Spouses Dan T. Trinidad and Engracia Palo-Trinidad vs. Onapal Philippine Commodities, Inc., et al.

[SEC-SICD * CASE NO. 3607. February 27, 1992.] SPOUSES DAN T. TRINIDAD and ENGRACIA PALO-TRINIDAD , complainants , vs . ONAPAL PHIL. COMMODITIES INC., ET AL. , respondents . D E C I S I O N In a complaint filed by Spouses Dan T. Trinidad and Engracia Palo-Trinidad, they prayed that judgment be rendered in their favor ordering defendants Onapal Philippines Commodities Inc., Jovita Abaya and Arlene Ogapong to pay them jointly and severally as follows: 1. P120,800 with interest counted from the date of filing of this case until the full amount is paid; 2. P50,000.00 as moral and exemplary damages; 3. P20,000.00 as and by way of attorney's fees and P1,000.00 per appearance; 4. P10,000.00 as expense for litigation; and 5. To pay the cost of this suit. Hearings were conducted for this case whereby the petitioners presented testimonial as well as documentary evidence. When respondents' turn to present evidence came, however, they failed to present their evidence despite opportunities given them. Hence, the case was considered submitted for resolution and thus, this decision. From the evidence submitted, it was established that Onapal Philippines Commodities, Inc. through its branch manager and branch assistant manager at Balibago, Angeles City, convinced Mrs. Engracia F. Trinidad to invest in the commodity futures; that while Mrs. Trinidad was made to understand that the minimum amount for investment is one hundred thousand pesos, she was convinced by defendant Arlene Ogapong that the amount of fifty thousand pesos, the amount of money she had at that time, is sufficient. Mrs. Trinidad gave the amount of fifty thousand pesos on February 19, 1988 to respondents Jovita Abaya and Arlene Ogapong in the following manner: a) fourteen thousand pesos, Philippine currency in cash and b) thirty-six thousand pesos, Philippine Currency covered by the issuance of PNB check dated February 19, 1988. Jovita Abaya issued a Deposit Notice (Exh. A). Mrs. Trinidad was made to understand that the said amount was to be joined with the account of Eva Tang but later discovered that the amount was joined with the account of the following existing investors of Onapal namely: 1. Account #5002 Eva Tang in the amount of ten thousand pesos, and 2. Account #5028 Spouses Jerome and Epifania Ticsay forty thousand pesos, without any written consent. When she learned this, Mrs. Trinidad then asked for the return of her P10,000.00 which was returned to her by way of a check issued by one Lou Concepcion. She likewise asked for a joint contract with the Spouses Ticsay but she was told that the contract is being prepared in Manila. In March, 1988, Ogapong came to complainant and asked for P30,000.00 so that the plaintiff will have a separate independent contract between herself and Onapal. Mrs. Trinidad gave the said amount and was issued a receipt (Exh. B), therefor. The said receipt, however, bore an annotation that it was for Account No. 5028. Again, in April, 1988, Mrs. Trinidad was asked to put up P50,800.00 for support so she could withdraw the money. She gave P20,800.00 on April 8, 1988 and she was given a receipt (Exh. C). On April 20, 1988 she turned over the remaining P30,000.00 to complete the sum, and Jovita Abaya issued another receipt (Exh. D). No independent contract was ever executed and the money supposed to have been for deposited but joined with the account of Spouses Ticsay was traded and lost. From these facts, it is clear that while complainants have already put up the requisite amount to open an account, they were not given a separate account by respondent branch manager Jovita Abaya or assistant branch manager Arlene Ogapong but instead their deposit were joined with the account of two existing account holders of Onapal. And later to the account of Spouses Ticsay. Rule 24 of the Revised Rules on Commodity Futures state: "RULE 24. Handling of money, securities and property by futures commission merchant . Any person registered and licensed as a futures commission merchant or futures brokers shall treat and deal with all money, securities and property received by such person to margin, guarantee or secure the trades or contracts of any customer of such person, or accruing to such customer as the result of such trades or contracts, as belonging to such customer . Such money shall be deposited in a bank account, (denominated Customer's Account), and together with the securities and property shall be separately accounted for and shall not be commingled with the funds of such commission merchant or broker or be used to margin or guarantee the trades of contracts, or to secure or extend the credit, of any customer or person other than the one for whom the same are held . . . . (Emphasis supplied) Provided, finally, that withdrawals of customers fee deposits must be paid upon demand any time during banking hours." Following the above-cited rule, it is evident that respondents have violated the rule on the handling of complainant's money. By commingling the amount deposited by the complainant to the account of Spouses Ticsay, respondents had not only not secured the said money as belonging to said complainant by accounting for it separately but they likewise commingled the same with those other persons. This practice is one of those which operates as a fraud or deceit which is prohibited under Rule 32 of Revised Rules on Commodity Futures and entitle the complainants to the reliefs prayed for in their complaint. Apropos to the above finding, it is hereby ordered that respondents: (1) return to the complainant the amount of one hundred twenty thousand and eight hundred pesos which the complainants have turned over the respondents as deposit plus 12% interest per annum counted from the date of filing of this case until the said amount is paid; (2) pay to the complainants the following: (a) the amount of fifty thousand pesos as moral and exemplary damages (b) the sum of twenty thousand pesos as and by way of attorney's fees and one thousand pesos per appearance (c) ten thousand pesos as expense for litigation and to pay the costs of this suit. SO ORDERED. (SGD.) FELIPE S. TONGCO Hearing Officer (SGD.) KIRTH S. BANSUELO Hearing Officer