BP

22

1. LOZANO V. MARTINEZ (Constitutionality of BP 22) - MAITI LAGOS

Emergency Recit
With the flooding of cases with regard to BP 22, its constitutionality is put at issue in this case.
These petitions arose from cases involving prosecution of offenses under BP 22. The defendants in those cases moved
seasonably to quash the informations on the ground that the acts charged did not constitute an offense, the statute being
unconstitutional.
BP 22 punishes a person
who makes or draws and issues any check 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 said check in full upon presentment
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."
penalty prescribed:
imprisonment of not less than 30 days nor more than one year OR
a fine or not less than the amount of the check nor more than double said amount
but in no case to exceed P200,000.00, OR
both such fine and imprisonment at the discretion of the court.
Brief history of BP 22
Started off as being included in the Penal Code of Spain, penalizing the act of defrauding another through false
pretenses in Art 335
1926, amendment was made, specifically referring to the issuance of worthless checks
1932, enactment of the RPC, the provisions penalizing such issuance was incorporated in Art 315 (estafa)
However, its par. 2d was deemed to exclude checks issued in payment of pre-existing obligations.
Since in estafa, the deceit causing the defraudation must be prior to or simultaneous with the commission of the fraud,
it cannot include issuing a check as payment for a pre-existing debt.
The drawer here does not derive any material benefit in return or as consideration for its issuance while the
payee, had already parted with his money or property before the check is issued to him.
Hence, he (payee) is not defrauded by means of any "prior" or "simultaneous" deceit perpetrated on him by the
drawer of the check.
To remedy this, Congress introduced amendments to Art 315 through RA 4885 to but still courts were not convinced
that it effectively covers checks issued in payment of pre-existing obligations, since the concept underlying the crime of
estafa are false pretenses or deceit
So, the Interim Batasan enacted BP 22 to address the problem directly and frontally and makes the act of issuing a
worthless check malum prohibitum.

Issue: WON BP 22 is constitutional? Yez.

Ratio:
1. BP 22 does not conflict with the constitutional prohibition of imprisonment for debt.
The gravamen of the offense punished by BP 22 is the act of making and issuing a worthless check or a check that is
dishonored upon its presentation for payment.
It is not the non-payment of an obligation which the law punishes.
The law is not intended or designed to coerce a debtor to pay his debt.
The thrust of the law is to prohibit, under pain of penal sanctions, the making of worthless checks and putting them in
circulation. Because of its deleterious effects on the public interest, the practice is proscribed by the law.
The law punishes the act not as an offense against property, but an offense against public order.
Checks have become widely accepted as a medium of payment in trade and commerce.
Although not legal tender, checks have come to be perceived as convenient substitutes for currency in commercial and
financial transactions.
The basis or foundation of such perception is confidence. If such confidence is shakes the usefulness of checks as currency
substitutes would be greatly diminished.
Any practice therefore tending to destroy that confidence should be deterred for the proliferation of worthless checks can
only create havoc in trade circles and the banking community.


Facts:

BP 22

The constitutionality of Batas Pambansa Bilang 22 (BP 22), popularly known as the Bouncing Check Law, which was
approved on April 3, 1979, is the sole issue presented by these petitions for decision.
These petitions arose from cases involving prosecution of offenses under BP 22. The defendants in those cases moved
seasonably to quash the informations on the ground that the acts charged did not constitute an offense, the statute being
unconstitutional.
As a threshold issue the former Solicitor General in his comment on the petitions, maintained the posture that it was
premature for the accused to elevate to this Court the orders denying their motions to quash, these orders being
interlocutory.
While this is correct as a general rule, we have in justifiable cases intervened to review the lower court's denial of a motion
to quash.
In view of the importance of the issue involved here, there is no doubt in our mind that the instant petitions should be
entertained and the constitutional challenge to BP 22 resolved promptly, one way or the other, in order to put to rest the
doubts and uncertainty that exist in legal and judicial circles and the general public which have unnecessarily caused a
delay in the disposition of cases involving the enforcement of the statute.

BP 22 punishes a person
who makes or draws and issues any check 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 said check in full upon presentment
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."
penalty prescribed:
imprisonment of not less than 30 days nor more than one year OR
a fine or not less than the amount of the check nor more than double said amount
but in no case to exceed P200,000.00, OR
both such fine and imprisonment at the discretion of the court.

The statute likewise imposes the same penalty on "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.

An essential element of the offense is "knowledge" on the part of the maker or drawer of the check of the insufficiency of
his funds in or credit with the bank to cover the check upon its presentment.
prima facie presumption knowledge: where payment of the check "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.
To mitigate the harshness of the law in its application, the statute provides that such presumption shall not arise if
within five (5) banking days from receipt of the notice of dishonor, the maker or drawer makes arrangements for
payment of the check by the bank or pays the holder the amount of the check.

Prima facie proof of issuance of a bad check: bank's refusal to pay stamped or written on the check or attached thereto,
giving the reason thereof.

Background History of BP 22

The Penal Code of Spain, which was in force in the Philippines from 1887 contained provisions penalizing the act of
defrauding another through false pretenses.
Art. 335 punished a person who defrauded another "by falsely pretending to possess any power, influence,
qualification, property, credit, agency or business, or by means of similar deceit." Although no explicit mention was
made therein regarding checks, this provision was deemed to cover within its ambit the issuance of worthless or bogus
checks in exchange for money.

In 1926, Philippine legislature added a new clause (paragraph 10) to Article 335 of the old Penal Code
The amendment penalized any person who
1) issues a check in payment of a debt or for other valuable consideration, knowing at the time of its issuance that
he does not have sufficient funds in the bank to cover its amount, or
2) maliciously signs the check differently from his authentic signature as registered at the bank in order that the
latter would refuse to honor it; or
3) issues a postdated check and, at the date set for its payment, does not have sufficient deposit to cover the

BP 22

same.

1932, Revised Penal Code. The above provisions, in amended form, were incorporated in Article 315 of the Revised Penal
Code defining the crime of estafa.
1
Par. 2(d) however, was deemed to exclude checks issued in payment of pre-existing obligations.
The rationale of this interpretation is that in estafa, the deceit causing the defraudation must be prior to or
simultaneous with the commission of the fraud.
In issuing a check as payment for a pre-existing debt, the drawer does not derive any material benefit in return or as
consideration for its issuance. On the part of the payee, he had already parted with his money or property before the
check is issued to him hence, he is not defrauded by means of any "prior" or "simultaneous" deceit perpetrated on him
by the drawer of the check.

To solve the problem of how to bring checks issued in payment of pre-existing debts within the ambit of Art. 315, an
2
amendment was introduced by the Congress of the Philippines in 1967 as RA No. 4885

However, the adoption of the amendment did not alter the situation materially. A divided Court held in People vs. Sabio, Jr.
12 that Article 315, as amended by Republic Act 4885, does not cover checks issued in payment of pre-existing obligations,
again relying on the concept underlying the crime of estafa through false pretenses or deceit

With the foregoing factual and legal antecedents as a backdrop, the then Interim Batasan confronted the problem
squarely. It opted to take a bold step and decided to enact a law dealing with the problem of bouncing or worthless checks,
without attaching the law's umbilical cord to the existing penal provisions on estafa. BP 22 addresses the problem directly
and frontally and makes the act of issuing a worthless check malum prohibitum.

Issue: Is BP 22 constitutional?

Those who question the constitutionality of BP 22 insist that:
(1) it offends the constitutional provision forbidding imprisonment for debt;
(2) it impairs freedom of contract;
(3) it contravenes the equal protection clause;
(4) it unduly delegates legislative and executive powers; and
(5) its enactment is flawed in that during its passage the Interim Batasan violated the constitutional provision
prohibiting amendments to a bill on Third Reading.

It is contended that the statute runs counter to the inhibition in the Bill of Rights which states, "No person shall be
imprisoned for debt or non-payment of a poll tax."
Petitioners insist that, since the offense under BP 22 is consummated only upon the dishonor or non-payment of the
check when it is presented to the drawee bank, the statute is really a "bad debt law" rather than a "bad check law."
What it punishes is the non-payment of the check, not the act of issuing it. The statute, it is claimed, is nothing more
than a veiled device to coerce payment of a debt under the threat of penal sanction.

Ganawa v Queen:
The 'debt' intended to be covered by the constitutional guaranty has a well-defined meaning. Organic provisions
relieving from imprisonment for debt, were intended to prevent commitment of debtors to prison for liabilities arising
from actions ex contractu.
The inhibition was never meant to include damages arising in actions ex delicto, for the reason that damages
recoverable therein do not arise from any contract entered into between the parties but are imposed upon the
defendant for the wrong he has done and are considered as punishment, nor to fines and penalties imposed by the
courts in criminal proceedings as punishments for crime."
People v Vera Reyes
one of the purposes of the law is to suppress possible abuses on the part of the employers who hire laborers or
employees without paying them the salaries agreed upon for their services, thus causing them financial difficulties.

1 (d)

By postdating a check, or issuing a check in payment of an obligation the offender knowing that at the time he had no funds in the bank, or
the funds deposited by him were not sufficient to cover the amount of the cheek without informing the payee of such circumstances.
2 (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 puma facie evidence of deceit constituting false pretense or fraudulent act.

BP 22

The law was viewed not as a measure to coerce payment of an obligation, although obviously such could be its effect,
but to banish a practice considered harmful to public welfare.

The gravamen of the offense punished by BP 22 is the act of making and issuing a worthless check or a check that is
dishonored upon its presentation for payment.
It is not the non-payment of an obligation which the law punishes.
The law is not intended or designed to coerce a debtor to pay his debt.
The thrust of the law is to prohibit, under pain of penal sanctions, the making of worthless checks and putting them in
circulation.
Because of its deleterious effects on the public interest, the practice is proscribed by the law. The law punishes the act
not as an offense against property, but an offense against public order.

The enactment of BP 22 is a declaration by the legislature that, as a matter of public policy, the making and issuance of a
worthless check is deemed public nuisance to be abated by the imposition of penal sanctions.

Confidence as the foundation of checks being used widely as a medium of payment
Unlike a promissory note, a check is not a mere undertaking to pay an amount of money. It is an order addressed to a bank
and partakes of a representation that the drawer has funds on deposit against which the check is drawn, sufficient to
ensure payment upon its presentation to the bank.
There is therefore an element of certainty or assurance that the instrument will be paid upon presentation.
For this reason, checks have become widely accepted as a medium of payment in trade and commerce. Although not legal
tender, checks have come to be perceived as convenient substitutes for currency in commercial and financial transactions.
The basis or foundation of such perception is confidence. If such confidence is shakes the usefulness of checks as currency
substitutes would be greatly diminished or may become nil.
Any practice therefore tending to destroy that confidence should be deterred for the proliferation of worthless checks can
only create havoc in trade circles and the banking community.
Flooding the system with worthless checks is like pouring garbage into the bloodstream of the nation's economy.

Effects of issuing a worthless check
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 thousand fold, 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.

BP 22 does not conflict with the constitutional inhibition against imprisonment for debt.
There are occasions when the police power of the state may even override a constitutional guaranty. For example, there
have been cases wherein we held that the constitutional provision on non-impairment of contracts must yield to the police
power of the state.
Whether the police power may override the constitutional inhibition against imprisonment for debt is an issue we do not
have to address. This bridge has not been reached, so there is no occasion to cross it.

On the impairment of freedom to contract
Checks can not be categorized as mere contracts. It is a commercial instrument which, in this modem day and age, has
become a convenient substitute for money; it forms part of the banking system and therefore not entirely free from the
regulatory power of the state.

BP 22 does not deny equal protection nor is it discriminatory for penalizing only the drawer and not the payee
It is contended that the payee is just as responsible for the crime as the drawer of the check, since without the
indispensable participation of the payee by his acceptance of the check there would be no crime.
This argument is tantamount to saying that, to give equal protection, the law should punish both the swindler and the
swindled. The petitioners' posture ignores the well-accepted meaning of the clause "equal protection of the laws." The
clause does not preclude classification of individuals, who may be accorded different treatment under the law as long as
the classification is no unreasonable or arbitrary.

On the issue that BP 22 constitutes an undue delegation of legislative powers on the theory that the offense is not completed by the
sole act of the maker or drawer but is made to depend on the will of the payee
If the payee does not present the check to the bank for payment but instead keeps it, there would be no crime.
The logic of the argument stretches to absurdity the meaning of "delegation of legislative power." What cannot be
delegated is the power to legislate, or the power to make laws which means, as applied to the present case, the power to
define the offense sought to be punished and to prescribe the penalty

BP 22

By no stretch of logic or imagination can it be said that the power to define the crime and prescribe the penalty therefor
has been in any manner delegated to the payee.

On the issue that 1973 Constitution was violated by the legislative body when it enacted BP 22 into law
This constitutional provision prohibits the introduction of amendments to a bill during the Third Reading. It is claimed that
during its Third Reading, the bill which eventually became BP 22 was amended in that the text of the second paragraph of
Section 1 of the bill as adopted on Second Reading was altered or changed in the printed text of the bill submitted for
approval on Third Reading.





2. RECUERDO V. PEOPLE - DONDON LUCENARIO
Recuerdo v. People of the Philippines and CA

Emergency Recit:
Yolanda sold a 3 karat loose diamond ring to Recuerdo for value of Php420,000
Recuerdo paid Php40,000 downpayment + 8 postdated checks of Php40,000 each, and 1 Php20,000
Only 3 checks were accepted and 5 were dishonoured due to closure of Recuerdos account
Demand letter was sent but to no avail hence 5 informations for violation of BP22 in Makati MeTC
MeTC convicted and RTC affirmed ordered payment of checks, atty fees, and 30 days imprisonment for each check
Recuerdo alleges (the main ones):
o BP22 is an unconstitutional law.
o Petitioner was denied her constitutional right to due process for failure of the courts a quo to uphold her
presumption of innocence and for convicting her even if the prosecution evidence does not prove her guilt
beyond reasonable doubt
th
o The law is in essence a resurrected form of 19 century imprisonment for debt
o The law is a bill of attainder as it does not leave much room for judicial determination, the guilt of the accused
having already been decided by the legislature
o Checks were not for encashment and had no valuable consideration
o Bank representative was needed to prove the element of dishonour of the check
Issues: W/N Recuerdos allegations are correct NO to all
SC Ratio:
Landmark case of Lozano v. Martinez:
The gravamen of the offense punished by BP 22 is the act of making and issuing a worthless check or a check that is
dishonored upon its presentation for payment.
It is not the non-payment of an obligation which the law punishes.
It is not intended or designed to coerce a debtor to pay his debt
BP 22 is NOT a bill of attainder
For under B. P. 22, every element of the crime is still to be proven before the trial court to warrant a conviction for
violation thereof
The terms and conditions surrounding the issuance of the checks are irrelevant
A check issued as an evidence of debt, though not intended for encashment, has the same effect like any other check. It is
within the contemplation of B.P. 22
Bank representative is NOT necessary to prove that checks were dishonoured
Complainants account of the event of dishonour accompanied by proof is sufficient
However, SC says that imprisonment does not always have to be imposed on violators of BP22.
Administrative Circular No. 13-2001 issued on February 14, 2001 vests in the courts the discretion to determine, taking into
consideration the peculiar circumstances of each case, whether the imposition of fine alone would best serve the interests of
justice. In this case, the court does not see the necessity to impose imprisonment. (so she can continue her dental practice, etc). just
impose a big giant fine.

