FLORENTINA A. LOZANO, petitioner, vs. THE HONORABLE ANTONIO M.

MARTINEZ, in his capacity as Presiding Judge, Regional Trial Court, National Capital Judicial Region, Branch XX, Manila, and the HONORABLE JOSE B. FLAMINIANO, in his capacity as City Fiscal of Manila, respondents. YAP, J: Petitioners, charged with Batas Pambansa Bilang 22 (BP 22 for short), popularly known as the Bouncing Check Law, assail the law's constitutionality. 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, 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." The penalty prescribed for the offense is 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. Since this involves a state of mind difficult to establish, the statute itself creates aprima 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. Another provision of the statute, also in the nature of a rule of evidence, provides that the introduction in evidence of the unpaid and dishonored check with the drawee bank's refusal to pay "stamped or written thereon or attached thereto, giving the reason therefor, "shall constitute primafacie proof of "the making or issuance of said check, and the due presentment to the drawee for payment and

the dishonor thereof ... for the reason written, stamped or attached by the drawee on such dishonored check." The presumptions being merely prima facie, it is open to the accused of course to present proof to the contrary to overcome the said presumptions. ISSUE: Whether or not (W/N) BP 22 violates the constitutional provision forbidding imprisonment for debt. HELD: No. 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 effects of the issuance of a worthless check transcends the private interests of the parties directly involved in the transaction and touches the interests of the community at large. The mischief it creates is not only a wrong to the payee or holder, but also an injury to the public. The harmful practice of putting valueless commercial papers in circulation, multiplied a thousand fold, can very wen pollute the channels of trade and commerce, injure the banking system and eventually hurt the welfare of society and the public interest. 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. ISSUE: W/N BP 22 impairs the freedom to contract. HELD: No. The freedom of contract which is constitutionally protected is freedom to enter into "lawful" contracts. Contracts which contravene public policy are not lawful. Besides, we must bear in mind that 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. ISSUE: W/N it violates the equal protection clause.

HELD: No. Petitioners contend 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. Moreover, 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.

JOY LEE RECUERDO, petitioner, vs. PEOPLE OF THE PHILIPPINES AND THE COURT OF APPEALS, respondents. DECISION
CARPIO-MORALES, J.:

Before us for review is the July 16, 1997 decision of the Court of Appeals in CA-G.R. No. 20577 affirming that rendered by the Regional Trial Court (RTC), Branch 150, Makati City which in turn affirmed that of the Metropolitan Trial Court (MeTC) of Makati City, Branch 67 convicting Joy Lee Recuerdo (petitioner) for violation of Batas Pambansa Blg. 22 (The Bouncing Checks Law) on 5 counts. From the evidence of the prosecution, the following facts are established: Sometime in the first week of December 1993, Yolanda Floro (Yolanda) who is engaged in jewelry business sold a 3-karat loose diamond stone valued at P420,000.00 to petitioner who gave a downpayment of P40,000.00. In settlement of the balance of the purchase price, petitioner issued 9 postdated checks, 8 of which in the amount of P40,000.00, and 1 in the amount ofP20,000.00, all drawn against her account at the Prudential Bank.
[1]

When Yolanda deposited 8 of the 10 checks to her depository bank, Liberty Savings and Loan Association, only 3, those dated December 25, 1993, January 25, 1994, and February 25, 1994, were cleared. The remaining 5 were dishonored due to the closure of petitioners account.
[2]

Yolanda thus went to petitioners dental clinic and advised her to change the dishonored checks to cash. Petitioner promised alright but she welshed on it.
[3]

A demand letter was thereupon sent to petitioner for her to settle her obligation but she failed to heed the same, hence, the filing of 5 informations against her for violation of B. P. 22 at the Makati MeTC, the accusatory portion of the first of which reads:
[4] [5] [6]

That sometime in the first week of December, 1993, in the Municipality of Makati, Metro Manila, Philippines, and within the jurisdiction of this Honorable Court, the above-named accused, did then and there willfully, unlawfully and feloniously make out, drawn (sic) and issue to YOLANDA G. FLORO to apply on account or for value the check described below: Check No. Drawn Against In the Amount of Postdated/dated Payable to - 008789 - Prudential Bank - P40,000.00 - July 25, 1994 - Cash

said accused well knowing that at the time of issue thereof, said account 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, which check 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 accused failed 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. Except for the check numbers and dates of maturity, the four other informations are similarly worded. After trial, Branch 67 of the Makati MeTC convicted petitioner in a Joint Decision the dispositive portion of which reads:
[7]

