Republic of the Philippines

Supreme Court
Manila

SECOND DIVISION

EUMELIA R. MITRA, G.R. NO. 191404

Petitioner,
Present:

CARPIO, J., Chairperson,

NACHURA,
- versus - PERALTA,
ABAD, and
MENDOZA, JJ.

PEOPLE OF
THE PHILIPPINESand
FELICISIMO S. TARCELO, Promulgated:
Respondents. July 5, 2010

X --------------------------------------------------------------------------------------X

DECISION
MENDOZA, J.:

This is a petition for review on certiorari under Rule 45 of the Rules of Court
assailing the July 31, 2009 Decision[1] and the February 11, 2010 Resolution of the
Court of Appeals (CA) in CA-G.R. CR No. 31740. The subject decision and
resolution affirmed the August 22, 2007 Decision of the Regional Trial Court,
Branch 2, Batangas City (RTC)which, in turn, affirmed the May 21, 2007 Decision
of the Municipal Trial Court in Cities, Branch 2, Batangas City (MTCC).

THE FACTS:

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

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

Between 1996 and 1999, private respondent Felicisimo S.

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

Bank Date Issued Date of Check Amount Check No.

Security Bank September 15, 1998 January 15, 1999 P 3,125.00 0000045804

-do- September 15, 1998 January 15, 1999 125,000.00 0000045805

-do- September 20, 1998 January 20, 1999 2,500.00 0000045809

-do- September 20, 1998 January 20, 1999 100,000.00 0000045810

-do- September 30, 1998 January 30, 1999 5,000.00 0000045814

-do- September 30, 1998 January 30, 1999 200,000.00 0000045815

-do- October 3, 1998 February 3, 1999 2,500.00 0000045875

-do- October 3, 1998 February 3, 1999 100,000.00 0000045876

-do- November 17, 1998 February17, 1999 5,000.00 0000046061

-do- November 17, 1998 March 17, 1999 5,000.00 0000046062

-do- November 17, 1998 March 17, 1999 200,000.00 0000046063

-do- November 19, 1998 January 19, 1999 2,500.00 0000046065

-do- November 19, 1998 February19, 1999 2,500.00 0000046066

-do- November 19, 1998 March 19, 1999 2,500.00 0000046067

-do- November 19, 1998 March 19, 1999 100,000.00 0000046068

 -do- November 20, 1998 January 20, 1999 10,000.00 0000046070

-do- November 20, 1998 February 20, 1999 10,000.00 0000046071

-do- November 20, 1998 March 20, 1999 10,000.00 0000046072

-do- November 20, 1998 March 20, 1999 10,000.00 0000046073

-do- November 30, 1998 January 30, 1999 2,500.00 0000046075

-do- November 30, 1998 February 28, 1999 2,500.00 0000046076

-do- November 30, 1998 March 30, 1999 2,500.00 0000046077

-do- November 30, 1998 March 30, 1999 100,000.00 0000046078

When Tarcelo presented these checks for payment, they were dishonored for
the reason account closed. Tarcelo made several oral demands on LNCC for the
payment of these checks but he was frustrated. Constrained, in 2002, he caused the
filing of seven informations for violation of Batas Pambansa Blg. 22 (BP 22) in the
total amount ofP925,000.00 with the MTCC in Batangas City.[3]

After trial on the merits, the MTCC found Mitra and Cabrera guilty of the
charges. The fallo of the May 21, 2007 MTCC Decision[4] reads:
 WHEREFORE, foregoing premises considered, the
accused FLORENCIO I. CABRERA, JR., and EUMELIA R. MITRA are
hereby found guilty of the offense of violation of Batas Pambansa Bilang
22 and are hereby ORDERED to respectively pay the following fines for
each violation and with subsidiary imprisonment in all cases, in case of
insolvency:

1. Criminal Case No. 43637 - P200,000.00

2. Criminal Case No. 43640 - P100,000.00
3. Criminal Case No. 43648 - P100,000.00
4. Criminal Case No. 43700 - P125,000.00
5. Criminal Case No. 43702 - P200,000.00
6. Criminal Case No. 43704 - P100,000.00
7. Criminal Case No. 43706 - P100,000.00

Said accused, nevertheless, are adjudged civilly liable and are

ordered to pay, in solidum, private complainant Felicisimo S. Tarcelo the
amount of NINE HUNDRED TWENTY FIVE THOUSAND PESOS
(P925,000.000).