CARPIO-MORALES, J.:

FACTS:

BP 22

December 1993 Yolanda Floro (Yolanda) engaged in the jewelry business sold a 3-karat loose diamond stone valued at
Php420,000 to Recuerdo
Payment scheme:
o Downpayment Php40,000
o 8 postdated checks each in the amount of Php40,000 and 1 postdated check for Php20,000 all drawn on her
account in Prudential Bank
Among these checks, only 3 were cleared and the other 5 dishonored due to closure of Recuerdos account
Yolanda went to Recuerdos dental clinic to ask her to change the dishonoured checks to cash. Recuerdo promised she
would but didnt comply
o Also, Recuerdo was not able to pay said payee the face amount of said check or to make arrangement for full
payment within five (5) banking days after receiving said notice.
Demand letter was sent but to no avail. Hence, 5 informations for violation of BP22 were filed with Makati MeTC
MeTC convicted. Affirmed by RTC.
o 30 days imprisonment for each count
o Restitute Php200,000 representing value of checks
o Php20,000 attorneys fees

Recuerdo alleges:
1. Batas Pambansa Blg. 22 is an unconstitutional law.
2. Petitioner was denied her constitutional right to due process for failure of the courts a quo to uphold her
presumption of innocence and for convicting her even if the prosecution evidence does not prove her guilt beyond
reasonable doubt
3. The findings of fact of the courts a quo, primarily the Court of Appeals, are based on surmises, conjectures and
speculations
4. The Court of Appeals was biased against petitioner when it denied the petition moto propio (sic) without the comment
of the Office of the Solicitor General
th
5. The law is in essence a resurrected form of 19 century imprisonment for debt since the drawer is coerced to pay
his debt on threat of imprisonment even if his failure to pay does not arise from malice or fraud or from any criminal
intent to cause damage
6. The law is a bill of attainder as it does not leave much room for judicial determination, the guilt of the accused
having already been decided by the legislature

ISSUES:
W/N BP 22 is an unconstitutional law that denies petitioner of due process by failing to uphold her presumption of
innocence NO
W/N BP 22 I a resurrection off imprisonment for debt NO
W/N BP 22 is a bill of attainder NO
W/N Recuerdo should be imprisoned also No more na. Just fines and the amount of the checks

HELD: Affirmed. But no more imprisonment! J
WHEREFORE, the assailed decision of the Court of Appeals finding petitioner JOY LEE RECUERDO guilty of violating Batas
Pambansa Blg. 22 is AFFIRMED with MODIFICATION.
In lieu of imprisonment, accused-herein petitioner JOY LEE RECUERDO, is ordered to pay a FINE equivalent to double the
amount of each dishonored check subject of the five cases at bar. And she is also ordered to pay private complainant, Yolanda Floro,
the amount of Two Hundred Thousand (P200,000.00) Pesos representing the total amount of the dishonored checks.
RATIO:

Landmark case of Lozano v. Martinez:
The gravamen of the offense punished by BP 22 is the act of making and issuing a worthless check or a check that is
dishonored upon its presentation for payment.
It is not the non-payment of an obligation which the law punishes.
It is not intended or designed to coerce a debtor to pay his debt
It is an offense against public order
Regarding the constitutionality of the law: it is not for the Court to question the wisdom or policy of the statute. It is
sufficient that a reasonable nexus exists between the means and the end

BP 22 is NOT a bill of attainder

BP 22

For under B. P. 22, every element of the crime is still to be proven before the trial court to warrant a conviction for
violation thereof

The terms and conditions surrounding the issuance of the checks are irrelevant
Recuerdo claims that the dishonored checks were not issued for deposit and encashment, and
There was no consideration for the checks because after she appraised the value of the stone (which Yolanda allegedly
gave her permission to do so to determine the price), its value was only Php160,000 and therefore the 3 accepted checks
were enough
SC: A check issued as an evidence of debt, though not intended for encashment, has the same effect like any other check.
It is within the contemplation of B.P. 22
o Any person who makes or draws and issues any check to apply for an account or for value, knowing at the time of
issue that he does not have sufficient funds in or credit with the drawee bank x x x which check is subsequently
dishonored x x x shall be punished by imprisonment.
BP 22 does not appear to concern itself with what might actually be envisioned by the parties, its primordial intention
being to instead ensure the stability and commercial value of checks as being virtual substitutes for

Bank representative is NOT necessary to prove that checks were dishonoured
SC: It is not required much less indispensable, for the prosecution to present the drawee banks representative as a witness
to testify on the dishonor of the checks because of insufficiency of funds. The prosecution may present, as it did in this
case, only complainant as a witness to prove all the elements of the offense charged
Yolandas testimony that when she deposited the checks to her depository bank they were dishonored due to Account
Closed thus sufficed.

Recuerdo imputes bias on appellate court in rendering decision without comment of Solicitor General
Rendition of decision without comment of SolGen is not by itself proof of bias
In any event, the Office of the Solicitor General gave its comment on petitioners Motion for Reconsideration of the
appellate courts decision

Under Administrative Circular No. 12-2000, imprisonment need not be imposed on those found guilty of violating B.P. Blg. 22.
Administrative Circular No. 13-2001 issued on February 14, 2001 vests in the courts the discretion to determine, taking into
consideration the peculiar circumstances of each case, whether the imposition of fine alone would best serve the interests
of justice, or whether forbearing to impose imprisonment would depreciate the seriousness of the offense, work violence
on the social order, or otherwise contrary to the imperatives of justice

In the case at bar, this Court notes that no proof, nay allegation, was proffered that petitioner was not a first time
offender. Considering this and the correctness of the case, it would best serve the interests of justice if petitioner is just fined to
enable her to continue her dental practice so as not to deprive her of her income, thus insuring the early settlement of the civil
aspect of the case, not to mention the FINE.





3. PEOPLE V. NITAFAN - KARL LIBONGCO
People v Nitafan- KARL

Facts:
-
Private Respondent K.T. Lim alias Mariano Lim (Lim), failing in his argument that BP 22 (Bouncing Check Law) is
unconstitutional, now argues that the check he issued, a memorandum check, is in the nature of a promissory note. Hence,
it is outside the purview of the statute.
-
Lim was charged before the RTC with a violation of BP 22
o 01/10/1985: Lim issued a Philippine Trust Company Check dated 02/09/1985 to Fatima Cortez Sasaki (Sasaki)
knowing that he did not have sufficient funds in his account.
o Said check was subsequently dishonored and despite receipt of the notice of dishonor, Lim still failed to pay
Sasaki.
-
07/18/1986: Lim moved to quash the information on the ground that the facts charged did not constitute an offense since
BP 22 was unconstitutional and that the check he issued was a memorandum check which was in the nature of a
promissory note.

BP 22

-

Issue:
Ratio:
-

09/01/1986: Judge David Nitafan ruled that BP 22 was unconstitutional and issued the questioned order quashing the
information. Hence, this petition of certiorari filed by the SolGen
in behalf of the government.
o Lozano v Martinez and 7 other cases upheld the constitutionality of BP 22
WON a memorandum check issued postdated in partial payment of a pre-existing obligation is within the coverage of BP
22.
Lim, citing US v Isham, contends that although a memorandum check may not differ in form and appearance from an
ordinary check, such check is given by the drawer to the payee more in the nature of a memorandum of indebtedness and
should be sued upon in a civil action.
The SC is not persuaded
o A memorandum check is in the form of an ordinary check, with the word "memorandum", "memo" or "mem"
written across its face, signifying that the maker or drawer engages to pay the bona fide holder absolutely,
without any condition concerning its presentment. Such a check is an evidence of debt against the drawer, and
although may not be intended to be presented, has the same effect as an ordinary check, and if passed to the
third person, will be valid in his hands like any other check.
o It is clear that a memorandum check, which is in the form of an ordinary check, is still drawn on a bank and should
therefore be distinguished from a promissory note, which is but a mere promise to pay. If Lim seeks to equate
memorandum check with promissory note, as he does to skirt the provisions of BP 22, he could very well have
issued a promissory note, and this would be have exempted him form the coverage of the law.
o A memorandum check comes within the meaning of Sec. 185 of the NIL which defines a check as "a bill of
exchange drawn on a bank payable on demand." A check is also defined as "[a] written order or request to a bank
or persons carrying on the business of banking, by a party having money in their hands, desiring them to pay, on
presentment, to a person therein named or bearer, or to such person or order, a named sum of money." Another
definition of check is that is "[a] draft drawn upon a bank and payable on demand, signed by the maker or drawer,
containing an unconditional promise to pay a sum certain in money to the order of the payee."
o A memorandum check must therefore fall within the ambit of B.P. 22 which does not distinguish but merely
provides that "any person who makes or draws and issues any check knowing at the time of issue that he does not
have sufficient funds in or credit with the drawee bank . . . which check is subsequently dishonored . . . shall be
punished by imprisonment . . ." Ubi lex no distinguit nec nos distinguere debemus.
Retracing the enactment of the Bouncing Check Law, the members of the then Batasang Pambansa intended it to be
comprehensive as to include all checks drawn against banks. This was particularly the ratiocination of Mar. Estelito P.
Mendoza, co-sponsor of Cabinet Bill No. 9 which later became B.P. 22, when in response to the interpellation of Mr.
Januario T. Seo, Mendoza explained that the draft or order must be addressed to a bank or depository, and accepted the
proposed amendment of Messrs. Antonio P. Roman and Arturo M. Tolentino that the words "draft or order", and certain
terms which technically meant promissory notes, wherever they were found in the text of the bill, should be deleted since
the bill was mainly directed against the pernicious practice of issuing checks with insufficient or no funds, and not to drafts
which were not drawn against banks.
A memorandum check, upon presentment, is generally accepted by the bank. Hence it does not matter whether the check
issued is in the nature of a memorandum as evidence of indebtedness or whether it was issued is partial fulfillment of a
pre-existing obligation, for what the law punishes is the issuance itself of a bouncing check and not the purpose for which it
was issuance. The mere act of issuing a worthless check, whether as a deposit, as a guarantee, or even as an evidence of a
pre-existing debt, is malum prohibitum.
We are not unaware that a memorandum check may carry with it the understanding that it is not be presented at the bank
but will be redeemed by the maker himself when the loan fall due. This understanding may be manifested by writing across
the check "Memorandum", "Memo" or "Mem." However, with the promulgation of B.P. 22, such understanding or private
arrangement may no longer prevail to exempt it from penal sanction imposed by the law. To require that the agreement
surrounding the issuance of check be first looked into and thereafter exempt such issuance from the punitive provision of
B.P. 22 on the basis of such agreement or understanding would frustrate the very purpose for which the law was enacted
to stem the proliferation of unfunded checks.

WHEREFORE, the petition is GRANTED and the Order of respondent Judge of 1 September 1986 is SET ASIDE. Consequently,
respondent Judge, or whoever presides over the Regional Trial Court of Manila, Branch 52, is hereby directed forthwith to proceed
with the hearing of the case until terminated.
SO ORDERED.

BP 22

4. PEOPLE V. CHUA GEORGINA FU
5. PEOPLE V. CUYUGAN - GASTON PEREZ DE TAGLE
PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs. RICA G. CUYUGAN, accused-appellant.
Perez de Tagle

Emergency Recit
CUYUGAN obtained a sum of money (P855k) from the SPOUSES ABAGAT. CUYUGAN secured the loan by issuing checks which all
bounced due to insufficient funds or that the accounts had been closed. SPOUSES ABAGAT demanded payment, went unheeded,
and so filed 3 criminal cases for ESTAFA (Art 315, par. 2[D]) against CUYUGAN. Cases were consolidated and CUYUGAN was found
guilty for all 3 charges. On appeal to the SC, CUYUGAN was acquitted on the ground that actual fraud was not proven in the trial
court. The SC likewise dismissed the OSGs contention that CUYUGAN should be held liable for a violation of BP22 because: (1) the
informations were for ESTAFA and not BP22; (2) BP22 is not necewssarily included in ESTAFA under Art 315 par. 2 (d)

I.
FACTS

PROCEDURAL STUFFS J
Appeal to the SC on a joint decision of the RTC convicting appellant of 3 counts of estafa (Art 315, paragraph 2 [D])
o Consolidated 3 separate cases because there was identity between the parties and the cause of actions.

ANTECEDENT FACTS J
Rodrigo Abagat was engaged in the business of supplying dry goods, such as materials for building construction as well as
communication parts, to the Philippine Air Force.
Spouses Abagat met with Cuyugan at the Villamor Golf Club:
o Prosecution: The parties met to discuss the matter of Cuyugans dire need for money on account of the supplies
she wanted to buy for the Philippine Armed Forces. Spouses Abagat gave Cuyugan, on staggered basis, the
amount totaling to P855,000. They agreed to give her the amount provided that Cuyugan would issue checks to
cover the value of the money given her
o Defense: it was Norma Abagat who requested that the Abagats participate in the big supply project for the
Philippine Army.
When the checks were presented for payment, they were all dishonored either on account of DAIF (drawn against
insufficient funds) or for reason of ACCOUNT CLOSED.
Abagat forthwith informed Cuyugan of the dishonor of the checks by sending her a demand letter on January 12, 1995.
Despite repeated demands, Cuyugan failed to make good the checks, which constrained the Abagat spouses to file in May
1995 a complaint for estafa against Cuyugan
The trial court found Cuyugan guilty beyond reasonable doubt of estafa committed by means of false pretenses or
fraudulent acts executed prior to or simultaneously with the commission of the fraud
o That is, 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

II.
ISSUE
W/N the trial court erred in convicting appellant for three counts of estafa and sentencing her pursuant to Article 315, 2 (d)
of the Revised Penal Code as amended by P.D. No. 818. (YEA)

III.
HELD
RTC judgments holding Cuyugan liable for three counts of estafa is REVERSED and SET ASIDE.
Cuyugan is ACQUITTED, for lack of sufficient evidence to prove fraud beyond reasonable doubt.
However, she is ordered to pay private complainants the balance of her obligation in the amount of P430,000 plus interest
of twelve percent (12%) per annum until fully paid.
She is hereby ordered RELEASED immediately from confinement in the Correctional Institution for Women, Mandaluyong
City, unless she is being held for another lawful cause.

IV.
RATIO

SC STATES THE RULE ON FRAUD IN RELATION TO ESTAFA UNDER THIS PROVISION J
To constitute estafa under this provision 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 a check
whether postdated or not.

BP 22

That is, the latter would not have parted with his money or other property were it not for the issuance of the
check.