Wherefore, in view of the foregoing, the court finds the accused guilty beyond reasonable doubt of Violation of Batas Pambansa Bilang 22 on five (5) counts and therefore sentences the accused to suffer an imprisonment of 30 days for each count and to restitute the amount of P 200,000.00 to Miss Yolanda G. Floro, which is the total amount of the five (5) checks, and to pay her also the amount of P20,000.00 as damages to compensate the payment of attorneys fees. SO ORDERED.
[8]

As stated early on, the RTC, on appeal, affirmed the decision of the MeTC. And the Court of Appeals affirmed that of the RTC.
[9] [10]

In the petition for review on certiorari at bar, petitioner proffers as follows: 1. Petitioner was convicted by an invalid law which is Batas Pambansa Blg. 22 for being 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.
[11]

Petitioner contends that since banks are not damaged by the presentment of dishonored checks as they impose a penalty for each, only creditors/payees are unduly favored by the law; that the law is in essence a resurrected form of 19th 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; and that 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.
[12] [13] [14]

These matters subject of petitioners contention have long been settled in the landmark case of Lozano v. Martinez where this Court upheld the constitutionality of B. P. 22:
[15]

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 law. The law punishes the act not as an offense against property, but an offense against public order. (Emphasis supplied)
[16]

The contention that B. P. 22 is a bill of attainder, one which inflicts punishment without trial and the essence of which is the substitution of a legislative for a judicial determination of guilt, fails. For under B. P. 22, every
[17]

element of the crime is still to be proven before the trial court to warrant a conviction for violation thereof. Reinforcing her thesis, petitioner cites the speech made by now VicePresident Teofisto Guingona delivered before the Philippine Bar Association wherein he stressed the need to review the law since it has not prevented the proliferation of bouncing checks.
[18]

As correctly argued by the Solicitor General, however, while due deference is given to the opinion of the Vice-President, the same should properly be addressed to the legislature which is in a better position to review the effectiveness and usefulness of the law. As held in the case of Lozano, 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.
[19] [20]

Petitioner further claims that the dishonored checks were not issued for deposit and encashment, nor was there consideration therefor, in support of which she cites her alleged agreement with Yolanda that she could have the stone appraised to determine the purchase price, and since she found out that it is only worth P160,000.00, there was no longer any need to fund the remaining checks which should be returned to her. Yolanda, however, so petitioner adds, could no longer be reached. Petitioner thus concludes that she had already paid in full the purchase price of the stone, she having paid P40,000.00 cash plus the P120,000.00 proceeds of the three cleared checks.
[21] [22] [23] [24] [25] [26]

Petitioners submission does not lie. Such alleged agreement does not inspire belief. The terms and conditions surrounding the issuance of the checks are irrelevant.
[27]

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, which is explicit that 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. (Emphasis supplied.)
[28]

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 currency. It is a policy that can be easily eroded if one has yet to determine the reason for which checks are issued, or the terms and conditions for their issuance, before an appropriate application of the legislative enactment can be made. (Emphasis supplied)
[29]

Additionally, petitioner argues that as no bank representative testified as to whether the questioned checks were dishonored due to insufficiency of funds (sic), such element was not clearly and convincingly proven, hence, the trial court failed to uphold her right to presumption of innocence when she was convicted based on the sole testimony of Yolanda.
[30]

Whether the checks were dishonored due to insufficiency of funds, or Account Closed as alleged in the informations and testified on by Yolanda, petitioners argument is untenable.
[31]

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 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 the 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. (Emphasis supplied)
[32]

Yolandas testimony that when she deposited the checks to her depository bank they were dishonored due to Account Closed thus sufficed. In fact, even petitioners counsel during trial admitted the dishonor, and on that ground.
[33] [34]

