Failure to present the check within 90 days from its indicated date would still not preclude the

prosecution from prosecuting the accused for BP22 violation if knowledge of the accused that
the check was unfunded at the time it was issued will still be proved.

1. In this case, knowledge of the issuer here was established by showing that the account
was closed long way before the issuance of the check. The account verifier of the
drawee bank was presented as prosecution’s witness.

FIRST DIVISION

[G.R. No. 146211. August 6, 2002.]

MANUEL NAGRAMPA, Petitioner, v. PEOPLE OF THE PHILIPPINES, Respondent.

DECISION

DAVIDE, JR., C.J.:

In this petition for review on certiorari, petitioner assails this conviction for estafa in Criminal Case No.
Q-90-15797 and for two counts of violation of Batas Pambansa Blg. 22 (Bouncing Checks Law) in
Criminal Cases Nos. Q-90-15798 and Q-90-15799. chanrob1es virtua1 1aw 1ibrary

The accusatory portion of the information in Criminal Case No. 90-15797 for estafa reads as follows:
library
chanrob1es virtual 1aw

That on or about the 28th day of July 1989 in Quezon City, Philippines and within the jurisdiction of this
Honorable Court, the above-named accused, with intent to gain by means of false pretenses or
fraudulent acts executed prior to or simultaneously with the commission of the fraud, did then and
there, wilfully, unlawfully and feloniously defraud FEDCOR TRADING CORPORATION represented by
FEDERICO A. SANTANDER by then and there making, drawing and issuing in favor of the latter the
following checks, to wit: chanrob1es virtual 1aw library

CHECK NOS. AMOUNT POSTDATED

473477 P75,000.00 August 31, 1989

473478 P75,000.00 September 30, 1989

drawn against the SECURITY BANK AND TRUST COMPANY in payment of an obligation, knowing fully
well at the time of issue that he did not have any funds in the bank or his funds deposited therein was
not sufficient to cover the amount of the checks that upon presentation of said checks to the said bank
for payment, the same were dishonored for the reason that the drawer thereof, Accused MANUEL
NAGRAMPA did not have any funds therein and despite notice of dishonor thereof, Accused failed and
refused and still fails and refuses to redeem or make good said checks, to the damage and prejudice of
the said FEDCOR TRADING CORPORATION in such amount as may be awarded under the provisions of
the Civil Code. chanrob1es virtua1 1aw 1ibrary

CONTRARY TO LAW.

The accusatory portion of the information in Criminal Case No. 90-15798 for violation of B.P. Blg. 22
reads as follows: chanrob1es virtual 1aw library

That on or about the 28th day of July, 1989 in Quezon City, Philippines, and within the jurisdiction of
this Honorable Court, the above-named accused, did then and there, willfully, unlawfully and
feloniously make, draw and issue in favor of FEDCOR TRADING CORPORATION represented by
FEDERICO A. SANTANDER a check numbered 473478 drawn against the SECURITY BANK AND TRUST
COMPANY, Escolta Branch, a duly established domestic banking institution, in the amount of
P75,000.00, Philippine Currency, postdated September 30, 1989 in payment of an obligation, knowing
fully well that at the time of issue that she/he did not have ANY funds in the drawee bank for the
payment of such check; that upon presentation of said check to said bank for payment, the same was
dishonored for the reason that the drawee bank of accused MANUEL NAGRAMPA did not have ANY
funds therein and despite notice of dishonor thereof, Accused failed and refused and still fails and
refuses to redeem or make good said check, to the damage and prejudice of the said FEDCOR
TRADING CORPORATION in the amount aforementioned and in such other amount as may be awarded
under the provisions of the Civil Code.

Contrary to law. 2
The information in Criminal Case No. Q-90-15799 is similar worded as in Criminal Case No. Q-90-15798
except as to the date and number of the check.

Upon his arraignment, petitioner entered a plea of not guilty in each case.

At the trial on the merits, the prosecution presented Federico Santander, President of Fedcor Trading
Corporation (hereafter FEDCOR), and Felix Mirano, signature verifier of the Escolta Branch of the
Security Bank and Trust Company.

