BETTY KING, 

PETITIONER, VS. PEOPLE OF THE PHILIPPINES, RESPONDENT.

 
PANGANIBAN, J.:

Under Batas Pambansa Blg. 22 (BP 22), the prosecution must prove not
only that the accused issued a check that was subsequently dishonored. It
must also established that the accused was actually notified that the check
was dishonored, and that he or she failed, within five banking days from
receipt of the notice, to pay the holder of the check the amount due thereon
or to make arrangement for its payment. Absent proof that the accused
received such notice, a prosecution for violation of the Bouncing Check
Law cannot prosper.

The Case

Before this Court is a Petition for Review on Certiorari under Rule 45 of the
Rules of Court assailing the January 30, 1997 Decision 1 of the Court of
Appeals 2 (CA) in CA-GR CR No. 18226 and its November 5, 1997

Resolution 3 denying reconsideration. The CA affirmed the June 14, 1994
Decision 4 of the Regional Trial Court (RTC) of Makati, Metro Manila 5 in
Criminal Case Nos. 93-3335 to 93-3345 which convicted petitioner of 11
counts of violation of BP 22, otherwise known as the Bouncing Check Law.

On April 28, 1993, Second Assistant Provincial Prosecutor Jaime A. Adoc

filed against petitioner eleven separate Informations, 6 which are identically
worded, except for the check number, the amount and the date, as follows:

That in or about the month of January, 1992 in the Municipality of Las

Piñas, Metro Manila, Philippines and within the jurisdiction of this
Honorable Court, the above-named accused, did, then and there willfully,
unlawfully and feloniously make or draw and issue to EILEEN
FERNANDEZ herein represented by ________ to apply on account or for
value the check described below:

EQUITABLE BANK

Check No. 021711

In the amount of P50,000.00

Postdated July 24, 1992

said accused well knowing that at the time of issue she/he did not have
sufficient funds in or credit with the drawee bank for the payment in full of
the face amount of such check upon their presentment, which check when
presented for payment within ninety (90) days from the date thereof were
subsequently dishonored by the drawee bank for the reason "Account
Closed" and despite receipt of notice of such dishonor the accused failed to
pay the face amount thereof or make arrangement for the full payment
thereof within five (5) working days after receiving notice. 7

When arraigned, petitioner, assisted by counsel, pleaded not guilty. After

the prosecution presented its evidence and rested its case, petitioner filed a
Demurrer to Evidence without leave of court, on the ground that the
prosecution failed to prove her guilt beyond reasonable doubt. The trial
court denied the Demurrer in its assailed Decision, the dispositive portion of
which reads:

WHEREFORE, premises considered, the demurrer to evidence without

prior leave of court is DENIED for lack of merit.

Since accused has waived her right to present evidence, judgment is

hereby rendered finding accused guilty beyond reasonable doubt of
Violation of Batas Pambansa Bilang 22 in the eleven (11) above-entitled
cases and is ordered to:

1. Suffer imprisonment for thirty (30) days, to pay a fine in the amount of
P50,000.00, and to pay complainant Eileen Fernandez the amount of
P50,000.00 as actual damages in Criminal Case No. 93-3335;

2. Suffer imprisonment for thirty (30) days, to pay a fine in the amount of
P50,000.00, and to pay complainant Eileen Fernandez the amount of
P50,000.00 as actual damages in Criminal Case No. 93-3336;

3. Suffer imprisonment for thirty (30) days, to pay a fine in the amount of
P50,000.00, and to pay complainant Eileen Fernandez the amount of
P50,000.00 as actual damages in Criminal Case No. 93-3337;

4. Suffer imprisonment for thirty (30) days, to pay a fine in the amount of
P64,200.00, and to pay complainant Eileen Fernandez the amount of
P64,200.00 as actual damages in Criminal Case No. 93-3338;
5. Suffer imprisonment for thirty (30) days, to pay a fine in the amount of
P66,000.00, and to pay complainant Eileen Fernandez the amount of
P66,000.00 as actual damages in Criminal Case No. 93-3339;

6. Suffer imprisonment for thirty (30) days, to pay a fine in the amount of
P100,000.00, and to pay complainant Eileen Fernandez the amount of
P100,000.00 as actual damages in Criminal Case No. 93-3340;

7. Suffer imprisonment for thirty (30) days, to pay a fine in the amount of
P150,000.00, and to pay complainant Eileen Fernandez the amount of
P150,000.00 as actual damages in Criminal Case No. 93-3341;

8. Suffer imprisonment for thirty (30) days, to pay a fine in the amount of
P150,000.00, and to pay complainant Eileen Fernandez the amount of
P150,000.00 as actual damages in Criminal Case No. 93-3342;

9. Suffer imprisonment for thirty (30) days, to pay a fine in the amount of
P130,000.00, and to pay complainant Eileen Fernandez the amount of
P130,000.00 as actual damages in Criminal Case No. 93-3343;

10. Suffer imprisonment for thirty (30) days, to pay a fine in the amount of
P130,000.00, and to pay complainant Eileen Fernandez the amount of
P130,000.00 as actual damages in Criminal Case No. 93-3344; and,

11. Suffer imprisonment for thirty (30) days, to pay a fine in the amount of
P130,000.00, and to pay complainant Eileen Fernandez the amount of
P130,000.00 as actual damages in Criminal Case No. 93-3345. 8

As already stated, the Court of Appeals affirmed the RTC in this wise: 9

WHEREFORE, the appealed decision is hereby affirmed [I]N TOTO. Costs

against appellant.

Hence, this Petition. 10

The Facts

Evidence for the Prosecution

The Office of the Solicitor General 11 summarized the facts, as viewed by

the prosecution, in this wise:
On several occasions in January, 1992, at Las Piñas, Metro Manila,
petitioner discounted with complainant Ellen Fernandez several Equitable
Bank checks postdated from July 23 to 29, 1992 in the total amount of
P1,070,000.00 in exchange for cash in the amount of P1,000,000.00. When
the checks were deposited for payment, they were dishonored by the
drawee bank because they were drawn against an account without
sufficient funds. Petitioner failed to make good the checks despite demand.
(Memorandum dated April 7, 1993 of Assistant Provincial Prosecutor to the
Rizal Provincial Prosecutor)

During the hearing on the merits of this case on September 17, 1998, the
prosecution offered in evidence its documentary evidence. Petitioner
admitted the genuineness and due execution of the documents presented.12

Evidence for the Defense

As noted earlier, petitioner filed a Demurrer to Evidence without leave of

court. In doing so, she waived her right to present evidence and submitted
the case for judgment on the basis of the documentary exhibits adduced by
the

prosecution. 13

Ruling of the Court of Appeals

In affirming the trial court, the Court of Appeals explained that the
prosecution proved all the elements of the crime. The CA also pointed out
that the failure of petitioner to sign the pretrial order was not fatal to the
prosecution, because her conviction was based on the evidence presented
during the trial.

The Issues

Petitioner submits the following issues for the Court's consideration:

Whether or not the trial court and the Court of Appeals gravely erred in
admitting in evidence all the documentary evidence of the prosecution
though their due execution and genuineness were not duly established in
evidence pursuant to the provisions of the Rules of Court and prevailing
jurisprudence;
 II

Whether or not the trial court and the Court of Appeals gravely erred in
declaring that Rule 118, Section 4 of the Rules of Court, as applied in the
case of Fule vs. Court of Appeals, 162 SCRA 446, which states that no
agreement or admission made or entered during the pre-trial conference
shall be used in evidence against the accused unless reduced to writing
and signed by him and his counsel, is inapplicable in the case at bar;

III

Whether or not the trial court and the Court of Appeals gravely erred in
ruling that the burden of evidence has already been shifted from the
prosecution to the defense despite the definite factual issues in the pre-trial
order; and

IV

Whether or not the trial court and the Court of Appeals erred in ruling that
the prosecution has proven the guilt of the accused beyond reasonable
doubt albeit the prosecution did not produce any evidence. 14

In the main, the resolution of the Petition hinges on (1) the admissibility and
(2) the sufficiency of the prosecution evidence.

This Court's Ruling

The Petition has merit insofar as it contends that the elements of the crime
charged have not all been proven beyond reasonable doubt.

First Issue:

Admissibility of Documentary Evidence

Because the first, the second and the third issues raised by petitioner all
refer to the same matter, they will be discussed together. She contends that
the pieces of documentary evidence presented by the prosecution during
pretrial are inadmissible, because she did not sign the pretrial agreement
as required under Section 4 of Rule 118 of the Rules of Court. 15 Hence, she
argues that there is no basis for her conviction.
True, a pretrial agreement not signed by a party is inadmissible. However,
the conviction of petitioner was based not on that agreement but on the
documents submitted during the trial, all of which were admitted without
any objection from her counsel. During the hearing on September 17, 1993,
the prosecution offered as evidence the dishonored checks, the return
check tickets addressed to private complainant, the notice from
complainant addressed to petitioner that the checks had been dishonored,
and the postmaster's letter that the notice had been returned to sender.
Petitioner's counsel did not object to their admissibility. This is shown by the
transcript of stenographic notes taken during the hearing on September 17,
1993:

COURT:

You have no objection to the admissibility, not that the Court will believe it.

ATTY. MANGERA

No, Your Honor.

COURT:

Exhibits "A" to "A" to "K" are admitted.

ATTY. MAKALINTAL:

We offer Exhibit "L", the return-check ticket dated July 27, 1992, relative to
checks No. 021745 and 021746 indicating that these checks were returned
DAIF, drawn against insufficient funds; Exh. M, returned check ticket dated
July 28, 1992, relative to Check No. 021727, 021711 and 021720 likewise
indicating the said checks to have been drawn against insufficient funds,
Your Honor. Exhibit N, returned check ticket dated July 29, 1992, relative to
Check Nos. 021749 and 021748, having the same indications;

Exhibits O, returned check ticket dated July 29, 1992 relative to Check Nos.
021750 and 021753, with the same indications;

Exhibits P, returned check ticket dated August 4, 1992 relative to Check No.
021752, having the same indication as being drawn against insufficient
funds;
Exhibit Q, the demand letter sent to the accused by Atty. Horacio Makalintal
dated August 3, 1992;

Exhibit R, the letter-request for certification addressed to the Postmaster

General sent by the same law office dated 17 September 1992, showing
that the said letter was dispatched properly by the Central Post Office of
Makati;

Exhibit S, 1st Indorsement of the Makati Central Post Office dated 21

September 1992;

Exhibit T, the Philippine Postal Corporation Central Post Office letter dated
24 September 1992, addressed to this representation showing that there
were 3 notices sent to the herein accused who received the said letter.

COURT:

Let's go to the third check slip; any objection to the third slip?

ATTY. MANGERA:

We have no objection as to the due execution and authenticity.

COURT:

Admitted.

ATTY. MAKALINTAL:

We are offering Exhibits Q, R, S and T, for the purpose of showing that

there was demand duly made on the accused and that the same had been
appropriately served by the Central Post Office Services of Manila.

ATTY. MANGERA:

We admit as to the due execution and authenticity only as to that portion,

Your Honor.

COURT:

We are talking of admissibility now, so admitted. In other words, at this

point, he makes an offer and the Court will either grant admission, [admit] it
in evidence or deny it. It can deny admission if it is not properly identified
etcetera.

ATTY. MANGERA:

I think it is already provided.

COURT:

So, admitted.

ATTY. MAKALINTAL:

With the admission of our offer, Your Honor, the prosecution


rests. 16

From the foregoing, it is clear that the prosecution evidence consisted of

documents offered and admitted during the trial. In view of this, the CA
correctly ruled that Fule v. Court of Appeals 17 would not apply to the
present controversy. In that case, a hearing was conducted during which
the prosecution presented three exhibits. However, Fule's conviction was
"based solely on the stipulation of facts made during rile pre-trial on August
8, 1985, which was not signed by the petitioner, nor by his counsel."
Because the stipulation was inadmissible in evidence under Section 4 of
Rule 118, the Court held that there was no proof of his guilt.

In the present case, petitioner's conviction was based on the evidence

presented during trial, and not on the stipulations made during the pretrial.
Hence, petitioner's admissions during the trial are governed not by
the Fule ruling or by Section 4 of Rule 118, but by Section 4 of Rule 129
which reads:

Sec. 4. Judicial Admissions. — An admission, verbal or written, made by a

party in the course of the proceedings in the same case, does not require
proof. The admission may be contradicted only by showing that it was
made through palpable mistake or that no such admission was made.

Hence, the trial court and the Court of Appeals did not err in taking
cognizance of the said documentary evidence.

Second Issue:
 Sufficiency of Prosecution Evidence

Petitioner argues that the prosecution failed to prove beyond reasonable

doubt the elements of the offense. After a careful consideration of the
records of this case, we believe and so rule that the totality of the evidence
presented does not support petitioner's conviction for violation of BP 22.

Sec. 1 of BP 22 defines the offense as follows:

Sec. 1. Checks without sufficient funds. — Any person who makes or draws
and issues any check to apply on account or for value, knowing at the time
of issue that he does not have sufficient funds in or credit with the drawee
bank for the payment of such check in full upon its presentment, which
check is subsequently dishonored by the drawee bank for insufficiency of
funds or credit or would have been dishonored for the same reason had not
the drawer, without any valid reason, ordered the bank to stop payment,
shall be punished by imprisonment of not less than thirty days but not more
than one (1) year or by a fine of not less than but not more than double the
amount of the check which fine shall in no case exceed Two hundred
thousand pesos, or both such fine and imprisonment at the discretion of the
court.

The same penalty shall be imposed upon any person who having sufficient
funds in or credit with the drawee bank when he makes or draws and
issues a check, shall fail to keep sufficient funds or to maintain a credit to
cover the full amount of the check if presented within a period of ninety (90)
days from the date appearing thereon, for which reason it is dishonored by
the drawee bank.

Where the check is drawn by a corporation, company or entity, the person

or persons who actually signed the check in behalf of such drawer shall be
liable under this Act.

Accordingly, this Court has held that the elements of the crime are as
follows: 18

1. The accused makes, draws or issues any check to apply to account or

for value.

2. The checks subsequently dishonored by the drawee bank for

insufficiency of funds or credit; or it would have been dishonored for the
same reason had not the drawer, without any valid reason, ordered the
bank to stop payment.

3. The accused knows at the time of the issuance that he or she does not
have sufficient funds in, or credit with, drawee bank for the payment of the
check in full upon its presentment.