Finally, petitioner imputes bias on the part of the appellate court when it decided her petition for review without the comment of the Office of the Solicitor General. The rendition of the decision by the appellate court without the comment of the People-Appellee 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. In fine, the affirmance of petitioners conviction is in order. 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.
[35]

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. 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. SO ORDERED.
People v. Nitafan Facts: On January 20, 1985, aid accused did then and there wilfully, unlawfully and feloniously make or draw and issue to Fatima Cortez Sasaki Philippine Trust Company Check No. 117383 in the amount of P143,000.00 He knew that at the time of issue he did not have sufficient funds in or credit with the drawee bank. The check was subsequently dishonored by the drawee bank for insufficiency of funds, and despite receipt of notice of such dishonor, said accused failed to pay Sasaki the amount of said check or to make arrangement for full payment of the same within five banking days after receiving said notice. Private respondent, Mariano Lim moved to quash the Information of the ground that the facts charged did not constitute a felony as B.P. 22 was unconstitutional and that the check he issued was a memorandum check which was in the nature of a promissory note in thus, is civil in nature. On 1 September 1986, respondent judge, ruling that B.P. 22 on which the Information was based was unconstitutional, issued the questioned Order quashing the Information. Hence, this petition for review on certiorari filed by the Solicitor General in behalf of the government. G.R. No. 75954 October 22, 1992

Issues: W/N B.P. 22 is unconstitutional W/N a memorandum check issued postdated in partial payment of a pre-existing obligation is within the coverage of B.P. 22.

Ratio: The constitutionality of the Bouncing Check Law has already been sustained by the SC through jurisprudence in Lozano v. Martinez, and the seven other cases decided jointly with it. 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. A memorandum check comes within the meaning of Sec. 185 of the Negotiable Instruments Law which defines a check as "a bill of exchange drawn on a bank payable on demand." 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" 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 15 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. Dispositive Portion: 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.
People v. Rica Cuyugan (2002) FACTS: Rica G. Cuyugan issued to Norma Abagat several checks in payment of supplies she wanted to buy for the Philippine Armed Forces. 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. Despite repeated demands, appellant failed to make good the checks, which constrained the Abagat spouses to file a complaint for estafa against Cuyugan. Cuygan claimed that the Abagat spousesand she were partners in obtaining construction projects with the Philippine Army. She issued postdated checks as proof that the Abagat spouses had invested their money with her. She claimed that she was the industrial partner as she did all the legwork in getting the projects. They then shared in the profits after deducting all the miscellaneous expenses. The trial court found appellant 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, 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. HELD: We find the appeal meritorious. The transaction between appellant and the Abagat spouses, in our view, was one for a loan of money to be used by appellant in her business and she issued checks to guarantee the payment of the loan. 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.

FELIPA B. CUEME, petitioner, vs. PEOPLE OF THE PHILIPPINES, respondent. DECISION BELLOSILLO, J.: FELIPA B. CUEME assails in this petition for review the Decision of the Court of Appeals promulgated 22 October 1997 which affirmed the decision of the trial court finding her guilty of fifteen (15) violations of Batas Pambansa Blg. 22 (Bouncing Checks Law), sentencing her to six (6) months imprisonment and fine for each violation, and ordering her to pay the complaining witness the face value of the dishonored checks with legal interest.
[1]

Helen Simolde was a bank teller of the Bank of the Philippine Islands (BPI), Makati Branch. One of the banks clients was petitioner Felipa B. Cueme, General Manager of Mark-Agro Trading Corporation and AMF General Trading Corporation engaged in the trading of cacao in Davao and Manila. Since both Simolde and Cueme hail from Davao they became friends and soon Simolde started lending money to Cueme for which Cueme would issue post-dated crossed checks to Simolde covering the amounts lent plus interests. As recorded, their transactions were [2] [3] [4]

DATE S OF CHECKS 7 Feb. 1990 12 Feb. 1990 17 Feb. 1990 21 Feb. 1990 3 Mar. 1990 6 Mar. 1990 8 Mar. 1990 10 Mar. 1990 12 Mar. 1990 12 Mar. 1990 14 Mar. 1990 14 Mar. 1990 15 Mar. 1990 16 Mar. 1990 24 Mar. 1990

