Negotiable Instruments - Atty.

Ampil
AY 2017 - 2018 - Term 1
Garcia, Pernes, Tagacay, Villasanta

01 LOZANO V. MARTINEZ ● 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
FACTS: This is a consolidated case, the petition arose from cases involving sufficient funds in or credit with the drawee bank for the payment of said
prosecution of offenses under the BP 22 also known as Bouncing Check Law. The check in full upon presentment, which check is subsequently dishonored by
defendant in these cases moved seasonably to quash the information on the ground the drawee bank for insufficiency of funds or credit or would have been
that the acts charged id not constitute an offense, the statute being unconstitutional. dishonored for the same reason had not the drawer, without any valid
The motions were denied by the respondent trial court, except in one case, which is reason, ordered the bank to stop payment.
the subject of GR No. 75789, wherein the trial court declared he law unconstitutional ● An essential element of the offense is "knowledge" on the part of the maker
and dismissed the case. The parties adversely affected have come to the court for or drawer of the check of the insufficiency of his funds in or credit with the
remedy. Those who question the constitutionality of the said statute insist the bank to cover the check upon its presentment. Since this involves a state of
following grounds: mind which is difficult to establish, the statute itself creates a prima facie
presumption of such knowledge.
1. It offends the constitutional provision forbidding imprisonment for debt; ● BP 22 is aimed at putting a stop to or curbing the practice of issuing checks
2. It impairs freedom of contract; that are worthless, i.e. checks that end up being rejected or dishonored for
3. It contravenes the equal protection clause; payment. The practice, as discussed later, is proscribed by the state
4. It unduly delegates legislative and executive powers; and because of the injury it causes to the public interests.
5. Its enactment is flawed in the sense that during its passage the interim ● Checks have become widely accepted as a medium of payment in trade and
Batasan provision prohibiting to a bill on Third Reading commerce. Although not legal tender, checks have come to be perceived as
convenient substitutes for currency in commercial and financial transactions.
Among the constitutional objections raised against BP 22, the most serious is the The basis or foundation of such perception is confidence.
alleged conflict between the statute and the constitutional provision forbidding ● If such confidence shakes the usefulness of checks as currency substitutes
imprisonment for debt. It is contended that the statute runs counter to the inhibition in would be greatly diminished. Any practice therefore tending to destroy that
the Bill of Rights which states “No person shall be imprisoned for debt or confidence should be deterred for the proliferation of worthless checks can
non-payment of a poll tax”. only create havoc in trade circles and the banking community.

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 02 JOY LEE RECUERDO v. PEOPLE OF THE PHILIPPINES AND CA
statute is really a “bad debt law” rather than a “bad check law”. What it punishes is the Facts: 1. In Dec. 1993, Yolanda Floro, engaged in jewelry business, sold a 3-karat
non-payment of the check, not the act of issuing it. The statute, it is claimed is nothing loose diamond stone valued at P420,000 to Joy Lee.
more than a veiled device to coerce payment of a debt under the threat of penal ● Joy Lee gave a downpayment of P40,000.
sanction. ● In settlement of the balance, Joy Lee issued 9 postdated checks, 8 of which
for P40,000, and 1 for P20,000, all drawn against her account at the
ISSUE: WON BP 22 transgressed the constitutional inhibition against imprisonment Prudential Bank.
for debt? NO. 2. When Yolanda deposited 8 of the checks to her depository bank, Liberty Savings
and Loan Association, only 3 cleared. The other 5 were dishonored due to closure of
HELD: Joy Lee’s account.
● Yolanda went to Joy Lee’s dental clinic and advised her to change the
● BP 22 does not conflict with the constitutional inhibition against dishonored checks to cash. Joy Lee promised alright but she welshed on it.
imprisonment for debt. The gravamen of the offense punished by BP 22 is ● A demand letter was sent to Joy Lee for her to settle her obligation but she
the act of making and issuing a worthless check or a check that is failed to heed the same, hence, the filing of 5 informations against her for
dishonored upon its presentation for payment. violation of B.P. 22.
● It is not the non-payment of an obligation which the law punishes. The law is 3. Joy Lee contends:
not intended or designed to coerce a debtor to pay his debt. The thrust of the ● that the dishonored checks were not issued for deposit and encashment, nor
law is to prohibit, under the pain of penal sanctions, the making of worthless was there consideration therefor, in support of which she cites her alleged
checks and putting them in circulation. Because of its deleterious effects on agreement with Yolanda — that she could have the stone appraised to
the public interest, the practice is proscribed by the law. determine the purchase price, and since she found out that it is only worth
● The law punishes the act not as an offense against property, but an offense P160,000, there was no longer any need to fund the remaining checks which
against public order. should be returned to her.
Negotiable Instruments - Atty. Ampil
AY 2017 - 2018 - Term 1
Garcia, Pernes, Tagacay, Villasanta

● Yolanda, however, could no longer be reached. Thus, Joy Lee had already present appeal on certiorari with the SC, arguing in favor of the constitutionality of the
paid in full the purchase price of the stone, she having paid P40,000 cash statute.
plus the P120,000 proceeds of the three cleared checks. 4. The accused – appellee argued that a “memorandum check” is not a check but a
promissory note, but a memorandum of indebtedness or a “mere promise to pay”, and
Issue: Should Joy Lee be convicted of violating BP 22? - YES. such must be sued not in a criminal action, but in a civil action.

Doctrine: A check issued as an evidence of debt, though not intended for ISSUE: WON memorandum checks are covered under BP 22.
encashment, has the same effect as an ordinary check within the contemplation of BP
22. (1.) Yes, memorandum checks are covered. A memorandum check is an ordinary
check on its face, where the word memorandum or ―memo is written on its face. A
Held: Joy Lee’s conviction is in order; pay a fine equivalent to double the amount of memorandum check, upon presentment, is generally accepted by the bank.
each dishonored check subject of the five cases; pay Yolanda P200,000. Hence it does not matter whether the check issued is in the nature of a memorandum
1. In Lozano v. Martinez, “B.P. 22 is not a bill of attainder. For under B.P. 22, every as evidence of indebtedness. What the law punishes is the issuance of a bouncing
element of the crime is still to be proven before the trial court to warrant a conviction check with total disregard as to the nature or usage of such.
for violation thereof. The mere act of issuing a worthless check whether as a deposit, guarantee, or even
2. Regarding Joy Lee’s claims, they must fail. as an evidence of a pre- existing debt, is malum prohibitum.
● The terms and conditions surrounding the issuance of the checks are
irrelevant. (2.) BP 22 does not take into consideration the intention of the parties as to the
● B.P. 22, states that "any person who makes or draws and issues any check purpose, nature or usage of a check. As long as it is dishonored due to insufficient
to apply for an account or for value, knowing at the time of issue that he funds and that the drawer knew of such insufficiency during issuance will suffice for
does not have sufficient funds in or credit with the drawee bank . . . which the law to apply. It would frustrate the purpose of BP 22 in limiting the issuance of
check is subsequently dishonored . . . shall be punished by imprisonment." bum checks if the intention of the parties
● B.P. 22 does not concern itself with what might actually be envisioned by the
parties; it ensures the stability and commercial value of checks as virtual
substitutes for currency.
● It is a policy that can be easily eroded if one has yet to determine the reason 04​ ​People v. Chua G.R. No. 130632 September 28, 1999
for which checks are issued, or the terms and conditions for their issuance,
before an appropriate application of the legislative enactment can be made. Facts:
3. Whether the checks were dishonored due to insufficiency of funds, or "Account RTC of Kalookan found accused-appellant Chua guilty of estafa and in violation of
Closed" B.P. 22 for deceiving one Roberto Loo Tian by issuing in favor of said complainant
● Yolanda's testimony that when she deposited the checks to her depository checks in exchange of the received cash money amounting to P232,650.00 when
bank they were dishonored due to "Account Closed" sufficed the element of accused knew fully well at the time that she had no sufficient funds in the bank and
whether the questioned checks were dishonored due to insufficiency of would not have such funds even on the date stated on the face thereof and upon
funds," hence, presentment of such checks to the drawee bank for payment.
● the trial court is correct to convict Joy Lee based on the sole testimony of ● Accused was brought to Robert Loo Tan’s house in Kalookan by
Yolanda. Teresita Lim, Loo’s sister in law, to ask for a loan worth 200,000.
● Tan agreed and gave the amount of P232,650.00 in cash in
consideration of which the accused issued and delivered him six (6)
03 People vs Nitafan personal postdated checks, drawn against the Equitable Banking
FACTS: Corporation.
1. The accused Lim was charged with the crime under BP 22 for issuing a ● 6 checks became due but Chua told Robert not to deposit them
“memorandum check” on Philippine Trust bank in favor of the complainant Cortez, because they were not funded. Accused replaced the 6 personal checks
which was subsequently dishonored by the drawee bank for insufficient funds. The with 6 postdated checks, four of which are personal checks and the
accused failed to settle the obligation within (5) banking days from the receipt of the other two endorsed to her by Gracita del Rosario and Susana de
notice of dishonor. Guzman. The two endorsed checks were dishonored upon presentment
2. The accused filed a motion to quash on the ground that what was issued is a for payment for insufficient funds. The four personal checks were also
“memorandum check” which partakes the nature of a promissory not, not a check; dishonored, one for insufficient funds and the other three for the reason
hence such is beyond the ambit of BP 22. that the account was closed.
3. The trial court granted the motion and dismissed the case. The OSG filed the
Negotiable Instruments - Atty. Ampil
AY 2017 - 2018 - Term 1
Garcia, Pernes, Tagacay, Villasanta