APPLIES THE ABOVE RULE TO THE FACTS J
Norma Abagat admitted on cross-examination that the checks that appellant issued merely guaranteed the payment of the
loan.
Rodrigo Abagat likewise admitted as much and even testified on cross-examination that he intended to impose a monthly
interest at the rate of 5% on the amount lent.
The transaction between Cuyugan and the Abagat spouses, in our view, was one for a loan of money to be used by
Cuyugan in her business and she issued checks to guarantee the payment of the loan.
o As such, she has the obligation to make good the payment of the money borrowed by her.
But such obligation is civil in character and in the absence of fraud, no criminal liability under the Revised Penal Code arises
from the mere issuance of postdated checks as a guarantee of repayment.
We also note that the trial court convicted Cuyugan on a general allegation that all the elements of estafa under Article
315, 2 (d) of the Revised Penal Code had been proved by the prosecution without making any reference to or giving any
proof of the actual fraud that Cuyugan allegedly committed to make her liable for estafa.
It is elementary that where an allegation in the information is an essential element of the crime, the same must be proved
beyond reasonable doubt to sustain a conviction.
o In this case, the prosecution did not establish specifically and conclusively the fraud alleged as an element of the
offenses charged.
o

[NEGO] CUYUGAN CANNOT BE HELD LIABLE FOR VIOLATIONS OF BP22 IN THIS CASE (2 REASONS) J

FIRST REASON J
Considering that the informations against Cuyugan involved violation of Art. 315, 2 (d) of the Revised Penal Code, We take
exception to the OSGs recommendation that Cuyugan should be held liable for violations of BP 22.
o Cuyugan cannot be convicted of a crime for which she was not properly charged, for that would violate appellants
constitutional right to be informed of the accusation against her
Earlier, the informations for BP 22 covering the same checks filed with the Metropolitan Trial Court of Pasay City, Branch
44, were provisionally dismissed on November 13, 1996.
o These cases were not re-filed nor consolidated with the informations for estafa before the RTC of Pasay.
o Accordingly, Cuyugan was never apprised of the fact that she may still be held liable for BP 22 and so never had an
opportunity to defend herself against an accusation for an offense under the special law.

SECOND REASON (DOCTRINE) J
BP 22 cannot be deemed necessarily included in the crime of estafa under RPC, Article 315, 2 (d).
The offense of fraud defined under the Revised Penal Code is malum in se, whereas BP 22, also known as Bouncing Checks
Law, is a special law which punishes the issuance of bouncing checks, a malum prohibitum.
Fraud or estafa under the Revised Penal Code is a distinct offense from the violation of the Bouncing Checks Law.
o They are different offenses, having different elements.
In this case, since appellant is accused of violating a particular provision of the Revised Penal Code on estafa, she may not
be convicted for violation of BP 22 without trenching on fundamental fairness.

6. CUEME V. PEOPLE - NORBY GERALDEZ

FELIPA B. CUEME, petitioner, vs. PEOPLE OF THE PHILIPPINES, respondent.(Geraldez)

Emergency Recit:
Cueme is a GM of a Mark-Agro Corp, Simolde is a bank teller from BPI. They are both from Davao. They became friends.
Simolde (in her personal capacity?) started lending to Cueme money. Cueme would issue PDCs for these. Cueme would
convince Simolde not yet to deposit. Eventually, Simolde had 15 of these PDCs already and decided to deposit. Dishonored for
DAIF.
RTC, CA, SC all convict Cueme for 15 counts of BP22, prison and fine (for amount of checks; although CA would reduce one of
the checks worth 220k to 200k because that is the limit set by BP22). BP22 is mala prohibita, criminal intent unnecessary, so
whatever purpose those checks were meant to serve does not matter. It is the issuance of unfunded checks that is punished,

BP 22

regardless the terms and conditions of its issuance, for if the Courts had to look at the terms and conditions, it would erode
public faith in the commercial value of check as currency substitutes.
Facts:
1. Felipa CUEME is the General Manager of Mark-Agro Trading Corp and AMF General Trading Corp. Helen SIMOLDE is a
bank teller of BPI Makati Branch.
a. By virtue of their both being from Davao, the 2 became friends.
b. Eventually, Simolde started lending money to Cueme. (it seems the loan was in her personal capacity, not
one from BPI)
c. Cueme would iss ue post dated checks lent plus interest upon receipt of cash. There were eventually 15
checks with Simolde.
2. Cueme would persuade Simolde not to deposit the checks issued. Eventually, Simolde deposits all the checks with her
in her account, but they were all dishonored for being drawn against insufficient funds.
3. Simolde demanded payment but to no avail. Apparently, Cueme had no intention to make good on checks.
4. On trial, the two had very conflicting stories.
a. CUEME said:
i. She did not borrow from Simolde. She actually borrowed from Mark-Agro Corp.
ii. She did not issue those checks. In fact, Simolde procured the pre-signed blank checks from
petitioner's secretary, Leonora GABUAN, and thereafter entered the dates, names and amounts in
each of the checks only for the purpose of showing them to prospective investors of Mark-Agro
Trading Corporation.
b. GABUAN said:
i. Corroborated Cuemes story.
ii. Testified that Cueme and Simolde were very close, like sisters.
iii. That at one point, while Cueme was in Davao, Gabuan had with her pre-signed checks for payment
of utility bills.
iv. Simolde convinced her to issue some of them so that the former can show them to potential
investors.
5. Trial Court ruled for Simolde. Guilty of 15 cases of BP22. Ordered 6 mos. imprisonment per check plus fine of face
value of all checks plus interest.
6. CA affirmed. Modified fine regarding one check valued at P220,000.
a. Sec. 1 of BP22 says that the fine shall be not less than the value of the check, and not more than double that
value, but shall not exceed P200,000.
Issues:
W/N she is guilty of violating BP22. (still based on her story above). YES. Ruling of CA affirmed.
Ratio:

There are two (2) ways of violating B.P. Blg. 22: (a) by making or drawing and issuing a check to apply on account or for
value knowing at the time of issue that the check is not sufficiently funded; and, (b) by having sufficient funds in or credit
with the drawee bank but failing to keep sufficient funds or to maintain a credit to cover the full amount of the check
when presented to the drawee bank within a period of ninety (90) days. Petitioner was convicted under the first type of
violation.
As to the contradicting stories, it is well-settled that where the issue is the credibility of witnesses the appellate court will
not generally disturb the findings of the lower court considering that it is in a better position to settle that issue.
The claim of petitioner that she merely signed the checks in blank is belied by the fact that some of the checks even bore
her signatures at the back suggesting that the checks had been indorsed by her, while others containing alterations in the
entries were properly countersigned by her.
The counter-affidavits submitted by Cueme and Gabuan also contradict the testimonies they gave. They claim that they
submitted those affidavits in a hurry and did not fully understand them. Certainly, their lame excuses cannot prevail
against complainants consistent, straightforward and positive testimony as noted by the trial court. It must be stressed
that in the prosecution of offenses under B.P. Blg. 22 it is incumbent upon the accused to prove his defenses by clear
and convincing evidence.

BP 22

The allegation of petitioner that the checks were merely intended to be shown to prospective investors of her
corporation is, to say the least, not a defense. The gravamen of the offense punished under B.P. Blg. 22 is the act of
making or issuing a worthless check or a check that is dishonored upon its presentment for payment. The law has made
the mere act of issuing a bad check malum prohibitum, an act proscribed by the legislature for being deemed
pernicious and inimical to public welfare. Considering the rule in mala prohibita cases, the only inquiry is whether the
law has been breached. Criminal intent becomes unnecessary where the acts are prohibited for reasons of public
policy, and the defenses of good faith and absence of criminal intent are unavailing.
The checks issued, even assuming they were not intended to be encashed or deposited in a bank, produce the same
effect as ordinary checks. What the law punishes is the issuance of a rubber check itself and not the purpose for which
the check was issued nor the terms and conditions relating to its issuance. This is not without good reasons. To
determine the purpose as well as the terms and conditions for which checks are issued will greatly erode the faith the
public reposes in the stability and commercial value of checks as currency substitutes, and bring about havoc in the
trading and banking communities. Besides, the law does not make any distinction as to the kind of checks which are the
subject of its provisions, hence, no such distinction can be made by means of interpretation or application.
In fine, it is evident from the records that there were violations of B.P. Blg. 22 committed by petitioner: (a) all the checks
were complete on their faces, i.e., properly dated, signed, with the name of the payee and amount of the checks entered;
(b) the checks were issued on account of loans petitioner made; (c) all the checks were dishonored and stamped "drawn
against insufficient funds;" and, (d) BPI Bookkeeper Arnulfo Fernandez presented in court a ledger where accounts of
petitioner were shown to have insufficient funds at the date of the issuance of the checks. Added to these is the
presumption of knowledge of insufficiency of funds. A makers knowledge is presumed from the dishonor of his check
for insufficiency of funds. Once proved that the maker or drawer had knowledge of the insufficiency of his funds or
credit, which is also an important element for the offense to exist, he is rendered ipso facto liable.

7. WONG V. CA - CARLO NARVASA
Wong v. CA NARVASA

Emergency Recit:

I. FACTS

Wong was an agent of Limtong Press. Inc. (LPI), a manufacturer of calendars.

o

LPI would print sample calendars, then give them to agents to present to customers.

The agents would get the purchase orders of customers and forward them to LPI.

After printing the calendars, LPI would ship the calendars directly to the customers. Thereafter, the agents would
come around to collect the payments.

Wong, however, had a history of unremitted collections, which he duly acknowledged in a confirmation receipt he co-

signed with his wife. Hence.

o

Wongs customers were required to issue postdated checks before LPI would accept their purchase orders.

Wong issued six (6) postdated checks totaling P18,025.00, all dated December 30, 1985 and drawn payable to the order of
LPI, as follows:
o

Allied Banking Corporation Checks for P6,410.00, P540.00, P5,500.00, P1,100.00, P3,375.00 and P1,100.00

These checks were initially intended to guarantee the calendar orders of customers who failed to issue post-dated
checks. However, following company policy, LPI refused to accept the checks as guarantees.

Instead, the parties agreed to apply the checks to the payment of Wongs unremitted collections amounting to

P18,077.07. LPI waived the P52.07 difference.

Before the maturity of the checks, Wong prevailed upon LPI not to deposit the checks and promised to replace them within
30 days.
o

Wong reneged on his promise.

Hence, on June 5, 1986, LPI deposited the checks with Rizal Commercial Banking Corporation (RCBC). The checks were
returned for the reason "account closed." The dishonor of the checks was evidenced by the RCBC return slip.

On June 20, 1986, LPI through counsel notified the Wong of the dishonor. Wong failed to make arrangements for payment

BP 22

within five (5) banking days.

Wong was charged with three (3) counts of violation of B.P. Blg. 22 under three separate Informations for the three checks
amounting to P5,500.00, P3,375.00, and P6,410.00.

Wong was similarly charged in Criminal Case No. 12057 for ABC Check No. 660143463 in the amount of P3,375.00, and in
Criminal Case No. 12058 for ABC Check No. 660143464 for P6,410.00. Both cases were raffled to the same trial court.

Upon arraignment, Wong pleaded not guilty. Trial ensued.

PROSECUTION

Manuel T. Limtong, general manager of LPI, testified on behalf of the company, Limtong averred that he refused to accept
the personal checks of Wong since it was against company policy to accept personal checks from agents.

Hence, he and Wong simply agreed to use the checks to pay Wongs unremitted collections to LPI.

According to Limtong, a few days before maturity of the checks, Wong requested him to defer the deposit of said checks
for lack of funds.

Wong promised to replace them within thirty days, but failed to do so.

Hence, upon advice of counsel, he deposited the checks which were subsequently returned on the ground of "account
closed."

DEFENSE

Wong issued the six (6) checks to guarantee the 1985 calendar bookings of his customers. According to Wong, he issued
the checks not as payment for any obligation, but to guarantee the orders of his customers.

RTC:

Wong is guilty of 3 counts of violating sec.1 of BP 22

4 month imprisonment and pay Limtong 5,500. 3,375. And 6,410.

CA: affirmed the trial courts decision in toto.

Issue: The only issue for our resolution now is whether or not the prosecution was able to establish beyond reasonable doubt all the
elements of the offense penalized under B.P. Blg. 22.

Held: We are of opinion that the contract by and between the plaintiff and the defendant was one of purchase and sale, and that
the obligations the breach of which is alleged as a cause of action are not imposed upon the defendant, either by agreement or by
law.

Ratio:

Wong contends that the checks were issued as guarantees for the 1985 purchase orders (POs) of his customers.
o

LPI is not a "holder for value" considering that the checks were deposited by LPI after the customers already paid
their orders.

Instead of depositing the checks, LPI should have returned the checks to him.

The issue as to whether the checks were issued merely as guarantee or for payment of Wongs unremitted collections is a
factual issue involving as it does the credibility of witnesses. Said factual issue has been settled by the trial court and Court
of Appeals.
o

Although initially intended to be used as guarantee for the purchase orders of customers, they found the checks
were eventually used to settle the remaining obligations of Wong with LPI. Although Manuel Limtong was the sole
witness for the prosecution, his testimony was found sufficient to prove all the elements of the offense charged.

We find no cogent reason to depart from findings of both the trial and appellate courts. In cases elevated from the Court of
.

Appeals, this Court is not a trier of facts.

The only issue for our resolution now is whether or not the prosecution was able to establish beyond reasonable doubt all the
elements of the offense penalized under B.P. Blg. 22.

There are two (2) ways of violating B.P. Blg. 22:

BP 22

o

(1) by making or drawing and issuing a check to apply on account or for value knowing at the time of issue that the
check is not sufficiently funded; and

(2) by having sufficient funds in or credit with the drawee bank at the time of issue but failing to keep sufficient
funds therein or credit with said bank to cover the full amount of the check when presented to the drawee bank
within a period of ninety (90) days.

The elements of B.P. Blg. 22 under the first situation, pertinent to the present case, are:
o

The making, drawing and issuance of any check to apply for account or for value;

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 such check in full upon its presentment; and

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."

First Element
o

Wong contends that the first element does not exist because the checks were not issued to apply for account or
for value.

He attempts to distinguish his situation from the usual "cut-and-dried" B.P. 22 case by claiming that the checks
were issued as guarantee and the obligations they were supposed to guarantee were already paid.

This flawed argument has no factual basis, the RTC and CA having both ruled that the checks were in payment for
unremitted collections, and not as guarantee.

Likewise, the argument has no legal basis, for what B.P. Blg. 22 punishes is the issuance of a bouncing check and
not the purpose for which it was issued nor the terms and conditions relating to its issuance.

Second element
o

B.P. Blg. 22 creates a presumption juris tantum that the second element prima facie exists when the first and third
elements of the offense are present.

Thus, the makers knowledge is presumed from the dishonor of the check for insufficiency of funds.

Wong avers that since the complainant deposited the checks on June 5, 1986, or 157 days after the December 30, 1985
maturity date, the presumption of knowledge of lack of funds under Section 2 of B.P. Blg. 22 should not apply to him.

He further claims that he should not be expected to keep his bank account active and funded beyond the ninety-day
period.

Section 2 of B.P. Blg. 22 provides:

o

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.

An essential element of the offense is "knowledge" on the part of the maker or drawer of the check of the insufficiency of
his funds in or credit with the bank to cover the check upon its presentment.
o

Since this involves a state of mind difficult to establish, the statute itself creates a prima facie presumption of such
knowledge where payment of the check "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."

To mitigate the harshness of the law in its application, the statute provides that such presumption shall not arise if
within five (5) banking days from receipt of the notice of dishonor, the maker or drawer makes arrangements for
payment of the check by the bank or pays the holder the amount of the check.

Nowhere in said provision does the law require a maker to maintain funds in his bank account for only 90 days.

Rather, the clear import of the law is to establish a prima facie presumption of knowledge of such insufficiency of funds
under the following conditions

BP 22

o

(1) presentment within 90 days from date of the check, and

(2) the dishonor of the check and failure of the maker to make arrangements for payment in full within 5 banking
days after notice thereof.