Federico Santander testified that on 28 July 1989, Corseno Bote FEDCOR’s Sales Manager, brought to
FEDCOR petitioner Manuel Nagrampa (hereafter NAGRAMPA), General Manager of the Nagrampa
Asphalt Plant Montalban, Rizal. NAGRAMPA purchased a Yutani Poclain Back Excavator Equipment for
P200,000 from FEDCOR and paid in cash down payment of P50,000. To cover the balance of P150,000,
he issued Check No. 473477 3 postdated 31 August 1989 and Check No. 473478 4 postdated 30
September 1989 in the amount of P75,000 each. The checks were drawn against the Security Bank
and Trust Company. Upon the assurance of FEDCOR’s salesman that the checks were good, FEDCOR
delivered to petitioner the equipment. 5 chanrob1es virtua1 1aw 1ibrary

Santander further testified that FEDCOR presented the checks payment on 22 February 1990;
however, they were dishonored on the ground that petitioner’s account with the drawee bank, Security
Bank, already been closed. In a letter 6 dated 19 March 1990, sent through registered mail, FEDCOR
demanded payment from petitioner; but the latter failed to pay. Hence, the above cases were filed
against petitioner with the trial court. 7 During his cross-examination, Santander denied that the
equipment was returned to FEDCOR. Ronnie Bote, son of Corseno Bote, not an employee of FEDCOR
but was merely its sales agent with no author to receive returned equipment. 8

Felix Mirano, the second prosecution witness, testified that he had been a signature verifier of Security
Bank for twelve years. His duty was to verify the signatures of the clients of the bank. He brought with
him the signature card for Account No. 0110-4048-19, petitioner’s 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. When asked about the status of said account, he answered that the account
had been closed in May 1985 yet. 9

For his part, petitioner testified that on 28 July 1989, he bought from Corseno Bote a backhoe and paid
P50,000 cash, as evidenced by an acknowledgment receipt 10 signed by Corseno Bote. In addition, he
issued and handed to Corseno Bote two checks in the amount of P75,000 each, dated 31 August 1989
11 and 30 September 1989. 12 The agreement with Corseno Bote was that petitioner would replace
the two checks with cash if the backhoe would be in good running condition. The backhoe was
delivered at petitioner’s jobsite on 29 July 1989. After five to seven days of use, the backhoe broke
down. Such fact was reported to Ronnie Bote, and the backhoe was thus repaired. After one 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 latter’s office for repair. As evidence of the return of
the equipment, petitioner presented a letter dated 3 October 1989 13 addressed to Electrobus
Consolidated, Inc., requesting the release of the backhoe to Ronnie Bote for repair, with alleged
signature 14 of Ronnie Bote appearing at the bottom thereof to attest to his receipt of the equipment.
After a week, petitioner demanded from Ronnie Bote the return of the backhoe, the P50,000 cash and
the two postdated checks, but to no avail. 15 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 FEDCOR’s counsel Atty. Orlan Paray. 16 chanrob1es virtua1 1aw 1ibrary

On 30 September 1993, the trial court rendered a decision 17 finding petitioner guilty of two counts of
violation of the Bouncing Checks Law and sentencing him to suffer imprisonment for two years and pay
FEDCOR P150,000, with legal interest thereon from 9 October 1990 up to the time of full payment.

Petitioner appealed the decision to the Court of Appeals. The appeal was docketed as CA-G.R. CR. No.
18082. Upon noticing that the 30 September 1993 Decision of the trial court did not resolve the issue
of petitioner’s liability for estafa, the Court of Appeals issued on 19 May 1998 a resolution 18 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 8 February 1999, the trial court rendered a decision 19 finding petitioner guilty beyond reasonable
doubt of estafa and sentencing him to suffer imprisonment of seven years and four months of prision
mayor as minimum to twelve years and six months of reclusion temporal as maximum. As might be
expected, petitioner also appealed said decision to the Court of Appeals.

On 21 July 2000, the Court of Appeals rendered a decision 20 affirming in toto the decision of the trial
court finding petitioner guilty of estafa and violations of the Bouncing Checks Law. It also denied
petitioner’s motion for reconsideration of the decision. 21 Hence, this petition.