We shall analyze the evidence, purportedly establishing each of the

aforementioned elements which the trial and the appellate courts relied
upon.

Issuance of the Questioned Checks

Contending that the prosecution failed to prove the first element, petitioner
maintains that she merely signed the questioned checks without indicating
therein the date and the amount involved. She adds that they were
improperly filled up by Eileen Fernandez. Thus, she concludes, she did not
"issue" the dishonored checks in the context of the Negotiable Instruments
Law, which defines "issue" as the "first delivery of the instrument complete
in form to a person who takes it as a holder." 19

Petitioner's contentions are not meritorious. The questioned checks,

marked as Exhibits "A" to "K," contained the date of issue and the amount
involved. In fact, petitioner even admitted that she signed those checks. On
the other hand, no proof was adduced to show that petitioner merely signed
them in blank, or that complainant filled them up in violation of the former's
instructions or their previous agreement. The evidence on record is clear
that petitioner issued eleven checks, all of which were duly filled up and
signed by her.

Checks Dishonored

Neither are we persuaded by petitioner's argument that "there appears no

evidence on record that the subject checks were unpaid and
dishonored." 20 Under Section 3 of BP 22, "the introduction in evidence of
any unpaid and dishonored check, having the drawee's refusal to pay
stamped or written thereon, or attached thereto, with the reason therefor as
aforesaid, shall be prima facie evidence of the making or issuance of said
check, and the due presentment to the drawee for payment and the
dishonor thereof, and that the same was properly dishonored for the reason
written, stamped, or attached by the drawee on such dishonored check."
In the present case, the fact that the checks were dishonored was
sufficiently shown by the checks themselves, which were stamped with the
words "ACCOUNT CLOSED." This was further supported by the returned
check tickets issued by PCI Bank, the depository bank, stating that the
checks had been dishonored.

Clearly, these documents constitute prima facie evidence that the drawee
bank dishonored the checks. Again, no evidence was presented to rebut
the prosecution's claim.

Knowledge of Insufficiency of Funds

To hold a person liable under BP 22, it is not enough to establish that a

check issued was subsequently dishonored. It must be shown further that
the person who issued the check knew "at the time of issue that he does
not have sufficient funds in or credit with the drawee bank for the payment
of such check in full upon its presentment." Because this element involves
a state of mind which is difficult to establish, Section 2 of the law creates
a prima facie presumption of such knowledge, as follows: 21

Sec. 2. Evidence of knowledge of insufficient funds. — The making,

drawing and issuance of a check payment of which is refused by the
drawee because of insufficient funds in or credit with such bank, when
presented within ninety (90) days from the date of the check, shall be prima
facie evidence of knowledge of such insufficiency of funds or credit unless
such maker or drawer pays the holder thereof the amount due thereon, or
makes arrangements for payment in full by the drawee of such check within
five (5) banking days after receiving notice that such check has not been
paid by the drawee.

In other words, the prima facie presumption arises when a check is issued.
But the law also provides that the presumption does not arise when the
issuer pays the amount of the check or makes arrangement for its payment
"within five banking days after receiving notice that such check has not
been paid by the drawee." Verily, BP 22 gives the accused an opportunity
to satisfy the amount indicated in the check and thus avert prosecution. As
the Court held in Lozano v. Martinez, the aforecited provision serves to
"mitigate the harshness of the law in its application." 22 This opportunity,
however, can be used only upon receipt by the accused of a notice of
dishonor. This point was underscored by the Court in Lina Lim Lao v. Court
of Appeals: 23
It has been observed that the State, under this statute, actually offers the
violator a "compromise by allowing him to perform some act which operates
to preempt the criminal action, and if he opts to perform it the action is
abated." This was also compared "to certain laws allowing illegal
possessors of firearms a certain period of time to surrender the illegally
possessed firearms to the Government, without incurring any criminal
liability." In this light, the full payment of the amount appearing in the check
within five banking days from notice of dishonor is a "complete defense."
The absence of a notice of dishonor necessarily deprives an accused an
opportunity to preclude a criminal prosecution. Accordingly, procedural due
process clearly enjoins that a notice of dishonor be actually served on
petitioner. Petitioner has a right to demand — and the basic postulates of
fairness require — that the notice of dishonor be actually sent to and
received by her to afford her the opportunity to avert prosecution under BP
22.

Thus, in order to create the prima facie presumption that the issuer knew of
the insufficiency of funds, it must be shown that he or she received a notice
of dishonor and, within five banking days thereafter, failed to satisfy the
amount of the check or make arrangement for its payment.

To prove that petitioner knew of the insufficiency of her funds, the

prosecution presented Exhibits "Q" to "T." Based on these documents, the
Court of Appeals concluded that "[p]rivate complainant sent a demand
letter to appellant to make good said checks . . .. Appellant failed to pay the
face value of the eleven checks or make arrangement for the full payment
thereof within 90 days after receiving the notice." 24

Upon closer examination of these documents, we find no evidentiary basis

for the holding of the trial court and the Court of Appeals that petitioner
received a notice that the checks had been dishonored.

True, complainant sent petitioner a registered mail, as shown in Exhibit "Q"

informing the latter that the checks had been dishonored. But the records
show that petitioner did not receive it. In fact, Postmaster Wilfredo Ulibarri's
letter addressed to complainant's counsel certified that the "subject
registered mail was returned to sender on September 22, 1992 . . .. " 25

Notwithstanding the clear import of the postmaster's certification, the

prosecution failed to adduce any other proof that petitioner received the
post office notice but unjustifiably refused to claim the registered mail. It is
possible that the drawee bank sent petitioner a notice of dishonor, but the
prosecution did not present evidence that the bank did send it, or that
petitioner actually received it. It was also possible that she was trying to
flee from complainant by staying in different address. Speculations and
possibilities, however, cannot take the place of proof. Conviction must rest
on proof beyond reasonable doubt. Clearly, the evidence on hand
demonstrates the indelible fact that petitioner did not receive notice that the
checks had been dishonored. Necessarily, the presumption that she knew
of the insufficiency of funds cannot arise.

Be that as it may, the Court must point out that it cannot rule on petitioner's
civil liability, for the issue was not raised in the pleadings submitted before
us.

We must stress that BP 22, like all penal statutes, is construed strictly
against the State and liberally in favor of the accused. 26 Likewise, the
prosecution has the burden to prove beyond reasonable doubt each
element of the crime. Hence, the prosecution's case must rise or fall on the
strength of its own evidence, never on the weakness or even absence of
that of the defense.

WHEREFORE, the assailed Decision of the Court of Appeals is hereby

REVERSED and SET ASIDE. Petitioner Betty King is ACQUITTED for
failure of the prosecution to prove all the elements of the crimes charged.
No pronouncement as to costs.

SO ORDERED.
 AMADA RESTERIO, Petitioner, v. PEOPLE OF THE
PHILIPPINES Respondent.

DECISION

BERSAMIN, J.:

The notice of dishonor required by Batas Pambansa Blg. 22 to be

given to the drawer, maker or issuer of a check should be written.
If the service of the written notice of dishonor on the maker,
drawer or issuer of the dishonored check is by registered mail,
the proof of service consists not only in the presentation as
evidence of the registry return receipt but also of the registry
receipt together with the authenticating affidavit of the person
mailing the notice of dishonor. Without the authenticating
affidavit, the proof of giving the notice of dishonor is insufficient
unless the mailer personally testifies in court on the sending by
registered mail.

Antecedents

The petitioner was charged with a violation of Batas Pambansa

Blg. 22 in the Municipal Trial Court in Cities (MTCC) in Mandaue
City through the information that alleged as follows: chanroblesvirtuallawlibrary

That on May, 2002, or thereabouts, in the City of Mandaue,

Philippines, and within the jurisdiction of this Honorable Court,
the above-named accused, with deliberate intent of gain, did
there and then willfully, unlawfully and feloniously make, draw
and issue ChinaBank Check bearing No. AO141332, dated June 3,
2002, in the amount of P 50,000.00 payable to the order of
Bernardo T. Villadolid to apply on account or for value, the
accused fully knowing well that at the time of the issuance of said
check that she does not have sufficient funds in or credit with the
drawee bank for the payment of such check in full upon its
presentment; or the accused having sufficient funds in or credit
with the drawee bank when she make/s or draw/s and issue/s a
check but she failed to keep sufficient funds or maintain a credit
to cover the full amount of the check, which check when
presented for encashment was dishonored by the drawee bank
for the reason "ACCT. CLOSED" or would have been dishonored
for the same reason had not the drawer, without any valid reason
ordered the bank to stop payment, and despite notice of dishonor
and demands for payment, said accused failed and refused and
still fails and refuses to redeem the check or to make
arrangement for payment in full by the drawee of such check
within five (5) banking days after receiving the notice of dishonor,
to the damage and prejudice of the aforenamed private
complainant, in the aforestated amount and other claims and
charges allowed by civil law.

CONTRARY TO LAW.1 ςrνll

After trial, the MTCC found the petitioner guilty as charged,

disposing as follows: chanroblesvirtuallawlibrary

WHEREFORE, decision is hereby rendered finding the accused,

AMADA Y. RESTERIO, GUILTY beyond reasonable doubt for
Violation of Batas Pambansa Bilang 22 and sentences her to pay a
fine of FIFTY THOUSAND PESOS (P 50,000.00) and to pay her
civil liabilities to the private complainant in the sum of FIFTY
THOUSAND PESOS (P 50,000.00), TEN THOUSAND PESOS
(P 10,000.00) as attorneys fees and FIVE HUNDRED SEVENTY-
FIVE PESOS (P 575.00) as eimbursement of the filing fees.

SO ORDERED.2 ςrνll

The petitioner appealed, but the RTC affirmed the conviction.3 ςrνll

By petition for review, the petitioner appealed to the CA, stating

that: (a) the RTC erred in affirming the conviction and in not
finding instead that the Prosecution did not establish her guilt
beyond reasonable doubt; and (b) the conviction was contrary to
existing laws and jurisprudence, particularly Yu Oh v. Court of
Appeals.4ςrνll

On December 4, 2006, the CA found the petition to be without

merit, and denied the petition for review.5 ςrνll
 Issues

The petitioner assails the affirmance of her conviction by the CA

based on the following grounds, to wit:

THE HONORABLE COURT OF APPEALS COMMITTED A SERIOUS

AND REVERSIBLE ERROR AND WITH GRAVE ABUSE OF
DISCRETION IN IGNORING THE APPLICABILITY IN THE PRESENT
CASE THE DECISION OF THE SUPREME COURT IN THE CASE OF
ELVIRA YU OH VS. COURT OF APPEALS, G.R. NO. 125297, JUNE
26, 2003.

THE HONORABLE COURT OF APPEALS COMMITTED A SERIOUS

AND REVERSIBLE ERROR AND WITH GRAVE ABUSE OF
DISCRETION IN NOT FINDING THAT THE PROSECUTION FAILED
TO PROVE ALL THE ESSENTIAL ELEMENTS OF THE CRIME OF
VIOLATION OF BATAS PAMBANSA BILANG 22.

THE HONORABLE COURT OF APPEALS COMMITTED A SERIOUS

AND REVERSIBLE ERROR AND WITH GRAVE ABUSE OF
DISCRETION IN NOT FINDING THAT NO NOTICE OF DISHONOR
WAS ACTUALLY SENT TO THE PETITIONER.

THE HONORABLE COURT OF APPEALS COMMITTED A SERIOUS

AND REVERSIBLE ERROR AND WITH GRAVE ABUSE OF
DISCRETION IN NOT FINDING THAT THE PROSECUTION FAILED
TO ESTABLISH THE GUILT OF THE PETITIONER BEYOND
REASONABLE DOUBT.6 ςrνll

The appeal hinges on whether or not all the elements of a

violation of Batas Pambansa Blg. 22 were established beyond
reasonable doubt.

Ruling

The petition is meritorious.

For a violation of Batas Pambansa Blg. 22, the Prosecution must

prove the following essential elements, namely:
(1) The making, drawing, and issuance of any check to apply for
account or for value;

(2) The knowledge of the maker, drawer, or issuer that at the

time of issue there were no sufficient funds in or credit with the
drawee bank for the payment of such check in full upon its
presentment; and

(3) The dishonor of the check by the drawee bank for

insufficiency of funds or credit or the dishonor for the same
reason had not the drawer, without any valid cause, ordered the
drawee bank to stop payment.7 ςrνll

The existence of the first element of the violation is not disputed.

According to the petitioner, she was "required to issue a check as
a collateral for the obligation," and that "she was left with no
alternative but to borrow the check of her friend xxx and used the
said check as a collateral of her loan."8 During her cross-
ςrνll

examination, she stated that she did not own the check that she
drew and issued to complainant Bernardo Villadolid.9 ςrνll

Yet, to avoid criminal liability, the petitioner contends that Batas

Pambansa Blg. 22 was applicable only if the dishonored check
was actually owned by her; and that she could not be held liable
because the check was issued as a mere collateral of the loan and
not intended to be deposited.

The petitioners contentions do not persuade.

What Batas Pambansa Blg. 22 punished was the mere act of

issuing a worthless check. The law did not look either at the
actual ownership of the check or of the account against which it
was made, drawn, or issued, or at the intention of the drawee,
maker or issuer. Also, that the check was not intended to be
deposited was really of no consequence to her incurring criminal
liability under Batas Pambansa Blg. 22. In Ruiz v. People,10 the ςrνll

Court debunked her contentions and cogently observed: chanroblesvirtuallawlibrary

In Lozano v. Martinez, this Court ruled that the gravamen of the
offense is the act of making and issuing a worthless check or any
check that is dishonored upon its presentment for payment and
putting them in circulation. The law includes all checks drawn
against banks. The law was designed to prohibit and altogether
eliminate the deleterious and pernicious practice of issuing checks
with insufficient or no credit or funds therefor. Such practice is
deemed a public nuisance, a crime against public order to be
abated. The mere act of issuing a worthless check, either as a
deposit, as a guarantee, or even as an evidence of a pre-existing
debt or as a mode of payment is covered by B.P. 22. It is a crime
classified as malum prohibitum. The law is broad enough to
include, within its coverage, the making and issuing of a check by
one who has no account with a bank, or where such account was
already closed when the check was presented for payment. As
the Court in Lozano explained: chanroblesvirtuallawlibrary

The effects of the issuance of a worthless check transcends the

private interests of the parties directly involved in the transaction
and touches the interests of the community at large. The mischief
it creates is not only a wrong to the payee or holder, but also an
injury to the public. The harmful practice of putting valueless
commercial papers in circulation, multiplied a thousandfold, can
very well pollute the channels of trade and commerce, injure the
banking system and eventually hurt the welfare of society and
the public interest. As aptly stated

The "check flasher" does a great deal more than contract a debt;
he shakes the pillars of business; and to my mind, it is a
mistaken charity of judgment to place him in the same category
with the honest man who is unable to pay his debts, and for
whom the constitutional inhibition against "imprisonment for
debt, except in cases of fraud" was intended as a shield and not a
sword.