Chua further declared that the four checks issued by her were for Teresita Lim as ● In her appeal, appellant contended that the agreement entered into by her
collateral for her loan and that she already paid these checks in cash and in kind out and the Abagat spouses ​was for a partnership transaction for the supply
of the goods taken by Teresita from her store. of materials for the Armed Forces. She further asserted that the Abagat
spouses had known her for a long time and had previous business dealings
RTC found Chua guilty, Chua appealed to CA, which was refferd to the SC in view of with her. It was actually on account of her good credit standing that they
the penalty of reclusion perpetua imposed in the Estafa case. were convinced to become her partners. She issued the subject checks as
mere guarantees, hence, they were postdated.
Issue:​ WON accused is guilty of Estafa – NO
WON accused is guilty of B.P. 22 - YES ISSUE: ​WON CUYUGAN IS GUILTY OF ESTAFA?

Held: HELD: ​NO. APPELLANT ACQUITTED.

One of the elements of estafa under Article 315 (2) (d) of the Revised Penal Code is a ● The OSG states that although the appellant incurred criminal liability, she
finding beyond reasonable doubt that the issuance of the check was the "efficient should only be penalized for violation of BP 22 and not for estafa because
cause" and the "means used to obtain a valuable consideration." the prosecution failed to establish fraud. The prosecution failed to discharge
This element was absent in the case of accused because the issuance of the checks its burden of proving beyond reasonable doubt that the offense of estafa as
was not the inducement for the loan to her. The inducements were the intercession defined by the RPC in Art. 315, 2(d).
made by Teresita Lim, ROBERT's sister-in-law, and the interest to be earned on the ● It is clear from the statement of facts that what was entered into between the
money lent.​ parties (Abagat Spouses and Cuyugan) was one for a loan of money to be
The trial court had overlooked portions of the testimony of Robert obviously indicating used by appellant in her business and she issued checks to guarantee the
that what transpired between Robert and Chua was a simple loan transaction, the payment of the loan. As such, she has the obligation to make good the
principal of which was payable at a future date with interest. This was amply payment of the money borrowed by her.
corroborated by prosecution witness Teresita Lim, who declared that it was she who ● However, such obligation is ​civil in character and in the absence of fraud,
introduced Chua to Robert and asked the latter whether he could lend money to no criminal liability under the RPC arises as a guarantee of payment.
Chua. ● The Court also ruled that CUYUGAN cannot be convicted of BP 22, a crime
Robert himself admitted that what motivated him to lend the amount to Chua was not she was not properly charged for that would violate appellant’s constitutional
her issuing the original postdated checks but the expectation that he would receive an right to be informed of accusation against her.
interest equivalent to 1% a month of the total amount borrowed from him. ● Accordingly, appellant was never apprised of the fact that she may still be
Still liable under B.P. 22 – ​The law makes the mere act of issuing a worthless check held liable for BP 22 and so never had an opportunity to defend herself
punishable as a special offense. The gravamen of the offense under this law is the against an accusation for an offense under the special law. BP 22 cannot be
act of issuing a worthless check or a check that is dishonored upon its presentment deemed necessarily included in the crime of estafa under RPC, Article 315,
for payment. (malum prohibitum law). 2 (d).
o The offense of fraud defined under the Revised Penal Code is
malum in se, whereas BP 22, also known as Bouncing Checks
05. PEOPLE V CUYUGAN Law, is a special law which punishes the issuance of bouncing
FACTS: checks, a malum prohibitum.
● Accused-appellant ​Rica G. Cuyugan was convicted by the Regional Trial o Fraud or estafa under the Revised Penal Code is a distinct offense
Court of Pasay City of ​three counts of estafa committed by means of false from the violation of the Bouncing Checks Law. They are different
pretenses or fraudulent acts executed prior to or simultaneously with the offenses, having different elements.
commission of the fraud, that is, by postdating a check or issuing a check in ● In this case, since appellant is accused of violating a particular provision of
payment of an obligation when the offender had no funds in the bank or his the Revised Penal Code on estafa, she may not be convicted for violation of
funds deposited therein were not sufficient to cover the amount of the check BP 22 without trenching on fundamental fairness.
and was sentenced to suffer imprisonment of 30 years of reclusion perpetua.
● During the cross examination, ​Rodrigo Abagat (the victim), admitted that NOTES: ​The purpose of the constitutional guarantee that a person accused of an
Cuyugan is a family friend and is in fact related by affinity to his wife. He offense be informed of the accusation against him is (a) to furnish the accused with
likewise admitted that he received from appellant the sum of PHP100,000.00 such a description of the charge against him as will enable him to make his defense;
applied against the check drawn in his favor. (b) to avail himself of his conviction or acquittal, for protection against a further
● Mrs. Abagat on the other hand admitted that the checks issued by Cuyugan prosecution for the same cause; and (c) to inform the court of the facts alleged, so
was a guarantee for the return of their money. that it may decide whether they are sufficient in law to support a conviction, if one
should be had.
Negotiable Instruments - Atty. Ampil
AY 2017 - 2018 - Term 1
Garcia, Pernes, Tagacay, Villasanta

06 FELIPA B. CUEME v. PEOPLE OF THE PHILIPPINES ● Cueme and her witness Leonora Gabuan submitted their Counter-Affidavit
Facts: 1. Helen Simolde was a bank teller of the BPI, Makati. and Affidavit, respectively.
● One of the bank's clients was Cueme, General Manager of Mark-Agro ○ Cueme categorically stated that she issued the checks in question
Trading Corp. and AMF General Trading Corp. engaged in the trading of to Simolde for purposes of showing them to various potential
cacao in Davao and Manila. investors.
● Both Simolde and Cueme hail from Davao so they became friends and soon, ○ Leonora Gabuan alleged that she was instructed by Cueme to
Simolde started lending money to Cueme. deliver the checks to the Simolde.
● Cueme would issue post-dated crossed checks to Simolde covering the 3. Cueme’s allegation that the checks were merely intended to be shown to
amounts lent plus interests. They had 15 transactions. prospective investors of her corporation is not a defense.
2. Each of these checks was drawn against the deposit accounts of Mark-Agro ● The gravamen of the offense punished under B.P. Blg. 22 is the act of
Trading at BPI. making or issuing a worthless check or a check that is dishonored upon its
● On several occasions Cueme persuaded Simolde not to deposit the checks presentment for payment. The law has made the mere act of issuing a bad
as issued. check malum prohibitum, thus the only inquiry is whether the law has been
● But Simolde finally deposited all the checks in her BPI-Makati account breached.
which, however, were dishonored for being "drawn against insufficient funds" ● Criminal intent becomes unnecessary where the acts are prohibited for
(DAIF). reasons of public policy, and the defenses of good faith and absence of
● Simolde demanded payment but to no avail. criminal intent are unavailing.
3. Cueme claims: ● The checks issued, even assuming they were not intended to be encashed
● She did not issue the checks in question as she merely signed them in or deposited in a bank, produce the same effect as ordinary checks. What
blank; the law punishes is the issuance of a rubber check itself and not the purpose
● It was Simolde who procured the checks from Cueme’s secretary, made the for which the check was issued nor the terms and conditions relating to its
corresponding entries, then deposited them in her account; issuance.
● The checks were not issued for value or consideration; intended to show to ● What is important is the fact that Cueme deliberately issued the checks in
would-be investors of Mark-Agro Trading Corp, and not to be encashed or question and those checks were dishonored upon presentment for payment.
deposited in bank.