That the check must be deposited within ninety (90) days is simply one of the conditions for the prima facie presumption of
knowledge of lack of funds to arise. It is not an element of the offense. Neither does it discharge Wong from his duty to
maintain sufficient funds in the account within a reasonable time thereof.

Under Section 186 of the Negotiable Instruments Law, "a check must be presented for payment within a reasonable time
after its issue or the drawer will be discharged from liability thereon to the extent of the loss caused by the delay."

By current banking practice, a check becomes stale after more than six (6) months, or 180 days.

LPI herein deposited the checks 157 days after the date of the check. Hence said checks cannot be considered stale.

Only the presumption of knowledge of insufficiency of funds was lost, but such knowledge could still be proven by direct or
circumstantial evidence.

As found by the trial court, LPI did not deposit the checks because of the reassurance of Wong that he would issue new
checks. Upon his failure to do so, LPI was constrained to deposit the said checks.

After the checks were dishonored, Wong was duly notified of such fact but failed to make arrangements for full payment
within five (5) banking days thereof. There is, on record, sufficient evidence that Wong had knowledge of the insufficiency
of his funds in or credit with the drawee bank at the time of issuance of the checks.

And despite Wongs insistent plea of innocence, we find no error in the respondent courts affirmance of his conviction

8. NAGRAMPA V. PEOPLE MARIANA LOPA
MANUEL NAGRAMPA vs. PEOPLE OF THE PHILIPPINES - LOPA

Emergency Recit:
Nagrampa bought backhoe equipment from FEDCOR. Paid cash as down payment and 2 checks for balance drawn against Security
Bank. FEDCOR presented the checks for payment 5 months after date but they were dishonored because Nagrampas account had
been closed for years already. Lower courts and CA found Nagrampa guilty of estafa and 2 violations of BP 22.

3 main issues:
W/N Nagrampa is guilty of estafa despite the fact that checks were not encashed within 90 days from date as required by BP22?
o Yes, violation of Sec 1 of BP 22. Nagrampa knew of insufficiency when he issued the check.
o No need to present check within 90 days because proof of knowledge of insufficiency of funds was proven by a testimony
by Security Banks signature verifier.

W/N Violations of BP22 should be punishable only by fine subject to Admin Circular 12-2000
o No. According to AC 12-000
o Good faith fine only
o Bad faith imprisonment and fine
o Sole discretion of judge

W/N FEDCOR suffered damages, thus making Nagrampa liable for estafa?
o Yes, FEDCOR suffered loss of backhoe, which they delivered in consideration of the payment of the down payment and
checks
o No proof that backhoe was returned

FACTS:
o Nagrampa assails conviction for estafa and two counts of violation of BP 22 (Bouncing Checks Law).

Information in criminal cases:
Nagrampa defrauded FEDCOR TRADING CORPORATION (FEDCOR) represented by FEDERICO SANTADER by making, drawing
and issuing 2 checks against SECURITY BANK AND TRUST COMPANY (Security Bank) knowing fully well that he did not have
funds in the bank or his funds were not sufficient to cover the amounts of the checks.
o Check No. 473477 for P 75,000 postdated Aug 31, 1989
o Check No. 473478 for P 75,000 postdated Sep. 30, 1989

BP 22

o

Upon presentation, the checks were dishonored for the reason that Nagrampa (drawer) did not have any funds
and despite notice of dishonor, he failed and refused to make good on said checks
FEDCOR was subjected to damage and prejudice

o

Parties to the Check:
o FEDCOR payee
o Security Bank drawee bank
o Nagrampa drawer

Other Relevant Parties:
o Federico Santander President of FEDCOR
o Felix Mirano Signature verifier of Escolta Branch of Security Bank
o Bote Sales agent of FEDCOR

Testimony of Santander (Pres. of FEDCOR):
o Nagrampa (as General Manager of the Nagrampa Asphalt Plant in Montalban, Rizal) purchased a Yutani Poclain Backhoe
Excavator Equipment for P200,000 from FEDCOR
o Paid for P50,000 in cash (downpayment)
o Issued the ff. checks for balance:
473477 and 473478 for P75,000 each, postdated on Aug 1989 and Sep 1989 respectively
FEDCORs salesman assured that the checks were good. Equipment delivered.
o FEDCOR presented checks for payment in Feb 1990. Dishonored on the ground that Nagrampas account with Security Bank
had already been closed.
o FEDCOR demanded payment via letter through registered mail. Nagrampa didnt pay.
o Aforementioned cases filed.
o Santander denied that equipment was returned. Ronnie Bote (who accepted the equipment) was not an employee of
FEDCOR but merely a sales agent with no authority to receive returned equipment.

Testimony of Mirano (signature verifier of Security Bank):
o His duty was to verify signatures of clients of the bank
o Verified that signatures on checks were that of Nagrampa based on his signature card
o Account of Nagrampa was closed in May 1985

Testimony of Nagrampa:
o Same facts of sale as Santander plus that Nagrampa bought the backhoe from Bote
o Agreement between Nagrampa and Bote that Nagrampa would replace the checks with cash if the backhoe would be in
good running condition
o After 5-7 days of use, the backhoe broke down. Reported to Ronnie Bote (father of Bote the sales agent) and it was thus
repaired.
o After 1 day, backhoe broke again. Nagrampa reported defect. Bote said the backhoe should be brought back to the office
for repair.
o Evidence of return of equipment: letter addressed to Electrobus Consolidated, Inc, requesting the release of the backhoe to
Bote for repair with the alleged signature of Bote appearing at the bottom to attest to his receipt of the equipment.
o After 1 week, Nagrampa demanded the return of the backhoe, cash downpayment and checks. No avail.

Ruling of lower court:
o Nagrampa guilty of 2 counts of violation of BP 22. Two years imprisonment and pay FEDCOR P150,000 with legal interest.
o Brought the case to CA. CA sent the case back to trial court because they did not rule on estafa.
o Trial courts second ruling found him guilty of estafa. Imprisonment of 7 years and 4 months.
o Appeal to CA again.

Decision of CA:
o Affirmed decision of trial court. Denied motion for reconsideration.

ISSUES:
1. W/N Nagrampa is guilty of estafa? YES
2. W/N Nagrampa is guilty of violation of BP 22? YES
3, W/N rulings in Vaca v. CA and Lim v. People should be applied retroactively violations of BP 22 punishable only by fine? NO!

Nagrampas claims:

BP 22

1.
2.
3.

No estafa because the backhoe became unserviceable and was eventually returned to FEDCOR through its sales agent
(Bote). No damage suffered by FEDCOR.
No violation of BP 22 because checks were presented for payment 5 months from date of check. BP 22 states that payee
(FEDCOR) had the duty of encashing or depositing check 90 days from date of issue.
Rulings in Vaca v. CA and Lim v. People should be given retroactive effect in his favor; therefore, only a fine may be
imposed on him as penalty.

SolGens claims:
1. Nagrampas account had been closed since May 1985, 4 years prior to issuance of checks. Date of encashment/deposit
immaterial because there was no more existing bank account. Dishonor was certain even if checks were presented for
payment within 90 days.
2. Imprisonment appropriate because Nagrampa issued worthless checks culpable violation of BP 22.
3. Lack of damage to FEDCOR disputed by pointing out Nagrampas failure to prove the return of the backhoe. Bote not
presented as witness. Even assuming arguendo that Bote received them, there is no showing that he acted for, and on
behalf of, FEDCOR.

RATIO:

W/N Nagrampa is guilty of violation of BP 22? YES
o Two distinct acts are punished under Sec 1 of BP 22:
(1) The making or drawing and issuance of any check to apply on account or for value, knowing at the time of issue
that the drawer does not have sufficient funds in, or credit with, the drawee bank; and
drawer knows of insufficiency of funds to cover check at time of issuance
check worthless at time of issuance
(2) The failure to keep sufficient funds or to maintain a credit to cover the full amount of the check if presented within
a period of ninety days from the date appearing thereon, for which reason it is dishonored by the drawee bank.
drawer has sufficient funds but fails to keep sufficient funds or maintain credit within 90 days from date
appearing on check
In BOTH CASES, offense is consummated by the dishonor of the check for insufficiency of funds or credit.
o Nagrampa charged with first type of offense under BP22
o The elements of the first type of offense are as follows:
(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 such 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.
o The fact that the checks were presented beyond the 90-day period provided in Section 2 of B.P. Blg. 22 is of no moment.
90-day period is not an element of the offense but merely a condition for the prima facie presumption of knowledge of the
insufficiency of funds
o Only consequence of the failure to present the check for payment within the 90-day period is that there arises no prima
facie presumption of knowledge of insufficiency of funds. Such knowledge may be proved through other evidence.
o Proved by Miranos testimony that Nagrampas account had been closed since May 1985
o FEDCOR presented checks for encashment within 6 month period from date of issuance. They would not have been
considered stale had Nagrampas account been existing.
o Nagrampa guilty of violation of BP 22.

W/N rulings in Vaca v. CA and Lim v. People should be applied retroactively violations of BP 22 punishable only by fine? NO!
o Administrative Circular No. 12-2000 does not remove imprisonment as an alternative penalty, but rather lays down a rule
of preference in the penalties provided for in BP 22.
o When offense and offender indicate good faith or clear mistake of fact without negligence, fine alone should be considered
as the more appropriate penalty.
o Sole determination of whether the circumstance warrants the impositions of a fine alone rests on the judge. Should the
judge deem imprisonment more appropriate, Admin Circular 12-2000 should not be a hindrance.
o Nagrampa manifested utter bad faith when he issued postdated checks without an account with the drawee bank. Cannot
avail of the benefits under Admin Circular 12-2000

W/N Nagrampa is guilty of estafa? YES
o Elements of Estafa:
(1) postdating or issuing of a check in payment of an obligation contracted at the time the check was issued
(2) lack or insufficiency of funds to cover the check

BP 22

o

o
o

(3) damage to the payee thereof (this is the only element being disputed)
Act of postdating or issuing a check in payment of an obligation must be the efficient cause of defraudation. It must be
prior to, or simultaneous with, the act of fraud.
o Must be able to obtain money or property because of the issuance of the check
o Check should have been issued as an inducement for the surrender by the party deceived of his money or
property. Not a payment of pre-existing obligation.
Damage in an element of estafa may consist in:
(1) the offended party being deprived of his money or property as a result of the fraud
(2) disturbance in property right
(3) temporary prejudice
Deprivation of FEDCORs property is apparent. FEDCOR delivered backhoe because of payment of down payment and
postdated checks.
Nagrampa could not prove return of backhoe.
o Never presented Bote as witness.
o Never wrote FEDCOR about the return of the allegedly defective backhoe to Bote
o Never went to FEDCOR to claim return of the equipment or cash downpayment or checks.

(Pogi/Ganda points)
o Admitted on cross-examination that during the pendency of the case, he paid Santander through FEDCORs lawyer, on two
separate occasions, in the total amount of P15,000 upon the adicce of his lawyer that he had to pay because he was guilty


o Negates his claim that he returned the backhoe; may even be tantamount to an offer of compromise
o Sec 27 Rule 130 on Rules of Evidence offer of compromise in criminal cases is an implied admission of guilty
o SC modified penalty for estafa pursuant to PD 818:
1. Imprisonment of one year for each of the two violations of BP22
2. Indeterminate penalty of 8 years and 1 day of prision mayor as minimum to 28 years, 4 months and 1 day of
reclusion perpetua as maximum for the crime of estafa
3. Pay FEDCOR P135,000 plus legal interest

Relevant Provision:

Section 1 of B.P. Blg. 22 provides:
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 or 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.


9. TING V. CA KEITH
Victor Ting Seng Dee and Emily Chan-Azajar vs. People of the Philippines
-Keith

Emergency Recitation:
Juliet Ting loaned 2,750,000 from Josefina Tagle for her business. As payment therefor, Juliet Ting issued 11 checks which were
subsequently dishonored. She was prosecuted for BP 22. (She was found guilty). Juliet Ting asked her husband Petitioner Victor Ting
and her sister Emily Chan Azajar to take over her business and all obligations arising therefrom. So they issued 19 checks in
replacement of the 11 checks. However, the planned take over did not materialize since the employer (Naga Hope Christian School)
of Emily Chan Azajar refused to let her go. Juliet then issued 23 checks as a replacement for the 19 checks issued by petitioners.
Subsequently, the petitioners asked for the return of their checks. Instead of returning, Tagle had deposited 7 checks which were
dishonored. She now files 7 counts of BP 22 cases against petitioners. RTC: Found that they were guilty. CA affirmed.
Issue: Are they guilty? No.

BP 22

Ratio: Elements of BP 22.
For a violation of Batas Pambansa Blg. 22 to be committed, the following 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 there are no sufficient funds in or credit
with the drawee bank for the payment of such check in full upon is 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
st
rd
st
rd
nd
1 and 3 element were proven. While the presence of the 1 and 3 element raises the presumption that the 2 element is also
present, there was proof that the drawers/petitioners had notice of dishonor. 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. (So that the issuer could within 5
days after receipt pay the amount of the check.) While private complainant alleges that she has given a demand letter, there was no
proof that the petitioners had received it. Hence, they were not notified of the dishonor. And could not be guilty of BP 22.

Facts:
From 1991 to 1992, Juliet Ting Chan Sioc Hiu obtained loans, in the aggregate amount of P2,750,000.00, from private
complainant Josefina K. Tagle for use in Juliets furniture business.
As payment thereof, Juliet issued eleven (11) post-dated checks which, upon maturity, were dishonored for reasons of
Closed Account or Drawn Against Insufficient Funds.
Juliet was subsequently prosecuted for violation of Batas Pambansa Blg. 22.
Due to her financial difficulties, Juliet requested her husband Victor Ting Seng Dee and her sister Emily Chan-Azajar
(petitioners herein) to take over her furniture business, including the obligations appurtenant thereto.
Agreeing to Juliets request, petitioners issued nineteen (19) checks in replacement of the eleven (11) checks earlier issued
by Juliet.
The planned take-over, however, never materialized since the Naga Hope Christian School, petitioner Emily Chan-Azajars
employer in Naga, refused to let her resign to attend to her sisters business.
Since the planned take-over did not take place, petitioners requested Juliet to reassume her obligation to private
complainant Tagle by replacing the checks they had previously issued to the latter.
Thus, Juliet replaced the nineteen (19) checks issued by petitioners with twenty-three (23) Far East Bank checks in favor of
Tagle.
Petitioners then requested private complainant Tagle to return the nineteen (19) checks they had issued to her.
Instead of returning the checks, Tagle deposited seven of the checks with MetroBank where they were dishonored for
being Drawn Against Insufficient Funds.
Tagle (private complainant) alleged:
o that sometime in April 1993, petitioners obtained a loan of P950,000.00 from her, issuing several post-dated
checks in payment thereof.
o When the checks were deposited by Tagle with MetroBank, they were dishonored for having been drawn against
insufficient funds.
o Tagle alleged that despite verbal and written demands, petitioners failed to pay her the value of the dishonored
checks.
Consequently, seven informations for violation of Batas Pambansa Blg. 22 were filed against petitioners.
o That sometime prior to May 27, 1993, in the City of Manila, Philippines, the said accused, conspiring and
confederating together and mutually helping each other, did then and there wilfully, unlawfully and feloniously
make or draw and issue to JOSEPHINE K. TAGLE, to apply on account or for value Producers Bank of the
Philippines, Check No. 946072 dated May 27, 1993 payable to CASH in the amount of P250,000.00 said accused
well knowing that at the time of issue they did not have sufficient funds in or credit with the drawee bank for
payment of such check in full upon its presentment, which check when presented for payment within ninety (90)
days from the date thereof, was subsequently dishonored by the drawee bank for Drawn Against Insufficient
Funds and despite receipt of notice of such dishonor, said accused failed to pay said JOSEFINA K. TAGLE the
amount of the check or to make arrangements for full payment of the same within five (5) banking days after
receiving said notice.