AMOUNTS LENT BY SIMOLDE P 25,000.00 175,000.00 175,000.00 100,000.00 25,000.00 25,000.00 ------------135,000.00 50,000.00 50,000.00 200,000.00 75,000.00 130,000.00 350,000.00 27,500.00

FAVE VALUE CHECKS P 27,000.00 189,000.00 189,000.00 108,000.00 27,000.00 27,000.00 696,000.00 155,000.00 54,000.00 55,000.00 220,000.00 82,500.00 145,000.00 385,000.00 27,500.00

BPI CHECK S NOS. 647647[5] 647626[6] 356891[7] 356892[8] 356941[9] 356942[10] 356942[11] 647700[12] 356915[13] 356943[14] 356944[15] 356945[16] 356946[17] 356947[18] 356948[19]

Each of these checks was drawn against the deposit accounts of Mark-Agro Trading Corporation at BPI. On several occasions Cueme somehow persuaded Simolde not to deposit the checks as issued. But on 9 May 1990 Simolde finally deposited all the checks in her BPI-Makati account which, however, were dishonored for being "drawn against insufficient funds" (DAIF). Simolde immediately informed Cueme about the dishonored checks and repeatedly demanded payment but to no avail. Apparently Cueme had no intention of making good any of those checks.
[20]

Petitioner Felipa B. Cueme however had a different story when she took the witness stand. She disputed Simoldes claim that she borrowed money from her. She contended that the sums petitioner received were not Simoldes but those of the investors of Mark-Agro Trading Corporation. She likewise denied having issued the subject checks to Simolde alleging instead that it was Simolde who 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. Leonora Gabuan corroborated petitioners version. Gabuan testified that she knew petitioner and complaining witness to be very close to each other like sisters; that sometime in March 1990 she had with her pre-signed checks entrusted by petitioner who was then in Davao for the payment of telephone and electric bills, payroll and petty cash; that Simolde approached her and asked for checks purportedly to be shown to potential investors but she refused knowing that she was not authorized to use them for any purpose other than that for which they were intended; that upon Simoldes insistence however she eventually relented and handed over to Simolde the requested checks; that the following day Simolde requested her to fill up three (3) blank checks to which she complied but she told Simolde that those checks were not funded yet and that Simolde would be paid as soon as they had the money.
[21] [22] [23] [24]

As stated earlier, the trial court found petitioner guilty as charged and sentenced her to a uniform prison term of six (6) months in each of the fifteen (15) cases plus a fine of P27,000.00 in Crim. Case No. 92-5626, P189,000.00 in Crim. Case No. 92-5625, P189,000.00 in Crim. Case No. 925621, P108,000.00 in Crim. Case No. 92-5622, P27,000.00 in Crim. Case No. 92-5613,P27,000.00 in Crim. Case No. 92-5612, P200,000.000 in Crim. Case No. 92-5624, P155,000.00 in Crim. Case No. 92-5627, P54,000.00 in Crim.

Case No. 92-5614, P55,000.00 in Crim. Case No. 92-5615, P220,000.00 in Crim. Case No. 92-5616, P82,500.00 in Crim. Case No. 925617, P145,000.00 in Crim. Case No. 92-5618, P200,000.00 in Crim. Case No. 92-5619, andP27,500.00 in Crim. Case No. 92-5620.
[25]

On appeal, the Court of Appeals affirmed with modification the trial courts decision The judgment of the court a quo finding the appellant guilty as charged is hereby affirmed. However, the penalty imposed in Criminal Case No. 92-5616, where the accused was sentenced to a fine of P220,000.00 in addition to six (6) months imprisonment must be modified. Section 1 of B.P. Blg. 22 provides that the fine to be imposed against the accused shall be "not less than but not more than double the amount of the check which fine shall in no case exceed Two Hundred Thousand Pesos x x x x. " In Criminal Case No. 92-5616, the accused issued Check No. 356944 with a face value of P220,000.00. Consequently, the fine imposed against the accused must be reduced to the maximum amount of Two Hundred Thousand Pesos (P200,000.00) only. Her motion for reconsideration having been denied by the Court of Appeals, petitioner now entreats us to reverse her conviction contending that, first, she did not issue the checks in question as she merely signed them in blank; second, it was complainant who procured the checks from petitioners secretary, made the corresponding entries therein, and thereafter deposited them in her account; and third, the checks were not issued for value or consideration as they were merely intended to be shown to would-be investors of Mark-Agro Trading Corporation, and not to be encashed or deposited in the bank. After a thorough review of the records we find petitioners conviction for violations of B.P. Blg. 22 well-founded. B.P. Blg. 22 was purposely enacted to prevent the proliferation of worthless checks in the mainstream of daily business and to avert not only the undermining of the banking system of the country but also the infliction of damage and injury upon trade and commerce occasioned by the indiscriminate issuances of such checks. By its very nature, the offenses defined under B.P. Blg. 22 are against public interest. Thus in Lozano v. Martinez we held [26]