Considering that the law imposes a penal sanction on one who

draws and issues a worthless check against insufficient funds or a
closed account in the drawee bank, there is, likewise, every
reason to penalize a person who indulges in the making and
issuing of a check on an account belonging to another with the
latters consent, which account has been closed or has no funds or
credit with the drawee bank.11 (Bold emphases supplied)
ςrνll

The State likewise proved the existence of the third element. On

direct examination, Villadolid declared that the check had been
dishonored upon its presentment to the drawee bank through the
Bank of the Philippine Islands (BPI) as the collecting bank. The
return check memorandum issued by BPI indicated that the
account had already been closed.12 The petitioner did not deny or
ςrνll

contradict the fact of dishonor.

The remaining issue is whether or not the second element, that

is, the knowledge of the petitioner as the issuer of the check that
at the time of issue there were no sufficient funds in or credit
with the drawee bank for the payment of such check in full upon
its presentment, was existent.

To establish the existence of the second element, the State

should present the giving of a written notice of the dishonor to
the drawer, maker or issuer of the dishonored check. The
rationale for this requirement is rendered in Dico v. Court of
Appeals,13 to wit:
ςrνll chanroblesvirtuallawlibrary

To hold a person liable under B.P. Blg. 22, the prosecution must
not only establish that a check was issued and that the same was
subsequently dishonored, it must further be shown that accused
knew at the time of the issuance of the check that he did not
have sufficient funds or credit with the drawee bank for the
payment of such check in full upon its presentment.

This knowledge of insufficiency of funds or credit at the time of

the issuance of the check is the second element of the offense.
Inasmuch as this element involves a state of mind of the person
making, drawing or issuing the check which is difficult to prove,
Section 2 of B.P. Blg. 22 creates a prima facie presumption of
such knowledge. Said section reads: chanroblesvirtuallawlibrary
SEC. 2. Evidence of knowledge of insufficient funds. The making,
drawing and issuance of a check payment of which is refused by
the drawee because of insufficient funds in or credit with such
bank, when presented within ninety (90) days from the date of
the check, shall be prima facie evidence of knowledge of such
insufficiency of funds or credit unless such maker or drawer

pays the holder thereof the amount due thereon, or makes

arrangements for payment in full by the drawee of such check
within five (5) banking days after receiving notice that such check
has not been paid by the drawee.

For this presumption to arise, the prosecution must prove the

following: (a) the check is presented within ninety (90) days from
the date of the check; (b) the drawer or maker of the check
receives notice that such check has not been paid by the drawee;
and (c) the drawer or maker of the check fails to pay the holder
of the check the amount due thereon, or make arrangements for
payment in full within five (5) banking days after receiving notice
that such check has not been paid by the drawee. In other words,
the presumption is brought into existence only after it is proved
that the issuer had received a notice of dishonor and that within
five days from receipt thereof, he failed to pay the amount of the
check or to make arrangements for its payment. The presumption
or prima facie evidence as provided in this section cannot arise, if
such notice of nonpayment by the drawee bank is not sent to the
maker or drawer, or if there is no proof as to when such notice
was received by the drawer, since there would simply be no way
of reckoning the crucial 5-day period.

A notice of dishonor received by the maker or drawer of the check

is thus indispensable before a conviction can ensue. The notice of
dishonor may be sent by the offended party or the drawee bank.
The notice must be in writing. A mere oral notice to pay a
dishonored check will not suffice. The lack of a written notice is
fatal for the prosecution.14 (Bold emphases supplied)
ςrνll
The giving of the written notice of dishonor does not only supply
the proof for the second element arising from the presumption of
knowledge the law puts up but also affords the offender due
process. The law thereby allows the offender to avoid prosecution
if she pays the holder of the check the amount due thereon, or
makes arrangements for the payment in full of the check by the
drawee within five banking days from receipt of the written notice
that the check had not been paid.15 The Court cannot permit a
ςrνll

deprivation of the offender of this statutory right by not giving

the proper notice of dishonor. The nature of this opportunity for
the accused to avoid criminal prosecution has been expounded in
Lao v. Court of Appeals:16ςrνll

It has been observed that the State, under this statute, actually
offers the violator a compromise by allowing him to perform some
act which operates to preempt the criminal action, and if he opts
to perform it the action is abated xxx In this light, the full
payment of the amount appearing in the check within five
banking days from notice of dishonor is a complete defense. The
absence of a notice of dishonor necessarily deprives an accused
an opportunity to preclude a criminal prosecution. Accordingly,
procedural due process clearly enjoins that a notice of dishonor
be actually served on petitioner. Petitioner has a right to demand
and the basic postulate of fairness require that the notice of
dishonor be actually sent to and received by her to afford her the
opportunity to avert prosecution under B.P. 22."17 (Bold ςrνll

emphases supplied)

To prove that he had sent the written notice of dishonor to the

petitioner by registered mail, Villadolid presented the registry
return receipt for the first notice of dishonor dated June 17, 2002
and the registry return receipt for the second notice of dishonor
dated July 16, 2002. However, the petitioner denied receiving the
written notices of dishonor.

The mere presentment of the two registry return receipts was not
sufficient to establish the fact that written notices of dishonor had
been sent to or served on the petitioner as the issuer of the
check. Considering that the sending of the written notices of
dishonor had been done by registered mail, the registry return
receipts by themselves were not proof of the service on the
petitioner without being accompanied by the authenticating
affidavit of the person or persons who had actually mailed the
written notices of dishonor, or without the testimony in court of
the mailer or mailers on the fact of mailing. The authentication by
affidavit of the mailer or mailers was necessary in order for the
giving of the notices of dishonor by registered mail to be
regarded as clear proof of the giving of the notices of dishonor to
predicate the existence of the second element of the offense. No
less would fulfill the quantum of proof beyond reasonable doubt,
for, as the Court said in Ting v. Court of Appeals:18
ςrνll

Aside from the above testimony, no other reference was made to

the demand letter by the prosecution. As can be noticed from the
above exchange, the prosecution alleged that the demand letter
had been sent by mail. To prove mailing, it presented a copy of
the demand letter as well as the registry return receipt. However,
no attempt was made to show that the demand letter was indeed
sent through registered mail nor was the signature on the
registry return receipt authenticated or identified. It cannot even
be gleaned from the testimony of private complainant as to who
sent the demand letter and when the same was sent. In fact, the
prosecution seems to have presumed that the registry return
receipt was proof enough that the demand letter was sent
through registered mail and that the same was actually received
by petitioners or their agents.

As adverted to earlier, it is necessary in cases for violation of

Batas Pambansa Blg. 22, that the prosecution prove that the
issuer had received a notice of dishonor. It is a general rule that
when service of notice is an issue, the person alleging that the
notice was served must prove the fact of service (58 Am Jur 2d,
Notice, 45). The burden of proving notice rests upon the party
asserting its existence. Now, ordinarily, preponderance of
evidence is sufficient to prove notice. In criminal cases, however,
the quantum of proof required is proof beyond reasonable doubt.
Hence, for Batas Pambansa Blg. 22 cases, there should be clear
proof of notice. Moreover, it is a general rule that, when service of
a notice is sought to be made by mail, it should appear that the
conditions on which the validity of such service depends had
existence, otherwise the evidence is insufficient to establish the
fact of service (C.J.S., Notice, 18). In the instant case, the
prosecution did not present proof that the demand letter was sent
through registered mail, relying as it did only on the registry
return receipt. In civil cases, service made through registered
mail is proved by the registry receipt issued by the mailing office
and an affidavit of the person mailing of facts showing compliance
with Section 7 of Rule 13 (See Section 13, Rule 13, 1997 Rules of
Civil Procedure). If, in addition to the registry receipt, it is
required in civil cases that an affidavit of mailing as proof of
service be presented, then with more reason should we hold in
criminal cases that a registry receipt alone is insufficient as proof
of mailing. In the instant case, the prosecution failed to present
the testimony, or at least the affidavit, of the person mailing that,
indeed, the demand letter was sent. xxx

Moreover, petitioners, during the pre-trial, denied having received

the demand letter (p. 135, Rollo). Given petitioners denial of
receipt of the demand letter, it behooved the prosecution to
present proof that the demand letter was indeed sent through
registered mail and that the same was received by petitioners.
This, the prosecution miserably failed to do. Instead, it merely
presented the demand letter and registry return receipt as if
mere presentation of the same was equivalent to proof that some
sort of mail matter was received by petitioners. Receipts for
registered letters and return receipts do not prove themselves;
they must be properly authenticated in order to serve as proof of
receipt of the letters (Central Trust Co. v. City of Des Moines, 218
NW 580).

Likewise, for notice by mail, it must appear that the same was
served on the addressee or a duly authorized agent of the
addressee. In fact, the registry return receipt itself provides that
"[a] registered article must not be delivered to anyone but the
addressee, or upon the addressees written order, in which case
the authorized agent must write the addressees name on the
proper space and then affix legibly his own signature below it." In
the case at bar, no effort was made to show that the demand
letter was received by petitioners or their agent. All that we have
on record is an illegible signature on the registry receipt as
evidence that someone received the letter. As to whether this
signature is that of one of the petitioners or of their authorized
agent remains a mystery. From the registry receipt alone, it is
possible that petitioners or their authorized agent did receive the
demand letter. Possibilities, however, cannot replace proof beyond
reasonable doubt. There being insufficient proof that petitioners
received notice that their checks had been dishonored, the
presumption that they knew of the insufficiency of the funds
therefor cannot arise.

As we stated in Savage v. Taypin (G.R. No. 134217, May 11,

2000, 311 SCRA 397), "penal statutes must be strictly construed
against the State and liberally in favor of the accused." Likewise,
the prosecution may not rely on the weakness of the evidence for
the defense to make up for its own blunders in prosecuting an
offense. Having failed to prove all the elements of the offense,
petitioners may not thus be convicted for violation of Batas
Pambansa Blg. 22. (Bold emphases supplied)

Also, that the wife of Villadolid verbally informed the petitioner

that the check had bounced did not satisfy the requirement of
showing that written notices of dishonor had been made to and
received by the petitioner. The verbal notices of dishonor were
not effective because it is already settled that a notice of dishonor
must be in writing.19 The Court definitively ruled on the specific
ςrνll

form of the notice of dishonor in Domagsang v. Court of Appeals:

20
ςrνll

Petitioner counters that the lack of a written notice of dishonor is

fatal. The Court agrees.
While, indeed, Section 2 of B.P. Blg. 22 does not state that the
notice of dishonor be in writing, taken in conjunction, however,
with Section 3 of the law, i.e., "that where there are no sufficient
funds in or credit with such drawee bank, such fact shall always
be explicitly stated in the notice of dishonor or refusal," a mere
oral notice or demand to pay would appear to be insufficient for
conviction under the law. The Court is convinced that both the
spirit and letter of the Bouncing Checks Law would require for the
act to be punished thereunder not only that the accused issued a
check that is dishonored, but that likewise the accused has
actually been notified in writing of the fact of dishonor. The
consistent rule is that penal statutes have to be construed strictly
against the State and liberally in favor of the accused. (Bold
emphases supplied; italics in the original text)

In light of the foregoing, the proof of the guilt of the petitioner for
a violation of Batas Pambansa Blg. 22 for issuing to Villadolid the
unfunded Chinabank Check No. LPU-A0141332 in the amount
of P 50,000.00 did not satisfy the quantum of proof beyond
reasonable doubt. According to Section 2 of Rule 133, Rules of
Court, the accused is entitled to an acquittal, unless his guilt is
shown beyond reasonable doubt, which does not mean such a
degree of proof as, excluding possibility of error, produces
absolute certainty; only a moral certainty is required, or that
degree of proof that produces conviction in an unprejudiced mind.
This is the required quantum, firstly, because the accused is
presumed to be innocent until the contrary is proved, and,
secondly, because of the inequality of the position in which the
accused finds herself, with the State being arrayed against her
with its unlimited command of means, with counsel usually of
authority and capacity, who are regarded as public officers, "and
with an attitude of tranquil majesty often in striking contrast to
that of (the accused) engaged in a perturbed and distracting
struggle for liberty if not for life."21
ςrνll

Nonetheless, the civil liability of the petitioner in the principal

sum of P 50,000.00, being admitted, was established. She was
further liable for legal interest of 6% per annum on that principal
sum, reckoned from the filing of the information in the trial court.
That rate of interest will increase to 12% per annum upon the
finality of this decision.
ςηαοblενιrυαllαωlιbrαr

WHEREFORE, the Court REVERSES and SETS ASIDE the decision

of the Court of Appeals promulgated on December 4, 2006, and
ACQUITS petitioner AMADA RESTERIO of the violation of Batas
Pambansa Blg. 22 as charged for failure to establish her guilt
beyond reasonable doubt.

The Court ORDERS the petitioner to pay to BERNARDO

VILLADOLID the amount of P 50,000.00, representing the face
value of Chinabank Check No. LPU-A0141332, with legal interest
of 6% per annum from the filing of the information until the
finality of this decision, and thereafter 12% per annum until the
principal amount ofP 50,000.00 is paid.

No pronouncement on costs of suit. ςrαlαωlιbrαr

SO ORDERED.
ERLINDA C. SAN MATEO, Petitioner,

vs.

PEOPLE OF THE PHILIPPINES, Respondent.

DECISION

ABAD, J.:

Sometime in May and July 2005, petitioner Erlinda C. San Mateo ordered
assorted yarns amounting to ₱327,394.14 from ITSP International,
Incorporated through its Vice-President for Operations Ravin A. Sehwani.
In partial payment thereof, San Mateo issued 11 postdated Metrobank
checks amounting to ₱134,275.00.

Whenever a check matured, however, San Mateo would either call or write
to Sehwani requesting him not to deposit the checks due to lack of
sufficient funds. In consideration of their business relationship, Sehwani
acceded to the request. But San Mateo continued to fail to settle her
account.