BP 22

The trial court found petitioners guilty of violating Batas Pambansa Blg. 22 in each of the seven cases.
CA affirmed.
Petitioners claim that the Court of Appeals erred in affirming the decision of the trial court, given the absence of proof
beyond reasonable doubt or in the presence of facts creating reasonable doubt.

Issue: Are the petitioners criminally liable for BP 22?

HELD: The petition has merit. They are not liable because they had no notice that it was dishonored (in the case, it was in the form
of a demand letter).

Ratio: Sec. 1 of BP 22

For a violation of Batas Pambansa Blg. 22 to be committed, the following 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 there are no sufficient funds in or
credit with the drawee bank for the payment of such check in full upon is 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 (Sycip, Jr. vs. CA,
G.R. No. 125059, March 17, 2000).

An analysis of the evidence presented, however, shows that not all the aforementioned elements have been established by the
prosecution beyond reasonable doubt.
That the seven checks in question were issued by petitioners is beyond dispute. Not only were the dishonored checks
presented in court, but petitioners even admitted signing the checks and issuing them to private complainant. From the evidence
on record, it is clear that petitioners signed and issued the seven checks in question.
That the checks were dishonored is also clearly established. Section 3 of Batas Pambansa Blg. 22 provides that the
introduction in evidence of any unpaid and dishonored check, having the drawees 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 instant case, the fact of the checks dishonor is sufficiently shown by the return slips issued by MetroBank, the
depository bank, stating that the checks had been returned for the reason DAIF Drawn Against Insufficient Funds. Not only are
these check return slips prima facie evidence that the drawee bank dishonored the checks, but the defense did not present any
evidence to rebut these documents. In fact, counsel for petitioners even admitted the fact of the checks dishonor, agreeing to
dispense with the presentation of the bank representative who was supposed to prove the fact of dishonor of said checks (p. 162,
Rollo.).
However, for liability to attach under Batas Pambansa Blg. 22, it is not enough that the prosecution establishes that a check
was issued and that the same was subsequently dishonored. The prosecution must also prove the second element, that is, it must
further show that the issuer, at the time of the checks issuance, had knowledge that he did not have enough funds or credit in the
bank for payment thereof upon its presentment. Since the second element involves a state of mind which is difficult to verify,
Section 2 of Batas Pambansa Blg. 22 creates a presumption juris tantum that the second element prima facie exists when the first
and third elements of the offense are present (Magno v. People, 210 SCRA 471 [1992]). Section 2 provides:
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 or credit with such bank, when presented within ninety 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.
However, 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. This is to give the accused an opportunity to pay within 5 days the amount of the checks.

BP 22

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.

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.

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.

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.

In summary, there was no proof of notice of dishonor given to the petitioners.

Having failed to prove all the elements of the offense, petitioners may not thus be convicted for violation of Batas Pambansa Blg. 22.

That petitioners are civilly liable to private complainant is also doubtful.

It was Juliet Ting who had a civil obligation to pay the loan with Tagle. Thus, Tagle cannot go against the petitioners to recover or for
the performance of the obligation.
The checks they issued were payments on behalf of Juliet Ting.

Moreover, the original debtor Juliet Ting was convicted by the Regional Trial Court of Manila in Criminal Cases 93-126581-91 for
eleven counts of violation of Batas Pambansa Blg. 22. These eleven bouncing check cases involved the same obligation being sued
upon by private complainant Tagle herein. The trial court expressly acknowledged in said cases that nineteen (19) checks were
issued by petitioners as payment for Juliet Tings obligation. In its August 7, 1997 decision convicting Juliet Ting for violation of
Batas Pambansa Blg. 22, the trial court declared that to cover the additional loans, accused (Juliet Ting) delivered 19 post-dated
checks issued by Victor Ting and Emily Azajar (p. 55, Rollo.).

By implication, had the 23 Far East Bank checks issued by Juliet Ting to replace the nineteen checks issued by petitioners been
cleared, then private complainant would have considered the checks in question as having been replaced. This only supports our
conclusion that it was Juliet Ting who owed money to private complainant, not petitioners.

Not having borrowed the amount of Nine Hundred Fifty Thousand (P950,000.00) from private complainant, petitioners may not
thus be held liable therefor.

10. DANAO V. CA - ALEXIS AQUINO
EVANGELINE DANAO, petitioner, vs. COURT OF APPEALS and PEOPLE OF THE PHILIPPINES, respondents
(by AQUINO)

Emergency Recit:
Danao was charged with the violation of BP22 for issuing 2 checks in favor of Macasieb, which were eventually dishonored by the
bank due to insufficiency of funds. The trial court convicted her. CA affirmed the trial court ruling. Danao assails the decision of the
lower courts hence the case was elevated to the SC. Issue: Whether or not the prosecution failed to prove knowledge of
insufficiency of funds as an element of the offense. The SC acquitted Danao because the prosecution failed to prove beyond
reasonable doubt all the elements of the offense. 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.' Aside from this, the prosecution also failed
to prove that notice of non-payment was given to the accused. 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

BP 22

or prima facie evidence as provided in Section 2 of B.P. Blg. 22 cannot arise, since there would simply be no way of reckoning the
crucial 5-day period wherein the accused can make arrangements for payment in full.


[G.R. No. 122353. June 6, 2001]
SANDOVAL-GUTIERREZ, J.

I. FACTS

Evangeline Danao was charged for violation of BP22 before the RTC Makati.
The 2 Informations essentially say the same things:
o "That on or about the 23rd day of December 1991, in the Municipality of Makati, Metro Manila, xxx the above-
named accused did xxx draw and issue to Luviminda Macasieb xxx the checks described below:
Crim case 1: Drawee PCI Bank; P14,500.00; Payable to cash; Dated January 23, 1992
Crim case 2: Drawee PCI Bank; P15,000.00; Payable to cash; Dated January 24, 1992

o xxx accused 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 its presentment, xxx when presented for payment within ninety (90) days from the
date thereof, was subsequently dishonored by the drawee bank for the reason 'ACCOUNT CLOSED' and, despite
receipt of notice of such dishonor, the said accused failed to pay said payee xxx within five (5) banking days after
receiving notice.
Evangeline pleaded not guilty
Summary of the version of prosecution and defense reiterated by the CA:
o Macasieb is in the business of rediscounting checks. Estrada (the branch manager of the Monte de Piedad bank)
was one of her agents, authorized to transact rediscounting business with any person for and in behalf of
Macasieb.
o Danao (appellant) went to see Estrada at his office to seek an additional loan, being a depositor and borrower of
the bank. Estrada had to refuse appellant's request, considering that her existing loan had not yet been fully
liquidated.
o Appellant then asked Estrada if he knew a private lender. Estrada informed appellant that he knew one who lends
money with postdated checks as security. Estrada phoned Macasieb and told her of appellant's desire to get a loan
with postdated checks as security. Macasieb talked with appellant over the phone and explained that the checks
would be subject to a 10% interest every month.
o Macasieb instructed Estrada to release the amount of P29,750.00. After appellant received the said amount from
Estrada, she issued two postdated checks in the total amount of P29,750.00.
o "On the maturity dates of the two checks, Macasieb deposited the same at the PCIB Branch at Heroes Hill, Quezon
City. However, the checks were dishonored for the reason that the account of appellant had already been closed.
Trial court: convicted Danao.
CA: affirmed in toto the trial court's Decision.

Issue
Assignment of error # 5: Whether or not the prosecution failed to prove knowledge of insufficiency of funds as an element of the
offense

Held:
Danao is acquitted from the charges

Ratio:
We find that the totality of the evidence presented does not support petitioner's conviction for violation of B.P. Blg. 22,
since the prosecution failed to prove beyond reasonable doubt all the elements of the offense.
Petitioner was specifically charged with violation of the first paragraph of Section 1 of BP Blg. 22, which provides:
o "SECTION 1. Checks without sufficient funds. - Any person who makes or draws and issues any check to apply on

BP 22

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." (Underscoring supplied)
The elements[6] of the offense under the abovequoted provision are:
o The accused makes, draws or issues any check to apply to account or for value;
o The accused knows at the time of the issuance that he or she does not have sufficient funds in, or credit with, the
drawee bank for the payment of the check in full upon its presentment; and
o The check is 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.
In King vs. People: "To hold a person liable under B.P. Blg. 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:
o '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.'
Indeed, the prima facie presumption in Section 2 of B.P. Blg. 22 "gives the accused an opportunity to satisfy the amount
indicated in the check and thus avert prosecution.
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 or prima facie evidence as
provided in Section 2 of B.P. Blg. 22 cannot arise, since there would simply be no way of reckoning the crucial 5-day
period.
In the present case, no proof of receipt by petitioner of any notice of non-payment of the checks was ever presented
during the trial. As found by the trial court itself, "(t)he evidence however is not clear when Macasieb (private
complainant) made the demands. There is no proof of the date when DANAO received the demand letter (Exh. F)."[11]
Obviously, in the instant case, there is no way of determining when the 5-day period prescribed in Section 2 of B.P. Blg. 22
would start and end. Thus, the presumption or prima facie evidence of knowledge by the petitioner of the insufficiency of
funds or credit at the times she issued the checks did not arise.
It is clear that the essential element of knowledge of insufficiency of funds or credit on the part of petitioner is absent in
the case at bar, not having been proved by the prosecution. On this ground alone, petitioner should be acquitted.
In the same vein, we clarified in Lao vs. Court of Appeals[13] that "(a)lthough the offense charged is a malum prohibitum,
the prosecution is not thereby excused from its responsibility of proving beyond reasonable doubt all the elements of the
offense, one of which is knowledge of the insufficiency of funds."

11. DOMAGSANG V. CA - JOBEN DEL ROSARIO

Domagsang vs CA (Del Rosario)

EMERGENCY RECIT:
Domagsang obtained loan from METROBANK specifically from Garcia for P573,800. Domagsang issued 18 postdated
checks for the repayment of the loan. They were dishonored by drawee bank for the reason: Account closed. The
complainant demanded payment allegedly by calling up petitioner at her office. Failing to receive any payment for the
value of the dishonored checks, the complainant referred the matter to his lawyer who supposedly wrote petitioner a

BP 22

letter of demand but that the latter ignored the demand (NOT INCLUDED BECAUSE NOT PRESENTED BY PROSECUTION).
Criminal Case. Whether or not an alleged verbal demand to pay sufficient to convict herein petitioner for the crime of
violation of B.P. Blg. 22. NOT SUFFICIENT. 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.

FACTS:
Petitioner Domagsang was convicted by the RTC Makati for having violated B.P. Blg. 22 (Anti-Bouncing Check Law), on
eighteen (18) counts, and sentenced to "suffer the penalty of One (1) Year imprisonment for each." Petitioner was
likewise ordered to pay the complainant the amount of P573,800.00.

Domagsang approached complainant Ignacio Garcia, an Assistant Vice President of METROBANK, to ask for financial
assistance. Garcia accommodated Domagsang and gave the latter a loan in the sum of P573,800.00.

In exchange, Domagsang issued and delivered to the complainant 18 postdated checks for the repayment of the loan.
When the checks were, in time, deposited, the instruments were all dishonored by the drawee bank for this reason:
Account closed.

The complainant demanded payment allegedly by calling up petitioner at her office. Failing to receive any payment for
the value of the dishonored checks, the complainant referred the matter to his lawyer who supposedly wrote petitioner
a letter of demand but that the latter ignored the demand.

Criminal case lodged against petitioner before the RTC Makati. Petitioner, through counsel, waived her right to present
evidence in her defense. Relying solely then on the evidence submitted by the prosecution, the lower court rendered
judgment convicting petitioner. The decision was affirmed by the Court of Appeals

ISSUE:
1. Whether or not an alleged verbal demand to pay sufficient to convict herein petitioner for the crime of violation of
B.P. Blg. 22. NOT SUFFICIENT

2. Whether or not the Honorable Court of Appeals committed reversible error when it affirmed the judgment of
conviction rendered by the trial court, on the ground that a written notice of dishonor is not necessary in a prosecution
for violation of B.P. Blg. 22, contrary to the pronouncement of the Supreme Court in the case of Lao vs. Court of
Appeals. CA ERRED

3. Whether or not the Honorable Court of Appeals erred in considering the alleged written demand letter, despite
failure of the prosecution to formally offer the same. CA ERRED

RATIO:
There is deemed to be a prima facie evidence of knowledge on the part of the maker, drawer or issuer of insufficiency of
funds in or credit with the drawee bank of the check issued if the dishonored check is presented within 90 days from the
date of the check and the maker or drawer fails to pay thereon or to make arrangement with the drawee bank for that
purpose. The presumption does not hold, however, when the maker, drawer or issuer of the check pays the holder

BP 22

thereof the amount due thereon or makes arrangement for payment in full by the drawee bank of such check within
5 banking days after receiving notice that such check has not been paid by the drawee bank.

In Lao vs. Court of Appeals, this Court explained:
Section 2 of B.P. 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.

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. 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 B.P. Blg. 22.

In the assailed decision, the Court of Appeals predicated the conviction of petitioner on the supposed fact that
petitioner was informed of the dishonor of the checks through verbal notice when the complainant had called her up by
telephone informing her of the dishonor of the checks and demanding payment therefor.

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.

(3RD ISSUE) Evidently, the appellate court did not give weight and credence to the assertion that a demand letter was
sent by a counsel of the complainant because of the failure of the prosecution to formally offer it in evidence. Courts
are bound to consider as part of the evidence only those which are formally offered for judges must base their findings
strictly on the evidence submitted by the parties at the trial. Without the written notice of dishonor, there can be no
basis, considering what has heretofore been said, for establishing the presence of "actual knowledge of insufficiency of
funds."

The prosecution may have failed to sufficiently establish a case to warrant conviction, however, it has clearly proved
petitioner's failure to pay a just debt owing to the private complainant.

WHEREFORE, the decision of the Court of Appeals is MODIFIED. Petitioner Josephine Domagsang is acquitted of the
crime charged on reasonable doubt. She is ordered, however, to pay to the offended party the face value of the
checks in the total amount of P563,800.00 with 12% legal interest, per annum, from the filing of the informations
until the finality of this decision, the sum of which, inclusive of the interest, shall be subject thereafter to 12%, per
annum, interest until the due amount is paid. Costs against petitioner.


12. RICO V. PEOPLE - JED VELASQUEZ

BP 22

13. YU OH V. CA - JECH
14. TADEO V. PEOPLE MAITI LAGOS
NARCISO A. TADEO, petitioner, vs. PEOPLE OF THE PHILIPPINES, respondent.