Petitioner claims that he is not guilty of estafa because no damage was caused to FEDCOR,
considering that the backhoe became unserviceable, a few days after delivery and was eventually
returned to FEDCOR through the latter’s sales agent Ronnie Bote. He also asserts that he did not
violate B. P. Blg. 22 either. The two checks issued by him were presented for payment only on 22
February 1990, or after more than five months from the date of the checks. Under Sections 1 and 2 of
B.P. Blg. 22 FEDCOR, as payee, had the duty or obligation to encash or deposit the checks issued in its
favor within ninety days from the date of issue. Since FEDCOR deposited the checks after this period,
he cannot be faulted for their subsequent dishonor.

Alternatively, petitioner prays that in the event that his conviction for violations of B.P. Blg. 22 is
sustained, the rulings in Vaca v. Court of Appeal 22 and Lim v People 23 should be given retroactive
effect in his favor so that only a fine may be imposed on him as penalty. cralaw : red

In arguing that petitioner’s conviction for two counts of violation of B.P. Blg. 22 is correct, the Office of
the Solicitor General relies heavily on he testimony of Felix Mirano that the account of petitioner had
been closed lay back in May 1985, or four years prior to the issuance of the subject checks to FEDCOR.
The date when the checks were encashed or deposited is immaterial because there was no more
existing bank account against which they were drawn, and their dishonor was therefore certain even if
the checks were presented for payment within the 90-day period from their issuance With respect to
petitioner’s plea to impose on him the penalty of fine in the event that his conviction is affirmed, the
OSG maintains that the penalty of imprisonment is appropriate considering petitioner’s act of issuing
worthless checks which showed his culpable violation of B.P. Blg. 22.

Petitioner’s argument that the element of damage to private to complainant FEDCOR is lacking is
disputed by the OSG by pointing out petitioners failure to prove the return or the backhoe to FEDCOR.
Ronnie Bote, the person to whom the backhoe was allegedly returned, was not presented as a witness
to corroborate petitioner’s testimony. But even granting arguendo that the backhoe was indeed
received by Ronie Bote, there is no showing that he acted for, and on behalf of, FEDCOR in doing so
considering that he was not an employee of FEDCOR.

The petition is without merit.

Section 1 of B.P. Blg. 22 provides: chanrob1es virtual 1aw library

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

The same penalty shall be imposed upon any person who, having sufficient funds in or credit with the
drawee bank when he makes or draws and issues a check, shall fail to keep sufficient funds or to
maintain a credit or to cover the full amount of the check if presented within a period of ninety (90)
days from the date appearing, thereon, for which reason it is dishonored by the drawee bank. chanrob1es virtua1 1aw 1ibrary

Two distinct acts are punished under the above-quoted provision: chanrob1es virtual 1aw library

(1) The making or drawing and issuance of any chick 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

(2) The failure to keep sufficient funds or to maintain a credit to cover the full amount of the check if
presented within a period of ninety days from the date appearing thereon, for which reason it is
dishonored by the drawee bank.

In the first situation, the drawer knows of the insufficiency of funds to cover the check at the time of its
issuance; while in the second situation, the drawer has sufficient funds at the time of issuance but fails
to keep sufficient funds or maintain credit within ninety days from the date appearing on the check.
The check involved in the first offense 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 that 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.25cralaw:red

It can be gleaned from the allegations in the information that petitioner is charged with the first type of
offense under B.P. Blg. 22.

The elements of the first type of offense are as follows: chanrob1es virtual 1aw library

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

(2) The knowledge of the maker, drawer, or issuer that at the time of issue he does not have sufficient
funds in or credit with the drawee bank for the payment of such check in full upon its presentment;
and
(3) The subsequent dishonor of the check by the drawee bank for insufficiency of funds or credit or
dishonor for the same reason had not the drawer, without any valid cause, ordered the bank to stop
payment. 26

Petitioner admitted that he issued the two postdated checks worth P75,000 each. He did not deny that
the same were dishonored on the ground that the account from which they were to be drawn was
already closed at the time the checks were presented for payment. Neither did he rebut the
prosecution’s evidence that the account against which he drew his two postdated checks had been
closed in May 1985 yet, or more than four years prior to the drawing and delivery of the checks.