The effects of the issuance of a worthless check transcend (sic) the private interests of the parties directly involved in the transaction and touch (sic) the interest of the community at large. The mischief it creates is not only a wrong to the payee and 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. 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.
[27]

Whether petitioner indeed issued the disputed checks to complainant in payment of outstanding obligations, or whether it was complainant who procured the checks from petitioners secretary only to be shown to potential investors is a factual question involving as it does the credibility of witnesses. 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. Verily, the trial court has the advantage of hearing the witnesses and observing their conduct during the trial, which circumstances carry great weight in assessing their credibility. We see no reason to overturn the decisions of the trial court and the Court of Appeals in giving credence to the testimony of complainant. The testimony of a lone witness when credible and trustworthy, as in this case, is sufficient to convict.
[28]

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. These circumstances could only mean that the checks were issued either by petitioner herself or at her instance.
[29]

Significantly, during the preliminary investigation, petitioner Cueme and her witness Leonora Gabuan submitted their Counter-Affidavit and Affidavit, respectively. Petitioner categorically stated in her Counter-Affidavit that she
[30] [31]

issued the checks in question to complainant for purposes of showing them to various potential investors. On her part, Leonora Gabuan alleged in her Affidavit that she was instructed by petitioner to deliver the checks to the complainant. Their admissions in their affidavits clearly contradicted their testimonies during the trial when they both denied that the checks were issued to complaining witness. Their explanations, i.e., that they were in a hurry when they signed the affidavits and that they did not understand their contents because they were Visayans and the affidavits were written in English, were hardly credible in the light of the observation of the trial court that both were well-educated in banking and finance and in fact exhibited a good command of the English language when they testified. 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.
[32]

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 checkmalum 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.
[33]

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. What is important is the fact that petitioner deliberately issued the checks in question and those checks were dishonored upon presentment for payment.
[34] [35]

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 Account Nos. 001-1151-95 and 0011-1318-08 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.
[36] [37]

Lastly, we agree with the modification made by the Court of Appeals on the penalty imposed by the court a quo. Section 1 of B.P. Blg. 22 specifically provides that the fine to be imposed on the offender shall be "not less than but not more than double the amount of the check, which fine shall in no case exceed Two Hundred Thousand Pesos (P200,000.00). Thus, petitioner should be made to pay only the maximum of P200,000.00 fine in Crim. Case No. 925616, and not P220,000.00 as fixed by the trial court. WHEREFORE, the assailed Decision of the Court of Appeals dated 22 October 1997 affirming the decision of the trial court convicting petitioner FELIPA B. CUEME of fifteen (15) violations ofBatas Pambansa Blg. 22 otherwise known as the Bouncing Checks Law is AFFIRMED. Accordingly, petitioner is sentenced to imprisonment of six (6) months for each crime and to pay fines in the total amount of P1,686,000.00 for the fifteen (15) cases after reducing the fine in Crim. Case No. 92-5616 to P200,000.00. Petitioner is further ordered to pay complaining witness Helen Simolde the face value of the dishonored checks in the aggregate amount of P2,387,500.00 with legal interest, plus costs. SO ORDERED.

