ANA RIVERA vs. PEOPLES BANK AND TRUST, CO.

, defendant- appellee, and MINNIE

STEPHENSON, in her capacity as Administratrix of the Intestate Estate of Edgar Stephenson,
intervenor-appelle (1942)
Ozaeta, J.
Under what topic:
Petitioner: Ana Rivera
Respondent: Peoples Bank and Trust, Co.
Intervenor: Minnie Stephenson, Administratrix of the Intestate Estate of Edgar Stephenson
Synopsis: Rivera was employed by Edgar Stephenson as a housekeeper for 19 years. On 24
December 1929, Edgar opened an account in his name with Peoples Bank and Trust, Co. (PBTC),
depositing therein P 1 000. On 17 October 1931, Edgar and Rivera executed a Survivorship
Agreement and transferred said account to the name of “Edgar Stephenson and/or Ana Rivera”. It
was stipulated that they were co-owners of the money deposited in the new account, and that upon
the death of either, the money “shall belong to and be the sole property of the survivor”. When
Edgar died, Rivera tried to claim the balance of P 701.43 but PBTC refused. Rivera the filed the
instant action against the bank to collect the amount. Minnie Stephenson, administratrix of the
estate, intervened and claimed said amount for the estate. The Trial Court ruled in favor of PBTC
and Minnie. It held that the Survivorship Agreement, viewed from its effect during the lives of the
parties, was a mere power of attorney authorizing Rivera to withdraw the deposit. And this power
of attorney was extinguished upon Edgar’s death. When the Survivorship Agreement is viewed
from its affect after the death of either of the parties, it was a donation mortis causa with reference
to the balance remaining at the time of death. Since Art. 620 of the Civil Code was not complied
with, such donation was void. In short, even if the agreement is considered as a power of attorney
or as a donation, Rivera could not claim the amount. Hence, Rivera appealed to the SC. The SC held
that based on the circumstances surrounding the case, Edgar was not the exclusive owner of the
bank account – he and Rivera were co-owners.
Doctrine:
 The mutual agreement of the joint depositors permitting either of them to withdraw the whole
deposit during their lifetime, and transferring the balance to the survivor upon the death of
one of them is an aleatory contract supported by a lawful consideration.