The fact that the checks were presented beyond the 90-day period provided in Section 2 of B.P. Blg..
22 is of no moment. We held in Wong v. Court of Appeals 27 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; thus:chanrob1es virtua1 1aw 1ibrary

That the check must be deposited within ninety (90) days is simply one of the conditions for the prima
facie presumption of knowledge of lack of funds to arise. It is not an element of the offense. Neither
does it discharge petitioner from his duty to maintain sufficient funds in the account within a
reasonable time thereof. Under Section 186 of the Negotiable Instruments Law, "a check must be
presented for payment within a reasonable time after its issue or the drawer will be discharged from
liability thereon to the extent of the loss caused by the delay." By current banking practice, a check
becomes stale after more than six (6) months, or 180 days.

In Bautista v Court of Appeals, 28 we 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. 29
The prosecution may still prove such knowledge through other evidence.

In this case, FEDCOR presented the checks for encashment on 22 February 1990, or within the six-
month period from the date of issuance of the checks, and would not therefore have been considered
stale had petitioner’s 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 petitioner’s account with the Security Bank was closed as early as May 1985, or more
than four years prior to the issuance of the two checks in question. chanrob1es virtua1 1aw 1ibrary

Thus, we find no error in the Court of Appeals’ affirmation of the trial court’s decision convicting
petitioner of violations of B.P. Blg. 22.

Petitioner’s alternative prayer for the modification of penalty by retroactively applying Vaca v. Court of
Appeals 30 and Lim v. People 31 must likewise be denied. We quote Administrative Circular No. 13-
2001 clarifying Administrative Circular No. 12-2000; thus: chanrob1es virtual 1aw library

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 clearly does not foreclose the possibility of imprisonment for violators of
B.P. Blg. 22. Neither does it defeat the legislative intent behind the law.

Thus, Administrative Circular 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, Administrative Circular No. 12-
2000 ought not be deemed a hindrance.

In this case, when petitioner issued the subject postdated checks even though he had no more account
with the drawee bank, having closed it more than four years before he drew and delivered the checks,
he manifested utter lack of good faith or wanton bad faith. Hence, he cannot avail himself of the
benefits under Administrative Circular No. 12-2000.

We likewise sustain petitioner’s conviction for the crime of estafa.

The crime of estafa under paragraph 2(d) of Article 315 of the Revised Penal Code, as amended, has
the following elements: (1) postdating or issuance of a check in payment of an obligation contracted at
the time the check was issued; (2) lack or insufficiency of funds to cover the check; and (3) damage to
the payee thereof. 32 chanrob1es virtua1 1aw 1ibrary

Settled is the rule that, to constitute estafa, the act of postdating or issuing a check in payment of an
obligation must be the efficient cause of defraudation and, as such, it should be either prior to, or
simultaneous with, the act of fraud. The offender must be able to obtain money or property from the
offended party because of the issuance of the check, or the person to whom the check was delivered
would not have parted with his money or property had there been no check issued to him. Stated
otherwise, the check should have been issued as an inducement for the surrender by the party
deceived of his money or property, and not in payment of a pre-existing obligation. 33

The existence of the first two elements in the case at bar is not disputed. Petitioner maintains that the
third element is not present.

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.
34

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 two postdated checks in the amount of P75,000 each. chanrob1es virtua1 1aw 1ibrary

Petitioner’s 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. 35
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 FEDCOR’s
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; thus: chanrob1es virtual 1aw library

Q During the pendency of this case you paid Engr. Santander cash, is that correct?

A I paid the amount of P10,000.00 and then another P5,000.00 because according to my first lawyer I
have to pay this because I am guilty and this is B.P. case [sic].

Q You delivered the money to Engr. Federico Santander?

A To you Atty. Paray.

Q And I was the lawyer of Engr. Federico Santander?