Issue: Should Cueme be convicted of violating BP 22, even assuming the checks 07 Wong vs People
were not intended to be encashed or deposited in a bank? - YES. Facts: The petitioner Wong was the agent of Limtong Press Inc. which is engaged in
the business of printing calendars. The clients of Limtong Press would send a
Doctrine: The gravamen of the offense punished under B.P. Blg. 22 is the act of purchase order to its office; then it would deliver the said calendars to the clients.
making or issuing worthless checks that is dishonored upon presentment; and that Wong, as an agent, would collect the payment form the clients in form of checks that
the defenses of good faith and absence of criminal intent were unavailing. would be remitted to Limtong Press Inc.

Held: Cueme is convicted of 15 violations of BP 22; imprisonment plus fines. Wong however did not manage to remit several payments. With this, Wong was
1. There are 2 ways of violating B.P. Blg. 22: (a) by making or drawing and issuing a compelled by Limtong Press to issue several checks in payment for the unremitted
check to apply on account or for value knowing at the time of issue that the check is payments of the customers. Before maturity of the checks, Wong advised Limtong
not sufficiently funded; and, (b) by having sufficient funds in or credit with the drawee Press not to encash the same and promised that he would replace the checks within
bank but failing to keep sufficient funds or to maintain a credit to cover the full amount (30) days. Wong reneged on his promise.
of the check when presented to the drawee bank within a period of (90) days.
● Cueme was convicted under (a). Limtong Press deposited the said checks but were dishonored due to “account
● Simolde’s lone testimony, where it’s credible & trustworthy, is sufficient to closed”. Wong did not manage to settle within (5) days from the receipt of the notice
convict. of dishonor, hence Limtong filed a criminal action against Wong for violation of BP 22.
2. Cueme’s claim 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 Wong interposed as defense that he issued the said checks not as payment for the
suggesting that the checks had been indorsed by her, unremitted payment of is clients, but as to guarantee the orders of his present
● while others containing alterations in the entries were properly countersigned customers. After trial, the trial court convicted the accused. The CA affirmed the
by her. decision upon appeal of the latter, hence the present recourse with the SC.
● This only means that the checks were issued either by Cueme herself or at
her instance.
(2​nd ​issue) The accused contends that he cannot be prosecuted under BP 22 on
Negotiable Instruments - Atty. Ampil
AY 2017 - 2018 - Term 1
Garcia, Pernes, Tagacay, Villasanta

account that the purpose of the checks (bounced) was for guaranteeing payment of reported to Ronnie Bote, and the backhoe was thus repaired. After one
his customers; and that the customers already paid Limtong Press, hence Limtong day of using it, the backhoe broke down again.
Press is not a holder for value anymore on account that it had been paid already.
The two checks were, however, dishonored by the bank, and upon verification it was
(1​st ​issue) The accused contend that the checks were deposited 157 days after its discovered that the account where the checks were drawn had already been closed
maturity date, hence the presumption of knowledge of insufficiency does not apply to long
him. before the issuance of the two checks.

WON the accused may be prosecuted for issuing checks (bounced) that are meant to The cases against petitioner were filed because of his failure to pay Fedcor after
guarantee payment (such payment is paid subsequently). demands were made. During the trial, petitioner claimed that the equipment involved
in the case was returned to the vendor thru its sales agent, Ronnie Bote. Fedcor
(1.) Yes, the accused is still liable. The issue of whether or not the checks were made denied the claim of the petitioner.
as a guarantee is already resolved by the trial court and the CA, holding that the
checks are for payment for the unremitted accounts. RTC found petitioner guilty of two counts of violation of B.P. Blg. 22 and of the crime
of estafa. CA affirmed. Hence, this petition.
(2.) The accused is still liable despite the presentment 157 days after date. The (90) Issue: ​WON petitioner is guilty of estafa and two accounts of BP 22 - YES
day period for presentment is merely to create the presumption that the drawer has
knowledge of the insufficiency. It is not an element of the crime. Held:
1. Petitioner charged with 1​st​ type of offense under BP 22. Petitioner admitted
Under NIL, (sec 186), a check must be presented within a reasonable time from that he issued the two postdated checks worth P75,000 each. He did not
issuance, or else the drawer would be discharged from liability to the extent caused deny that the same were dishonored on the ground that the account from
by such delay. By current bank practice, a check will be considered stale if such is which they were to be drawn was already closed at the time the checks were
presented beyond 6 months (180) days from date. presented for payment.
2. Neither did he rebut the prosecution's evidence that the account against
In the present case, the complainant presented the check on the 157​th ​day, hence the which he drew his two postdated checks had been closed in May 1985 yet,
check did not yet turned stale. Only the presumption of knowledge of insufficiency of or more than four years prior to the drawing and delivery of the checks.
funds was lost, but such knowledge could still be proven by direct or circumstantial 3. T​hat the check must be deposited within ninety (90) days is simply one of
evidence. the conditions for the prima facie presumption of knowledge of lack of funds
to arise. It is not the element of the offense.
As found by the trial court, private respondent did not deposit the checks because of 4. The only consequence of the failure to present the check for payment within
the reassurance of petitioner that he would issue new checks. the 90-day period is that there arises no prima facie presumption of
knowledge of insufficiency of funds. The prosecution may still prove such
knowledge through other evidence.
08 Nagrampa v. People G.R. No. 146211 August 6, 2002 5. FEDCOR presented the checks for encashment on 22 February 1990, or
Facts: ​Petitioner Nagrampa was the general manager of Nagrampa Asphalt Plant in within the six-month period from the date of issuance of the checks, and
Montalban, Rizal. He purchased from Fedcor Trading Corporation Backhoe Elevator would not therefore have been considered stale had petitioner's account
Equipment, with Federico Santander as President, paying the down payment and two been existing.
postdated checks. 6. Although the presumption of knowledge of insufficiency of funds did not
● Petitioner testified that on 28 July 1989, he bought from Corseno Bote a arise, such knowledge was sufficiently proved by the unrebutted testimony of
backhoe and paid P50,000 cash, as evidenced by an acknowledgment Mirano to the effect that petitioner's account with the Security Bank was
receipt 10 signed by Corseno Bote. In addition, he issued and handed closed as early as May 1985, or more than four years prior to the issuance
to Corseno Bote two checks in the amount of P75,000 each, dated 31 of the two checks in question.
August 1989 11 and 30 September 1989.
● The agreement with Corseno Bote was that petitioner would replace the Notes:
two checks with cash if the backhoe would be in good running condition. Two distinct acts punished under Sec. 1 of B.P. 22:
The backhoe was delivered at petitioner's jobsite on 29 July 1989. After (1) The making or drawing and issuance of any chick to apply on account or for
five to seven days of use, the backhoe broke down. Such fact was value, knowing at the time of issue that the drawer does not have sufficient
funds in, or credit with, the drawee bank
Negotiable Instruments - Atty. Ampil
AY 2017 - 2018 - Term 1
Garcia, Pernes, Tagacay, Villasanta

