Sycip v. Court of Appeals
REITERATIONFacts
The Antecedents: Jose K. Lapuz received 2,000 shares of stock from Albert Smith for sale on commission. Francisco Sycip approached Lapuz, offering to sell the shares, assuring him of good connections in the Stock Exchange. Lapuz, clarifying that the shares were not his, entrusted them to Sycip. Sycip later informed Lapuz that 1,758 shares were sold for P29,000.00, pending necessary documents. Lapuz provided a power of attorney for 1,758 shares, with the remaining 242 shares returned to the company. Sycip sold 758 shares for P12,128.00, for which Lapuz issued a receipt and turned over P9,981.40 to Albert Smith. Sycip then informed Lapuz that 1,000 shares could not be delivered and offered to return some certificates, enclosing a draft for P8,000.00 for 500 shares, which was dishonored for lack of funds. Sycip subsequently gave Lapuz a P5,000.00 check from his daughter, which also bounced. Despite demands and threats of an estafa case, Sycip failed to remit the balance, forcing Lapuz to pay Albert Smith the value of the 500 shares. Procedural History: The Court of First Instance of Manila convicted Francisco Sycip of estafa and sentenced him to an indeterminate penalty, to indemnify Jose K. Lapuz, and to pay costs. The Court of Appeals affirmed the conviction but deleted the subsidiary imprisonment. Sycip filed a petition for review on certiorari with the Supreme Court. The Petition: Petitioner Sycip claimed the Court of Appeals erred in denying him a hearing, violating due process, refusing to apply compensation under the Civil Code, not dismissing the complaint, not ruling that a consummated contract is not covered by the Statute of Frauds, and ignoring the ruling in People vs. Benitez regarding offenses under Article 315, paragraph 1(b) of the Penal Code.
Issue(s)
Whether the Court of Appeals erred in denying petitioner a hearing and violating due process. Whether the provisions on compensation under Articles 1278 and 1279 of the Civil Code should have been applied. Whether the complaint should have been dismissed on the ground that a consummated contract is not covered by the Statute of Frauds. Whether the conviction for estafa under Article 315, paragraph 1(b) of the Revised Penal Code was proper, considering the alleged lack of fraud, demand, or explanation.
Ruling
The petition is dismissed for lack of merit. The Court of Appeals did not err in affirming the conviction of Francisco Sycip for estafa.
Ratio Decidendi
On the denial of a hearing and due process: The Court held that the petitioner's contention is without merit. While the petitioner had the right to be present during the trial court proceedings, the right to be present and heard on appeal is not absolute. The procedure in the Court of Appeals involves the filing of briefs within prescribed periods, and oral arguments are discretionary. The appellate court may decide the case based on the records and briefs without oral argument, and the appellant need not be present during deliberations or hearings before the appellate court. On the application of compensation: The Court found this contention untenable. Compensation, under Articles 1278 and 1279 of the Civil Code, requires that two persons be creditors and debtors of each other in their own right. In this case, Jose K. Lapuz acted as an agent for Albert Smith and/or Dr. Dwight Dill. Furthermore, the trial court correctly noted that Lapuz did not consent to the offsetting of his obligation with Sycip's obligation to pay for the shares, which is a prerequisite for compensation. On the Statute of Frauds: The Court ruled that the issue of whether the alleged contract of sale was covered by the Statute of Frauds was not raised in the trial court or the Court of Appeals. Therefore, it could not be raised for the first time in the petition for review before the Supreme Court. The appellate court was not required to make findings of fact on this matter as it was not an issue presented to it. On the conviction for estafa: The Court affirmed the conviction, citing the findings of the respondent court. The "malice or intent to commit fraud" was indicated by Sycip's failure to turn over the proceeds of the sold shares to Lapuz after informing him that the shares had been sold. The abuse of confidence in misappropriating the funds or property after they came into the offender's hands constitutes fraud. The delivery of a worthless check for P5,000.00 after Lapuz had to 'hunt' for Sycip further indicated intent to commit fraud. Sycip's explanation for his inability to return the shares, such as giving them to a creditor, was not satisfactory and did not absolve him of estafa by conversion, as he received the shares to be sold on commission.
Main Doctrine
An agent who misappropriates funds or property entrusted to him for sale commits estafa by conversion, even if he claims to have given the property to a creditor, as the abuse of confidence constitutes fraud.