32.

Fernando forged the name of Daniel, manager of a Trading Company, as the drawer of a
check. The Bank of Philippine Islands, the drawee bank, did not detect the forgery and paid
the amount. May the bank charge the amount paid against the account of the alleged drawer?
Explain

38. Pedro writes out a check for P1,000.00 in favor of Jose or order against his current
account with the Bank of America. Juan steals the check, erases the name of Jose and
superimposes his own name. Juan deposits the check at Citibank and after clearing, Juan
withdraws the amount and absconds. Upon discovery by Pedro of the material alteration, he
lodged a complaint at the Bank of America, who debited the amount to Pedro. Bank of
America demands reimbursement for Citibank which refuses on the ground that it only acted
as an agent for collection. Who bears the loss? Why? [1977 Bar Examinations].