st​
a.
In 1​ situation - the drawer knows of the insufficiency of funds to checks in payment thereof which were all dishonored as well. (not important,
cover the check at the time of its issuance. The check involved is don’t say this anymore).
worthless at the time of issuance, since the drawer has neither - Despite repeated demands, petitioners failed to pay the value of the
sufficient funds in, nor credit with, the drawee bank at the time dishonored checks.
(2) The failure to keep sufficient funds or to maintain a credit to cover the full - Consequently 7 informations for violation of BP Blg. 22 were filed against
amount of the check if presented within a period of ninety days from the date petitioners.
appearing thereon, for which reason it is dishonored by the drawee bank. - RTC found them guilty. Petitioners filed an appeal with the CA which was
a. the drawer has sufficient funds at the time of issuance but fails to denied.
keep sufficient funds or maintain credit within ninety days from the
date appearing on the check. The check involved the second ISSUE: ​WON CA erred in affirming the decision of the RTC, given the absence of
offense is good when issued, as the drawer has sufficient funds in, proof beyond reasonable doubt or in the presence of facts creating reasonable
or credit with, the drawee bank when issued. doubt?
(3) In both instances, the offense is consummated by the dishonor of the check
for insufficiency of funds or credit. HELD: ​YES. PETITION GRANTED.
The CA erred in affirming the decision of the RTC. In cases like this, pieces of
The elements of the first type of offense in BP 22: evidence presented must lead to a proof beyond reasonable doubt not merely
(1) The making, drawing and issuance of any check to apply for account or for value; preponderance of evidence.
(2) The knowledge of the maker, drawer, or issuer that at the time of issue he does For a violation of Batas Pambansa Blg. 22 to be committed,
not have sufficient funds in or credit with the drawee bank for the payment of such the following elements must be present:
check in full upon its presentment; and (1) the making, drawing, and issuance of any check to apply
(3) The subsequent dishonor of the check by the drawee bank for insufficiency of for account or for value;
funds or credit or dishonor for the same reason had not the drawer, without any valid (2) the knowledge of the maker, drawer, or issuer that at the
cause, ordered the bank to stop payment. time of issue there are no sufficient funds in or credit with
the drawee bank for the payment of such check in full upon
its presentment;
09. TING vs CA [G.R. No. 140665 November 13, 2000] (3) and the subsequent dishonor of the check by the drawee
FACTS: bank for insufficiency of funds or credit or dishonor for the
- From 1991 – 1992, Juliet Ting obtained loans in the amount of same reason had not the drawer, without any valid cause,
PHP2,750,000.00 from complainant Josefina K. Tagle for use in Juliet’s ordered the bank to stop payment
furniture business. An analysis of the evidence presented, however, shows that not all the
- As payment, Juliet issued 11 post dated checks which were all dishonored aforementioned elements have been established by the prosecution beyond
upon maturity due to insufficiency of funds. Juliet was subsequently reasonable doubt. In this case, to prove the existence of the second element, the
prosecuted for violation of BP Blg. 22. prosecution alleged that the demand letter had been sent by mail and to prove this,
- Due to her financial difficulties, Juliet requested her husband, Victor Ting they presented a copy of the demand letter as well as the registry return receipt.
and sister Emily Chan-Azajar (petitioners herein) to take over her furniture However, this Court found this insufficient to establish guilt beyond reasonable doubt.
business, including the obligations appurtenant thereto.
- Agreeing to Juliet’s request, petitioners issued 19 checks in replacement of In civil cases, service made through registered mail is proved by the registry receipt
the 11 checks earlier issued by Juliet. However, the planned takeover did issued by the mailing office and an affidavit of the person mailing of facts showing
not materialize for Emily was not allowed by her employer (head of Naga compliance with Section 7 of Rule 13 (See Section 13, Rule 13, 1997 Rules of Civil
Hope Christian School) to resign. Procedure). If, in addition to the registry receipt, it is required in civil cases that an
- Petitioners then requested Taglet for the return of the checks and asked affidavit of mailing as proof of service be presented, then with more reason
Juliet to resume her obligations. should we hold in criminal cases that a registry receipt alone is insufficient as
- Juliet then replaced the 19 checks issued by petitioners with 23 Far East proof of mailing. ​In the instant case, the prosecution failed to present the testimony,
Bank checks in favour of Tagle. or at least the affidavit, of the person mailing that, indeed, the demand letter was sent.
- However instead of returning the checks, Tagle deposited 7 of the checks
with Metrobank where they were dishonored for being Drawn Against For liability to attach under Batas Pambansa Blg. 22, it is not enough that the
Insufficiency of Funds. prosecution establishes that a check was issued and that the same was subsequently
- In addition to this, Tagle alleged that sometime in April 1993, petitioners dishonored. ​The prosecution must also prove the second element, that is, it
obtained a loan of PHP950,000.00 from her, issuing several post dated must further show that the issuer, at the time of the check's issuance, had
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knowledge that he did not have enough funds or credit in the bank for payment
thereof upon its presentment. Held: DANAO IS ACQUITTED.
1. The totality of the evidence presented does not support Danao’s conviction for
It is necessary in cases for violation of Batas Pambansa Blg. 22, that the prosecution violation of B.P. 22, since the prosecution failed to prove beyond reasonable doubt all
prove that the issuer had received a notice of dishonor. It is a general rule that when the elements.
service of notice is an issue, the person alleging that the notice was served must 2. The elements of the offense under Sec. 1 of BP 22 are:
prove the fact of service (58 Am Jur 2d, Notice, §45). The burden of proving notice ● The accused makes, draws or issues any check to apply to account or for
rests upon the party asserting its existence. value;
● The accused knows at the time of the issuance that he or she does not have
As we stated in Savage v. Taypin (G.R. No. 134217, May 11, 2000), "penal statutes sufficient funds in or credit with, the drawee bank for the payment of the
must be strictly construed against the State and liberally in favor of the accused." check in full upon its presentment; and
● 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
10 EVANGELINE DANAO v. CA and PEOPLE OF THE PHILIPPINES not the drawer, without any valid reason, ordered the bank to stop payment.
Facts: 3. To hold a person liable under B.P. Blg. 22, it is not enough to establish that a check
1. Luviminda Macasieb is in the business of rediscounting checks. issued was subsequently dishonored.
● Arturo Estrada, branch manager of the Monte de Piedad bank, was one of ● It must be shown further that the person who issued the check knew 'at the
her agents, authorized to transact rediscounting business with any person time of issue that he does not have sufficient funds in or credit with the
for and in her behalf. drawee bank for the payment of such check in full upon its presentment.'
● Sometime in December 1991, Evangeline Danao went to see Estrada at his ● Because this element involves a state of mind which is difficult to establish,
office to seek an additional loan but Estrada had to refuse Danao’s request. Section 2 of the law creates a prima facie presumption of such knowledge.
2. Estrada told Danao that he knew one who lends money with postdated checks as
security. 4. In the present case, no proof of receipt by Danao of any notice of non-payment of
● Estrada phoned Macasieb of the arrangement then Macasieb instructed the checks was ever presented during the trial.
Estrada to release the amount of P29,750 from the petty cash fund entrusted ● The evidence is not clear when Macasieb made the demands. There is no
by her to Estrada. proof of the date when Danao received the demand letter.
● After Danao received the amount, she issued 2 postdated checks totalling ● There is no way of determining when the 5-day period would start and end.
P29,750. Thus, the presumption or prima facie evidence of knowledge by Danao of
3. On the maturity dates of the 2 checks, Macasieb deposited the same at the PCIB. the insufficiency of funds or credit at the times she issued the checks did not
● However, the checks were dishonored for the reason that the account of arise.
Danao had already been closed. ● It is clear that the essential element of knowledge of insufficiency of funds or
4. On Dec. 18, 1992, Danao was charged in 2 Criminal Cases for violation of BP 22. credit on Danao’s part is absent. On this ground alone, she should be
● Danao contends that the presumption of prima facie evidence of knowledge acquitted.
of insufficiency of funds did not arise since the prosecution failed to prove
her receipt of, as well as the date when she received Macasieb’s letter of
demand. 11 Domagsang vs CA
FACTS:
Issue: Should Danao be convicted of violating BP 22, when it was not proven she 1. The accused Josephine Domagsang obtained a loan from Garcia
received Macasieb’s letter of demand? - NO. (metrobank VP). In consideration of the loan, Domagsang issued eighteen
(18) postdated checks to Garcia.
Doctrine: In order to create the prima facie presumption that the issuer knew of the 2. When presented for payment, the said checks bounced for the reasons
insufficiency of funds, it must be shown that he or she received a notice of dishonor "Account Closed". Ignacio demanded payment by calling up Domagsang at
and, within 5 banking days thereafter, failed to satisfy the amount of the check or her office. However, Domagsang failed to pay.
make arrangement for its payment. 3. Both the RTC and Court of Appeals convicted Domagsang of the crime. The
If such notice of non-payment by the drawee bank is not sent to the maker or drawer latter appealed to the Supreme Court.
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. ISSUE: WON a verbal notice of dishonor or demand to pay sufficient to convict the
Blg. 22 cannot arise, since there would simply be no way of reckoning the crucial accused for BP 22.
5-day period.
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HELD: payment of such check in full upon its presentment. Thus, the presumption that the
(1.) No, a verbal demand is not sufficient. Although Section 2 of B.P. Blg. 22 does issuer had knowledge of the insufficiency of funds is brought into existence only after
state that the notice of dishonor be in writing, Section 3 states that where there are no it is proved that the issuer had received a notice of dishonor and that, within five days
sufficient funds in or credit with the drawee bank, such fact shall always be explicitly from receipt thereof, he failed to pay the amount of the check or to make arrangement
stated in the notice of dishonor or refusal. for its payment.