Facts: by the Bank with the

 Plaintiff Rivera was employed by Edgar
Stephenson as housekeeper from 1920
until the latter’s death on 8 June 1939.
 On 24 December 1929, Edgar opened an
account, in his name, with Defendant
Peoples Bank and Trust, Co. (PBTC),
depositing therein P 1000.
 On 17 October 1931, when there was a
balance of P 2 072, Edgar and Rivera
executed a Survivorship Agreement and
said account was transferred to the name
of “Edgar Stephenson and/or Ana Rivera”.
 Terms of the Survivorship Agreement:
o “all moneys now or hereafter
deposited by us or either of us with
the Bank in our savings account
shall be deposited in and received
understanding and upon the
conditions that said money be
deposited without consideration
of its previous ownership”
o “said money and all interest
thereon, if any there be, shall be
the property of both of us as joint
tenants, and shall be payable to
and collectible by either of us
during our joint lives, and after the
death of one of us shall belong to
and be the sole property of the
survivor, and shall be payable to
and collectible by such survivor”
 At the time of Edgar’s death, Rivera held
the deposit book.
 o Rivera tried to claim the balance of
P 701.43 but PBTC refused upon
advice of its lawyers.
 They opined that the
Survivorship Agreement
was of doubtful validity.
 Rivera then instituted the present action
against PBTC.
o Defendant Minnie Stephenson,
administratrix of the estate,
intervened and claimed said
amount for the estate.
 Minnie alleged that the
money was Edgar’s
exclusive property.
 The Trial Court ruled in favor of the
Defendants, holding that:
o The Agreement, viewed from its
effect during the lives of the
parties, was a mere power of
attorney authorizing Rivera to
withdraw the deposit.
 Which was terminated
upon the death of the
principal.
o Viewed from its affect after the
death of either of the parties, the
Agreement was a donation mortis
causa with reference to the
balance remaining at the time of
death.
 Which had no legal effect
for not having been
executed with the
formalities of
testamentary disposition
as required by Art. 620 of
the Civil Code.
 Hence, this appeal to the SC.
Issue-Held:
1. Whether or not the funds exclusively
belonged to Edgar (NO, they were co-
owners)
2. Whether or not the Survivorship
Agreement is valid (YES)
Ratio:
First issue
 The SC no basis for the conclusion that the
Survivorship Agreement was a mere
power of attorney from Edgar to Rivera, or
that it is a gift mortis causa of the bank
account in question from him to her.
o Such conclusion was evidently
predicated on the assumption that
Edgar was the exclusive owner of
the funds deposited in the bank,
which was based on the facts that
1) the account was originally
opened in Edgar’s name; and 2)
Rivera merely served as the
former’s housemaid.
 The SC notes that it is not uncommon that
a person deposits money in the bank in the
name of another.
 In the instant case, the SC found that
Rivera worked for Edgar for about
nineteen years without actually receiving
her salary.
 Based on the foregoing, the SC concluded
that: “[t]he fact that subsequently Edgar
transferred the account to the name of
himself and/or Ana Rivera and executed
with the latter the survivorship agreement
in question although there was no relation
of kinship between them but only that of
master and servant, nullifies the
assumption that Edgar was the exclusive
owner of the bank account.”
o Thus, in the absence of clear proof
to the contrary, the certificate of
credit must be given full faith and
credit. Therefore:
 The funds in question
belonged to Edgar and
Rivera.
 Edgar and Rivera were
joint owners of the funds.
 Either of them could
withdraw any part or
whole of said account
during the lifetime of both,
and the balance, if any,
upon the death of either,
belonged to the survivor.
Second Issue
 The SC held that prima facie, the defeat the legitime of a forced heir,
survivorship agreement was valid. it may be assailed and annulled
o It is an aleatory contract upon such grounds.
supported by a lawful  In the case at bar, no such
consideration — the mutual vice has been imputed and
agreement of the joint depositors established against the
permitting either of them to survivorship agreement
withdraw the whole deposit between Edgar and Rivera.
during their lifetime, and
transferring the balance to the Disposition:
survivor upon the death of one of RTC decision reversed; PBTC is ordered to pay
them. Rivera P 701.43, with legal interest from the
 Contrary to the RTC’s ruling that such an date of the complaint.
agreement was not supported by any
provision in the Civil Code, the SC held that Digester’s notes:
the same is covered by Art. 17901.  Please note that the provisions cited by the
 Macam v. Gatmaitan is applicable. SC in this case refer to those in the Old Civil
o The parties therein reciprocally Code.
assigned their respective property
to one another conditioned upon
who might die first (like Edgar and
Rivera), the time of death
determining the event upon which
the acquisition of such right by the
one or the other depended.
o Such a contract, as any other
contract, is binding upon the
parties thereto.
 Furthermore, “it is well established that a
bank account may be so created that two
persons shall be joint owners thereof
during their mutual lives, and the survivor
take the whole on the death of the other.
The right to make such joint deposits has
generally been held not to be done away
with by statutes abolishing joint tenancy
and survivorship generally as they existed
at common law.” (7 Am. Jur., 299)
 The SC notes, however, that even if the
survivorship agreement is per se not
contrary to law, its operation or effect may
be violative of the law.
o For example, if such an agreement
is a mere cloak to hide an
inofficious donation, to transfer
property in fraud of creditors, or to

1
ART. 1790. By an aleatory contract one of the parties which the other party is to give or do in case of the
binds himself, or both reciprocally bind themselves, occurrence of an event which is uncertain or will
to give or to do something as an equivalent for that happen at an indeterminate time.