On October 6, 2005, Sehwani deposited Metrobank Check 917604197

dated July 25, 2005 but it was dishonored for insufficiency of funds.
Sehwani immediately informed San Mateo of the dishonor, who asked him
to defer depositing the other checks since she w2s encountering financial
difficulties. On October 8, 2005, Sehwani received a letter from San Mateo
explaining her predicament and reiterating her request to coordinate first
with her office before depositing any other check. She also offered to
replace Metrobank Check 917604197 with a manager's check but failed to
do so.

In November 2005, Sehwani tried to follow up with San Mateo but she
never returned his call. On November 7, 2005, he deposited Metrobank
Check 917604206 dated July 21, 2005 but San Mateo made a stop
payment order. On November 11, 2005, he received a letter from San
Mateo apologizing for her failure to pay with a promise to communicate on
November 21, 2005. Since San Mateo failed to make payments, Sehwani
deposited the remaining checks which were all dishonored because the
account had been closed. Sehwani attempted to contact San Mateo but
she never responded. He also sent demand letters to her last known
address but she still failed to pay the value of the checks.
On November 23, 2005, Sehwani’s counsel sent a demand letter to San
Mateo’s residence at Greenhills, San Juan but the security guard of the
townhouse complex refused to accept the letter in compliance with San
Mateo’s order. Thus, the liaison officer left the letter with the security guard
with the instruction to deliver the same to San Mateo. Thereafter, he sent a
copy of the demand letter to San Mateo by registered mail which was
returned to his counsel’s office with the notation "N/S Party Out 12/12/05"
and that San Mateo did not claim it despite three notices to her dated
December 12, 2005, December 22, 2005, and January 2, 2006,
respectively.

On June 5, 2006, San Mateo was charged with 11 counts of violation of

Batas Pambansa (B.P.) 22. During trial, she claimed that she has an
agreement with Sehwani not to deposit her checks unless she gave a go
signal. But Sehwani ignored this agreement and deposited the nine checks
which resulted in the closure of her account.

On August 27, 2009, the Metropolitan Trial Court (MeTC) of Taguig City,
Branch 74 found San Mateo guilty of 10 counts of violation of B.P. 22. She
was sentenced to suffer the straight penalty of imprisonment of six months
for each count and ordered to pay the total value of the 11 checks
amounting to ₱134,275.00.

In finding her criminally liable for 10 counts of violation of B.P. 22 but civilly
liable for the total value of the 11 checks, the MeTC declared that
Metrobank Check 917604206 was dishonored not because of insufficiency
of funds or closed account but because of a stop payment order from San
Mateo.

San Mateo appealed to the Regional Trial Court (RTC) of Pasig City,
Branch 70 which affirmed her conviction on June 1, 2010. The RTC ruled
that the third element of notice of dishonor was duly established during the
trial by the following facts: (1) her unjustified refusal to claim the demand
letter sent to her by registered mail despite three notices from the
postmaster; (2) her various letters to Sehwani requesting the latter to defer
the deposit of her checks; and (3) her statement in her Amended Affidavit
that Sehwani’s act of depositing the nine checks resulted in the closure of
her account.

Undeterred, San Mateo elevated the case to the Court of Appeals (CA). On
August 23, 2011, the CA affirmed the RTC Decision and reiterated that all
the elements for violation of B.P. 22 had been sufficiently proven in this
case.1

On March 1, 2012, San Mateo filed a petition for review on certiorari before
this Court raising the following issues: (1) whether or not the subject checks
were issued for valuable consideration; (2) whether or not the demand
letter sent by Sehwani constituted the notice of dishonor required under
B.P. 22; and (3) whether or not the penalty of imprisonment is proper. In a
Resolution dated April 23, 2012, the Court denied the petition for its failure
to show that the CA committed reversible error when it upheld the factual
findings of both the MeTC and the RTC that all the elements for violation of
B.P. 22 had been sufficiently proven to convict San Mateo of the said crime.

On May 30, 2012, San Mateo filed a motion for reconsideration. On July
16, 2012, the Court granted the motion and reinstated the petition.

We grant the petition.

It is a settled rule that the remedy of appeal through a petition for review on
certiorari under Rule 45 of the Rules of Court contemplates only errors of
law and not errors of fact.2 The issues of: (1) whether or not the subject
checks were issued for valuable consideration; and (2) whether or not the
demand letter sent by Sehwani constituted the notice of dishonor required
under B.P. 22, are factual matters that belong to the proper determination
of the MeTC, the RTC and the CA. But when such courts have overlooked
certain facts and circumstances which, if taken into account, would
materially affect the result of the case, this Court may re-examine their
findings of facts.3

To be liable for violation of B.P. 22, the following essential elements must
be present: (1) the making, drawing, and issuance of any check to apply for
account or for value; (2) the knowledge of the maker, drawer, or issuer that
at the time of issue he does not have sufficient funds in or credit with the
drawee bank for the payment of the check in full upon its presentment; and
(3) the subsequent dishonor of the check by the drawee bank for
insufficiency of funds or credit or dishonor for the same reason had not the
drawer, without any valid cause, ordered the bank to stop payment.4

In this case, the third element is present and had been adequately
established. With respect to the first element, the Court gives full faith and
credit to the findings of the lower courts that the checks were issued for
value since San Mateo herself admitted that she drew and issued the same
as payment for the yarns she ordered from ITSP. Besides, the Court has
consistently pronounced that the issue of lack of valuable consideration for
the issuance of checks which were later on dishonored for insufficient funds
is immaterial to the success of a prosecution for violation of B.P. 22.5

But the Court finds that the second element was not sufficiently
established. Section 26 of B.P. 22 creates the presumption that the issuer of
the check was aware of the insufficiency of funds when he issued a check
and the bank dishonored it. This presumption, however, arises only after it
is proved that the issuer had received a written notice of dishonor and that,
within five days from receipt thereof, he failed to pay the amount of the
check or to make arrangements for its payment.7

Here, there is no basis in concluding that San Mateo knew of the

insufficiency of her funds. While she may have requested Sehwani in her
letters dated October 8, 2005 and November 11, 2005, to defer depositing
all the checks, with maturity dates of July and August 2005, otherwise, her
account will close, such act did not amount to an admission that, when she
issued those checks, she knew that she would have no sufficient funds in
the drawee bank to pay for them.8

Upon the other hand, the records show that Sehwani tried to serve the
notice of dishonor to San Mateo two times. On the first occasion, Sehwani’s
counsel sent a demand letter to San Mateo’s residence at Greenhills, San
Juan which the security guard refused to accept. Thus, the liaison officer
left the letter with the security guard with the instruction to hand it to San
Mateo. But the prosecution failed to show that the letter ever reached San
Mateo.

On the second occasion, Sehwani’s counsel sent a demand letter to San

Mateo by registered mail which was returned with the notation "N/S Party
Out 12/12/05" and that San Mateo did not claim it despite three notices to
her.

It has been the consistent ruling of this Court that receipts for registered
letters including return receipts do not themselves prove receipt; they must
be properly authenticated to serve as proof of receipt of the letters, claimed
to be a notice of dishonor.9 To be sure, the presentation of the registry card
with an unauthenticated signature, does not meet the required proof
beyond reasonable doubt that the accused received such notice. It is not
enough for the prosecution to prove that a notice of dishonor was sent to
the accused. The prosecution must also prove actual receipt of said notice,
because the fact of service provided for in the law is reckoned from receipt
of such notice of dishonor by the accused.10

In King v. People,11 the complainant sent the accused a demand letter via
registered mail. But the records showed that the accused did not receive it.
The postmaster likewise certified that the letter was returned to sender. Yet
despite the clear import of the postmaster’s certification, the prosecution
did not adduce proof that the accused received the post office notice but
unjustifiably refused to claim the registered mail. The Court held that it was
possible that the drawee bank sent the accused a notice of dishonor, but
the prosecution did not present evidence that the bank did send it, or that
the accused actually received it. It was also possible that the accused was
trying to flee from the complainant by staying in different addresses. But
speculations and possibilities cannot take the place of proof. The conviction
must rest on proof beyond reasonable doubt.12

Since there is insufficient proof that San Mateo actually received the notice
of dishonor, the presumption that she knew of the insufficiency of her funds
cannot arise. For this reason, the Court cannot convict her with moral
certainty of violation of B.P. 22.

Nevertheless, San Mateo’s acquittal does not entail the extinguishment of

her civil liability for the dishonored checks.13 An acquittal based on lack of
proof beyond reasonable doubt does not preclude the award of civil
damages.14 For this reason, the trial court’s directive for San Mateo to pay
the civil liability in the amount of ₱134,275.00 representing the total value
of the 11 checks plus 12% interest per annum from the time the said sum
became due and demandable until fully paid, stands.

WHEREFORE, the Court GRANTS the petition. The assailed Decision

dated August 23, 2011 of the Court of Appeals in CA-G.R. CR 33434
finding petitioner Erlinda C. San Mateo guilty of 10 counts of violation of
B.P. 22 is REVERSED and SET ASIDE. Petitioner Erlinda C. San Mateo is
hereby ACQUITTED on the ground that her guilt has not been established
beyond reasonable doubt. She is ordered, however, to indemnify the
complainant, ITSP International, Incorporated, represented by its Vice-
President for Operations Ravin A. Sehwani, the amount of P 134,275.00
representing the total value of the 11 checks plus 12% interest per annum
from the time the said sum became due and demandable until fully paid.
EUMELIA R. MITRA, Petitioner,

vs.

PEOPLE OF THE PHILIPPINES and FELICISIMO S.
TARCELO, Respondents.

DECISION

MENDOZA, J.:

This is a petition for review on certiorari under Rule 45 of the Rules of Court
assailing the July 31, 2009 Decision1 and the February 11, 2010 Resolution
of the Court of Appeals (CA) in CA-G.R. CR No. 31740. The subject
decision and resolution affirmed the August 22, 2007 Decision of the
Regional Trial Court, Branch 2, Batangas City (RTC) which, in turn,
affirmed the May 21, 2007 Decision of the Municipal Trial Court in Cities,
Branch 2, Batangas City (MTCC).

THE FACTS:

Petitioner Eumelia R. Mitra (Mitra) was the Treasurer, and Florencio L.

Cabrera, Jr. (now deceased) was the President, of Lucky Nine Credit
Corporation (LNCC), a corporation engaged in money lending activities.

Between 1996 and 1999, private respondent Felicisimo S.

Tarcelo (Tarcelo) invested money in LNCC. As the usual practice in money
placement transactions, Tarcelo was issued checks equivalent to the
amounts he invested plus the interest on his investments. The following
checks, signed by Mitra and Cabrera, were issued by LNCC to Tarcelo.2

Bank Date Issued Date of Check Amount Check No.

Security September 15, January 15, ₱3,125.00 45804
Bank 1998 1999
September 15, January 15,
-do- 125,000.00 45805
1998 1999
September 20, January 20,
-do- 2,500.00 45809
1998 1999
 September 20, January 20,
-do- 100,000.00 45810
1998 1999
September 30, January 30,
-do- 5,000.00 45814
1998 1999
September 30, January 30,
-do- 200,000.00 45815
1998 1999
February 3,
-do- October 3, 1998 2,500.00 45875
1999
February 3,
-do- October 3, 1998 100,000.00 45876
1999
November 17, February17,
-do- 5,000.00 46061
1998 1999
November 17, March 17,
-do- 5,000.00 46062
1998 1999
November 17, March 17,
-do- 200,000.00 46063
1998 1999
November 19, January 19,
-do- 2,500.00 46065
1998 1999
November 19, February19,
-do- 2,500.00 46066
1998 1999
November 19, March 19,
-do- 2,500.00 46067
1998 1999
November 19, March 19,
-do- 100,000.00 46068
1998 1999
November 20, January 20,
-do- 10,000.00 46070
1998 1999
November 20, February 20,
-do- 10,000.00 46071
1998 1999
November 20, March 20,
-do- 10,000.00 46072
1998 1999
 November 20, March 20,
-do- 10,000.00 46073
1998 1999
November 30, January 30,
-do- 2,500.00 46075
1998 1999
November 30, February 28,
-do- 2,500.00 46076
1998 1999
November 30, March 30,
-do- 2,500.00 46077
1998 1999
November 30, March 30,
-do- 100,000.00 46078
1998 1999

When Tarcelo presented these checks for payment, they were dishonored
for the reason "account closed." Tarcelo made several oral demands on
LNCC for the payment of these checks but he was frustrated. Constrained,
in 2002, he caused the filing of seven informations for violation of Batas
Pambansa Blg. 22 (BP 22) in the total amount of ₱925,000.00 with the
MTCC in Batangas City.3 1avvphi1

After trial on the merits, the MTCC found Mitra and Cabrera guilty of the
charges. The fallo of the May 21, 2007 MTCC Decision4 reads:

WHEREFORE, foregoing premises considered, the accused FLORENCIO

I. CABRERA, JR., and EUMELIA R. MITRA are hereby found guilty of the
offense of violation of Batas Pambansa Bilang 22 and are hereby
ORDERED to respectively pay the following fines for each violation and
with subsidiary imprisonment in all cases, in case of insolvency:

1. Criminal Case No. 43637 - ₱200,000.00

2. Criminal Case No. 43640 - ₱100,000.00

3. Criminal Case No. 43648 - ₱100,000.00

4. Criminal Case No. 43700 - ₱125,000.00

5. Criminal Case No. 43702 - ₱200,000.00

6. Criminal Case No. 43704 - ₱100,000.00

7. Criminal Case No. 43706 - ₱100,000.00

Said accused, nevertheless, are adjudged civilly liable and are ordered to
pay, in solidum, private complainant Felicisimo S. Tarcelo the amount of
NINE HUNDRED TWENTY FIVE THOUSAND PESOS (₱925,000.000).

SO ORDERED.

Mitra and Cabrera appealed to the Batangas RTC contending that: they
signed the seven checks in blank with no name of the payee, no amount
stated and no date of maturity; they did not know when and to whom those
checks would be issued; the seven checks were only among those in one
or two booklets of checks they were made to sign at that time; and that they
signed the checks so as not to delay the transactions of LNCC because
they did not regularly hold office there.5

The RTC affirmed the MTCC decision and later denied their motion for
reconsideration. Meanwhile, Cabrera died. Mitra alone filed this petition for
review6 claiming, among others, that there was no proper service of the
notice of dishonor on her. The Court of Appeals dismissed her petition for
lack of merit.