ER:
Complainant Luz leased out apartments in QC
Tadeo's wife rented 1 of the apartments for 5 years and subsequently rented the adjacent apartment after 2 years.
Tadeo's wife then incurred rental arrears amounting to 113,300
To settle, Tadeo issued 8 checks to cover the arrears
All the checks bounced. Luz filed for BP 22
During trial, prosecution presented Luz as the sole witness
Tadeo motioned to dismiss through a demurrer to evidence, TC denied
Appealed to CA by certiorari. Denied. Improper remedy.
WON certiorari was the proper remedy?
No. certiorari does not lie to review a trial courts interlocutory order denying a motion to dismiss (or to acquit), which
is equivalent to a demurrer to evidence, filed after the prosecution had presented its evidence and rested its case.
An order denying a demurrer to evidence is interlocutory. It is not appealable. Neither can it be the subject of a
petition for certiorari.
From such denial, appeal in due time is the proper remedy, not certiorari, in the absence of grave abuse of discretion
or excess of jurisdiction, or an oppressive exercise of judicial authority.
WON prosecution can present Luz as sole witness?
Yes. Complainants sole testimony suffices to identify the dishonored checks with the drawee banks notation stamped
or written on the dorsal side drawn against insufficient funds or in a notice attached thereto and such notice of
dishonor given to the drawer.
Unless rebutted, the prosecution may rely on such presumption to establish that element of the offense charged. It is
for petitioner, as accused, to rebut the presumption, disputable as it is. Otherwise, the presumption would be
sufficient basis to convict.

FACTS:
Appeal via certiorari by Tadeo from denying his demurrer to evidence in 8 BP 22 cases
Complainant, Ms. Luz M. Sison was the owner of commercial apartments at 731 Edsa corner Ermin Garcia, Cubao, Quezon
City.
Tadeo's wife leased 1 of the apartment units at 7,000 a month for 5 years.
After 2 years, she also leased the adjacent apartment at an additional 4,000 a month.
Thereafter, she incurred rental arrears amounting to 113,300.
to settle the account, Tadeo issued 8 postdated checks covering the rental arrears.
All the checks bounced with the notation DAIF (drawn against insufficient funds)
Counsel of Ms. Luz wrote a demand letter to Tadeo that the checks should be redeemed within 3 days from receipt of the
letter
Tadeo replied that he was willing to talk about this with Ms. Luz but he never redeemed the checks nor mention any
intention of paying Ms. Luz or to make arrangements for payment.
Asst. Prosecutor Bigornia filed with RTC QC 8 infos for BP 22 which were consolidated
Tadeo moved to quash, on the ground of lack of jurisdiction by the court.
Trial court denied motion
During trial, prosecution presented the testimony of Luz Sison to prove the charges against Tadeo. Cross-examination. Then
prosecution rested and formally offered the documentary exhibits marked at the pre-trial
Tadeo, without prior leave of court, filed a demurrer to evidence on the ground that the prosecution failed to present
sufficient evidence proving all the elements of the offense charged.
Trial court declared that there exists a prima facie case after the prosecution has presented its evidence and rested its
case and accordingly denied the demurrer to evidence for lack of merit.
Tadeo then filed with CA a special civil action for certiorari seeking to annul the lower court's orders denying his demurrer
to evidence.
CA dismissed. Certiorari does not lie to challenge trial court interlocutory order denying motion to dismiss. Appeal in due
time is the proper remedy in order to have the findings of facts of the respondent judge reviewed by a superior court.

ISSUE:
WON CA erred in denying Tadeo's special civil action for certiorari seeking to annul the denial of his demurrer to evidence?
Nope.

BP 22

WON prosecution can present the complainant as the sole witness to prove elements of the offense? Yup.

HELD:
CA affirmed. Remand to lower court for further proceedings consistent with this opinion, which shall be limited to the
lower courts imposition of the proper sentence on petitioner and its promulgation with notice to the parties.

RATIO:

Remedy of Certiorari not applicable
certiorari does not lie to review a trial courts interlocutory order denying a motion to dismiss (or to acquit), which is
equivalent to a demurrer to evidence, filed after the prosecution had presented its evidence and rested its case.
An order denying a demurrer to evidence is interlocutory.
It is not appealable. Neither can it be the subject of a petition for certiorari.
From such denial, appeal in due time is the proper remedy, not certiorari, in the absence of grave abuse of discretion
or excess of jurisdiction, or an oppressive exercise of judicial authority.

Tadeo insists that prosecution should have presented a witness from the drawee bank to testify the dishonor of the checks

SC: Prosecution may only present the complainant as sole witness to prove all elements of BP22
It is not required, much less indispensable, for the prosecution to present the drawee banks representative as a witness to
testify on the dishonor of the checks because of insufficiency of funds. The prosecution may present, as it did in this case,
only complainant as a witness to prove all the elements of the offense charged.
She is a competent and qualified witness to testify that she deposited the checks to her account in a bank;
that she subsequently received from the bank the checks returned unpaid with a notation drawn against insufficient
funds stamped or written on the dorsal side of the checks themselves, or in a notice attached to the dishonored
checks duly given to complainant, and that petitioner failed to pay complainant the value of the checks or make
arrangements for their payment in full within five (5) banking days after receiving notice that such checks had not
been paid by the drawee bank.

Complainants sole testimony suffices to identify the dishonored checks with the drawee banks notation stamped or
written on the dorsal side drawn against insufficient funds or in a notice attached thereto and such notice of dishonor
given to the drawer.

A legal presumption arises that petitioner had knowledge of the making of the checks, the due presentment to the drawee
bank for payment, the dishonor and the reason therefor written, stamped or notice of dishonor attached by the drawee
bank to the returned checks. Such prima facie presumption proves that petitioner has knowledge of the insufficiency of
funds.

Unless rebutted, the prosecution may rely on such presumption to establish that element of the offense charged. It is for
petitioner, as accused, to rebut the presumption, disputable as it is. Otherwise, the presumption would be sufficient basis
to convict.

In this case, the prosecution has proved all the essential elements of the offense charged with the sole testimony of
complainant Luz Sison.

We note that petitioner did not ask the trial court for leave to file a demurrer to evidence. In such case, he loses the right
to adduce evidence in his defense.
15. LLAMADO V. CA - DONDON LUCENARIO

Llamado v. CA and People of the Philippines

Emergency Recitation:

Llamado (Treasurer) and Pascual (President) of Pan Asia Pacific Corp. issued a check to Gaw in the amount of
Php186,500 as payment for a Php180,000 loan.
Gaw deposited the check in his account in Equitable Bank but it was dishonoured.
He approached Llamado who then offered him in writing to pay 10% of the loan, with the balance to be rolled over for a
period of 90 days. Gaw accepted but Llamado then still failed to pay. Hence, compliant for BP22.
ISSUE: Is Llamado guilty of BP22? YES he is

BP 22


Llamado alleges for his defense (but all were debunked by SC):
1) The check was only a contingent payment for investment. He claims that the check was only intended for
investment which they agreed would only be repaid with interest if the project was successful
- The check was issued for a valuable consideration of Php180,000. If this were true, the check need not have
been issued because a receipt and their written agreement would have sufficed
- Assuming that the checks are issued for different purposes (i.e. for guarantee of payment, evidence of
indebtedness, mode of payment), to require that we determine the reason for which each check is issued to
know the terms, conditions, and rules to apply would greatly erode the faith the public reposes in the
stability and commercial value of checks as currency substitutes, and bring about havoc in trade and in
banking communities
- So, what the law punishes is the issuance of a bouncing check and not the purpose for which it was issued
nor the terms and conditions relating to its issuance. The mere act of issuing a worthless check is malum
prohibitum
2) He merely signed the check in question without being actually involved in the transaction for which the check
was issued. He did not know that there were no funds
- Knowledge of state of mind is hard to prove so the law creates a prima facie presumption that the drawer
has knowledge of the insufficiency of funds
- Llamado failed to rebut the presumption by paying the amount of the check within five (5) banking days
from notice of the dishonour
3) The check was a check of the Pan Asia Finance Corporation and he signed the same only in his capacity as
Treasurer of the corporation
o Sec. 1 BP22 clearly states: 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.

TORRES, JR., J.:

FACTS:
Overview: Accused are Ricardo Llamado (Treasurer) and Jacinto Pascual (President) of Pan Asia Finance Corporation.
They are charged with violation of BP22 and pleaded not guilty. Pascual remains at large, so trial on merits was
conducted against Llamado only.

Private complainant, Leon Gaw, delivered to accused the amount of P180,000.00, with the assurance of Aida
Tan, the secretary in the corporation, that it will be repaid on 4 November 1983, plus interests thereon at 12%
plus a share in the profits of the corporation, if any
Upon delivery of the money, accused Ricardo Llamado took it and placed it inside a deposit box.
Pascual and Llamado then signed Philippine Trust Company Check No. 047809, postdated 4 November 1983, in
the amount of P186,500.00 in the presence of Gaw as payment of principal plus interests thereon

November 4, 1983 Gaw deposited the check in his current account with the Equitable Banking Corporation
However, Equitable later informed Gaw that
o Said check was dishonored by the drawee bank because payment was stopped, and that the check was
drawn against insufficient funds.
o Also, that his current account was debited for the amount of P186,500.00 because of the dishonor of
the said check
Gaw returned to Aida Tan to inform her of the dishonor of the check.
Aida Tan received the check from private complainant with the assurance that she will have said check changed
with cash. However, upon his return to Aida Tan, he was still not paid

November 11, 1983 Gaw went to Llamado to inform him of the dishonor of the check.
Llamado offered in writing to pay Gaw a portion of the amount equivalent to 10% thereof on 14 or 15
November 1983, and the balance to be rolled over for a period of ninety (90) days.
This offer was accepted by Gaw.

BP 22

Llamado, however, failed to remit to private complainant the aforesaid 10% on or before 15 November 1983
and to roll over the balance of the money.
Gaw then demanded from Llamado the payment of P186,500.00
o But Llamado failed to pay and instead, he offered to return to Gaw only 30% of his money, which was
refused by the latter.
Thus, the filing of the complaint for violation of Batas Pambansa No. 22 against Llamado

Llamados alleges:
It was the practice in the corporation for petitioner to sign blank checks and leave them with Pascual so that
Pascual could make disbursements and enter into transactions even in the absence of petitioner

RTC decision which was appealed by CA:
Llamado guilty of BP22 - suffer imprisonment for a period of one (1) year of prision correccional and to pay a
fine of P200,000.00, with subsidiary imprisonment in case of insolvency
Reimburse Leon Gaw the aforesaid amount of P186,500.00 plus the costs of suit

Llamado alleges for his defense:
1) The check was only a contingent payment for investment which had not been proven to be successful, thus
the check was not issued to apply on account or for value within the contemplation of BP22
2) He merely signed the check in question without being actually involved in the transaction for which the
check was issued
3) Novation theory that even before the BP22 case was filed, Gaw entered into a new agreement
supplanting the check in question
4) The check was a check of the Pan Asia Finance Corporation and he signed the same only in his capacity as
Treasurer of the corporation

ISSUES: W/N Llamado is guilty of BP 22 Yes he is!

HELD: IN VIEW WHEREOF, the petition is hereby DENIED and the decision of respondent court AFFIRMED in
toto.
RATIO:
Llamado CANNOT claim that he had no knowledge that he issued the check without sufficient funds
o Knowledge of state of mind is hard to prove so the law creates a prima facie presumption that the
drawer has knowledge of the insufficiency of funds
o Llamado failed to rebut the presumption by paying the amount of the check within five (5)
banking days from notice of the dishonour
o Llamado must prove his defences which h did not do
o As Treasurer of the corporation who signed the check in his capacity as an officer of the corporation,
lack of involvement in the negotiation for the transaction is not a defense
The check was not only a contingent payment for investment. Llamado wrongly claims that the check was only
intended for investment which they agreed would only be repaid with interest if the project was successful
o The check was issued for a valuable consideration of Php180,000
o If this were true, the check need not have been issued because a receipt and their written agreement
would have sufficed
Although checks are issued for different purposes (i.e. for guarantee of payment, evidence of indebtedness,
mode of payment), to require that we determine the reason for which each check is issued to know the terms,
conditions, and rules to apply would greatly erode the faith the public reposes in the stability and commercial
value of checks as currency substitutes, and bring about havoc in trade and in banking communities
o So, what the law punishes is the issuance of a bouncing check and not the purpose for which it was
issued nor the terms and conditions relating to its issuance. The mere act of issuing a worthless check
is malum prohibitum
Llamado also cannot claim that he merely signed as treasurer and therefore should not be liable because third
paragraph of Section 1 of BP Blg. 22 states:

BP 22

o

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.

.

16. VACA V. CAGEORGE
17. LIM V. PEOPLE - ANGEL BASCARA
18. TAN V. MENDEZ - GASTON PEREZ DE TAGLE
STEVE TAN and MARCIANO TAN, petitioners, vs. FABIAN MENDEZ, JR., respondent.
PEREZ DE TAGLE

Emergency Recit
TAN (owner of bus company) and MENDEZ (owner of gas stations) entered into an arrangement wherein TAN would purchase its
fuel and lubricant requirements from MENDEZ via checks drawn against a credit line. TAN also designated MENDEZ as its booking
and ticketing agent in Iriga City. TAN issued bum checks to pay for the fuel; did not rectify the issue when such was demanded by
MENDEZ. Charged for violation of BP22 in the RTC. TAN argues that their obligation was extinguished due to compensation. RTC is
not impressed and convicts TAN. CA affirms.
SC holds that there is a violation of BP22 given that the elements are present. SC notes that given that the offense contemplated in
BP22 is malum prohibitum, one can be convicted of issuing a bum check regardless of whether or not the debt was paid or
compensated. SC talks about some pogi points in the ratio.

I.
FACTS

PARTIES
Steve Tan and Marciano Tan (TAN) are the owners of Master Tours and Travel Corporation and operators of Philippine
Lawin Bus Co., Inc.,
Fabian Mendez, Jr. (MENDEZ) is the owner of 3 gasoline stations in Albay and Camarines Sur.

RELATIONSHIP BETWEEN TAN AND MENDEZ
TAN opened a credit line for their buses lubricants and fuel consumption with MENDEZ.
At the same time, the MENDEZ was also designated by TAN as the booking and ticketing agent of Philippine Lawin Bus Co.
in Iriga City
Under such arrangement, TANS drivers purchased on credit fuel and various oil products for its buses through withdrawal
slips issued by TAN, with periodic payments to MENDEZ through the issuance of checks.
On the other hand, MENDEZ remitted the proceeds of ticket sales to TAN also through the issuance of checks.
Sent together with MENDEZ remittance are the remittances of the ticket sales in the Baao Booking office, which is
managed separately and independently by another agent, Elias Bacsain.

CONTROVERSY
Accordingly, TAN issued several checks to MENDEZ as payment for oil and fuel products.
o One of these is FEBTC check no. 704227 dated June 4, 1991 in the amount of P58,237.75, as payment for gasoline
and oil products procured during the period May 2 to 15, 1991.
o Said check was dishonored by the bank upon presentment for payment for being drawn against insufficient funds.
MENDEZ sent a demand letter dated June 21, 1991 to TAN demanding that they make good the check or pay the amount
thereof, to no avail.