A Yes, sir. 36

If indeed petitioner returned the backhoe to Ronnie Bote and yet the latter did not heed his demands
for the return of his cash payment and the checks, he (petitioner) should have, at the very least, gone
to or written FEDCOR itself about the matter. Instead, he again paid FEDCOR the amount of P15,000
during the pendency of the case. Such payment to FEDCOR negates his claim that he returned the
backhoe; it may even be tantamount to an offer of compromise. Under Section 27 of Rule 130 of the
Rules on Evidence, an offer of compromise in criminal cases is an implied admission of guilt. chanrob1es virtua1 1aw 1ibrary

Finally, by appealing his conviction, petitioner has thrown the whole case open for review. It becomes
the duty of this Court to correct any error as may be found in the appealed judgment, even though it
was not made the subject of assignment, of errors. 37 This Court finds to be erroneous the penalty
imposed by the trial court for the crime of estafa, as affirmed by the Court of Appeals, which is seven
years and four months of prision mayor as minimum to twelve years and six months of reclusion
temporal as maximum. The penalty for estafa committed by means of bouncing checks has been
increased by Presidential Decree No. 818, which took effect on 22 October 1975. Section 1 thereof
provides in part as follows:
chanrob1es virtual 1aw library

SECTION 1. Any person who shall defraud another by means of false pretenses or fraudulent acts as
defined in paragraph 2(d) of Article 315 of the Revised Penal Code, as amended by Republic Act No.
4885, shall be punished by: chanrob1es virtual 1aw library

1st. The penalty of reclusion temporal if the amount of the fraud is over 12,000 pesos but does not
exceed 22,000 pesos, and if such amount exceeds the latter sum, the penalty provided in this
paragraph shall be imposed in its maximum period, adding one year for each additional 10,000 pesos
but the total penalty which may be imposed shall in no case exceed thirty years. In such cases, and in
connection with the accessory penalties which may be imposed under the Revised Penal Code, the
penalty shall be termed reclusion perpetua . . .

Petitioner NAGRAMPA defrauded FEDCOR in the amount of P135,000 (P150,000 [value of the checks]
minus P15,000 [payment made by petitioner during the pendency of these cases]). Applying P.D. No.
818 and the Indeterminate Sentence Law, the maximum penalty shall be reclusion temporal in its
maximum period, plus one year for each additional P10,000 of the amount of the fraud; and the
minimum shall be prision mayor, which is the penalty next lower to that prescribed for the offense
without first considering any modifying circumstances or the incremental penalty for the amount of
fraud in excess of P22,000. 38

WHEREFORE, the instant petition is DENIED. The decision of the Court of Appeals upholding the
decisions of the Regional Trial Court of Quezon City, Branch 80, in Criminal Cases Nos. Q-90-15797, Q-
90-15798 and Q-90-15799 is hereby AFFIRMED, with the modification that petitioner Manuel Nagrampa
is hereby sentenced to suffer (1) an imprisonment of one year for each of the two counts of violation of
B. P. Blg. 22, and (2) an indeterminate penalty of eight years and one day of prision mayor as
minimum to twenty-eight years, four months and one day of reclusion perpetua as maximum for the
crime of estafa; and to pay private complainant Fedcor Trading Corporation the amount of P135,000,
plus legal interest thereon from 9 October 1990 up to the time of full payment.
chanrob1es virtua1 1aw 1ibrary

SO ORDERED.

2. Knowledge here was established by showing that prior to the arrival of the maturity
date, accused told complainant not to deposit the check and that he would replace the
same within 30 days but to no avail.

G.R. No. 117857 February 2, 2001

LUIS S. WONG, petitioner,

vs.
COURT OF APPEALS and PEOPLE OF THE PHILIPPINES, respondents.

QUISUMBING, J.:

For review on certiorari is the decision dated October 28, 1994 of the Court of Appeals in C.A. G.R.
CR 118561 which affirmed the decision of the Regional Trial Court of Cebu City, Branch 17,
convicting petitioner on three (3) counts of Batas Pambansa Blg. 22 (the Bouncing Checks Law)
violations, and sentencing him to imprisonment of four (4) months for each count, and to pay private
respondent the amounts of P5,500.00, P6,410.00 and P3,375.00, respectively, corresponding to the
value of the checks involved, with the legal rate of interest from the time of filing of the criminal
charges, as well as to pay the costs.
1âwphi1.nêt

The factual antecedents of the case are as follows:

Petitioner Wong was an agent of Limtong Press. Inc. (LPI), a manufacturer of calendars. LPI would
print sample calendars, then give them to agents to present to customers. The agents would get the
purchase orders of customers and forward them to LPI. After printing the calendars, LPI would ship
the calendars directly to the customers. Thereafter, the agents would come around to collect the
payments. Petitioner, however, had a history of unremitted collections, which he duly acknowledged
in a confirmation receipt he co-signed with his wife.2 Hence, petitioner’s customers were required to
issue postdated checks before LPI would accept their purchase orders.