Mitra is now before this Court on a petition for review and submits these
issues:

1. WHETHER OR NOT THE ELEMENTS OF VIOLATION OF BATAS

PAMBANSA BILANG 22 MUST BE PROVED BEYOND REASONABLE
DOUBT AS AGAINST THE CORPORATION WHO OWNS THE
CURRENT ACCOUNT WHERE THE SUBJECT CHECKS WERE DRAWN
BEFORE LIABILITY ATTACHES TO THE SIGNATORIES.

2. WHETHER OR NOT THERE IS PROPER SERVICE OF NOTICE OF

DISHONOR AND DEMAND TO PAY TO THE PETITIONER AND THE
LATE FLORENCIO CABRERA, JR.

The Court denies the petition.

A check is a negotiable instrument that serves as a substitute for money

and as a convenient form of payment in financial transactions and
obligations. The use of checks as payment allows commercial and banking
transactions to proceed without the actual handling of money, thus, doing
away with the need to physically count bills and coins whenever payment is
made. It permits commercial and banking transactions to be carried out
quickly and efficiently. But the convenience afforded by checks is damaged
by unfunded checks that adversely affect confidence in our commercial and
banking activities, and ultimately injure public interest.

BP 22 or the Bouncing Checks Law was enacted for the specific purpose of
addressing the problem of the continued issuance and circulation of
unfunded checks by irresponsible persons. To stem the harm caused by
these bouncing checks to the community, BP 22 considers the mere act of
issuing an unfunded check as an offense not only against property but also
against public order.7 The purpose of BP 22 in declaring the mere issuance
of a bouncing check as malum prohibitum is to punish the offender in order
to deter him and others from committing the offense, to isolate him from
society, to reform and rehabilitate him, and to maintain social order.8 The
penalty is stiff. BP 22 imposes the penalty of imprisonment for at least 30
days or a fine of up to double the amount of the check or both
imprisonment and fine.

Specifically, BP 22 provides:

SECTION 1. Checks Without Sufficient Funds. - Any person who makes or

draws and issues any check to apply on account or for value, knowing at
the time of issue that he does not have sufficient funds in or credit with the
drawee bank for the payment of such check in full upon its presentment,
which check is subsequently dishonored by the drawee bank for
insufficiency of funds or credit or would have been dishonored for the same
reason had not the drawer, without any valid reason, ordered the bank to
stop payment, shall be punished by imprisonment of not less than thirty
days but not more than one (1) year or by a fine of not less than but not
more than double the amount of the check which fine shall in no case
exceed Two Hundred Thousand Pesos, or both such fine and imprisonment
at the discretion of the court.

The same penalty shall be imposed upon any person who, having sufficient
funds in or credit with the drawee bank when he makes or draws and
issues a check, shall fail to keep sufficient funds or to maintain a credit to
cover the full amount of the check if presented within a period of ninety (90)
days from the date appearing thereon, for which reason it is dishonored by
the drawee bank.
Where the check is drawn by a corporation, company or entity, the person
or persons who actually signed the check in behalf of such drawer shall be
liable under this Act.

SECTION 2. Evidence of Knowledge of Insufficient Funds. - The making,

drawing and issuance of a check payment of which is refused by the
drawee because of insufficient funds in or credit with such bank, when
presented within ninety (90) days from the date of the check, shall be prima
facie evidence of knowledge of such insufficiency of funds or credit unless
such maker or drawer pays the holder thereof the amount due thereon, or
makes arrangements for payment in full by the drawee of such check within
five (5) banking days after receiving notice that such check has not been
paid by the drawee.

Mitra posits in this petition that before the signatory to a bouncing corporate
check can be held liable, all the elements of the crime of violation of BP 22
must first be proven against the corporation. The corporation must first be
declared to have committed the violation before the liability attaches to the
signatories of the checks.9

The Court finds Itself unable to agree with Mitra's posture. The third
paragraph of Section 1 of BP 22 reads: "Where the check is drawn by a
corporation, company or entity, the person or persons who actually signed
the check in behalf of such drawer shall be liable under this Act." This
provision recognizes the reality that a corporation can only act through its
officers. Hence, its wording is unequivocal and mandatory - that the person
who actually signed the corporate check shall be held liable for a violation
of BP 22. This provision does not contain any condition, qualification or
limitation.

In the case of Llamado v. Court of Appeals,10 the Court ruled that the
accused was liable on the unfunded corporate check which he signed as
treasurer of the corporation. He could not invoke his lack of involvement in
the negotiation for the transaction as a defense because BP 22 punishes
the mere issuance of a bouncing check, not the purpose for which the
check was issued or in consideration of the terms and conditions relating to
its issuance. In this case, Mitra signed the LNCC checks as treasurer.
Following Llamado, she must then be held liable for violating BP 22.

Another essential element of a violation of BP 22 is the drawer's knowledge

that he has insufficient funds or credit with the drawee bank to cover his
check. Because this involves a state of mind that is difficult to establish, BP
22 creates the prima facie presumption that once the check is dishonored,
the drawer of the check gains knowledge of the insufficiency, unless within
five banking days from receipt of the notice of dishonor, the drawer pays
the holder of the check or makes arrangements with the drawee bank for
the payment of the check. The service of the notice of dishonor gives the
drawer the opportunity to make good the check within those five days to
avert his prosecution for violating BP 22.

Mitra alleges that there was no proper service on her of the notice of
dishonor and, so, an essential element of the offense is missing. This
contention raises a factual issue that is not proper for review. It is not the
function of the Court to re-examine the finding of facts of the Court of
Appeals. Our review is limited to errors of law and cannot touch errors of
facts unless the petitioner shows that the trial court overlooked facts or
circumstances that warrant a different disposition of the case11 or that the
findings of fact have no basis on record. Hence, with respect to the issue of
the propriety of service on Mitra of the notice of dishonor, the Court gives
full faith and credit to the consistent findings of the MTCC, the RTC and the
CA.

The defense postulated that there was no demand served upon the
accused, said denial deserves scant consideration. Positive allegation of
the prosecution that a demand letter was served upon the accused prevails
over the denial made by the accused. Though, having denied that there
was no demand letter served on April 10, 2000, however, the prosecution
positively alleged and proved that the questioned demand letter was served
upon the accused on April 10, 2000, that was at the time they were
attending Court hearing before Branch I of this Court. In fact, the
prosecution had submitted a Certification issued by the other Branch of this
Court certifying the fact that the accused were present during the April 10,
2010 hearing. With such straightforward and categorical testimony of the
witness, the Court believes that the prosecution has achieved what was
dismally lacking in the three (3) cases of Betty King, Victor Ting and Caras -
evidence of the receipt by the accused of the demand letter sent to her.
The Court accepts the prosecution's narrative that the accused refused to
sign the same to evidence their receipt thereof. To require the prosecution
to produce the signature of the accused on said demand letter would be
imposing an undue hardship on it. As well, actual receipt acknowledgment
is not and has never been required of the prosecution either by law or
jurisprudence.12 [emphasis supplied]

With the notice of dishonor duly served and disregarded, there arose the
presumption that Mitra and Cabrera knew that there were insufficient funds
to cover the checks upon their presentment for payment. In fact, the
account was already closed.

To reiterate the elements of a violation of BP 22 as contained in the above-

quoted provision, a violation exists where:

1. a person makes or draws and issues a check to apply on account or for

value;

2. the person who makes or draws and issues the check knows at the time
of issue that he does not have sufficient funds in or credit with the drawee
bank for the full payment of the check upon its presentment; and

3. the check is subsequently dishonored by the drawee bank for

insufficiency of funds or credit, or would have been dishonored for the
same reason had not the drawer, without any valid reason, ordered the
bank to stop payment. 13

There is no dispute that Mitra signed the checks and that the bank
dishonored the checks because the account had been closed. Notice of
dishonor was properly given, but Mitra failed to pay the checks or make
arrangements for their payment within five days from notice. With all the
above elements duly proven, Mitra cannot escape the civil and criminal
liabilities that BP 22 imposes for its breach.14

WHEREFORE, the July 31, 2009 Decision and the February 11, 2010
Resolution of the Court of Appeals in CA-G.R. CR No. 31740 are hereby
AFFIRMED.

SO ORDERED.
 BEN B. RICO, Petitioner, v. PEOPLE OF THE
PHILIPPINES, Respondent.

DECISION

QUISUMBING, J.:

For review on certiorari is the decision 1 dated June 15, 1998 of

the Court of Appeals in CA-G.R. CR No. 19764, affirming the
judgment 2 of the Regional Trial Court of Laoag City which found
the petitioner guilty of five counts of violation of Batas Pambansa
Blg. 22 (the Bouncing Checks Law), and the resolution 3 dated
January 7, 1999 denying petitioner’s motion for reconsideration.
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chanrob1es virtua1

Petitioner Ben Rico was a "pakyaw" contractor who used to

purchase construction materials on credit from private
complainant Ever Lucky Commercial (ELC), represented by Victor
Chan, Manager. Petitioner made payments either in cash or by
postdated checks. On several occasions, he issued checks to ELC,
which were dishonored by the bank upon presentment for
payment for "insufficiency of funds" or "closed account", as
follows: chanrob1es virtual 1aw library

CHECK NO. DATE DATE OF REASON FOR AMOUNT

DISHONOR DISHONOR

04142 Nov. 5, 1990 Nov. 13, 1990 Insufficient P81,800.00

funds

1759806 Apr. 19, 1990 Apr. 20, 1990 Insufficient 25,000.00

funds
1759808 Apr. 20, 1990 Apr. 23, 1990 Account Closed 4,834.00

1759810 Apr. 11, 1990 Apr. 16, 1990 Insufficient 39,000.00

funds

1759812 Apr. 11, 1990 Apr. 16, 1990 Insufficient 15,250.00

funds

1759811 May 2, 1990 May 3, 1990 Account Closed 12,550.00

——————

TOTAL P178.434.00

===========

Consequently, petitioner was charged under several informations

docketed as Criminal Cases Nos. 5796, 5797, 5798, 5799 and
5800 for violation of Batas Pambansa Blg. 22. The information in
Criminal Case No. 5796 reads: chanrob1es virtual 1aw library

That on or about the 27th day of October, 1990, in the City of

Laoag, Philippines, and within the jurisdiction of this Honorable
Court, the above-named accused did then and there wilfully,
unlawfully and feloniously draw and issue Check No. 04142 in the
amount of Eighty One Thousand Eight Hundred Pesos
(P81,800.00), dated November 5, 1990, drawn against the
Philippine Commercial and International Bank, Laoag City Branch,
in favor of the Ever Lucky Commercial, as payee, in payment of
construction materials which he purchased on credit from the said
Ever Lucky Commercial, located at Brgy. No. 12, Gen. Segundo
Ave., Laoag City, of which Mr. Victor Chan is the Gen. Manager,
knowing fully well that he had no sufficient funds deposited with
the drawee bank to cover the payment thereof, as in fact it was
dishonored when presented for payment to the drawee bank on
November 13, 1990, on the ground that it was drawn against
insufficient funds, and the accused, despite due notice to him of
the dishonor of said check had not paid the amount thereof nor
had he made arrangements for its payment in full by the drawee
bank within five (5) banking days from receipt of the notice of
dishonor, to the damage and prejudice of the Ever Lucky
Commercial in the amount of P81,800.00, Philippine Currency. chanrob1es virtua1 1aw 1ibrary

CONTRARY TO LAW. 4

The other informations are similarly worded, except for the check
number and their amounts and the dates of issue which are
hereunder itemized as follows:chanrob1es virtual 1aw library

CRIMINAL CASE CHECK NO. DATE AMOUNT

NO.

5797 1759806 Apr. 19, 1990 P25,000.00

5798 1759808 Apr. 20, 1990 P4,834.00

5799 1759810 Apr. 11, 1990 P39,000.00

1759812 Apr. 11, 1990 P15,250.00

5800 1759811 May 2, 1990 P12,550.00

The five informations were consolidated by the lower court. Upon

arraignment, petitioner pleaded not guilty to all the charges, and
trial on the merits ensued.

The prosecution established that petitioner, who used to purchase

construction materials on credit from ELC, issued the above-cited
checks as payment for the materials and that they were
dishonored upon presentment for payment to the bank either for
"insufficient funds" or "account closed." After the checks were
dishonored, ELC demanded payments from petitioner, who failed
to make good his undertaking to replace the checks. No formal
written demand letter or notice of dishonor, however, was sent to
the petitioner. It was also established by the prosecution that
ELC, through its manager, issued several receipts covering several
payments in various amounts made by petitioner as replacement
of some dishonored but returned checks as well as for payment of
materials purchased. No official receipts covering the materials
purchased, however, were presented in court as evidence. 5

In his defense, petitioner did not deny that he issued the subject
checks and that they were dishonored upon presentment for
payment with the drawee bank. He claimed, however, that he
already paid the amounts covered by the checks, totalling
P284,340.50, including interest. In support thereof, he submitted
as evidence the following official receipts issued by ELC 6

OFFICIAL RECEIPT NO. DATE AMOUNT

3290 Apr. 24, 1990 P65,000.00

3298 Apr. 27, 1990 90,733.50

3411 May 3, 1990 10,000.00

3683 Sept. 4, 1990 68,607.00

3866 Jan. 5, 1991 50,000.00

——————

TOTAL P284,340.50

===========

According to petitioner, the difference between the total amount

as reflected in the receipts and the total amount covered by the
subject checks represented interest. 7 He also admitted that he
did not retrieve the dishonored checks as they were not yet fully
paid. 8
On March 13, 1996, the trial court rendered its judgment as
follows:
chanrob1es virtual 1aw library

(1) In Criminal Case No. 5796, the accused is hereby found guilty
beyond reasonable doubt of the violation of BP Bilang 22. He is
sentenced to suffer the straight penalty of ONE (1) YEAR
imprisonment and to indemnify the offended party in the amount
of P81,800.00; chanrob1es virtua1 1aw 1ibrary

(2) In Criminal Case No. 5797, the accused is hereby found guilty
beyond reasonable doubt of the violation of BP Bilang 22. He is
sentenced to suffer the straight penalty of SIX (6) MONTHS
imprisonment and to indemnify the offended party in the amount
of P25,000.00;

(3) In Criminal Case No. 5798, the accused is hereby found guilty
beyond reasonable doubt of the violation of BP Bilang 22. He is
sentenced to suffer the straight penalty of THREE (3) MONTHS
imprisonment and to indemnify the offended party in the amount
of P4,834.00;

(4) In Criminal Case No. 5799, the accused is hereby found guilty
beyond reasonable doubt of the violation of BP Bilang 22. He is
sentenced to suffer the straight penalty of ONE (1) YEAR
Imprisonment and to indemnify the offended party in the amount
of P54,250.00; and

(5) In Criminal Case No. 5800, the accused is hereby found guilty
beyond reasonable doubt of the violation of BP Bilang 22. He is
sentenced to suffer the straight penalty of SIX (6) MONTHS
imprisonment and to indemnify the offended party in the amount
of P12,550.00.