LEGAL ACTION (RTC, CA)
Hence, an information for violation of B.P. 22 was filed against TAN, upon the complaint of MENDEZ, before the RTC of
Iriga City.
In his testimony, TAN averred that he cannot be held liable for violation of B.P. 22 because the amount subject of the check
had already been extinguished by offset or compensation against the collection from ticket sales from the booking offices.
o TAN presented a MEMORANDUM showing the return to MENDEZ of various unencashed checks in the total
amount of P66,839.25 representing remittance of ticket sales in the Iriga and Baao offices that were earlier sent
by respondent.
o After the alleged offset, there remains a balance of P226,785.83
On cross-examination, TAN admitted to have drawn the subject check to pay MENDEZ gasoline station and that it was not
covered by sufficient funds at the time of its issuance due to uncollected receivables.
Upon query by the court, TAN claimed that he did not talk to MENDEZ and could not tell if the latter agreed to offset the
checks with the remittances.
MENDEZ disputed TANS claim of payment through offset or compensation.

BP 22

The trial court convicted TAN for violation of B.P. 22

o Sentences both accused to suffer the penalty of imprisonment of Six (6) Months, to indemnify the MENDEZ jointly
and severally, the sum of P58,237.75
CA affirmed the conviction.

ISSUES
Whether or not petitioners can be held liable for violation of B.P. 22 or the Bouncing Checks Law (YES)
Whether or not payment through compensation or offset can preclude prosecution for violation of B.P. 22. (YES)

II.

III.

IV.

HELD
Petition is DENIED and the Decision of Court of Appeals is AFFIRMED with MODIFICATION.
TAN are ordered to indemnify MENDEZ in the amount of P58,237.75 with legal interest from date of judicial demand.
The sentence of imprisonment of six months is SET ASIDE and in lieu thereof, a FINE in the amount of P116,475.50[34] is
imposed upon petitioners, with subsidiary imprisonment not to exceed six months in case of insolvency or non-payment.
RATIO

ISSUE 1 RESOLVED
The law enumerates the elements of B.P. Blg. 22 to be:
o The making, drawing, and issuance of any check to apply for account or for value;
o 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
o 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.
We find all the foregoing elements present in this case.
o TAN admitted that he drew the subject check as payment for the fuel and oil products of respondents.
o TAN knew at that time that there were no sufficient funds to cover the check because he had uncollected
receivables.
o The check was thus dishonored upon presentment to the bank for payment.

ISSUE 2 RESOLVED
The law has made the mere act of issuing a bum check a malum prohibitum, an act proscribed by legislature for being
deemed pernicious and inimical to public welfare.
o The gravamen of the offense under this law is the act of issuing a worthless check or a check that is dishonored
upon its presentment for payment.
Thus, even if there had been payment, through compensation or some other means, there could still be
prosecution for violation of B.P. 22.

POGI/GANDA POINTS
Essentially, TAN argue that they could not be held liable for violation of B.P. 22 because the amount covered by the subject
check had already been paid by compensation or offset through other checks issued by respondent as remittances of ticket
sales for petitioners bus company.
o The trial court noted that the total amount of the two checks issued by TAN is P293,625.08 while the total amount
of the returned checks amounted to only P66,939.75.
o No application of payment was made as to which check was to be paid.
o We also note that no compensation can take place between TAN and MENDEZ as MENDEZ is not a debtor of TAN
insofar as the two checks representing collections from the Baao ticket sales are concerned.
Article 1278 of the Civil Code requires, as a prerequisite for compensation, that the parties be mutually
and principally bound as creditors and debtors.If they were not mutually creditors and debtors of each
other, the law on compensation would not apply.
MENDEZ only acted as an intermediary in remitting the Baao ticket sales and, thus, is not a debtor of
TAN.

While we recognize the noble objective of B.P.22, we deem it proper to apply the philosophy underlying the Indeterminate
Sentence Law in imposing penalties for its violation. The gist of Administrative Circular No. 12-2000 is to consider the
underlying circumstances of the case such that if the situation calls for the imposition of the alternative penalty of fine
rather than imprisonment, the courts should not hesitate to do so.
o In this case, we note that TAN had exerted efforts to settle their obligations.
o The fact of returning the unencashed checks to MENDEZ indicates good faith on the part of petitioners.

BP 22

o Absent any showing that TAN acted in bad faith, the deletion of the penalty of imprisonment in this case is proper.

19. SVENDESEN V. PEOPLE - - NORBY GERALDEZ

James Svendsen vs. People of the Philippines (geraldez)

Emergency Recit:
Svendsen loaned from Reyes 200,000 (with 10% interest a month).
Svendsen paid a part, couldnt pay others, and this amount ballooned to 380k.
Reyes files collection suit for 360k.
Settles by making 200k cash payment, 160k check payment.
Check dishonored for DAIF. Reyes gives demand letter (no proof of receipt). No avail. Reyes files BP 22.
MeTC, RTC, CA, convict Sven. SC acquits him.
Section 2 of BP 22 allows drawer to make payment within 5 days from dishonor. Without a notice, theres no way to
reckon this five-day period. Sven was not given this notice, or if he was, theres no proof. Notice of dishonor must be
written and there must be a proof of receipt.
v Civil liability exists. But the P160k for which the check was issued stands for interest. 10% per month is unconscionable.
SC reduces to 12% per annum and figure comes out to be P16k.
v
v
v
v
v
v
v

Facts:
1. In October 1997, Cristina Reyes (Cristina) extended a loan to Svendsen in the amount of P200,000, to bear interest at 10%
a month.
a. Svendsen had partially paid his obligation,
b. He failed to settle the balance thereof which had reached P380,000 inclusive of interest.
2. Cristina thus filed a collection suit against Svendsen,
a. eventually settled by:
i. Svendsen paid her P200,000
ii. Plus issued in her favor an International Exchange Bank check postdated February 2, 1999 (the check)
in the amount of P160,000 representing interest.
iii. The check was co-signed by one Wilhelm Bolton.
3. When the check was presented for payment on February 9, 1999, it was dishonored for having been Drawn Against
Insufficient Funds (DAIF).
4. Cristina, through counsel, thus sent a letter to Svendsen by registered mail informing him that the check was dishonored
by the drawee bank, and demanding that he make it good within five (5) days from receipt thereof.
5. No settlement having been made by Svendsen, Cristina filed a complaint dated March 1, 1999 against him and his co-
signatory to the check, Bolton, for violation of B.P. Blg. 22.
a. Information omitted.
b. Bolton having remained at large, the trial court never acquired jurisdiction over his person.
6. MeTC: Svendsen guilty. Fine of P160,000, plus civil indemnity of P160,000 (also).
a. Warrant for Bolton. Sent to archives.
7. RTC affirmed. CA denied appeal. Hence, the present petition for review.
8. Svendsen argues:
a. Error in finding that the first element of violation of B.P. Blg. 22 the making, drawing, and issuance of any check
"to apply on account or for value" was present, as the obligation to pay interest is void, the same not being in
writing and the 10% monthly interest is unconscionable.
b. Violating his right to due process when it convicted him, notwithstanding the absence of proof of receipt by him
of a written notice of dishonor.
Issues:
W/N Sven should be convicted? No. Acquitted. But pay civil liability. But interest too much, reduced to P16k.
Ratio:

BP 22

The petition is impressed with merit.
Pertinent Part

For Svendsen to be validly convicted of the crime under B.P. Blg. 22, the following requisites must thus concur:
o (1) the making, drawing and issuance of any check to apply for account or for value;
o (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
o (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.
Svendsen admits having issued the postdated check to Cristina. The check, however, was dishonored when deposited for
payment in Banco de Oro due to DAIF. Hence, the first and the third elements obtain in the case.

As for the second element, Section 2 of B.P. Blg. 22 provides that

[t]he 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 Rico v. People of the Philippines,12 this Court held:
If 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.
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 vs. Court of Appeals, 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 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. This is consistent with the rule that penal statues must be construed strictly against the state
and liberally in favor of the accused.
The evidence for the prosecution failed to prove the second element. While the registry receipt, which is said to cover the
letter-notice of dishonor and of demand sent to Svendsen, was presented, there is no proof that he or a duly authorized
agent received the same. 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.
For failure then to prove all the elements of violation of B.P. Blg. 22, Svendsens acquittal is in order. But he is civilly liable.
About Interest
The decision of the MeTC, ordering P160,000 representing his civil obligation covered by subject check, deserves circumspect
examination. 10% per annuem is unconscionable.
The P160,000 check Svendsen issued to Cristina admittedly represented unpaid interest. By Cristinas information, the
interest was computed at a fixed rate of 10% per month.

BP 22

Mentions Usury. Stipulations authorizing such interest are contra bonos mores, if not against the law. They are, under Article
1409 of the New Civil Code, inexistent and void from the beginning.
The interest rate of 10% per month agreed upon by the parties in this case being clearly excessive, iniquitous and
unconscionable cannot thus be sustained. In a similar case, 10% a month was reduced to 12% per year.
This Court deems it fair and reasonable then, consistent with existing jurisprudence, to adjust the civil indemnity to P16,000,
the equivalent of Svendsens unpaid interest on the P200,000 loan at 12% percent per annum as of February 2, 1999, the date
of the check.

20. WALTER V. LIMOSCEEJ NARVASA
Wilkie vs. Atty. Limos NARVASA
Emergency Recit:
Atty. Limos borrowed money from Wilkie in the amount of 250k at 24% per annum interest. Atty. Limos issued 2 post dated checks
representing principal (250k) and interest (60k). When checks were due, Wilkie deposited them at Equitable PCI Bank, but were
returned due to insufficient funds. Despite demands, Limos failed to pay. Criminal case filed. This is the administrative case. IBPs
Commission on Bar Discipline (CBD) ruled that Limos should be suspended for 2 years. Board of Governors ruled that she will be
given a stern warning. Both sent records to SC. Issue: W/N Limos should be administratively punished as a lawyer? Held: Yes. For 3
months. It shows a lack of personal honesty and good moral character as to render her unworthy of public confidence. The issuance
of a series of worthless checks also shows the remorseless attitude of respondent, unmindful to the deleterious effects of such act
to the public interest and public order. It also manifests a lawyers low regard to her commitment to the oath she has taken when
she joined her peers, seriously and irreparably tarnishing the image of the profession she should hold in high esteem.
DOCTRINE: membership in the legal profession is a privilege demanding a high degree of good moral character, not only as a
condition precedent to admission, but also as a continuing requirement for the practice of law. Sadly, herein respondent fell short of
the exacting standards expected of her as a vanguard of the legal profession.

I. FACTS

Wilkie engaged the services of Atty. Limos regarding his intention of adopting his wifes nephew, Reynal Alsaen Taltalen.
Wilkie has given his full trust and confidence on Atty. Limos.

Notwithstanding their lawyer and client relationship, Atty. Limos borrowed money from Wilkie in the amount of
P250,000.00.
o

The loan agreement was evidenced by a Contract of Loan with a stipulation of interest in the amount of 24% per
annum and

Atty. Limos will issue two (2) post dated checks representing the principal amount of P250,000.00 and the interest
in the amount of P60,000.00.

When the checks became due, Wilkie deposited the same to his account at Equitable PCI Bank but the checks were
returned as they were drawn against insufficient funds.

Despite demands made, Atty. Limos failed to pay her obligation.

Wilkie decided to engage the services of a counsel who also made a formal demand to Atty. Limos but to no avail.

Criminal complaints were filed against Atty. Limos.

Wilkie has also withdrawn the adoption case from Atty. Limos who did not do anything regarding the case despite the lapse
of almost a year.

The CBD gave Atty. Limos a period of fifteen (15) days to submit her Answer to the Complaint.

And also sent a Notice of Mandatory Conference/Hearing to the parties which required them to appear before the
Commission on March 29, 2006.

In response to the aforementioned Notice, a Manifestation and Motion was filed by the Atty. Limos, requesting that she be
furnished a copy of the complaint and be given a reasonable time after receipt of the complaint to submit a responsive

BP 22

pleading thereto.

Commissioner Villanueva-Maala rejected Atty. Limoss claim that she did not receive the complaint in view of the registry
return receipt attached to the records showing that a certain JE Limos received the Order
o

but Atty. Limos was given a non-extendible period of ten (10) days to file an Answer

At the scheduled mandatory conference/hearing, the Wilkie was present but the Atty. Limos failed to appear.
o

Atty. Limos failed to file an answer.

The Commissioner considered Atty. Limos in default and deemed the case submitted for report and
recommendation in her Order.

The Investigating Commissioners Report and Recommendation was submitted to the IBP Board of Governors:
o

A lawyer who issued bouncing checks violates the law and is subject to disbarment or suspension. Violation of B.P.
22 is considered a crime involving moral turpitude as this mischief creates not only a wrong to the payee or
holder, but also an injury to the public.

Although it does not relate to the exercise of the profession of a lawyer, however, it certainly relates to and affects
the good moral character of a person.

The Court has stressed that the nature of the office of an attorney at law requires that she shall be a person of
good moral character. This qualification is not only a condition precedent to the practice of law; its continued
possession is also essential for remaining in the practice of law.

LIMOS be suspended for a period of TWO (2) YEARS from practice of her profession and as a member of the Bar.

Board of Governors of the IBP adopted and approved, with modification, the above-quoted report and recommendation of
the commissioner, to wit:
o

Atty. Sinamar E. Limos is hereby REPRIMANDED with STERN WARNING that a repetition of similar conduct will be
dealt with more severely.

CBD and IBP Commission transmitted the Notice of Resolution and records of the case to SC.

Included therein is Limos letter explaining:

o

failure to attend hearing saying she was physically unfit at that time.

Her office staff whom she relied upon to receive communications for the office went on leave without her
knowledge and she was made to believe that the administrative complaint would be withdrawn in view of the
Affidavit of Desistance by Wilkie.

Atty. Limos claimed that her loan from Wilkie was actually an accommodation she extended in behalf of a client,
Hilario Inocencio.

She issued the postdated checks on the belief that Inocencio will send her the funds to cover the said
checks pursuant to their agreement.

To this day, however, Inocencio had not complied with his promise in spite of the loan having been fully
paid by Atty. Limos. Inocencios demise had left her without any recourse.

Issue: W/N Atty. Limos should be administratively punished? YES. 3 months

Held: We find the records sufficient to support the IBPs findings. We disagree, however, with the recommended sanction of
reprimand by the IBP Board of Governors for being not commensurate to the gravity of the wrong committed by respondent.

Ratio:
LAWS

Canon 1 and Rule 1.01 of which explicitly states:

CANON 1-- A lawyer shall uphold the constitution, obey the laws of the land and promote respect for law and for legal
processes.

Rule 1.01 -- A lawyer shall not engage in unlawful, dishonest, immoral or deceitful conduct.

Section 5, Rule 139-B of the Rules of Court provides in part:

Sec. 5. Service or dismissal. No investigation shall be interrupted or terminated by reason of the desistance, settlement,

BP 22

compromise, restitution, withdrawal of the charges, or failure of the complainant to prosecute the same

Under Sec. 27, Rule 138 of the Rules of Court, a member of the Bar may be disbarred or suspended from his office as
attorney by the Supreme Court for any deceit, malpractice, or other gross misconduct in such office, grossly immoral
conduct, or by reason of his conviction of a crime involving moral turpitude, or for any violation of the oath which he is
required to take before admission to practice, or for a willful disobedience of any lawful order of a superior court, or for
corruptly or willfully appearing as an attorney for a party to a case without authority to do so.