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

(1) Allied Banking Corporation (ABC) Check No. 660143464-C for P6,410.00 (Exh. "B");

(2) ABC Check No. 660143460-C for P540.00 (Exh. "C");

(3) ABC Check No. PA660143451-C for P5,500.00 (Exh. "D");

(4) ABC Check No. PA660143465-C for P1,100.00 (Exh. "E");

(5) ABC Check No. PA660143463-C for P3,375.00 (Exh. "F");

(6) ABC Check No. PA660143452-C for P1,100.00 (Exh. "G").

These checks were initially intended to guarantee the calendar orders of customers who failed to
issue post-dated checks. However, following company policy, LPI refused to accept the checks as
guarantees. Instead, the parties agreed to apply the checks to the payment of petitioner’s unremitted
collections for 1984 amounting to P18,077.07.3 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." The dishonor of the checks was evidenced by
the RCBC return slip.

On June 20, 1986, complainant through counsel notified the petitioner of the dishonor. Petitioner
failed to make arrangements for payment within five (5) banking days.

On November 6, 1987, petitioner was charged with three (3) counts of violation of B.P. Blg.
224 under three separate Informations for the three checks amounting to P5,500.00, P3,375.00, and
P6,410.00.5

The Information in Criminal Case No. CBU-12055 reads as follows:6

That on or about the 30th day of December, 1985 and for sometime subsequent thereto, in
the City of Cebu, Philippines, and within the jurisdiction of this Honorable Court, the said
accused, knowing at the time of issue of the check she/he does not have sufficient funds in
or credit with the drawee bank for the payment of such check in full upon its presentment,
with deliberate intent, with intent of gain and of causing damage, did then and there issue,
make or draw Allied Banking Corporation Check No. 660143451 dated 12-30-85 in the
amount of P5,500.00 payable to Manuel T. Limtong which check was issued in payment of
an obligation of said accused, but when the said check was presented with said bank, the
same was dishonored for reason ‘ACCOUNT CLOSED’ and despite notice and demands
made to redeem or make good said check, said accused failed and refused, and up to the
present time still fails and refuses to do so, to the damage and prejudice of said Manuel T.
Limtong in the amount of P5,500.00 Philippine Currency.

Contrary to law.

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.

Upon arraignment, Wong pleaded not guilty. Trial ensued.

Manuel T. Limtong, general manager of LPI, testified on behalf of the company, Limtong averred that
he refused to accept the personal checks of petitioner since it was against company policy to accept
personal checks from agents. Hence, he and petitioner simply agreed to use the checks to pay
petitioner’s unremitted collections to LPI. According to Limtong, a few days before maturity of the
checks, Wong requested him to defer the deposit of said checks for lack of funds. Wong promised to
replace them within thirty days, but failed to do so. Hence, upon advice of counsel, he deposited the
checks which were subsequently returned on the ground of "account closed."

The version of the defense is that petitioner issued the six (6) checks to guarantee the 1985
calendar bookings of his customers. According to petitioner, he issued the checks not as payment
for any obligation, but to guarantee the orders of his customers. In fact, the face value of the six (6)
postdated checks tallied with the total amount of the calendar orders of the six (6) customers of the
accused, namely, Golden Friendship Supermarket, Inc. (P6,410.00), New Society Rice and Corn Mill
(P5,500.00), Cuesta Enterprises (P540.00), Pelrico Marketing (P1,100.00), New Asia Restaurant
P3,375.00), and New China Restaurant (P1,100.00). 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 issued its decision, disposing as follows: 7