A mere oral notice or demand to pay would appear to be insufficient for conviction In other words, if such notice of non-payment by the drawee bank is not sent to the
under the law. Both the spirit and letter of the Bouncing Checks Law require for the maker or drawer of the bum check, or if there is no proof as to when such notice was
act to be punished there under not only that the accused issued a check that is received by the drawer, then ​the presumption of knowledge as provided in
dishonored, but that likewise the accused has actually been notified in writing of the Section 2 of B.P. 22 cannot​ ​arise, since there would simply be no way of
fact of dishonor. reckoning the crucial five-day period.

The consistent rule is that penal statutes have to be construed strictly against the However, while petitioner is acquitted for violation of B.P. 22, he should be
State and liberally in favor of the accused. Domagsang was acquitted of the crime. ordered to pay the face value of the five dishonored checks plus legal interest
However, she was ordered to pay Ignacio the total face value of the dishonored in accordance with our ruling in Domagsang vs. Court of Appeals.
checks as it was established that she failed to pay her debt.
13. YU OH vs CA and PEOPLE OF THE PHILIPPINES
12 Rico v. People of the Philippines, G.R. No. 137191, November 18, 2002 FACTS:
- Petitioner purchased pieces of jewelry from Solid Gold International Traders,
Facts: Inc., a company engaged in jewelry trading.
Petitioner Ben Rico was a "pakyaw" contractor who used to purchase construction - Due to her failure to pay the purchase price, Solid Gold filed Civil Cases
materials on credit from private complainant Ever Lucky Commercial (ELC), against her for specific performance before the RTC.
represented by Victor Chan, Manager. Petitioner made payments either in cash or by - Subsequently, petitioner & Solid Gold through its GM Joaquin Novales III,
postdated checks. entered into a compromise agreement wherein it was agreed that petitioner
shall issue a total of 99 post dated checks in the amount of PHP50,000.00
On several occasions, he issued checks to ELC, which were dishonored by the bank each dated every 15​th​ and 30​th​ of the month starting Oct. 1, 1990 and the
upon presentment for payment for "insufficiency of funds" or "closed account”. balance of PHP1M to be paid in lump sum on Nov. 16, 1994 which is also
the due date of the 99​th​ and last postdated check.
After the checks were dishonored, ELC demanded payments from petitioner, who - Petitioner then issued 10 checks drawn against her account at Equitable
failed to make good his undertaking to replace the checks. No formal written demand Banking Corporation which Novales deposited with Far East Bank and Trust
letter or notice of dishonor, however, was sent to the petitioner. Company.
- However, these checks were all dishonored for the reason of “Account
Petitioner Ben B. Rico was convicted of five (5) counts of violation of Batas Closed.”
Pambansa Blg. 22 by the Regional Trial Court of Laoag City. CA affirmed. It further - Dishonor slips were issued for each check that was returned to Novales.
stated that even if there was payment, petitioner failed to prove that it was made - RTC found petitioner guilty of ten counts of violation of BP Blg 22 which was
within five days from receipt of the notice of dishonor. Hence, the present petition. affirmed by the CA.
- Petitioner alleged among other things that no notice of dishonor had been
Issue​: WON accused is guilty of violation of BP 22 – NO, ACQUITTED given to appellant as drawer of the dishonored checks.
- Hence this appeal.
Held: ​The first and third elements of the offense are present and proved in these
consolidated cases. But we find that the second element was not sufficiently ISSUE: ​WON Petitioner is guilty of violation of BP Blg 22?
established. Knowledge of insufficiency of funds or credit in the drawee bank for the
payment of a check upon its presentment is an essential element of the offense. In HELD: ​NO. The Supreme Court reversed the decision of the CA and acquitted
several cases, we have ruled that to hold a person liable under B.P. 22, it is not petitioner, ruling: that in cases for violation of B.P. Blg. 22, it is necessary that the
enough to establish that a check was dishonored upon presentment. prosecution prove that the issuer had received a notice of dishonor. The law provides
for an opportunity for the drawer to effect full payment of the amount appearing on the
It must be shown further that the person who issued the check knew at the time of check, within five banking days from notice of dishonor. Procedural due process
issue that he does not have sufficient funds in or credit with the drawee bank for the demands that a notice of dishonor be actually served on petitioner. A perusal of the
Negotiable Instruments - Atty. Ampil
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Garcia, Pernes, Tagacay, Villasanta

testimony of the prosecution witness Joaquin Novales III, disclosed that no personal notice of dishonor attached by the drawee bank to the returned checks.
demands were made on appellant before the filing of the complaints against her. The
failure of the prosecution to prove that petitioner was given the requisite notice of Held: Petition Denied; Case Remanded to TC.
dishonor was a clear ground for her acquittal. It is not required, much less indispensable, for the prosecution to present the drawee
bank's representative as witness to testify on dishonor of the checks because of
SEC. 2. Evidence of knowledge of insufficient funds. — The insufficiency of funds.
making, drawing and issuance of a check payment of which is ● The prosecution may present, as it did in this case, only complainant as a
refused by the drawee because of insufficient funds in or credit witness to prove all the elements of the offense charged.
with such bank, when presented within ninety (90) days from the ● Sison’s sole testimony suffices to identify the dishonored checks with the
date of the check, shall be prima facie evidence of knowledge of drawee bank's notation stamped or written on the dorsal side "DAIF" or in a
such insufficiency of funds or credit unless such maker or drawer notice attached thereto and such notice of dishonor given to the drawer.
pays the holder thereof the amount due thereon, or makes ● A legal presumption arises that Tadeo had knowledge of the making of the
arrangements for payment in full by the drawee of such check checks, the due presentment to the drawee bank for payment, the dishonor
within five (5) banking days after receiving notice that such check and the reason therefor written, stamped or notice of dishonor attached by
has not been paid by the drawee. the drawee bank to the returned checks.
● Such prima facie presumption proves that Tadeo has knowledge of the
Based on this section, the presumption that the issuer had knowledge of the insufficiency of funds. The presumption is sufficient basis to convict.
insufficiency of funds is brought into existence only after it is proved that the issuer ● Consequently, the prosecution has proved all the essential elements of the
had received a notice of dishonor and that within five days from receipt thereof, he offense charged with the sole testimony of Sison.
failed to pay the amount of the check or to make arrangement for its payment.

