build customer loyalty and did not cause loss or damage to any party. In fact, she acknowledged committing lapses and offered to resign. While Rogan’s lapses with respect to the subject transactions do not, by themselves, constitute gross and habitual neglect, we find that they were enough to finally breach the trust and confidence reposed in her by CSI. x x x It must be
noted that Rogan had been previously suspended for failing to conduct a cash count and misrepresenting such lapse in an official company document. In her suspension notice, she was formally warned that any similar violations in the future will be dealt with more severely. Given the extraordinarily level of diligence demanded by law from banks and sensitive nature of Rogan’s duties, her accumulated
violations of company policies, which all relate to the proper management and disposition of cash, were enough for CSI to lost trust and confidence in her. We therefore sustain the concurrent conclusion of LA band the NLRC that her dismissal on the basis of loss and trust and confidence is justified.”
The peculiar part, however, is that the Supreme Court, while termination of Rogan’s
employment based on a just cause was upheld, gave a humanitarian financial assistance of one month per year of service owing to Rogan’s length in service and absence of ill motive. The Supreme Court exercised its discretion by giving Rogan equitable consideration but balancing this with the State interest to preserve the high standards of diligence on banks.