"Wherefore, premises considered, this Court finds the accused Luis S. Wong GUILTY
beyond reasonable doubt of the offense of Violations of Section 1 of Batas Pambansa Bilang
22 in THREE (3) Counts and is hereby sentenced to serve an imprisonment of FOUR (4)
MONTHS for each count; to pay Private Complainant Manuel T. Limtong the sums of Five
Thousand Five Hundred (P5,500.00) Pesos, Six Thousand Four Hundred Ten (P6,410.00)
Pesos and Three Thousand Three Hundred Seventy-Five (P3,375.00) Pesos corresponding
to the amounts indicated in Allied Banking Checks Nos. 660143451, 66[0]143464 and
660143463 all issued on December 30, 1985 together with the legal rate of interest from the
time of the filing of the criminal charges in Court and pay the costs." 8
Petitioner appealed his conviction to the Court of Appeals. On October 28, 1994, it affirmed the trial
court’s decision in toto.9

Hence, the present petition.10 Petitioner raises the following questions of law -11

May a complainant successfully prosecute a case under BP 22 --- if there is no more

consideration or price or value – ever the binding tie that it is in contracts in general and in
negotiable instruments in particular – behind the checks? – if even before he deposits the
checks, he has ceased to be a holder for value because the purchase orders (PO’s)
guaranteed by the checks were already paid?

Given the fact that the checks lost their reason for being, as above stated, is it not then the
duty of complainant – knowing he is no longer a holder for value – to return the checks and
not to deposit them ever? Upon what legal basis then may such a holder deposit them and
get paid twice?

Is petitioner, as the drawer of the guarantee checks which lost their reason for being, still
bound under BP 22 to maintain his account long after 90 days from maturity of the checks?

May the prosecution apply the prima facie presumption of "knowledge of lack of funds"
against the drawer if the checks were belatedly deposited by the complainant 157 days after
maturity, or will it be then necessary for the prosecution to show actual proof of "lack of
funds" during the 90-day term?

Petitioner insists that the checks were issued as guarantees for the 1985 purchase orders (PO’s) of
his customers. He contends that private respondent is not a "holder for value" considering that the
checks were deposited by private respondent after the customers already paid their orders. Instead
of depositing the checks, private respondent should have returned the checks to him. Petitioner
further assails the credibility of complainant considering that his answers to cross-examination
questions included: "I cannot recall, anymore" and "We have no more record."

In his Comment,12 the Solicitor General concedes that the checks might have been initially intended
by petitioner to guarantee payments due from customers, but upon the refusal of LPI to accept said
personal checks per company policy, the parties had agreed that the checks would be used to pay
off petitioner’s unremitted collections. Petitioner’s contention that he did not demand the return of the
checks because he trusted LPI’s good faith is contrary to human nature and sound business
practice, according to the Solicitor General.

The issue as to whether the checks were issued merely as guarantee or for payment of petitioner’s
unremitted collections is a factual issue involving as it does the credibility of witnesses. Said factual
issue has been settled by the trial court and Court of Appeals. Although initially intended to be used
as guarantee for the purchase orders of customers, they found the checks were eventually used to
settle the remaining obligations of petitioner with LPI. Although Manuel Limtong was the sole witness
for the prosecution, his testimony was found sufficient to prove all the elements of the offense
charged.13 We find no cogent reason to depart from findings of both the trial and appellate courts. In
cases elevated from the Court of Appeals, our review is confined to allege errors of law. Its findings
of fact are generally conclusive. Absent any showing that the findings by the respondent court are
entirely devoid of any substantiation on record, the same must stand.14 The lack of accounting
between the parties is not the issue in this case. As repeatedly held, this Court is not a trier of
facts.15 Moreover, in Llamado v. Court of Appeals,16 we held that "[t]o determine the reason for which
checks are issued, or the terms and conditions for their issuance, will greatly erode the faith the
public reposes in the stability and commercial value of checks as currency substitutes, and bring
about havoc in trade and in banking communities. So what the law punishes is the issuance of a
bouncing check and not the purpose for which it was issued nor the terms and conditions relating to
its issuance. The mere act of issuing a worthless check is malum prohibitum." Nothing herein
persuades us to hold otherwise.

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

There are two (2) ways of violating B.P. Blg. 22: (1) by making or drawing and issuing a check to
apply on account or for value knowing at the time of issue that the check is not sufficiently funded;
and (2) by having sufficient funds in or credit with the drawee bank at the time of issue but failing to
keep sufficient funds therein or credit with said bank to cover the full amount of the check when
presented to the drawee bank within a period of ninety (90) days.17

The elements of B.P. Blg. 22 under the first situation, pertinent to the present case, are: 18

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

(2) The knowledge of the maker, drawer, or issuer that at the time of issue he does not have
sufficient funds in or credit with the drawee bank for the payment of such check in full upon
its presentment; and

(3) The subsequent dishonor of the check by the drawee bank for insufficiency of funds or
credit or dishonor for the same reason had not the drawer, without any valid cause, ordered
the bank to stop payment."

