13.  ROSALINDA S. KHITRI AND FERNANDO S. KHITRI v.

 PEOPLE OF THE
PHILIPPINES, G.R. No. 210192, July 04, 2016 
Facts: 
Rosalinda is Fernando's mother. Rosalinda manufactures and exports ladies' lingerie and
wear. Hiroshi (complainant), on the other hand, is an exporter of locally-manufactured women's
wear to Japan. In 1989, Hiroshi proposed a venture for them to jointly manufacture and export
women's wear to United States of America and other countries. The venture required the
construction of a factory, with Hiroshi contributing P400,000.00 therefor. Initially, Hiroshi
wanted the factory to be constructed in Cubao, Quezon City beside Rosalinda's warehouse.
However, Rosalinda offered her lot in Monte Vista Park Subdivision, Cainta, Rizal and Hiroshi
acceded. The factory was intended to occupy one-half of the lot, while the other half thereof
would be reserved for the petitioners' residence. The parties' agreement was merely verbal.  
The construction started in 1991. The private complainants were eventually shocked to discover
instead a two-door studio-type apartment, the plan for which was never shown to them. In their
disappointment, they demanded the return of their money, but the petitioners avoided their calls
and even changed their phone numbers. Through counsel, the private complainants wrote a
demand letter for the petitioners to return their money. In response, the petitioners offered one
apartment unit, with the cost of the lot where it stands to be paid for separately. The private
complainants outrightly rejected the offer. 

The private complainants tried to contact the petitioners but they could no longer be
reached. They felt deceived because their agreement was not complied with.  The Information
indicting the petitioners was filed in the RTC of Las Pinas. 

On March 28, 2001, the petitioners were arraigned and pleaded "not guilty" to the charge.
Since their primary defense was in the nature of an affirmative allegation, the RTC reversed the
order of trial. 
On cross-examination, Hiroshi admitted that the negotiations for the joint venture were done in
his Elizabeth Mansions office in Quezon City. He recalled having seen the petitioners in
Las Piñas City only once or twice. There was no written contract anent the joint venture because
he trusted the petitioners.12c 
Ruling of the RTC 

The RTC convicted the petitioners, GUILTY beyond reasonable doubt of the crime

of Estafa punishable under Article 315, paragraph 1 (b) of the [RPC].  
 
Unfazed by the above, the petitioners appealed to the CA. The CA affirmed in toto the
RTC decision. The CA agreed with the RTC that it had jurisdiction over the crime charged. All
the elements of the crime of estafa are present, and that the petitioners conspired in committing
the crime.  
 
1st Topic: Estafa
Issue:
Whether the evidence submitted is sufficient to establish guilt of the petitioners
beyond reasonable doubt. 
Ruling:
No. Not all the elements of the crime of estafa are present. 
 
Under Article 315, paragraph 1(b) of the RPC,22 the elements of estafa with abuse of
confidence are as follows:  
(1) that the money, goods or other personal property is received by the offender in trust or
on commission, or for administration, or under any other obligation involving the duty to
make delivery of, or to return, the same;  
(2) that there be misappropriation or conversion of such money or property by the
offender, or denial on his part of such receipt;  
(3) that such misappropriation or conversion or denial is to the prejudice of another; and  
(4) that there is demand by the offended party to the offender.23chanrobleslaw 

In the case at bar, the presence of the first and last elements is undisputed. The
petitioners received money in trust or for administration to build a factory in Cainta, and
that the private complainants, through counsel, demanded the return of their
P400,000.00 via letters dated December 13, 1999 and January 25, 2000, which were
received on December 28, 1999, and January 5, 2000, respectively. However, the
elements of misappropriation and prejudice were not sufficiently established. 
The essence of estafa committed with abuse of confidence is the appropriation or
conversion of money or property received to the prejudice of the entity to whom a
return should be made. The words "convert" and "misappropriate" connote the act of
using or disposing of another's property as if it were one's own, or of devoting it to a
purpose or use different from that agreed upon. To misappropriate for one's own use
includes not only conversion to one's personal advantage, but also every attempt to
dispose of the property of another without right.25

Here, Rosalinda received P400,000.000 for the purpose of constructing a

garments factory inside the Monte Vista Park Subdivision, Cainta, Rizal. True to their
agreement, she caused the erection of a two-door studio-type apartment, one of which
would serve as the garments factory. The private complainants however posit that the
structure was not in compliance with their agreed plan. Nonetheless, the purpose of the
money had been complied with by the petitioners, albeit modified. The Court believes
that the ends sought to be achieved by the money have not been rendered illusory by the
modification. In fact, after the construction, the private complainants sent five sewing
machines for use in the garments factory, but these were subsequently pulled out after
two weeks for repairs. 