SO ORDERED.

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

The RTC affirmed the MTCC decision and later denied their motion for
reconsideration. Meanwhile, Cabrera died. Mitra alone filed this petition for
review[6] claiming, among others, that there was no proper service of the notice of
dishonor on her. The Court of Appeals dismissed her petition for lack of merit.

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

1. WHETHER OR NOT THE ELEMENTS OF VIOLATION OF

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

2. WHETHER OR NOT THERE IS PROPER SERVICE OF

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

The Court denies the petition.

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

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

BP 22 or the Bouncing Checks Law was enacted for the specific purpose of
addressing the problem of the continued issuance and circulation of unfunded
checks by irresponsible persons. To stem the harm caused by these bouncing
checks to the community, BP 22 considers the mere act of issuing an unfunded
check as an offense not only against property but also against public order. [7] The
purpose of BP 22 in declaring the mere issuance of a bouncing check as malum
prohibitum is to punish the offender in order to deter him and others from
committing the offense, to isolate him from society, to reform and rehabilitate him,
and to maintain social order.[8] The penalty is stiff. BP 22 imposes the penalty of
imprisonment for at least 30 days or a fine of up to double the amount of the check
or both imprisonment and fine.
Specifically, BP 22 provides:
 SECTION 1. Checks Without Sufficient Funds. Any person who
makes or draws and issues any check to apply on account or for value,
knowing at the time of issue that he does not have sufficient funds in or
credit with the drawee bank for the payment of such check in full upon its
presentment, which check is subsequently dishonored by the drawee bank
for insufficiency of funds or credit or would have been dishonored for the
same reason had not the drawer, without any valid reason, ordered the
bank to stop payment, shall be punished by imprisonment of not less than
thirty days but not more than one (1) year or by a fine of not less than but
not more than double the amount of the check which fine shall in no case
exceed Two Hundred Thousand Pesos, or both such fine and
imprisonment at the discretion of the court.

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

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

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

SECTION 2. Evidence of Knowledge of Insufficient Funds. The

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

Mitra posits in this petition that before the signatory to a bouncing corporate
check can be held liable, all the elements of the crime of violation of BP 22 must
first be proven against the corporation. The corporation must first be declared to
have committed the violation before the liability attaches to the signatories of the
checks.[9]
 The Court finds Itself unable to agree with Mitras posture. The third
paragraph of Section 1 of BP 22 reads: "Where the check is drawn by a
corporation, company or entity, the person or persons who actually signed the
check in behalf of such drawer shall be liable under this Act." This provision
recognizes the reality that a corporation can only act through its officers. Hence, its
wording is unequivocal and mandatory that the person who actually signed the
corporate check shall be held liable for a violation of BP 22.This provision does
not contain any condition, qualification or limitation.

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

Another essential element of a violation of BP 22 is the drawers knowledge

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

Mitra alleges that there was no proper service on her of the notice of
dishonor and, so, an essential element of the offense is missing. This contention
raises a factual issue that is not proper for review. It is not the function of the Court
to re-examine the finding of facts of the Court of Appeals. Our review is limited to
errors of law and cannot touch errors of facts unless the petitioner shows that the
trial court overlooked facts or circumstances that warrant a different disposition of
the case[11] or that the findings of fact have no basis on record. Hence, with respect
to the issue of the propriety of service on Mitra of the notice of dishonor, the Court
gives full faith and credit to the consistent findings of the MTCC, the RTC and the
CA.

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

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

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

quoted provision, a violation exists where:

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

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

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

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

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

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

SO ORDERED.