People v. Yu
REITERATIONFacts
The Antecedents: Yu Chai Ho, managing partner of Gui Sing & Co., ordered Colgate perfumes and soap from Wm. H. Anderson & Co. The merchandise was shipped from New York, with shipping documents and invoices consigned to Wm. H. Anderson & Co. and forwarded to the International Banking Corporation (IBC), subject to delivery upon payment. Gui Sing & Co. accepted a draft for the purchase price but was unable to pay. IBC retained the documents. Through Wm. H. Anderson & Co., IBC agreed to release the documents to Gui Sing & Co. upon a trust receipt. Gui Sing & Co. executed the trust receipt, received the merchandise, sold it, but failed to pay IBC. Wm. H. Anderson & Co., as guarantors, were compelled to pay IBC the purchase price. Procedural History: The Court of First Instance of Cebu found the defendant guilty of estafa under paragraph 5 of article 535 of the Penal Code and sentenced him to five months of arresto mayor and costs. The Petition: The defendant appealed the decision, arguing that since Wm. H. Anderson & Co. paid the purchase price, IBC suffered no loss, and thus an essential element of estafa (prejudice) was lacking. He contended that only Wm. H. Anderson & Co. was prejudiced, creating a civil obligation.
Issue(s)
Whether the crime of estafa was committed to the prejudice of another, as required by Article 535, paragraph 5 of the Penal Code, when the party ultimately prejudiced was not the owner of the goods but a guarantor who paid the purchase price. Whether the information was defective for alleging prejudice to Wm. H. Anderson & Co. instead of the International Banking Corporation.
Ruling
The appealed sentence is modified by ordering the defendant to indemnify Wm. H. Anderson & Co. in the sum of P519, with subsidiary imprisonment in case of insolvency. In all other respects, the judgment of the court below is affirmed, with costs against the appellant.
Ratio Decidendi
On the issue of prejudice in estafa: The Court held that the crime of estafa under Article 535, paragraph 5 of the Penal Code is committed "to the prejudice of another." The language of the provision is clear and does not require that the prejudiced party be the owner of the converted or misappropriated property. The prejudice can be suffered by a third party. This interpretation is supported by the Spanish Supreme Court's sentence of May 8, 1884, which held that it is immaterial whether the loss is suffered by the owner or a third person, as the juridical nature of the crime is not affected. The action is a public offense brought by the People of the Philippine Islands, aimed at discouraging dishonesty, not merely enforcing indemnities. The fact that Wm. H. Anderson & Co. paid the purchase price to the International Banking Corporation made them subrogated to the rights of the bank against the defendant, thus standing in the bank's shoes and suffering the prejudice. On the alleged defect in the information: The Court found the information to be sufficient. While it alleged prejudice to Wm. H. Anderson & Co., the facts set forth clearly showed the consequences of the defendant's acts to both the International Banking Corporation and Wm. H. Anderson & Co. Even if the fiscal erred in alleging that Wm. H. Anderson & Co. suffered damages contemporaneously with the commission of the crime, such an error was non-prejudicial and did not vitiate the proceedings. Furthermore, the Court reasoned that Wm. H. Anderson & Co., by compensating the International Banking Corporation, became subrogated to all its rights against the defendant. Therefore, the commission of the crime did result to the prejudice of Wm. H. Anderson & Co., and this fact could be stated in the information, as the damage need not occur simultaneously with the acts constituting the crime.
Main Doctrine
The crime of estafa under Article 535, paragraph 5 of the Penal Code is committed to the prejudice of another when the conversion or misappropriation of money, goods, or personal property causes damage to any person, not necessarily the owner of the property. The prejudice suffered by a third party, who subsequently becomes subrogated to the rights of the owner, is sufficient to establish the crime.