"Not to be overlooked is that this felony falls under the category of mala in
se offenses that require the attendance of criminal intent. Evil intent must unite with an
unlawful act for it to be a felony. Actus non facit reum, nisi mens sit rea."
The element of intent - on which the Court shall focus - is described as the state of
mind accompanying an act, especially a forbidden act.27 It refers to the purpose of the
mind and the resolve with which a person proceeds.28 It does not refer to mere will, for
the latter pertains to the act, while intent concerns the result of the act.29 While motive is
the "moving power" that impels one to action for a definite result, intent is the "purpose"
 of using a particular means to produce the result. 30 On the other hand, the term
"felonious" means, inter alia, malicious, villainous, and/or proceeding from an evil heart
or purpose.31 With these elements taken together, the requirement of intent in intentional
felony must refer to malicious intent, which is a vicious and malevolent state of mind
accompanying a forbidden act. Stated otherwise, intentional felony requires the existence
of dolus malus - that the act or omission be done "willfully," "maliciously," "with
deliberate evil intent," and "with malice aforethought."32 The maxim
is actus non facit reum, nisi mens sit rea — a crime is not committed if the mind of the
person performing the act complained of is innocent. 33 As is required of the other
elements of a felony, the existence of malicious intent must be proven beyond reasonable
doubt.
In the instant petition, the records do not show that the prosecution was able to
prove the existence of malicious intent when the petitioners used the money they received
to construct two-door studio-type apartments, one of which would serve as the garments
factory. To reiterate, the purpose of the money was achieved. Furthermore, the factual
precedents of the case do not sufficiently warrant conviction for the crime of estafa, much
less deserve deprivation of liberty. At best, the petitioners could be held liable for
damages for violating the tenor of their agreement. 
 
Ultimately, the amount of P400,000.00 given to the petitioners could hardly be
considered as the damage sustained by the private complainants.  
Damage, as an element of estafa, may consist in:  
(1) the offended party being deprived of his money or property as a result of
the defraudation;  
(2) disturbance in property right; or  
(3) temporary prejudice.  
In this case, the amount was voluntarily given pursuant to a joint venture agreement for
the construction of a garments factory, and with which the petitioners complied. Absent
the element of misappropriation, the private complainants could not have been
deprived of their money through defraudation. Moreover, the allegation of lost profits,
which could have arisen from the aborted joint venture, is conjectural in nature and could
barely be contemplated as prejudice suffered. 

Where the inculpatory facts and circumstances are susceptible of two or more

interpretations, one of which is consistent with the innocence of the accused while the
other may be compatible with the finding of guilt, the Court must acquit the accused
because the evidence does not fulfill the test of moral certainty required for conviction.
Consequently, the Court is constrained to uphold the presumption of innocence in
the petitioners' favor and acquit them. 
 
2nd Topic: Conspiracy
Issue:
Whether the evidence submitted establishes conspiracy between the petitioners. 

Ruling: 
 Anent the allegation of conspiracy, the Court deems it proper not to discuss the
same in view of the fact that the prosecution failed to establish the existence of all the
elements of the crime charged. 
 
3rd Topic: Jurisdiction over the case
Issue:
Whether RTC has jurisdiction over the case.c 

Ruling:
Yes.  The RTC of Las Piñas City had jurisdiction over the case. 
 
The Court agrees that the RTC of Las Piñas City had territorial jurisdiction over the case.
Although the bank account for the joint venture was set up in San Juan City, in which the
P400,000.00 capital contribution of the private complainants was deposited and
eventually withdrawn, Belen issued four checks from her residence in
Las Piñas City. These checks were picked up by the messenger sent by the petitioners. 

The Court has ruled in the case of Tan v. People20 that "[t]he delivery by the
private complainant of the check and its acceptance by [the accused] signified not merely
the transfer to the accused of the money belonging to private complainant, [but] it also
marked the creation of a fiduciary relation between the parties.