FALLO: ​Petitioner Elvira Yu Oh is ACQUITTED. 15 Llamado vs CA (co accused Pascual)

FACTS: The accused Llamado was the treasurer of the Pan Asia Finance
14 NARCISO A. TADEO v. PEOPLE OF THE PHILIPPINES Corporation. The private complainant Leon Gaw delivered to accused the amount of
Facts: Luz Sison was the owner of commercial apartments in QC. P180,000.00, with the assurance that it will be repaid on November 1983, with 12%
● In 1985, Narciso Tadeo’s wife leased from Sison 1 unit of the apartment for interes, plus a share in the profits of the corporation.
a period of 5 years. After 2 years, she also leased the adjacent apartment. Upon delivery of the money, the accused Ricardo Llamado signed and handed over a
● In 1988, Tadeo’s wife incurred rental arrears with Sison of P113,300. In Philippine Trust Company postdated check to the private complainant as payment for
order to settle the account Tadeo issued 8 postdated checks covering the the cash delivered by the latter.
unpaid rental arrears of P113,300.
● All the checks bounced upon deposit with the drawee bank. After the last Upon presentment of the check, the drawee bank dishonored the same due to a stop
check was returned to complainant unpaid, with the notation "drawn against payment order and insufficiency of funds. The complainant went to the secretary of
insufficient funds" stamped thereon, Sison's counsel wrote Tadeo the accused, demanding the replacement of the check, but such was unheeded. The
demanding that the unpaid checks be redeemed within 3 days from receipt accused then made an arrangement for payment with the complainant, but did not
of the letter. materialize as well.
● Tadeo expressed his willingness to discuss the matter with her counsel.
However, he did not redeem the unpaid checks; indeed, he did not even The complainant filed BP 22 cases against the accused. The accused contended that
mention any intention to pay Sison or to make arrangements for payment of it is a company practice that he, as treasurer, would pre sign checks for the
the dishonored checks. immediate disbursements of funds for the company. He further alleged that it was his
● 8 Informations charging Tadeo with violation of BP 22 were filed. co – accused Pascual who negotiated the same to the complainant.
Issue: Does there exist a prima facie case despite disregarding the prosecution's ISSUE: WON the accused may be held guilty under BP 22, despite the fact that he
failure to present as witness a representative of the drawee bank to testify on the merely pre signed the checks and was not the one who negotiated the same.
dishonor of the questioned checks? - YES.