LUIS WONG vs. CA

Posted on November 24, 2012

G.R. No. 117857 February 2, 2001

FACTS: Wong was an agent of Limtong Press Inc. (LPI), a manufacturer of calendars. However, petitioner had a history of unremitted collections. Hence, petitioners customers were required to issue postdated checks before LPI would accept their purchase orders. In early December 1985, Wong issued 6 postdated checks totaling P18,025, all dated December 30, 1985 and drawn payable to the order of LPI. The checks were drawn against Allied Banking Corporation. The 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 petitioners unremitted collections for 1984 amounting to P18,077.07. LPI waived the P52.07 difference. Before the maturity of the checks, petitioner prevailed upon LPI not to deposit the checks and promised to replace them within 30 days. However, petitioner 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. On June 20, 1986, complainant notified the petitioner of the dishonor. However, petitioner failed to make arrangements for payment within 5 banking days. On November 6, 1987, petitioner was charged with 3 counts of violation of B.P. Blg. 22 under 3 separate Informations for the 3 checks amounting to P5,500.00, P3,375.00, and P6,410.00. Petitioner 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.

The version of the defense is that petitioner issued the 6 checks to guarantee the 1985 calendar bookings of his customers, not as payment for any obligation. In fact, the face value of the 6 postdated checks tallied with the total amount of the calendar orders of the 6 customers of the accused. Although these customers had already paid their respective orders, petitioner claimed LPI did not return the said checks to him. On August 30, 1990, the trial court found petitioner guilty beyond reasonable doubt with 3 counts of Violations of Sec.1 of B.P. Blg. 22. Petitioner appealed his conviction to the CA. However, it affirmed the trial courts decision in toto on October 28, 1994. ISSUES: 1. Whether the checks were issued merely as guarantee or for payment of petitioners unremitted collections. 2. WON the prosecution was able to establish beyond reasonable doubt all the elements of the offense penalized under B.P. Blg. 22. 3. WON petitioners penalty may be modified to only payment of fine. HELD: 1.This is a factual issue involving as it does the credibility of witnesses. Said factual issue has been settled by the trial court and CA. Its findings of fact are generally conclusive, and there is no cogent reason to depart from such. In cases elevated from the CA, the SCs review is confined to alleged errors of law. Absent any showing that the findings by the respondent court are entirely devoid of any substantiation on record, the same must stand. The lack of accounting between the parties is not the issue in this case. As repeatedly held, the SC is not a trier of facts. 2. There are 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 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 90 days. The elements of B.P. Blg. 22 under the 1st situation, pertinent to the present case, are: (a) The making, drawing & issuance of any check to apply for account or for value; (b) 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 (c) 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. As to the 1st element, the RTC & CA have both ruled that the checks were in payment for unremitted collections, and not as guarantee. 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. As to the 2nd element, B.P. Blg. 22 creates a presumption juris tantum that the 2nd element prima facie exists when the 1st & 3rd elements of the offense are present. Thus, the makers knowledge is presumed from the dishonor of the check for insufficiency of funds. An essential element of the offense is knowledge on the part of the maker/drawer of the check of the insufficiency of his funds in, or credit with, the bank to cover the check upon its presentment. 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 90 days from the date of the check. The statute provides that such presumption shall not arise if within 5 banking days from receipt of the notice of dishonor, the maker/drawer makes arrangements for payment of the check by the bank or pays the holder the amount of the check. Nowhere in the 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: (1) presentment within 90 days from date of the check, and (2) the dishonor of the check & 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 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 petitioner from his duty to maintain sufficient funds in the account within a reasonable time thereof. Under Sec. 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 6 months (180 days). Private respondent 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 RTC, private respondent did not deposit the checks because of the reassurance of petitioner 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, petitioner was duly notified of such fact but failed to make arrangements for full payment within 5 banking days thereof. There is, on record, sufficient evidence that petitioner 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 petitioners insistent plea of innocence, the respondent court is not in