Costs against the accused.

SO ORDERED. 9
In convicting petitioner, the trial court noted that petitioner had
admitted the issuance and dishonor of the subject checks, and he
could not escape criminal liability as it found his defense of
payment off-tangent. 10 It ruled that the alleged payments do
not apply to the subject checks but for the other materials
purchased, and granting they were applicable, they could only
affect his civil liability. 11 Further, the trial court concluded that a
mathematical computation of the payments made by the
petitioner vis-a-vis the subject checks did not give credence to
the stance of petitioner. The trial court found it illogical for
petitioner to have paid more than the amounts covered by the
subject checks without a single alleged payment matching any of
the amounts written in the subject checks, and with petitioner
paying more than his outstanding liabilities at some point. 12

Aggrieved, petitioner filed an appeal before the Court of Appeals,

which affirmed the trial court’s decision. The Court of Appeals
found petitioner’s defense of payment untenable and not proven
by clear and convincing evidence. It further stated that even if
there were payment, petitioner failed to prove that it was made
within five days from receipt of notice of dishonor. 13 In relation
thereto, it ruled that the testimonial evidence of private
complainant declaring that immediate demands to pay were
made on petitioner is in themselves notices of dishonor. 14
Petitioner’s motion for reconsideration was denied in a resolution
dated January 7, 1999. chanrob1es virtua1 1aw 1ibrary

Hence, this petition raising issues based on the alleged errors of

the appellate court.

MAIN ISSUE: chanrob1es virtual 1aw library

THE APPELLATE COURT COMMITTED A GRAVE MISTAKE IN

AFFIRMING THE TRIAL COURT’S FINDING THAT THE PETITIONER
IN THE FIVE (5) CRIMINAL CASES IS GUILTY BEYOND
REASONABLE DOUBT OF THE VIOLATION OF BP BILANG 22 AND
SENTENCING HIM TO SUFFER THE PENALTY IMPOSED THEREIN.
SUB-ISSUES

THE APPELLATE COURT ERRED IN SHIFTING UNTO THE

PETITIONER THE BURDEN OF PROVING HIS OWN INNOCENCE
INSTEAD OF LAYING THE BURDEN UPON THE PROSECUTION TO
PROVE THE GUILT OF PETITIONER BEYOND REASONABLE DOUBT.

II

THE APPELLATE COURT ERRED IN FINDING THAT DEFENSE OF

PAYMENT BY PETITIONER DID NOT OVERTHROW THE PRIMA
FACIE EVIDENCE OF KNOWLEDGE OF THE INSUFFICIENCY OF
FUNDS AT THE TIME OF ISSUANCE OF THE CHECKS AND THAT
THE DEMANDS FOR PAYMENT MADE TO PETITIONER ARE IN
THEMSELVES NOTICES OF DISHONOR.

III

THE APPELLATE COURT ERRED IN AFFIRMING THE TRIAL

COURT’S FINDING THAT THE PAYMENTS MADE BY THE
PETITIONER TO THE EVER LUCKY COMMERCIAL (ELC) AS
EVIDENCED BY OFFICIAL RECEIPT ISSUED BY ELC REFER TO
OTHER TRANSACTIONS BETWEEN THE PETITIONER AND ELC AND
NOT TO THE DISHONORED CHECKS.

IV

THE APPELLATE COURT ERRED IN AFFIRMING THE TRIAL

COURT’S ANALYSIS DEBUNKING PETITIONER’S DEFENSE OF
PAYMENTS. 15
In our view, the principal issue for our resolution is whether or
not petitioner’s guilt has been established beyond reasonable
doubt.

Petitioner contends that he should be acquitted of all charges

because he already paid his obligations to Ever Lucky
Commercial. He likewise avers that the prosecution failed to
establish all the elements of the crime, particularly that he had
knowledge of the insufficiency of his funds in the bank at the time
he issued the checks. This failure, according to petitioner, can be
traced to the prosecution’s inability to prove that notices of
dishonor were sent to him. chanrob1es virtua1 1aw 1ibrary

The Office of the Solicitor General (OSG), for appellee, argues

that the payments made by petitioner refer to different
transactions and not to those covered by the checks subject
matter of this case. The OSG also avers that the verbal demands
made by private complainant are more than enough to prove that
petitioner had knowledge of the insufficiency of his funds in the
bank at the time he issued the checks.

At the outset, we must stress that as a general rule, the factual

findings of the trial court, when affirmed by the Court of Appeals,
are accorded respect and finality, unless tainted with arbitrariness
or palpable error, 16 or when the trial court failed to appreciate
certain facts and circumstances which, if taken into account,
would materially affect the result of the case. 17 We find that the
exceptions rather than the general rule apply in this case. We also
find the petition meritorious.

The law enumerates the elements of violation of B.P. 22, namely

(1) the making, drawing and issuance of any check to apply for
account or for value; (2) the knowledge of the maker, drawer, or
issuer that at the time of issue he does not have sufficient funds
in or credit with the drawee bank for the payment of the check in
full upon its presentment; and (3) the subsequent dishonor of the
check by the drawee bank for insufficiency of funds or credit or
dishonor for the same reason had not the drawer, without any
valid cause, ordered the bank to stop payment. 18

The first and third elements of the offense are present and proved
in these consolidated cases. But we find that the second element
was not sufficiently established.

Knowledge of insufficiency of funds or credit in the drawee bank

for the payment of a check upon its presentment is an essential
element of the offense. 19 In several cases, 20 we have ruled
that to hold a person liable under B.P. 22, it is not enough to
establish that a check was dishonored upon presentment. It must
be shown further that the person who issued the check knew at
the time of issue that he does not have sufficient funds in or
credit with the drawee bank for the payment of such check in full
upon its presentment. Because this element involves a state of
mind which is difficult to establish, Section 2 of the law creates a
prima facie presumption of such knowledge.

SEC. 2. Evidence of knowledge of insufficient funds. — The

making, drawing and issuance of a check payment of which is
refused by the drawee because of insufficient funds or credit with
such bank, when presented within ninety (90) days from the date
of the check, shall be prima facie evidence of knowledge of such
insufficiency of funds or credit unless such maker or drawer pays
the holder thereof the amount due thereon, or makes
arrangements for payment in full by the drawee of such check
within five (5) banking days after receiving notice that such check
has not been paid by the drawee." (Emphasis supplied)

In King v. People, 21 we held: chanrob1es virtual 1aw library

. . . The prima facie presumption arises when a check is issued.

But the law also provides that the presumption does not arise
when the issuer pays the amount of the check or makes
arrangement for its payment within five banking days after
receiving notice that such check has not been paid by the
drawee. chanrob1es virtua1 1aw 1ibrary
Thus, the presumption that the issuer had knowledge of the
insufficiency of funds is brought into existence only after it is
proved that the issuer had received a notice of dishonor and that,
within five days from receipt thereof, he failed to pay the amount
of the check or to make arrangement for its payment. 22

Here, both the Court of Appeals and the trial court relied solely on
the testimony of prosecution witness Danilo Cac to the effect that
private complainant immediately demanded payment of the value
of the checks after they were dishonored. Aside from this self-
serving testimony, no other evidence was presented to prove the
giving and receiving of such notice. The nature and content of
said demands were not clarified. Even the date when and the
manner by which these alleged demands were made upon and
received by petitioner were not specified. Worse, the records do
not show that formal and written demand letters or notices of
dishonor were ever sent to petitioner.

Where the presumption of knowledge of insufficiency of funds

does not arise due to the absence of notice of dishonor of the
check, the accused should not be held liable for the offense
defined under the first paragraph of Section 1 of B.P. 22. 23

As held in the case of Lao v. Court of Appeals 24 a notice of

dishonor personally sent to and received by the accused is
necessary before one can be held liable under B.P. 22. In that
case, we stated thus: chanrob1es virtual 1aw library

Because no notice of dishonor was actually sent to and received

by the petitioner, the prima facie presumption that she knew
about the insufficiency of funds cannot apply. Section 2 of BP Blg.
22 clearly provides that this presumption arises not from the
mere fact of drawing, making, and issuing a bum check; there
must also be a showing that, within five banking days from
receipt of the notice of dishonor, such maker or drawer failed to
pay the holder of the check the amount due thereon or to make
arrangement for its payment in full by the drawee of such check.
virtua1 1aw 1ibrary
chanrob1es
It has been observed that the State, under this statute, actually
offers the violator "a compromise by allowing him to perform
some act which operates to preempt the criminal action, and if he
opts to perform it the action is abated.." . . The absence of a
notice of dishonor necessarily deprives an accused an opportunity
to preclude a criminal prosecution. Accordingly, procedural due
process clearly enjoins that a notice of dishonor be actually
served on petitioner. Petitioner has a right to demand — and the
basic postulates of fairness require — that the notice of dishonor
be actually sent to and received by her to afford her the
opportunity to avert prosecution under BP Blg. 22. (Emphasis
supplied.)

In other words, if such notice of non-payment by the drawee

bank is not sent to the maker or drawer of the bum check, or if
there is no proof as to when such notice was received by the
drawer, then the presumption of knowledge as provided in
Section 2 of B.P. 22 cannot arise, since there would simply be no
way of reckoning the crucial five-day period.25 cralaw:red

As stated earlier, the prosecution not only failed to prove the

receipt by petitioner of any notice of dishonor, the records are
also bereft of any indication that written formal demand letters or
notice of dishonor were actually sent to petitioner. In recent
cases, we had the occasion to emphasize that not only must
there be a written notice of dishonor or demand letters actually
received by the drawer of a dishonored check, but there must
also be proof of receipt thereof that is properly authenticated,
and not mere registered receipt and/or return receipt.

Thus, as held in Domagsang v. Court of Appeals, 26 while Section

2 of B.P. 22 indeed does not state that the notice of dishonor be
in writing, this must be taken in conjunction with Section 3 of the
law, i.e., "that where there are no sufficient funds in or credit with
such drawee bank, such fact shall always be explicitly stated in
the notice of dishonor or refusal." A mere oral notice or demand
to pay would appear to be insufficient for conviction under the
law. In our view, both the spirit and the letter of the Bouncing
Checks Law require for the act to be punished thereunder not
only that the accused issued a check that is dishonored, but also
that the accused has actually been notified in writing of the fact
of dishonor. The consistent rule is that penal statutes must be
construed strictly against the State and liberally in favor of the
accused. In Victor Ting v. Court of Appeals, 27 we stated that
when service of a notice is sought to be made by mail, it should
appear that conditions exist on which the validity of such service
depends. Otherwise, the evidence is insufficient to establish the
fact of service. Receipts for registered letters and return receipts
do not by themselves prove receipt; they must be properly
authenticated to serve as proof of receipt of the letters.

In fine, the failure of the prosecution to prove the existence and

receipt by petitioner of the requisite written notice of dishonor
and that he was given at least five banking days within which to
settle his account constitutes sufficient ground for his acquittal.

However, while petitioner is acquitted for violation of B.P. 22, he

should be ordered to pay the face value of the five dishonored
checks plus legal interest in accordance with our ruling in
Domagsang v. Court of Appeals. 28 There, the prosecution failed
to sufficiently establish a case to warrant conviction, but clearly
proved petitioner’s failure to pay a just debt owing to the private
complainant. Thus, petitioner was ordered to pay the face value
of the check with 12 percent legal interest per annum, reckoned
from the filing of the information until the finality of the decision.
It is well settled that an acquittal based on reasonable doubt does
not preclude the award of civil damages. The judgment of
acquittal extinguishes the liability of the accused for damages
only when it includes a declaration that the facts from which the
civil liability might arise did not exist. Thus, the civil liability is not
extinguished by acquittal where the acquittal is based on lack of
proof beyond reasonable doubt, since only preponderance of
evidence is required in civil cases. There appears to be no sound
reason to require that a separate civil action be still filed
considering that the facts to be proved in the civil case have
already been established in the criminal proceedings where the
accused was acquitted. To require a separate civil action would
mean needless clogging of court dockets and unnecessary
duplication of litigation with all its attendant loss of time, effort,
and money on the part of all concerned. 29

Finally, we agree that petitioner’s alleged prior payment is

untenable. As found by the trial court and by the Court of
Appeals, it is unnatural and illogical for petitioner to have paid
more than his outstanding obligations. It is also unlikely that he
would pay substantial amounts of interest when nothing had been
agreed upon on this matter. It is quite striking how he could have
generously paid more than what was due from him when he could
hardly pay private complainant in cash, and had to issue post-
dated checks. Moreover, he could have asked for the return of the
checks as a matter of sound business practice and procedure if
indeed he already paid all the dishonored checks. The fact that
these checks remained in the possession of private complainant
contradicts petitioner’s allegation of payment. 30

WHEREFORE, the decision of the Court of Appeals in CA-G.R. CR

No. 19764 is MODIFIED. Petitioner BEN RICO is ACQUITTED of
the charge for violation of B.P. 22 on the ground of reasonable
doubt. However, he is ordered to pay private complainant the face
value of the checks in the total amount of P178,434.00, with 12
percent interest per annum, from the filing of the informations
until the amount due is fully paid.chanrobles virtual law library

No pronouncement as to costs.
 ANTONIO NIEVA, JR., Petitioner, v. THE HONORABLE
COURT OF APPEALS and THE PEOPLE OF THE
PHILIPPINES, Respondents.

The Solicitor General for Respondent.

Melencio L. Lim for Petitioner.

SYLLABUS

1. CRIMINAL LAW; ESTAFA; COMMITTED BY MEANS OF

BOUNCING CHECKS; ELEMENTS. — Settled is the rule that, to
constitute estafa, the act of postdating or issuing a check in
payment of an obligation must be the efficient cause of
defraudation and, as such, it should be either prior to or
simultaneous with the act of fraud. The offender must be able to
obtain money or property from the offended party because of the
issuance of the check or that the person to whom the check was
delivered would not have parted with his money or property had
there been no check issued to him. Stated otherwise, the check
should have been issued as an inducement for the surrender by
the party deceived of his money or property and not in payment
of a pre-existing obligation.