Doctrine: A legal presumption arises that the accused had knowledge of the HELD:
insufficiency of funds that in the making of the checks, the due presentment to the (1.) No, the lack of involvement in the transaction is not a defense in BP 22.He made
drawee bank for payment, the dishonor and the reason therefor written, stamped or himself succeptible to be prosecuted under BP 22 by pre signing the checks. As
Treasurer of the corporation who signed the check in his capacity as officer of the
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corporation, lack of involvement in negotiation for the transaction is not a defense. Issue:​ WON petitioners are guilty of BP 22 – YES, affirmed with modification that the
sentence of imprisonment is deleted and petitioners are each ordered to pay a fine of
(2.) The petitioner argued that the check was not negotiated for valuable P20,000.00 equivalent to double the amount of the check.
consideration. The court disagreed, holding that it was negotiated for the amount of
180,000 pesos. Held:
1. Petitioners in this case cannot pretend ignorance of the insufficiency of
(3.) The petitioner‘s contention that the check was just a mere guarantee, hinged funds. While it may be true that it was the company's accountant who
upon the condition that the cash of the complainant would be returned if the actually prepared the rubber check, the fact remains that petitioners are the
partnership does not materialize does not matter. To determine the reason for which owners and officers of the company.
checks are issued, or the terms and conditions for their issuance, will greatly erode 2. Sec. 1 of B.P. Blg. 22 provides that "Where the check is drawn by a
the faith the public reposes in the stability of commercial paper. corporation, company, or entity, the ​person or persons who actually
signed the check in behalf of such drawer shall be liable under this
Petitioner's argument that he should not be held personally liable for the Act.”​ ​Petitioner Nieto testified that after the check in question was
amount of the check because it was a check of the Pan Asia Finance dishonored, he instructed their company accountant to prepare a
Corporation and he signed the same in his capacity as Treasurer of the replacement check​.
corporation, is also untenable. The third paragraph of Section 1 of BP Blg. 22 3. This belies petitioners' claim that they had no hand in the preparation of
states: Where the check is drawn by a corporation, company or entity, the checks and shows that petitioners were in control of the finances of the
person or persons who actually signed the check in behalf of such drawer shall company.
be liable under this Act. 4. On the issue of the penalty be modified by deleting the sentence of
imprisonment and, in lieu thereof, a fine in an increased amount be imposed
- ALLOWED BY SC. B.P. Blg. 22, §1 par. 1 provides a penalty of
"imprisonment of not less than thirty days but not more than one (1) year or
16 Vaca vs. CA G.R. No. 131714 November 16, 1998 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
Facts: such fine and ​imprisonment at the discretion of the Court​."
1. Petitioner Eduardo R. Vaca is the president and owner of Ervine 5. Petitioners are first-time offenders. They are Filipino enterpreneurs who
International, Inc. (Ervine), which is engaged in the manufacture and sale of presumably contribute to the national economy. Apparently, they brought
refrigeration equipment, while his son-in-law, petitioner Fernando Nieto, is this appeal, believing in all good faith, although mistakenly, that they had not
the firm's purchasing manager. committed a violation of B.P. Blg. 22. Otherwise, they could simply have
2. Petitioners issued a check for P10,000.00 to the General Agency for accepted the judgment of the trial court and applied for probation to evade a
Reconnaissance, Detection, and Security, Inc. (GARDS) in partial payment prison term.
of the security services rendered by GARDS to Ervine drawn on the China
Banking Corporation (CBC).
3. When deposited in the Philippine Commercial International Bank (PCIBank) 17. LIM vs PEOPLE
branch at Shaw Boulevard, Mandaluyong, the check was dishonored for FACTS:
insufficiency of funds. - Petitioner bought various kinds of jewelry – Singaporean necklaces,
4. GARDS wrote Ervine a letter in which it demanded payment in cash of the bracelets and rings worth PHP300,000.00 from Maria Antonia Seguan. She
amount of the check within seven days from notice. The letter was received issued a check dated August 25, 1990 payable to cash as payment thereof.
by Ervine on the same day, but petitioners did not pay within the time given. - On August 26, 1990: Petitioner then went again to Seguan’s store &
5. A check drawn on Associated Bank was issued by petitioners to GARDS in purchased jewelry valued at PHP241,668.00. Petitioner issued a check in
order to replace the dishonored check. The check and the voucher were payment thereof.
received by a GARDS messenger, Nolan C. Pena but GARDS did not return - Seguan deposited the two checks with her bank and were returned with a
the dishonored check. GARDS Operations Manager Jovito C. Cabusara filed notice of dishonor. Petitioner’s account in the bank from which the checks
a criminal complaint against petitioners for violation of B.P. Blg. 22. were drawn was closed.
6. RTC issued an information against petitioners for violation of BP22 and - Despite repeated demands, petitioner failed to pay her obligations.
found guilty and sentenced to suffer one (1) year imprisonment and to pay a - Petitioner was found guilty of two counts of violation of BP Blg. 22.
fine of P10,000.00 and the costs. CA affirmed. Hence, this petition. - In this appeal, petitioner argues that she never knew Seguan and much
more, had any transaction with her. According to her, she have the two
checks to Aurelia Nadera from who she got the jewelries as a security
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arrangement or gurantee that she would return the jewelry received if she ● Under the arrangement:
would not be able to sell them. ○ the Tans’ drivers purchased on credit fuel and various oil products
for its buses through withdrawal slips issued by the Tans, with
ISSUE: ​WON Petitioner is guilty of violation of BP Blg. 22? periodic payments to Mendez through the issuance of checks.
○ Mendez then remitted the proceeds of ticket sales to the Tans
HELD: ​YES. through the issuance of checks. Sent together with Mendez’
- Petitioner never denied issuing the two checks. She argued that the checks remittance are the remittances of the ticket sales in the Baao
were not issued to Seguan and that they had no pre-existing transaction. Booking office, which is managed separately and independently by
The checks were issued to Aurelia Nadera as mere guarantee and as a another agent, Elias Bacsain.
security arrangement to cover the value of jewelry she was to sell on 3. Accordingly, the Tans issued several checks to Mendez as payment for oil and fuel
consignment basis. These defenses cannot save the day for her. products. One is an FEBTC check of P58,237.75, which was dishonored by the bank
- The first and last elements of the offense are admittedly present. To escape upon presentment for payment for being drawn against insufficient funds.
liability, she must prove that the second element was absent, that is, at the ● Mendez sent a demand letter the Tans demanding that they make good the
time of issue of the checks, she did not know that her funds in the bank check or pay the amount thereof, to no avail.
account were insufficient. She did not prove this. ● Hence, an information for violation of B.P. 22 was filed against the Tans.
- B.P. No. 22, Section 2 creates a presumption juris tantum that the second Issue: Does payment through compensation or offset preclude prosecution for
element prima facie exists when the first and third elements of the offense violation of BP22? - NO.
are present. If not rebutted, it suffices to sustain a conviction.
- The gravamen of B. P. No. 22 is the act of making and issuing a worthless Doctrine: Even if there had been payment, through compensation or some other
check or one that is dishonored upon its presentment for payment. And the means, there could still be prosecution for violation of B.P. 22.
accused failed to satisfy the amount of the check or make arrangement for
its payment within five (5) banking days from notice of dishonor. Held: Petition Denied; Ordered to Pay Fines.
- The act is malum prohibitum, pernicious and inimical to public welfare. Laws 1. All the elements for violation of BP 22 are present.
are created to achieve a goal intended and to guide and prevent against an ● Tan admitted that he drew the subject check as payment for the fuel and oil
evil or mischief. Why and to whom the check was issued is irrelevant in products of Mendez.
determining culpability. The terms and conditions surrounding the issuance ● He knew at that time that there were no sufficient funds to cover the check
of the checks are also irrelevant. because he had uncollected receivables.
- This case is a perfect example of an act mala prohibita. Petitioner ● The check was thus dishonored upon presentment to the bank for payment.
issued two checks. They were dishonored upon presentment for 2. The law has made the mere act of issuing a bum check a malum prohibitum.
payment due to the fact that the account was closed. Petitioner failed ● Thus, even if there had been payment, through compensation or some other
to rebut the presumption that she knew her funds were insufficient at means, there could still be prosecution for violation of B.P. 22.
the time of issue of the checks. And she failed to pay the amount of the 3. The alleged compensation is not supported by clear and positive evidence.
checks or make arrangement for its payment within five (5) banking ● The total amount of the two checks issued by the Tans is P293,625.08 while
days from receipt of notice of dishonor. B. P. No. 22 was clearly the total amount of the returned checks amounted to only P66,939.75.
violated. ● No application of payment was made as to which check was to be paid.
4. The Tans never alleged compensation when they received the demand letter,
FALLO: ​Petitioner Rosa Lim guilty beyond reasonable doubt of two counts of violation during the preliminary investigation, or before trial by filing a motion to dismiss.
of BP 22. ● If indeed there was payment by compensation, the Tans should have
redeemed or taken the checks back in the ordinary course of business.
● There is no evidence on record that they did so.
18 STEVE TAN and MARCIANO TAN v. FABIAN MENDEZ, JR.
Facts:
1. Steve Tan and Marciano Tan are the owners of Master Tours and Travel Corp. and 19 Svendsen v. People
operators of Philippine Lawin Bus Co. Fabian Mendez, Jr. is the owner of 3 gasoline Facts:
stations. Cristina Reyes extended aloanto James Svendsen (Svendsen) in the amount of
2. The Tans opened a credit line for their buses' lubricants and fuel consumption with P200,000, to bear interest at 10% a month. After Svendsen had partially paid his
Mendez. obligation, he failed to settle the balance which had reached P380,000 inclusive of
● Mendez was designated as the booking and ticketing agent of PHL Lawin interest.
Bus in Iriga.
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Cristina thus filed a collection suit against petitioner, which was eventually settled 20 Walker Wilkie vs. Limos, A.C. No. 7505, October 24, 2008
when petitioner paid her P200,000 and issued in her favor an International Exchange
Bank check postdated February 2, 1999 in the amount of P160,000 representing Facts:
interest. The check was co-signed by one Wilhelm Bolton Administrative case arose from a complaint initially filed with the IBP La Union
Chapter, and forwarded to the IBP, National Office in Pasig City, by Mr. Walter Wilkie
The check was dishonored. DAIF. Cristina, through counsel, thus sent a letter to against Atty. Sinamar E. Limos.
petitioner by registered mail informing him that the check was dishonored by the ● Petitioner engaged the services of respondent regarding his intention of
drawee bank, and demanding that he make it good within five (5) days from receipt. adopting his wife's nephew, Reynal Alsaen Taltalen
No avail. ● Notwithstanding their lawyer and client relationship, respondent
borrowed money from petitioner in the amount of P250,000.00.
Cristina filed a complaint against Svendsen and his co-signatory to the check, Bolton, ● The loan agreement was evidenced by a Contract of Loan with a
for violation of B.P. Blg. 22. An information was filed before the MeTC. MeTC forund stipulation of interest in the amount of 24% per annum and that
Svendsen guilty. Bolton remained at large so the trial court never acquired jurisdiction respondent will issue two (2) post dated checks representing the
over him. RTC and CA affirmed. principal amount of P250,000.00 and the interest in the amount of
P60,000.00.
Petitioner argues that the appellate court erred in finding that the first element of ● Checks became due, petitioner deposited checks to account at
violation of B.P. Blg. 22 – the making, drawing, and issuance of any check "to apply Equitable PCI Bank but checks bounced because of insufficient funds.
on account or for value" – was present, as the obligation to pay interest is void, the ● Despite demands, respondent failed to pay.
same not being in writing and the 10% monthly interest is unconscionable; in holding
him civilly liable in the amount of P160,000 to private complainant, notwithstanding Despite being given a period of fifteen (15) days to submit her Answer to the
the invalidity of the interest stipulation; and in violating his right to due process when it Complaint by the Commission of Bar Discipline (CBD) and not being able to submit
convicted him, notwithstanding the absence of proof of receipt by him of a written her answer and failing to appear in the mandatory conference which required them to
notice of dishonor. appear before the Commission, IBP Board of Governors recommended that
respondent be suspended for 2 years.
Issue: W/N the petitioner is guilty Ruling: Not guilty.
According to respondent, she was not able to attend the mandatory conference/
Held: Petitioner admits having issued the postdated check to Cristina. The check, hearing because she was physically un3t at that time. Respondent claimed that her
however, was dishonored when deposited for payment in Banco de Oro due to DAIF. loan from complainant was actually an accommodation she extended in behalf of a
Hence, the first and the third elements of BP 22 are present in the case. client, Hilario Inocencio. Inocencio's demise had left her without any recourse. To
support her allegations, respondent attached to her letter the Affidavit of Desistance
and the order of the MTC dismissing the criminal cases for violation of BP 22 against
However, the evidence for the prosecution failed to prove the second element. While her (respondent).
the registry receipt, which is said to cover the letter-notice of dishonor and of demand
sent to petitioner, was presented, there is no proof that he or a duly authorized agent Issue:​ WON respondent is guilty of violating of BP 22 – YES, SUSPENDED FOR 3
received the same. Receipts for registered letters including return receipts do not MONTHS
themselves prove receipt; they must be properly authenticated to serve as proof of
receipt of the letters. Held:
We have held that the issuance of checks which were later dishonored for having
Not only must there be a written notice of dishonor or demand letters actually been drawn against a closed account indicates a lawyer's unfitness for the trust and
received by the drawer of a dishonored check, but there must also be proof of receipt confidence reposed on her. A lawyer who issued bouncing checks violates the law
thereof that is properly authenticated, and not mere registered receipt and/or return and is subject to disbarment or suspension. ​Violation of B.P. 22 is considered a
receipt. crime involving moral turpitude as this mischief creates not only a wrong to the
payee or holder, but also an injury to the public.
Not so important in the svendsen ruling: Petitioner is civilly liable, however. For in a
criminal case, the social injury is sought to be repaired through the imposition of the Respondent's bare claim that the loan was, in fact, only an accommodation for a
corresponding penalty, whereas with respect to the personal injury of the victim, it is former client who according to respondent had already died cannot be given
sought to be compensated through indemnity, which is civil in nature. credence. 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. ​Added to
this observation is the fact that in her Manifestation and Motion, no mention
Negotiable Instruments - Atty. Ampil
AY 2017 - 2018 - Term 1
Garcia, Pernes, Tagacay, Villasanta