error for affirming his conviction by the trial court for violations of the Bouncing Checks Law. 3. Pursuant to the policy guidelines in Administrative Circular No. 12-2000, which took effect on November 21, 2000, the penalty imposed on petitioner should now be modified to a fine of not less than but not more than double the amount of the checks that were dishonored. The penalty imposed on him is modified so that the sentence of imprisonment is deleted. MANUEL NAGRAMPA vs. PEOPLE OF THE PHILIPPINES G.R. No. 146211 August 6, 2002 In this petition for review on certiorari, petitioner assails his conviction for estafa in Criminal Case No. Q-90-15797 and for 2 counts of violation of Batas Pambansa Blg. 22 (Bouncing Checks Law) in Criminal Cases Nos. Q-90-15798 and Q-90-15799. FACTS On July 28, 1989, Manuel Nagrampa purchased a Yutani Poclain Backhoe Excavator Equipment for P200,000 from FEDCOR & paid the down payment of P50,000 in cash. To cover the balance, he issued Check No. 473477 postdated August 31, 1989 and Check No. 473478 postdated September 30, 1989 in the amount of P75,000 each. The checks were drawn against the Security Bank and Trust Company. Upon the assurance of FEDCORs salesman that the checks were good, FEDCOR delivered the equipment to Nagrampa. FEDCOR presented the checks for payment on February 22, 1990; however, they were dishonored on the ground that petitioners account had already been closed. FEDCOR demanded payment from petitioner in a letter dated March 19, 1990; but the latter failed to pay. Hence, the above cases were filed against petitioner with the trial court. During his cross-examination, Santander denied that the equipment was returned to FEDCOR.

Felix Mirano testified that he had been a signature verifier of Security Bank for 12 years. He brought with him the signature card for petitioners account, the s ame account against which the subject checks were drawn. He identified the signatures appearing on Checks Nos. 473477 and 473478 to be those of the petitioner, and explained that petitioners account had been closed in May 1985. For his part, petitioner testified that he had an agreement with Corseno Bote wherein he would replace the 2 checks with cash if the backhoe would be in good running condition. However, after 5-7 days of use, the backhoe broke down. Such fact was reported to Ronnie Bote, and the backhoe was thus repaired. After 1 day of using it, the backhoe broke down again. Petitioner again reported the matter to Ronnie Bote, who told him that the equipment should be brought to the latters office for repair. As evidence of the return of the equipment, petitioner presented a letter dated October 3, 1989 addressed to Electrobus Consolidated, Inc., requesting the release of the backhoe to Ronnie Bote for repair, with the latters alleged signature appearing at the bottom thereof. After a week, petitioner demanded from Ronnie Bote the return of the backhoe, the P50,000 cash and the 2 postdated checks, but to no avail. On cross-examination, he admitted that during the pendency of the case he paid, upon the advice of his counsel, the amount of P15,000, which he handed to FEDCORs counsel Atty. Orlando Paray. On September 30, 1993, the trial court found petitioner guilty of 2 counts of violation of B.P. Blg. 22. Petitioner appealed the decision to the CA. Upon noticing that the trial court did not resolve the issue of petitioners liability for estafa, the CA issued a resolution ordering the return of the entire records of the case to the trial court for the latter to decide the estafa case against petitioner. On February 8, 1999, the trial court found petitioner guilty beyond reasonable doubt of estafa. Thus, petitioner also appealed said decision to the CA.

On July 21, 2000, the CA affirmed in toto the decision of the trial court finding petitioner guilty of estafa and violations of B.P. Blg. 22. ISSUES: 1. WON petitioner is guilty of violating B.P. Blg. 22. 2. If so, may the penalty be modified by retroactively applying Vaca v. CA and Lim v. People so that petitioner only need to pay a fine instead of serving imprisonment? 3. WON petitioner should be convicted for estafa. HELD: 1. Two distinct acts are punished under Sec.1 of B.P. Blg. 22: (a)The making or drawing & 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 (b)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 90 days from the date appearing thereon, for which reason it is dishonored by the drawee bank. In the 1st situation, the drawer knows of the insufficiency of funds to cover the check at the time of its issuance. The check involved is worthless at the time of issuance, since the drawer has neither sufficient funds in, nor credit with, the drawee bank at the time. While in the 2nd situation, the drawer has sufficient funds at the time of issuance but fails to keep sufficient funds or maintain credit within 90 days from the date appearing on the check. The check involved in the second offense is good when

issued, as the drawer has sufficient funds in, or credit with, the drawee bank when issued. In both instances, the offense is consummated by the dishonor of the check for insufficiency of funds or credit. It is clear from the allegations in the information that petitioner is charged with the 1st type of offense under B.P. Blg. 22. Its elements are as follows: (a) The making, drawing and issuance of any check to apply for account or for value; (b) 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 (c) 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. The fact that the checks were presented beyond the 90-day period provided in Sec. 2, B.P. Blg. 22 is of no moment. It was held in Wong vs CA that the 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: Neither does it discharge petitioner from his duty to maintain sufficient funds in the account within a reasonable time thereof. Under Sec.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 6 months (180 days).

