People v. Supnad
REITERATIONFacts
The Antecedents: The Office of the City Fiscal filed an Information charging Pastor L. Supnad and Brigida M. Ungos with Violation of Paragraph 2, Article 316 of the Revised Penal Code. The accused were alleged to have conspired and confederated to defraud Teresa Bautista by selling a 2-story residential house, which they had mortgaged to Bautista for P2,500.00, to one Damian Vasquez for P7,000.00 through an absolute sale, making it appear that the house was free from liens and encumbrances. The mortgage was not recorded. Procedural History: The accused pleaded not guilty. They raised the issue of a prejudicial question, citing a civil case (Civil Case No. 39224) between Teresa Bautista and Eduardo Dava, plaintiffs, and Pastor Supnad, Brigido Ungos, and Damian Vasquez, defendants, which was decided by the CFI of Manila. The trial court, after considering memoranda on the prejudicial question, dismissed the criminal case, holding that the facts alleged in the information did not constitute an offense. The trial court reasoned that the information did not allege fraud or misrepresentation on the buyer (Vasquez) or that the latter suffered damage, and that the penal provision in question does not comprehend misrepresentation on the mortgagee. The Court of Appeals certified the case to the Supreme Court as the issues were purely legal. The Petition: The People of the Philippines appealed the dismissal, arguing that the facts alleged in the information constitute a violation of Article 316, paragraph 2 of the Revised Penal Code.
Issue(s)
Whether the facts alleged in the information constitute a violation of Article 316, paragraph 2 of the Revised Penal Code. Whether the trial court erred in dismissing the case on the ground that the facts alleged do not constitute an offense.
Ruling
The Supreme Court held that the trial court erred in dismissing the information. The decision of the trial court was set aside, and the case was remanded for further proceedings. The Court found that the facts alleged in the information sufficiently constitute a violation of Article 316, paragraph 2 of the Revised Penal Code.
Ratio Decidendi
On whether the facts alleged in the information constitute a violation of Article 316, paragraph 2 of the Revised Penal Code: The Court held that the information sufficiently alleged facts constituting a violation of Article 316, paragraph 2 of the Revised Penal Code. This provision penalizes any person who, knowing that real property is encumbered, disposes of the same, even if the encumbrance is not recorded. The accused sold the mortgaged property to Damian Vasquez, knowing it was mortgaged to Teresa Bautista. The fact that the mortgage was not recorded does not negate the crime. The gravamen of the offense is the fraudulent disposition of the encumbered property to the prejudice of the mortgagee. The information clearly stated that the accused defrauded Teresa Bautista in the amount of P2,500.00 by selling the mortgaged property. The Court emphasized that the offense is committed when the property is disposed of knowing it is encumbered, and damage results to the mortgagee. The Court cited People v. Mariano to support its contention that if the party with a lien suffers damages due to the vendor's misrepresentation or fraud, the vendor is criminally liable. In this case, Teresa Bautista, the mortgagee, suffered damages. On whether the trial court erred in dismissing the case on the ground that the facts alleged do not constitute an offense: The Court ruled that the trial court erred in its dismissal. The trial court's reasoning that the information lacked allegations of fraud on the vendee or damage to the vendee was misplaced. The offense under Article 316, paragraph 2, is directed at the disposition of encumbered property, and the damage contemplated is that suffered by the mortgagee. The Court clarified that the findings in the civil case, which was still pending appeal, could not be considered a prejudicial question. At most, they would constitute a defense to be substantiated during the trial. The information, as written, contained sufficient allegations to establish the crime of estafa under the cited provision. The Court found that the trial court's reliance on People v. Mariano was also misplaced, as that case, when properly interpreted, supported the People's contention that damage to the mortgagee makes the vendor criminally liable.
Main Doctrine
The act of disposing of real property known to be encumbered, even if the encumbrance is not recorded, constitutes estafa under Article 316, paragraph 2 of the Revised Penal Code, provided that the mortgagee suffers damage as a result thereof. The information need not allege fraud or misrepresentation on the vendee; the gravamen of the offense lies in the fraudulent disposition of the encumbered property to the prejudice of the mortgagee.