was made with regard to the complainant's Affidavit of Desistance.​ It was only third paragraph of Section 1 of BP 22 reads: "Where the check is drawn by a
mentioned in her letter to the IBP which was received by the IBP-CBD on January 3, corporation, company or entity, the person or persons who actually signed
2007. By then, the Report and Recommendation Commissioner was already the check in behalf of such drawer shall be liable under this Act."
submitted to the Board of Governors which resolved to affirm said Report in its - This provision recognizes the reality that a corporation can only act
Resolution. through its officers. Hence, its wording is unequivocal and mandatory
— that the person who actually signed the corporate check shall be
Reliance on the Affidavit of Desistance is misplaced because while the ​complainant held liable for a violation of BP 22. This provision does not contain any
filed his affidavit with the trial court, he did not do the same thing in this case. condition, qualification or limitation.
Notably, at the time of the mandatory conference/hearing before the CBD, - In this case, Mitra signed the LNCC checks as treasurer, she must be
complainant did not even inform the Commissioner that he already desisted in then held liable for violating BP 22.
prosecuting the criminal cases he filed with the MTC against the respondent and that - Mitra also alleges that there was no proper service on her of the notice of
such desistance resulted in the dismissal of said cases. In any event, the Court has dishonor and so an essential element of the offense is missing. However,
consistently frowned upon the desistance of complainants because of legal and this contention raises a factual issue that is not proper for review. The Court
jurisprudential injunction. herein respects both the decision of the MTCC, RTC and CA that there was
sufficient notice of dishonor given to petitioner:
Though, having denied that there was no demand letter
21. EUMELIA MITRA vs PEOPLE OF THE PHILIPPINES served on April 10, 2000, however, the ​prosecution
FACTS: positively alleged and proved that the questioned
- Eumelia Mitra was the treasurer and Floreancio L. Cabrera, Jr (now demand letter was served upon the accused on April 10,
deceased) was the President of Lucky Nine Credit Corporation (LNCC), a 2000, that was at the time they were attending Court
corporation engaged in money lending activities. hearing before Branch I of this Court. In fact, the
- Between 1995 & 1999, Felicismo S. Tarcelo invested money in LNCC. prosecution had submitted a Certification issued by the other
- As the usual practice in money placement transactions, Tarcelo was issued Branch of this Court certifying the fact that the accused were
checks equivalent to the amounts he invested plus the interest on his present during the April 10, 2010 hearing. With such
investments. straightforward and categorical testimony of the witness, the
- However, when these checks were presented for payment, they were Court believes that the prosecution has achieved what was
dishonored for the reason of “account closed.” dismally lacking in the three (3) cases of Betty King, Victor
- Tarcelo made several demands but to no avail. Ting and Caras — evidence of the receipt by the accused of
- 7 informations for violation of BP Blg 22 in the total amount of the demand letter sent to her. The Court accepts the
PHP925,000.00 with the MTCC in Batangas City. prosecution's narrative that the accused refused to sign the
- Petitioner was found guilty. same to evidence their receipt thereof.
- As their defense, they were contending that they signed the seven checks in
blank with no name of the payee, no amount stated and no date of maturity; - With the notice of dishonor duly served and disregarded, there arose the
they did not know when and to whom those checks would be issued; the presumption that Mitra and Cabrera knew that there were insufficient funds
seven checks were only among those in one or two booklets of checks they to cover the checks upon their presentment for payment. In fact, the account
were made to sign at that time; and that they signed the checks so as not to was already closed.
delay the transactions of LNCC because they did not regularly hold office - There is no dispute that Mitra signed the checks and that the bank
there. dishonored the checks because the account had been closed. Notice of
- RTC then affirmed the conviction of the MTCC decision and later denied dishonor was properly given, but Mitra failed to pay the checks or make
their MR. arrangements for their payment within five days from notice. With all the
- Petitioner was also claiming that there was a lack of notice of dishonor and above elements duly proven, Mitra cannot escape the civil and criminal
demand to pay Tarcelo. liabilities that BP 22 imposes for its breach.

ISSUE: ​WON Petitioner is guilty of BP Blg. 22? FALLO: ​WHEREFORE, the July 31, 2009 Decision and the February 11, 2010
Resolution of the Court of Appeals in CA-G.R. CR No. 31740 are hereby AFFIRMED.
HELD: ​YES.
- Mitra was claiming that before the signatory to a bouncing corporate check NOTES:
can be held liable, all the elements of the crime of violation of BP 22 must
first be proven against the corporation. However, the Court ruled that the
Negotiable Instruments - Atty. Ampil
AY 2017 - 2018 - Term 1
Garcia, Pernes, Tagacay, Villasanta

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

as a convenient form of payment in financial transactions and obligations. Issue: Can Chan's civil action to recover the amount of the unfunded check be an
- The use of checks as payment allows commercial and banking transactions independent civil action from the criminal case? - NO.
to proceed without the actual handling of money, thus, doing away with the
need to physically count bills and coins whenever payment is made. Doctrine: A civil action cannot be filed independently from the criminal case for
- It permits commercial and banking transactions to be carried out quickly and violation of BP 22. The criminal action for violation of BP 22 shall be deemed to
efficiently. But the convenience afforded by checks is damaged by unfunded include the corresponding civil action. No reservation to file such civil action
checks that adversely affect confidence in our commercial and banking separately shall be allowed.
activities, and ultimately injure public interest.
- BP 22 or the Bouncing Checks Law was enacted for the specific purpose of Held:
addressing the problem of the continued issuance and circulation of 1. A violation of BP 22 can give rise to civil liability.
unfunded checks by irresponsible persons. To stem the harm caused by ● Every crime gives rise to a penal or criminal action for the punishment of the
these bouncing checks to the community, BP 22 considers the mere act of guilty party, and also to civil action for the restitution of the thing, repair of
issuing an unfunded check as an offense not only against property but also the damage, and indemnification for the losses.
against public order.
- The purpose of BP 22 in declaring the mere issuance of a bouncing check ● Civil liability to the offended party cannot thus be denied. The payee of the
as ​malum prohibitum is to punish the offender in order to deter him and check is entitled to receive the payment of money for which the worthless
others from committing the offense, to isolate him from society, to reform check was issued. Having been caused the damage, she is entitled to
and rehabilitate him, and to maintain social order. The penalty is stiff. BP 22 recompense.
imposes the penalty of imprisonment for at least 30 days or a ne of up to 2. However, there is no independent civil action to recover the value of a bouncing
double the amount of the check or both imprisonment and fine. check issued in contravention of BP 22. This is clear from Rule 111 of the Rules of
Court:
● “The criminal action for violation of BP 22 shall be deemed to include the
22 HEIRS OF EDUARDO SIMON v. ELVIN CHAN AND CA corresponding civil action. No reservation to file such civil action separately
shall be allowed.”
Facts: 1. An information charged the late Eduardo Simon with a violation of BP 22. ● 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
● Simon issued to Elvin Chan to apply on account or for value a Landbank based on dishonored checks.
Check payable to cash of P336,000, ● Instead of instituting two separate cases, one for criminal and another for
● and well knowing that at the time of issue she/he/they did not have sufficient civil, only a single suit shall be filed and tried.
funds in or credit with the drawee bank for payment of such check in full
upon its presentment, ● The only instance when separate proceedings are allowed is when the civil
● and for which check when presented for payment within 90 days, was action is filed ahead of the criminal case.
subsequently dishonored by the drawee bank for Account Closed ● It should be stressed that the policy laid down by the Rules is to discourage
● and despite receipt of notice of such dishonor, Simon failed to pay Elvin the separate filing of the civil action.
Chan the amount of the check or to make arrangement for full payment of
the same within 5 banking days after receiving said notice.
2. More than 3 years later Elvin Chan commenced a civil action for the collection of
the principal amount of P336,000, coupled with an application for a Writ of Preliminary
Attachment.
● The MeTC issued the WPA, thus, the sheriff attaching a Nissan vehicle of
Simon.
● Simon filed an urgent motion to dismiss averring:
○ On the ground of litis pendentia, that is, as a consequence of the
pendency of another action between the instant parties for the
same cause, entitled "People of the Philippines vs. Eduardo
Simon", the instant action is dismissable.