Petitioner contends that the first element does not exist because the checks were not issued to apply
for account or for value. He attempts to distinguish his situation from the usual "cut-and-dried" B.P.
22 case by claiming that the checks were issued as guarantee and the obligations they were
supposed to guarantee were already paid. This flawed argument has no factual basis, the RTC and
CA having both ruled that the checks were in payment for unremitted collections, and not as
guarantee. Likewise, the argument has no legal basis, for what B.P. Blg. 22 punishes is the issuance
of a bouncing check and not the purpose for which it was issued nor the terms and conditions
relating to its issuance.19

As to the second element, B.P. Blg. 22 creates a presumption juris tantum that the second
element prima facie exists when the first and third elements of the offense are present.20 Thus, the
maker’s knowledge is presumed from the dishonor of the check for insufficiency of funds. 21

Petitioner avers that since the complainant deposited the checks on June 5, 1986, or 157 days after
the December 30, 1985 maturity date, the presumption of knowledge of lack of funds under Section
2 of B.P. Blg. 22 should not apply to him. He further claims that he should not be expected to keep
his bank account active and funded beyond the ninety-day period.

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

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

An essential element of the offense is "knowledge" on the part of the maker or drawer of the check
of the insufficiency of his funds in or credit with the bank to cover the check upon its presentment.
Since this involves a state of mind difficult to establish, the statute itself creates a prima
facie presumption of such knowledge where payment of the check "is refused by the drawee
because of insufficient funds in or credit with such bank when presented within ninety (90) days from
the date of the check." To mitigate the harshness of the law in its application, the statute provides
that such presumption shall not arise if within five (5) banking days from receipt of the notice of
dishonor, the maker or drawer makes arrangements for payment of the check by the bank or pays
the holder the amount of the check.22

Contrary to petitioner’s assertions, nowhere in said provision does the law require a maker to
maintain funds in his bank account for only 90 days. Rather, the clear import of the law is to
establish a prima facie presumption of knowledge of such insufficiency of funds under the following
conditions (1) presentment within 90 days from date of the check, and (2) the dishonor of the check
and failure of the maker to make arrangements for payment in full within 5 banking days after notice
thereof. That the check must be deposited within ninety (90) days is simply one of the conditions
for the prima facie presumption of knowledge of lack of funds to arise. It is not an element of the
offense. Neither does it discharge petitioner from his duty to maintain sufficient funds in the account
within a reasonable time thereof. Under Section 186 of the Negotiable Instruments Law, "a check
must be presented for payment within a reasonable time after its issue or the drawer will be
discharged from liability thereon to the extent of the loss caused by the delay." By current banking
practice, a check becomes stale after more than six (6) months,23 or 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 trial court,
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 five (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 petitioner’s insistent plea of innocence, we
find no error in the respondent court’s affirmance of his conviction by the trial court for violations of
the Bouncing Checks Law.

However, 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.

WHEREFORE, the petition is DENIED. Petitioner Luis S. Wong is found liable for violation of Batas
Pambansa Blg. 22 but the penalty imposed on him is hereby MODIFIED so that the sentence of
imprisonment is deleted. Petitioner is ORDERED to pay a FINE of (1) P6,750.00, equivalent to
double the amount of the check involved in Criminal Case No. CBU-12057, (2) P12,820.00,
equivalent to double the amount of the check involved in Criminal Case No. CBU-12058, and (3)
P11,000.00, equivalent to double the amount of the check involved in Criminal Case No. CBU-
12055, with subsidiary imprisonment24 in case of insolvency to pay the aforesaid fines. Finally, as
civil indemnity, petitioner is also ordered to pay to LPI the face value of said checks totaling
P18,025.00 with legal interest thereon from the time of filing the criminal charges in court, as well as
to pay the costs.1âwphi1.nêt

SO ORDERED.