2. ID.; BOUNCING CHECKS LAW (BP BLG. 22); VIOLATION

THEREOF; ELEMENTS. — The elements of the offense under
Section 1, BP Blg. 22, are: (1) the making, drawing and issuance
of any check to apply to account or for value; (2) the maker,
drawer or issuer knows that at the time of issue he does not have
sufficient funds in or credit with the drawee bank for the payment
of such in full upon presentment; and (3) the check is
subsequently dishonored by the drawee bank for insufficiency of
funds or credit or would have been dishonored for the same
reason had not the drawer, without any valid reason, ordered the
bank to stop payment.
3. ID.; ID.; ID.; ID.; KNOWLEDGE BY THE DRAWER OF CHECK OF
THE INSUFFICIENCY OF FUNDS, REQUIRED. — It would be noted
that BP Blg. 22 requires that the drawer of the check must have
knowledge at the time of issue that he does not have sufficient
funds in or credit with the drawee bank. Under Section 2 thereof,
the making, drawing and issuance of a check, payment of which
is refused by the drawee because of insufficient funds in or credit
with such bank, is prima facie evidence of knowledge of such
insufficiency when the check is presented within 90 days from the
date of the check. However, the prima facie evidence of
knowledge of such insufficiency does not lie when the maker or
drawer pays the holder of the check the amount due thereon, or
makes arrangements for payment in full by the drawee of such
check within five (5) banking days after receiving notice that such
check has not been paid by the drawee.

4. REMEDIAL LAW; CRIMINAL PROCEDURE; VIOLATION OF B.P.

BLG. 22; RULE ON THE JURISDICTION OVER TRANSITION
CRIMES; APPLICATION IN CASE AT BAR. — The evidence
discloses that the check was deposited and/or presented for
encashment with the Angeles City Branch of the Bank of the
Philippine Islands. This fact clearly confers jurisdiction upon the
Regional Trial Court of Pampanga over the crimes of which
petitioner is charged. It must be noted that violations of BP Blg.
22 are categorized as transitory or continuing crimes and so is
the crime of estafa. The rule is that a person charged with a
transitory crime may be validly tried in any municipality or
territory where the offense was in part committed.

PADILLA, J., concurring and dissenting opinion: chanrob1es virtual 1aw library

1. CIVIL LAW; CONTRACTS; ABSOLUTE SALE AND CONTRACT TO

SELL, DISTINGUISHED; ILLUSTRATION IN CASE AT BAR. —
Under contract law, a contract of sale is void and produces no
effect whatsoever if the price which appears to have been paid
had in fact not been paid. Normally, a seller would promise to
execute a deed of absolute sale upon complete payment of the
price, in which the case the contract is not of (absolute) sale but
a contract to sell. Thus, a seller is not bound to deliver the thing
sold if the vendee has not paid the price, unless the thing is sold
on credit (or by installments). Generally, payment and delivery of
the thing sold are concurent acts because in reciprocal obligations
neither party incurs in delay if the other does not comply or is not
ready to comply in a proper manner with what is incumbent upon
him (Article 1169, last paragraph). In the case at bar, the
contract executed between the parties is an absolute deed of
sale. There is no evidence of an express provision on the contract
that the title shall not pass until full payment of the purchase
price. This means that when the thing sold (dumptruck) was
delivered through tradicio brevi manu, title or ownership was
transferred to herein petitioner without prejudice to the right of
Atty. Joven to claim payment of the price. The point, however, is
that there is a disputable presumption that the ordinary course of
business has been followed and it would be a contradiction to
state that Atty. Joven "did not ask for payment" when the
evidence shows that he executed an absolute deed of sale which
otherwise stated that he received sufficient consideration
(P70,000.00) for dumptruck. Hence, the best evidence of
payment was the deed of absolute sale.

2. CRIMINAL LAW; SWINDLING PUNISHABLE UNDER ACT 315,

SEC. 2 (D) OF THE REVISED PENAL CODE; THE FRAUDULENT ACT
MUST BE EXECUTED PRIOR TO OR SIMULTANEOUSLY WITH THE
COMMISSION OF THE FRAUD. — Article 315 sec. 2 (d) of the
Revised Penal Code punishes as a form of swindling "by means of
any of the following false pretenses or fraudulent acts executed
prior to or simultaneously with the commission of the fraud: ". . .
(d) by postdating a check, or issuing a check in payment of an
obligation when the offender had no funds in the bank, or his
funds deposited therein were not sufficient to cover the amount
of the check. The failure of the drawer of the check to deposit the
amount necessary to cover his check within three (3) days from
receipt of notice from the bank and/or the payee or holder that
said check has been dishonored for lack or insufficiency of funds
shall be prima facie evidence of deceit constituting false pretense
or fraudulent act." Note that the law states that the false
pretense or fraudulent act must be executed prior to or
simultaneously with the commission of the fraud. Nowhere in the
provision does it state that the obligation must be contracted at
the time of the issuance of a (worthless) check. Justice Padilla
does not subscribe to the view that damage in estafa should only
be either pecuniary or material. In fact, this Court has held, as
early as 1907, that disturbance or property rights is also a form
of damage suffered by a creditor. The point is that a false
pretense or fraudulent act must have a necessary consequence.
And it cannot be truly said that Mr. Joven’s property rights
remained undisturbed when petitioner issued or fraudulent act of
issuing a worthless check does not only occur at the time of
contracting an obligation, but also at the time of payment. In
both instances, the deceit is the efficient cause of the damage or
defraudation.

DECISION

HERMOSISIMA, JR., J.:

The herein petition seeks the review of the Decision 1 of the

Court of Appeals 2 which affirmed the judgment of conviction 3 of
the petitioner Antonio Nieva, Jr. rendered by the Regional Trial
Court of Pampanga 4 in criminal cases involving Estafa and
Violation of Batas Pambansa Blg. 22. cralawnad

The following antecedent facts are not disputed: chanrob1es virtual 1aw library

Sometime in 1982, one Alberto Joven had his car repaired in an

auto repair shop in Quezon City, which was owned by petitioner.
Alberto had frequently visited said repair shop to avail himself of
its services and so, he had become friendly with petitioner as
owner of the shop. Alberto learned that, like his father, the late
Atty. Ramon Joven, petitioner was engaged in the construction
business. Alberto then informed petitioner that they had idle
construction equipment in Bacolor, Pampanga, which were not
being attended to because his father had become quite ill.
Petitioner expressed interest in the equipment and requested
Alberto to introduce him to his father.

During a meeting sometime in 1985 in Bacolor, Pampanga,

petitioner offered to lease a Toyota Dump Truck, with Motor No.
2D-58961, with the intention to use it for some construction
project in Quezon Province. Atty. Joven, now deceased,
commented that he could not accept the offer unless the dump
truck was first repaired. Petitioner thus offered to have the dump
truck repaired at his expense, with the repair expenses to be
deducted, however, from the rentals for the use of the truck. Atty.
Joven agreed to such a proposal.

On April 30, 1985, Atty. Joven who was at that time confined at
the Lung Center, signed an order to turn over the possession and
custody of subject dump truck to petitioner. On May 14, 1985, a
lease contract 5 covering the above-described transaction was
executed and entered into between the petitioner and Atty.
Joven.

Petitioner, however, failed to fulfill his obligations under the said

lease contract: he did not repair the subject dump truck nor did
he pay any rentals. The dump truck was left idle in petitioner’s
auto repair shop on Mayon Street in Quezon City. Learning about
petitioner’s non-compliance with their lease agreement, Atty.
Joven secured a pass from the Lung Center, confronted petitioner
at petitioner’s repair shop in Quezon City, and asked petitioner to
return the dump truck. Petitioner countered by offering to buy the
truck. When Atty. Joven manifested that the selling price of the
truck was P70,000.00, petitioner accepted the offer and agreed to
the consideration thereof.

On June 10, 1985, an absolute deed of sale 6 evidencing this

most recent transaction between petitioner and Atty. Joven, was
executed and entered into by said parties.
A week later, petitioner delivered to Atty. Joven a post-dated
check 7 drawn against the Commercial Bank of Manila in the
amount of P70,000.00 as payment for the subject dump truck.

Said check was deposited in the Angeles City branch of the Bank
of Philippine Islands. Thereafter, Atty. Joven was advised that the
Commercial Bank of Manila returned the check for the following
reason: "closed accounts." 8 Repeated verbal demands were
made on petitioner for him to make good the returned check, but
to no avail. Thus, Atty. Joven availed himself of the services of
counsel who made a formal written demand 9 upon petitioner to
pay his obligations. Petitioner, however, ignored the written
demand. Hence, the criminal cases for Estafa and Violation of B.P.
Blg. 22, were filed against him.

For having issued a worthless check, petitioner was charged with

Estafa under paragraph 2 (d), Article 315 of the Revised Penal
Code and with Violation of B.P. Blg. 22 under two separate
Informations filed by the Provincial Fiscal of San Fernando,
Pampanga before, the Regional Trial Court of Pampanga, Branch
45. For ready reference, the two informations are reproduced
below:chanrob1es virtual 1aw library

In Criminal Case No. 3228 for Estafa: jgc:chanrobles.com.ph

"That on or about the 31st day of July, 1985, in the municipality

of Bacolor, Province of Pampanga, Philippines, and within the
jurisdiction of this Honorable Court, the above-named accused
ANTONIO M. NIEVA, JR, knowing fully well that he had insufficient
funds in the bank, with intent to defraud, with grave abuse of
confidence and by means of deceit, did then and there willfully,
unlawfully, feloniously and maliciously issue, draw and deliver
Commercial Bank of Manila Check No. KAM 015417 in the amount
of SEVENTY THOUSAND (P70,000.00) PESOS, to and in favor of
Atty. Ramon R Joven in payment of the Toyota dump truck
purchased by accused Antonio M. Nieva, Jr. from Atty. Ramon R.
Joven, and when said check was presented for encashment, the
same was dishonored and returned with the information that the
same was drawn against an ‘Account Closed’, and in spite of
repeated demands made upon the accused to redeem said check,
he failed and refused and presently fails and refuses to redeem
the same, to the damage and prejudice of said Atty. Ramon R.
Joven in the total amount of P70,000.00, Philippine Currency." 10

In Criminal Case No. 3229 for Violation of B.P. Blg. 22: jgc:chanrobles.com.ph

"That on or about the 31st day of July, 1985, in the municipality

of Bacolor, province of Pampanga, Philippines, and within the
jurisdiction of this Honorable Court, the above-named accused
ANTONIO M. NIEVA, JR, knowing fully well that he had no
sufficient funds in the bank, did then and there willfully,
unlawfully, feloniously and maliciously draw, issue and deliver a
Commercial Bank of Manila Check NO. KAM 015417 in the
amount of SEVENTY THOUSAND (P70,000.00) PESOS, drawn
against his checking/current account with the Commercial Bank of
Manila, Kamuning Branch, Quezon City, to and in favor of Atty.
Ramon R. Joven, and when said check was presented for
payment to the drawee bank, the same was dishonored and
refused payment for the reason that it was drawn against an
‘Account Closed’, and notwithstanding several and repeated
demands made upon the accused to redeem said check, said
accused failed and refused and presently fails and refuses to
comply therewith, to the damage and prejudice of said Atty.
Ramon R. Joven in the total amount of P70,000.00." 11

At the arraignment, petitioner entered the plea of "not guilty" as

to each of the aforesaid charges, after which trial was held on the
merits.

After trial, the trial court rendered a judgment of conviction 12 in

both Informations, the decretal portion of which decision reads:
lawlibrary
chanrobles virtual

"WHEREFORE, the Court hereby renders judgment finding

accused ANTONIO NIEVA, JR guilty beyond reasonable doubt as
PRINCIPAL 1) of the crime of ESTAFA defined and penalized under
Par. 2 (d) of Art. 315, Revised Penal Code as amended by P.D.
818 and of the offense of violation of Batas Pambansa Blg. 22 . . .
and sentencing the said accused as follows: chanrob1es virtual 1aw library

a) For Crim. Case No. 3228

a.1. To suffer an indeterminate sentence of imprisonment of SIX

(6) years and ONE (1) day of PRISION MAYOR as MINIMUM to
SEVENTEEN (17) years FOUR (4) months and ONE (1) day of
RECLUSION TEMPORAL as MAXIMUM;

a.2. To suffer the accessory penalties provided by law;

a.3. To pay the cost; and

a.4. To indemnify the complainant, heirs of Atty. RAMON JOVEN

the sum of P70,000.00; and

b) For Crim. Case No. 3229

a.1. To suffer imprisonment of TWO (2) months; and,

a.2 Pay a fine of P70,000.00.

SO ORDERED." 13

Petitioner appealed his conviction to the respondent appellate

court which, however, affirmed the same. 14 Hence, this petition.

Petitioner asks us to set aside the herein assailed decision

rendered by respondent Court of Appeals, upon the following
grounds: jgc:chanrobles.com.ph

"1. The elements of Estafa as re-defined in Sales v. Court of

Appeals were not present and were not duly proved, because: chanrob1es virtual 1aw library

a. The post-dated check was not issued in payment of an

obligation contracted at the time the check was issued;
b. There is no sufficient and competent evidence to show that
there is lack or insufficient funds to cover the check: and.

c. There was no damage to the payee thereof.

2. The conviction of petitioner was based on the sole and only

uncorroborated testimony of prosecution witness, Alberto Joven,
whose testimony is bias [sic], incredible and hearsay.

3. The trial court has no jurisdiction to try the cases charged

against petitioner, as none of the essential elements of the
offenses charged was ever committed in Pampanga." cralaw virtua1aw library

The instant petition is meritorious insofar as it appeals petitioner’s

conviction for estafa.

Petitioner was convicted for estafa under paragraph 2 (d), Article

315 of the Revised Penal Code basically upon the finding that
petitioner issued the postdated check in question as consideration
for the dump truck subject of the contract of sale between
petitioner and Atty. Ramon Joven and that when said check was
deposited with the Angeles City Branch of the Bank of the
Philippine Islands, the same was dishonored and returned per
Check Return slip 15 for the following reason: "Account Closed."
library
cralaw virtua1aw

In this appeal, petitioner does not dispute the fact that he did
issue the postdated check in payment of the dump truck as in
fact he made an annotation at the back thereof which reads: "for
payment Toyota dump truck." However, he contends that the
postdated check was not issued at the time the contract of sale
involving the dump truck was entered into by and between
petitioner and Atty. Ramon Joven, said transaction being
evidenced by a deed of absolute sale dated June 10, 1985, the
fact being that he issued and delivered the said check to Atty.
Joven a week thereafter.
Evidently, there is a need to resolve in this case the question of
whether the postdated check was issued at the time the
obligation of the petitioner to pay the consideration for the dump
truck was contracted or thereafter.

