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Recovery of dormant deposits and unclaimed balances


By Atty. Jun de Zuñiga

Dormant accounts are bank accounts in the form of either savings accounts or checking accounts that have no shown no activity (deposit or withdrawal) for a certain period of time.  These are normally booked by banks in separate ledgers and subject to more stringent controls, custodianship and reporting requirements.  This is to prevent the accounts from being taken advantage of through spurious or forged claims.  Because of the added administrative handling, dormant accounts can be subject to dormancy fees in accordance with regulations issued by the Bangko Sentral.  However, before such fees can be collected, notice must first be given by the bank to the depositor.

Dormancy does not alter the fact that the subject deposits remain to be liabilities of the bank.  Such deposit arose from a contractual relationship between the bank and the depositor wherein the bank, as debtor, has obliged itself to pay back the depositor or creditor.

Thus, unless title over the deposit has been vested on the State through escheat, the depositor has the perfect right to either reactivate or withdraw the funds in his or her capacity as owner.  Of course, there has to be compliance with all the requirements so that the depositor may duly establish the genuineness and authenticity of his or her claim.

If the dormancy reaches 10 years and there has been no reactivation or withdrawal as above mentioned, the deposit accounts are classified as unclaimed balances subject to escheat in favor of the Government as provided under the Unclaimed Balances Law (Act No. 3936). If after the proceedings the property remains without a lawful owner interested to claim it, the property shall be reverted to the State to forestall an open invitation to self-service by the first comers.  However, if interested parties have come forward and laid claim to the property, the courts shall determine whether the credit or deposit should pass to the claimants or be forfeited in favor of the State. (Rizal Commercial Banking Corporation vs. Hi-Tri Dev. Corp., G.R. No. 192413, June 13, 2012).

Banks are required to submit to the Treasurer of the Philippines in January of every odd year such list of unclaimed balances, which the Treasurer will then submit to the Solicitor General.It will then be the duty of the Solicitor General to file a petition in court so that a judgment be issued declaring the unclaimed balances to have been escheated in favor of the Government.  After escheat, legal title to the funds rests on the State.

As may be noted, title to the unclaimed balances would vest on the State only upon finality of the escheat judgment.  Before title is vested on the State, the funds would still be recoverable since, on record, the deposit is still traceable to the ownership by the depositor.  Thus, it is not automatic that the depositor would lose ownership over the deposit by the mere fact that it has been dormant or inactive for 10 years.  The appropriate recourse for that depositor to do is to follow up the status of the account and if no judgment of escheat is issued yet, to file the legal documents and prove before the court his or her entitlement to the recovery and withdrawal of the deposit.


The above comments are the personal views of the writer. His email address is

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