The rule is that disbarment is meted out only in clear cases of misconduct that seriously affect the standing and character
of the lawyer as an officer of the court.

While we will not hesitate to remove an erring attorney from the esteemed brotherhood of lawyers, where the evidence
calls for it, we will also not disbar him where a lesser penalty will suffice to accomplish the desired end.

APPLIED TO THIS CASE

Limos did not deny that she obtained a loan in the amount of P250,000.00 with interest from the complainant.

Limos bare claim that the loan was, in fact, only an accommodation for a former client who according to respondent had
already died cannot be given credence and, indeed, too specious to be believed.

Besides, she did not file any answer to the complaint nor even appeared personally before the CBD despite being duly
notified, to allege such claim.

At any rate, the excuses given by respondent cannot exculpate her from an administrative sanction considering her
acknowledgement that worthless checks were issued by her in payment of the loan.

We have held that the issuance of checks which were later dishonored for having been drawn against a closed account
indicates a lawyers unfitness for the trust and confidence reposed on her.
o

It shows a lack of personal honesty and good moral character as to render her unworthy of public confidence.

The issuance of a series of worthless checks also shows the remorseless attitude of respondent, unmindful to the
deleterious effects of such act to the public interest and public order.

It also manifests a lawyers low regard to her commitment to the oath she has taken when she joined her peers,
seriously and irreparably tarnishing the image of the profession she should hold in high esteem.

In this case, the Limos has fully paid her obligation to the complainant

The criminal cases filed by the complainant have been dismissed and this is the first time a complaint of such nature has
been filed against the respondent.

Under these circumstances, the Court rules and so holds that a suspension of three months from the practice of law would
be sufficient sanction on the respondent.

WHEREFORE, respondent Atty. Sinamar E. Limos is SUSPENDED FOR THREE MONTHS from the practice of law with warning
that repetition of the same or similar acts will merit a more severe penalty.

JURISPRUDENCE (POGI POINTS)

In Barrientos v. Libiran-Meteoro, we held that: [the] deliberate failure to pay just debts and the issuance of worthless
checks constitute gross misconduct, for which a lawyer may be sanctioned with suspension from the practice of law.
Lawyers are instruments for the administration of justice and vanguards of our legal system. They are expected to maintain
not only legal proficiency but also a high standard of morality, honesty, integrity and fair dealing so that the peoples faith
and confidence in the judicial system is ensured. They must at all times faithfully perform their duties to society, to the bar,
the courts and to their clients, which include prompt payment of financial obligations. They must conduct themselves in a
manner that reflect the values and norms of the legal profession as embodied in the Code of Professional Responsibility.

Bolivar v. Simbol, the Court ruled that the discipline of lawyers cannot be cut short by a compromise or withdrawal of
charges.

In Barrios v. Martinez, we disbarred the respondent who issued worthless checks for which he was convicted in the criminal
case filed against him.

In Lao v. Medel, we held that the deliberate failure to pay just debts and the issuance of worthless checks constitute gross
misconduct, for which a lawyer may be sanctioned with one-year suspension from the practice of law. The same sanction

BP 22

was imposed on the respondent-lawyer in Rangwani v. Dino having been found guilty of gross misconduct for issuing bad
checks in payment of a piece of property the title of which was only entrusted to him by the complainant.

But in Barrientos v. Libiran-Meteoro, we meted out only a six-month suspension to Atty. Elerizza Libiran-Meteoro for
having issued several checks to the complainants in payment of a pre-existing debt without sufficient funds, justifying the
imposition of a lighter penalty on the ground of the respondents payment of a portion of her debt to the complainant,
unlike in the aforementioned Lao and Rangwani cases where there was no showing of any restitution on the part of the

respondents.

21. MITRA V. PEOPLE - MARIANA LOPA
Mitra v. People LOPA

Emergency Recit:
Mitra and Cabrera were officers of Lucky Nine Credit Corporation, a corporation engaged in money lending activities. Tarcelo
invested money in LNCC and as usual, LNCC gave him 7 checks equivalent to the amounts he invested plus interest. Checks
dishonored because account closed. Filed 7 informations for violations of BP 22. Lower courts all held that they are liable to pay
P925000 as fine and imprisonment in case of insolvency, plus civil liability of same amount. Cabrera died during pendency so Mitra
is the sole appelant. Mitra claims that the company should first be held liable before him as a signatory and that no proper notice of
dishonor was given to him. SC denied both his claims. Law explicitly states that 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. W/N
notice of dishonor was duly given is a question of fact so SC just accepted the rulings of MTCC, RTC and CA. Notice of dishonor duly
served and disregarded. Mitra and Cabrera knew that there were insufficient funds.


Facts:
o Lucky Nine Credit Corporation (LNCC) corporation engaged in money lending activities
o Mitra Treasurer
o Cabrera (deceased) President
o Respondent Tarcelo invested money in LNCC.
o As usual practice, Tarcelo was issued checks equivalent to the amounts he invested plus interest. (7 checks)
o Tarcelo presented checks for payment. Dishonored because account closed.
o Tarcelo made several demands for payment to LNCC but these were in vain.
o Filed 7 informations for violation of BP 22 in the total amount of P925,000 in the MTCC in Batangas City.
o MTCC found Mitra and Cabrera guilty of violation of BP 22.
o Ordered to pay fines (P925,000 Total) for each violation and with subsidiary imprisonment in case of insolvency.
o Civilly liable and ordered to pay, in solidum, Tarcelo P925,000
o Mitra and Cabrera appealed to Batangas RTC.
o Signed 7 checks in blank with no name of payee
o No amount stated
o No date of maturity
o Did not know when and to whom checks would be issued
o Seven checks were only among the one or two booklets they were made to sign at the time
o Signed in order to avoid delay in transactions of LNCC because they did not hold office there.
o RTC affirmed MTCC decision. Denied Motion for Reconsideration.
o Cabrera died. Mitra filed petition for review in CA because there was allegedly no proper service of notice of dishonor.
o CA dismissed for lack of merit. Hence, present petition for review.

Issues:
1. W/N elements of violation of BP 22 must be proved beyond reasonable doubt against the corporation who owns the current
account given that checks were drawn before liability attached to the signatories? NO.
2. W/N there was proper service of notice of dishonor and demand to pay to Mitra and the late Cabrera? YES.


Ratio:
o Check - negotiable instrument that serves as a substitute for money and as a convenient form of payment in financial
transactions and obligations.
o Use of checks as payment allows commercial and banking transactions to proceed without the actual handling of money.
Its quick and efficient.

BP 22

o Purpose of BP 22: address problem of continued issuance and circulation of unfunded checks by irresponsible persons

1. W/N elements of violation of BP 22 must be proved beyond reasonable doubt against the corporation who owns the current
account given that checks were drawn before liability attached to the signatories? NO.

o Mere act of issuing an unfunded check as an offense against property and public order.
o Purpose of Malum Prohibitum nature of issuing an unfunded check: punish 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.
o Penalty: Imprisonment for at least 30 days, fine up to double the amount of the check or both.
o Mitra claims that the corporation should first be declared to have committed the violation before the liability attaches to
the signatory. NOT TRUE.
o Paragraph 3, Sec 1, BP 22: 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.
o Corporation acts through its officers. Person who actually signed the check is held liable for violations of BP22.
o Llamado v. CA - Accused was liable on the unfunded corporate check which he signed as treasurer of the corporation. 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.

2. W/N there was proper service of notice of dishonor and demand to pay to Mitra and the late Cabrera? YES.

o Essential Element of Violation of BP 22: drawers knowledge that he has insufficient funds or credit with the drawee bank
to cover his check.
o BP 22 creates prima facie presumption that when the check is dishonored, the drawer gains knowledge of the insufficiency
of funds UNLESS within 5 banking days, the drawer pays the holder or makes arrangements with drawee for payment
o Notice of dishonor gives drawer the opportunity to make good the check within 5 days to avert prosecution for violation of
BP22.
o Mitra alleges that there was no proper service of her notice of dishonor, therefore, one essential element is missing.
Question of Fact not proper for review.
o SC gave full credit to findings of MTCC, RTC and CA.
o 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.
o To require the prosecution to produce the signature of the accused on said demand letter would be imposing an
undue hardship on it.
o Notice of dishonor duly served and disregarded. Mitra and Cabrera knew that there were insufficient funds.
o Just for reference, the elements of a violation of BP 22:
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.


Relevant Provisions of BP 22:

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.

BP 22

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.



22. SIMON V. CHAN KEITH

Heirs of Eduardo Simon v. Chan, Feb. 23, 2011
-Keith

There is no independent civil action to recover the civil liability arising from the issuance of an unfunded check prohibited and
punished under Batas Pambansa Bilang 22 (BP 22).

Emergency Recitation:
A BP 22 case was filed against Simon.
A civil case on the grounds of fraud was instituted by Chan against Simon regarding the same check
Chan obtained a writ of attachment against Simons Nissan vehicle.
Simon: Motion to lift attachment. On the ground of Litis Pendentia. The current civil action is being litigated in the criminal
action.
Chan counters: There was an implied reservation of the civil aspect of the case, that the action was based of fraud pursuant
to Art. 33 of the Civil Code, and that the action was also based on the liabilities of a drawer.
MeTC ruled in favor of Simon. RTC affirmed. CA reversed saying that there a was separate civil action.
Issue: Whether or not there is a separate civil action? NO
HELD: The criminal action for violation of Batas Pambansa Blg. 22 shall be deemed to include the corresponding civil action.
No reservation to file such civil action separately shall be allowed. The criminal action barred the civil action (Litis
pendentia)

Facts:
On July 11, 1997, the Office of the City Prosecutor of Manila filed in the Metropolitan Trial Court of Manila (MeTC) an
information charging the late Eduardo Simon (Simon) with a violation of BP 22. Check was worth P336,000.00. Land Bank
Check.
More than three years later, or on August 3, 2000, respondent Elvin Chan commenced in the MeTC in Pasay City a civil
action for the collection of the principal amount of P336,000.00, coupled with an application for a writ of preliminary
attachment:
Chan alleges that (Simon) employing fraud, deceit, and misrepresentation encashed a check dated December 26, 1996 in
the amount of P336,000.00 to the plaintiff assuring the latter that the check is duly funded.
the MeTC in Pasay City issued a writ of preliminary attachment, which was implemented on August 17, 2000 through the
sheriff attaching a Nissan vehicle of Simon.
SIMON: Urgent Motion to dismiss with application to charge plaintiffs attachment bond for damages was filed by Simon.
(He wanted to remove the attachment on his property.)
o There was a litis pendentia
o basis of the instant civil action is the herein plaintiffs criminal complaint against defendant arising from a charge
of violation of Batas Pambansa Blg. 22
o when a criminal action is instituted, the civil action for recovery of civil liability arising from the offense charged is
impliedly instituted with the criminal action, unless unless the offended party expressly waives the civil action or
reserves his right to institute it separately
o (The current civil action is being litigated upon in the previous criminal action.)
CHAN opposed:
o it is the submission of the plaintiff that an implied reservation of the right to file a civil action has already been
made

BP 22

by the fact that the information for violation of B.P. 22 in Criminal Case No. 2753841 does not at all make
any allegation of damages suffered by the plaintiff nor is there any claim for recovery of damages;
That He Was not represented at all by a private prosecutor such that no evidence has been adduced by
the prosecution on the criminal case to prove damages;
o The case is one that falls under Art. 33 of the Civil Code of the Philippines as it is based on fraud, this action
therefore may be prosecuted independently of the criminal action;
o That nevertheless, plaintiff seeks to enforce an obligation which the defendant owes to the plaintiff by virtue of
the negotiable instruments law.
The plaintiff in this case sued the defendant to enforce his liability as drawer in favor of the plaintiff as
payee of the check
MeTC ruled in favor of Simon. Order to dissolve/lift the Writ of Attachment on Simons property.
o On the grounds of litis pendentia
o In both civil and criminal cases, the rights asserted and relief prayed for, the reliefs being founded on the same
facts, are identical.
o Plaintiff Chan did not waive or made a reservation as to his right to pursue the civil branch of the criminal case for
violation of BP Blg.
o Even assuming the correctness of the plaintiffs submission that the herein case for sum of money is one based on
fraud and hence falling under Article 33 of the Civil Code, still prior reservation is required by the Rules, to wit
In the cases provided for in Articles 31, 32, 33, 34 and 2177 of the Civil Code of the Philippines, an
independent civil action entirely separate and distinct from the criminal action, may be brought by the
injured party during the pendency of criminal case provided the right is reserved as required in the
preceding section.
MR denied. Mere repetition.
RTC affirmed.
CA reversed.
o There was a separate civil action.
o DMPI Employees Credit Association vs. Velez:
There is no more need for a reservation of the right to file the independent civil action under Articles 32,
33, 34 and 2176 of the Civil Code of the Philippines.
CA denied Simons MR.

Issue: whether or not Chans civil action to recover the amount of the unfunded check (Civil Case No. 915-00) was an independent
civil action. - No

RATIO:
there is no independent civil action to recover the value of a bouncing check issued in contravention of BP 22.

The criminal action for violation of Batas Pambansa Blg. 22 shall be deemed to include the corresponding civil action. No
reservation to file such civil action separately shall be allowed. Sec. 1b of Rule 111

The aforequoted provisions of the Rules of Court, even if not yet in effect when Chan commenced Civil Case No. 915-00 on August 3,
2000, are nonetheless applicable. It is axiomatic that the retroactive application of procedural laws does not violate any right of a
person who may feel adversely affected, nor is it constitutionally objectionable. The reason is simply that, as a general rule, no
vested right may attach to, or arise from, procedural laws.

This rule was enacted to help declog court dockets which are filled with B.P. 22 cases as creditors actually use the courts as
collectors.
Because ordinarily no filing fee is charged in criminal cases for actual damages, the payee uses the intimidating effect of a criminal
charge to collect his credit gratis and sometimes, upon being paid, the trial court is not even informed thereof. The inclusion of the
civil action in the criminal case is expected to significantly lower the number of cases filed before the courts for collection based on
dishonored checks.

BP 22

It is also expected to expedite the disposition of these cases. Instead of instituting two separate cases, one for criminal and another
for civil, only a single suit shall be filed and tried.

CAs reliance on DMPI v Velez was unwarranted.
DMPI case was about estafa and not BP 22.

Did the pendency of the civil action in the MeTC in Manila (as the civil aspect in Criminal Case No. 275381) bar the filing of Civil Case
No. 915-00 in the MeTC in Pasay City on the ground of litis pendentia? YES

For litis pendentia to be successfully invoked as a bar to an action, the concurrence of the following requisites is necessary, namely:
(a) there must be identity of parties or at least such as represent the same interest in both actions;
(b) there must be identity of rights asserted and reliefs prayed for, the reliefs being founded on the same facts; and,
(c) the identity in the two cases should be such that the judgment that may be rendered in one would, regardless of which party is
successful, amount to res judicata in respect of the other.
Absent the first two requisites, the possibility of the existence of the third becomes nil.

All the elements of litis pendentia are attendant.