It is significant to note that the trial court did not make any
finding or any categorical statement on the matter, it having
concluded simply that petitioner issued a worthless check in
payment of the dump truck. Neither did the Court of Appeals
make such finding in affirming petitioner’s conviction, it having
also simply stated that: jgc:chanrobles.com.ph

". . . What motivated the accused to issue the postdated check

was the sale of the vehicle to him. Had there been no contract of
sale in the first place, he would not have issued the check." 16

The testimony of the sole prosecution witness Alberto Joven is

also not enlightening. A perusal of said testimony would readily
show that no categorical statement was made either relative to
the date in issue. Alberto Joven testified on direct examination
that:jgc:chanrobles.com.ph

"x x x

Q: And when Mr. Nieva offered to buy the dump truck instead of
just bringing it back to Bacolor, because it was repaired and
rentals were not paid, what did your father say? chanrobles virtual lawlibrary

A: My father quoted his price for the truck, sir.

Q: And after quoting the price, what happened?

A: They both agreed and the accused gave him a postdated

check." 17

and on cross-examination, that: jgc:chanrobles.com.ph

"x x x
Q: You were present when the negotiation for the purchase of the
motor vehicle was made by your father and the accused?

A: Yes, sir.

Q: Can you tell the date?

A: I cannot remember the date, sir.

Q: But it was in 1985?

A: Yes, sir.

Q: And that sale was consummated I presume?

A: Yes, sir.

Q: Can you tell when it was consummated?

A: I cannot remember, sir.

Q: But it is in 1985?

A: Yes, sir. 18

x x x

Q: On August 2, 1985, did you know where your father was the
whole day of August 2, 1985?

A: I cannot remember.

Q: You cannot remember either whether your father received a

check from the accused for this, did you?

A: I can remember he received the check but not the date, sir.
Q: But it was in 1985?

A: Yes, sir.

Q: Neither could you remember when your father, after receiving

the said check delivered by the accused to your father, encashed
the same?

A: No, sir." 19

(Emphasis ours.)

In contrast, we note the petitioner’s positive averment that he

issued and delivered the postdated check to Atty. Joven one week
after Atty. Joven and he entered into the contract of sale,
stressing that the deed of sale was handed to him by Atty. Joven
without asking for any payment. Petitioner testified in this
manner: jgc:chanrobles.com.ph

"x x x

Q: You just stated in the direct examination that the said check
was postdated July 31, 1985. Mr. Nieva, when did you actually
issue the said check postdated July 31, 1985?

A: That was one week after he gave me the deed of sale. He gave
me the deed of sale without asking me for the payment." 20

Settled is the rule that, to constitute estafa, the act of postdating

or issuing a check in payment of an obligation must be the
efficient cause of defraudation and, as such. it should be either
prior to or simultaneous with the act of fraud. 21 The offender
must be able to obtain money or property from the offended
party because of the issuance of the check or that the person to
whom the check was delivered would not have parted with his
money or property had there been no check issued to him. Stated
otherwise, the check should have been issued as an inducement
for the surrender by the party deceived of his money or property
and not in payment of a pre-existing obligation. 22

It will be recalled that petitioner has been in possession of the

dump truck as early as April 30, 1985. The property had been
delivered to and obtained by petitioner initially for the purpose of
having the same repaired by the petitioner so that it could be
rented out to him. When it turned out, however, that the same
was not repaired nor the rentals therefor paid, Atty. Joven
demanded that it be returned and what dissuaded him from
taking it away from petitioner in order to be brought back to
Bacolor, Pampanga was petitioner’s offer to buy the same. The
offer having been accepted with the consideration having also
been agreed upon, Atty. Joven let the dump truck remain in the
possession of petitioner. An absolute deed of sale was accordingly
executed and entered into by the parties on June 10, 1985,
during which Atty. Joven did not ask for payment. As has
heretofore been clearly shown, petitioner issued and delivered to
Atty. Joven the postdated check in payment of the dump truck a
week later. Needless to state, it was not by reason of the issuance
of the check that petitioner has remained to be in possession of
the dump truck but the perfected contract of sale entered into by
petitioner and Atty. Joven a week earlier than the issuance of the
check.chanrobles virtuallawlibrary

In fine, we find and so hold that petitioner did not commit the
fraud or deceit envisioned in the law as to make him liable for
estafa when he issued the postdated check, such issuance having
been clearly made in payment of a pre-existing obligation.

We, however, sustain petitioner’s conviction for violation of Batas

Pambansa Blg. 22.

It bears stressing that while this is also an appeal on petitioner’s

conviction of the offense under BP Blg. 22, the arguments in his
brief, except on the issue of jurisdiction, had not dwelt thereon.
Nevertheless, we note that upon the facts adduced, his conviction
of the said offense is proper.
The elements of the offense under Section 1, BP Blg. 22, are: (1)
the making, drawing and issuance of any check to apply to
account or for value; (2) the maker, drawer or issuer knows that
at the time of issue he does not have sufficient funds in or credit
with the drawee bank for the payment of such in full upon
presentment; and (3) the check is subsequently dishonored by
the drawee bank for insufficiency of funds or credit or would have
been dishonored for the same reason had not the drawer, without
any valid reason, ordered the bank to stop payment. 23

It will be noted that BP Blg. 22 requires that the drawer of the

check must have knowledge at the time of issue that he does not
have sufficient funds in or credit with the drawee bank. Under
Section 2 thereof, the making, drawing and issuance of a check,
payment of which is refused by the drawee because of insufficient
funds in or credit with such bank, is prima facie evidence of
knowledge of such insufficiency when the check is presented
within 90 days from the date of the check. However, the prima
facie evidence of knowledge of such insufficiency does not lie
when the maker or drawer pays the holder of the check the
amount due thereon, or makes arrangements for payment in full
by the drawee of such check within five (5) banking days after
receiving notice that such check has not been paid by the drawee.

It has been established in this case that petitioner issued to Atty.

Joven the postdated check — CBM Check No. 015417 dated July
31, 1985 in the amount of P70,000.00 as payment for the dump
truck sold by Atty. Joven to him. He knew that he had no funds
with the bank to cover the said check at the time he issued or
postdated it, such knowledge being evident from his own
admission that the check would be funded from out of his
collectibles from the Development Bank of the Philippines but
which, however, did not materialize as expected, not to mention
the legal presumption of such knowledge arising from the
dishonor of his check for insufficiency of funds. The check was
presented for payment on August 2, 1985 or within 90 days from
date of issue and the same was dishonored by reason of "closed
account" stamped on its face. Petitioner did not pay Atty. Joven
the amount due on the check despite demand; neither did he
make arrangements for payment in full by the drawee bank of
such check within five (5) banking days after notice of non-
payment.

As to petitioner’s contention that the Regional Trial Court of

Pampanga has no jurisdiction to try the cases charged herein as
none of the essential elements thereof took place in Pampanga,
suffice it to say that such contention has no basis. The evidence
discloses that the check was deposited and/or presented for
encashment with the Angeles City Branch of the Bank of the
Philippine Islands. This fact clearly confers jurisdiction upon the
Regional Trial Court of Pampanga over the crimes of which
petitioner is charged. It must be noted that violations of BP Blg.
22 are categorized as transitory or continuing crimes 24 and so is
the crime of estafa. 25 The rule is that a person charged with a
transitory crime may be validly tried in any municipality or
territory where the offense was in part committed. 26

WHEREFORE, the petition is partly GRANTED. The decision of the

respondent court in Criminal Case No. 3228 is hereby REVERSED
and petitioner Antonio Nieva, Jr. is ACQUITTED of the crime of
estafa under par. 2(d), Article 315 of the Revised Penal Code. The
decision in Criminal Case No. 3229 sustaining the conviction of
petitioner of the offense under Batas Pambansa Blg. 22 is hereby
AFFIRMED in toto.

SO ORDERED.

Bellosillo, Vitug and Kapunan, JJ., concur.

Separate Opinions

PADILLA, J., concurring and dissenting: chanrob1es virtual 1aw library

I concur with the ponencia of Mr. Justice Hermosisima, insofar as
it affirms the conviction of petitioner Antonio Nieva, Jr. under
Section 1 of B.P. 22 (The Bouncing Checks Law).

There can be no dispute that when petitioner issued a post-dated

check for P70,000.00, drawn against the Commercial Bank of
Manila and payable to Atty. Joven as consideration for the
dumptruck he bought from the latter, he knew that he did not
have sufficient funds or credit with the drawee bank for the
payment of such check in full upon its presentment. Thus, when
the check was subsequently dishonored because of his closed
account and his failure to pay the amount due thereon despite
repeated demands from private respondent, his conviction was
warranted under Sec. 1 of B.P. 22.chanrobles.com : virtual law library

Upon the other hand, I am unable to agree with the majority in

finding that petitioner cannot be convicted of Estafa under Art.
315 par. 2(d) of the Revised Penal Code because the issuance of
the (post-dated) check was allegedly made in payment of a pre-
existing obligation.

The ponencia states that petitioner and Atty. Joven entered into a
deed of absolute sale (of the dumptruck) on 10 June 1985 but
Atty. Joven did not ask for payment prior to or simultaneously
with the execution of the deed. The ponencia then concludes that
when petitioner issued the post-dated check as payment for the
dumptruck a week later —

"it was not by reason of the issuance of the check that petitioner
has remained [sic] to be in possession of the dumptruck but the
perfected contract of sale entered into by petitioner and Atty.
Joven a week earlier than the issuance of the check." cralaw virtua1aw library

"In fine . . . petitioner did not commit the fraud or deceit

envisioned in the law as to make him liable for Estafa when he
issued the post-dated check. Such issuance having been clearly
made in payment of a pre-existing obligation." cralaw virtua1aw library
Under the facts laid down in the ponencia, I find it difficult to
conceive that a lawyer like Atty. Joven could be induced to sell his
property and not ask for payment upon the execution of the deed
of absolute sale. It just doesn’t make sense for Atty. Joven to
allow petitioner continued possession of the dumptruck because
of a "perfected" contract of sale when in reality no consideration
was paid to him when he signed the deed of absolute sale.

Under contract law, a contract of sale is void and produces no

effect whatsoever if the price which appears to have been paid
had in fact not been paid. Normally, a seller would promise to
execute a deed of absolute sale upon complete payment of the
price, in which case the contract is not of (absolute) sale but a
contract to sell. Thus, a seller is not bound to deliver the thing
sold if the vendee has not paid the price, unless the thing is sold
on credit (or by installments). Generally., payment and delivery of
the thing sold are concurrent acts because in reciprocal
obligations neither party incurs in delay if the other does not
comply or is not ready to comply in a proper manner with what is
incumbent upon him. 1

In the case at bar the contract executed between the parties is an

absolute deed of sale. There is no evidence of an express
provision in the contract that title shall not pass until full payment
of the purchase price. This means that when the thing sold
(dumptruck) was delivered through tradicio brevi manu, title or
ownership was transferred to herein petitioner without prejudice
to the right of Atty. Joven to claim payment of the price. The
point, however, is that there is a disputable presumption that the
ordinary course of business has been followed and it would be a
contradiction to state that Atty. Joven "did not ask for payment"
when the evidence shows that he executed an absolute deed of
sale which otherwise stated that he received sufficient
consideration (P70,000.00) for the dumptruck. Hence, the best
evidence of payment was the deed of absolute sale.

It is not stated in the ponencia whether the introduction of parole

evidence to establish that Atty. Joven "did not ask for payment"
was objected to by the prosecution. A closer analysis of the
testimony of Alberto Joven shows that what he could no longer
remember was the exact date when his father received the post-
dated check from petitioner. Nowhere in his testimony did he
state that the exact date excludes the day when the deed of
absolute sale was executed.

Otherwise stated, petitioner’s "positive averment" is, at the same

time, a self-serving testimony because he can now conveniently
state any day except the day when the contract was executed in
order to escape prosecution for estafa. And this is because Atty.
Joven, who was the real privy in the case, could no longer rise
from his grave to contradict said testimony.

Article 315 sec 2 (d) of the Revised Penal Code punishes as a

form of swindling "by means of any of the following false
pretenses or fraudulent acts executed prior to or simultaneously
with the commission of the fraud: jgc:chanrobles.com.ph

"x x x

(d) By postdating a check, or issuing a check in payment of an

obligation when the offender had no funds in the bank, or his
funds deposited therein were not sufficient to cover the amount
of the check. The failure of the drawer of the check to deposit the
amount necessary to cover his check within three(3) days from
receipt of notice from the bank and/or the payee or holder that
said check has been dishonored for lack or insufficiency of funds
shall be prima facie evidence of deceit constituting false pretense
or fraudulent act."
cralaw virtua1aw library

Note that the law states that the false pretense or fraudulent act
must be executed prior to or simultaneously with the commission
of the fraud. Nowhere in the provision does it state that the
obligation must be contracted at the time of the issuance of a
(worthless) check.
Petitioner’s account with the drawee bank was already closed
even before he executed the deed of absolute sale with Atty.
Joven. This circumstance reinforces the fact that the act of
issuing a worthless check remains a fraudulent act or a false
pretense under par 2(d) whether or not it was issued in payment
of an existing obligation. However, ever since the Court had
interpreted this provision under the principle that laws that
impose criminal liability are (to be) strictly construed, 2 a wily
estafador can never be convicted of estafa as long as he issues a
worthless check not prior to or simultaneous with but after
contracting an obligation.
chanrobles law library : red

I do not also subscribe to the view that damage in estafa should

only be either pecuniary or material. In fact, this Court has held,
as early as 1907, that disturbance of property rights is also a
form of damage suffered by a creditor. 3 The point is that a false
pretense or fraudulent act must have a necessary consequence.
And it cannot be truly said that Mr. Joven’s property rights
remained undisturbed when petitioner issued a worthless check.
In this sense, the false pretense or fraudulent act of issuing a
worthless check does not only occur at the time of contracting an
obligation, but also at the time of payment. In both instances, the
deceit is the efficient cause of the damage or defraudation.

I therefore vote to AFFIRM the decision of the Court of Appeals in

toto.