In Bautista v. Court of Appeals, it was ruled that such prima facie presumption is intended to facilitate proof of knowledge, and not to foreclose admissibility of other evidence that may also prove such knowledge; thus, the 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. The prosecution may still prove such knowledge through other evidence. In this case, FEDCOR presented the checks for encashment within the 6-month period from the date of issuance of the checks, and would not therefore have been considered stale had petitioners account been existing. Although the presumption of knowledge of insufficiency of funds did not arise, such knowledge was sufficiently proved by the unrebutted testimony of Mirano to the effect that petitioners account with the Security Bank was closed for more than 4 years prior to the issuance of the 2 checks in question. Thus, the CA did not err in its affirmation of the trial courts decision convicting petitioner of violations of B.P. Blg.22. 2. No. According to Administrative Circular No. 13-2001 clarifying AC No. 12-2000; thus: The clear tenor and intention of Administrative Circular No. 12-2000 is not to remove imprisonment as an alternative penalty, but to lay down a rule of preference in the application of the penalties provided for in B.P. Blg. 22. The pursuit of this purpose does not foreclose the possibility of imprisonment for violators of B.P. Blg. 22. AC No. 12-2000 establishes a rule of preference in the application of the penal provisions of B.P. Blg. 22 such that where the circumstances of both the offense and the offender clearly indicate good faith or a clear mistake of fact without taint of

negligence, the imposition of a fine alone should be considered as the more appropriate penalty. Needless to say, the determination of whether the circumstances warrant the imposition of a fine alone rests solely upon the Judge. Should the Judge decide that imprisonment is the more appropriate penalty, AC No. 12-2000 ought not be deemed a hindrance. In this case, petitioner manifested utter lack of good faith or wanton bad faith when he issued the subject postdated checks even though he had no more account with the drawee bank, having closed it more than 4 years before he drew and delivered the checks. Hence, he cannot avail himself of the benefits under AC No. 12-2000. 3. Yes. The crime of estafa under paragraph 2(d) of Art. 315 of the RPC, as amended, has the following elements: (a) postdating or issuance of a check in payment of an obligation contracted at the time the check was issued; (b) lack or insufficiency of funds to cover the check; and (c) damage to the payee thereof. Settled is the rule that, to constitute estafa, the act of postdating or issuing a check in payment of an obligation must be the efficient cause of defraudation and it should be either prior to, or simultaneous with, the act of fraud. The offender must be able to obtain money or property from the offended party because of the issuance of the check, or the person to whom the check was delivered would not have parted with his money or property had there been no check issued to him. The existence of the first two elements in the case at bar is not disputed.

Damage as an element of estafa may consist in (1) the offended party being deprived of his money or property as a result of the defraudation; (2) disturbance in property right; or (3) temporary prejudice. In this case, the deprivation of the property of FEDCOR is apparent. Undoubtedly, the reason why FEDCOR delivered the backhoe to petitioner was that the latter paid the P50,000 down payment and issued 2 postdated checks in the amount of P75,000 each. Petitioners claim that he returned the equipment was not duly proved; he never presented as witness the agent who allegedly received the equipment from him. Moreover, he admitted that he never wrote FEDCOR about the return of the allegedly defective backhoe to Ronnie Bote; neither did he go to FEDCOR to claim the return of the equipment or of the cash down payment and the two checks. Such admissions belie his allegation that he returned the equipment to FEDCOR. Besides, on cross-examination he admitted 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 advice of his own lawyer that he had to pay because he was guilty. Such payment to FEDCOR negates his claim that he returned the backhoe; it may even be tantamount to an offer of compromise. Under Sec. 27 of Rule 130 of the Rules on Evidence, an offer of compromise in criminal cases is an implied admission of guilt.