Buenaflor v. Office of the Secretary of Justice
REITERATIONFacts
The Antecedents: In 1987, Dina C. Buenaflor (Buenaflor) and her late husband obtained PHP 950,000.00 in loans from United Coconut Planters Bank Magsaysay Branch, Davao City (UCPB-Magsaysay) for their corn and palay business, guaranteed by Quedan and Rural Credit Guarantee Corporation (Quedancor). In 1989, Buenaflor allegedly paid PHP 950,000.00 to Edmond E. Bernardo (Bernardo), then general manager of UCPB-Magsaysay, to settle the loans, but no receipt was issued. Bernardo denied receipt. Consequently, Quedancor paid PHP 809,850.00 to UCPB-Magsaysay on February 19, 1991, under an undated Subrogation Receipt, acquiring UCPB-Magsaysay's rights. Attys. Michael P. Millares (Atty. Millares), Atty. Ronald E. Hubilla (Atty. Hubilla), and Atty. Flor Anastacio (Atty. Anastacio) of Quedancor informed Buenaflor of this payment. Procedural History: On November 8, 1993, Quedancor filed a collection case against Buenaflor and her husband, which was dismissed on February 21, 2007, due to non-appearance of counsel and became final. On May 18, 2011, Buenaflor filed an administrative complaint against UCPB-Magsaysay with the Office of Special Investigation of the Bangko Sentral ng Pilipinas (OSI-BSP), which was dismissed for lack of credibility on June 8, 2012, and affirmed by the Monetary Board of the Bangko Sentral ng Pilipinas (BSP) on March 21, 2013, and March 26, 2018. Buenaflor also wrote to the Office of the President (OP), which endorsed the matter to the Governance Commission for Government-Owned or Controlled Corporations (GCG). In a June 23, 2017 conference, Quedancor failed to produce original loan documents, leading the GCG to issue a letter certifying this failure on July 25, 2017. Based on this, Buenaflor demanded accounting and/or return of funds from private respondents. For their failure to heed, Buenaflor filed a criminal complaint for Estafa with Abuse of Confidence under Article 315, paragraph 1(b) and Other Deceits under Article 318 of the Revised Penal Code against private respondents before the Office of the City Prosecutor, Davao City (OCP-Davao) on January 16, 2019. The OCP-Davao dismissed the complaint on August 7, 2019, due to prescription, which was affirmed by the Regional Prosecution Office XI, Davao City (RPO-XI) on December 29, 2020, and May 4, 2021. The Court of Appeals (CA) dismissed Buenaflor's Petition for Certiorari, upholding the RPO-XI's resolutions, finding the crime prescribed and no probable cause. The Petition: Buenaflor filed a Petition for Review on Certiorari under Rule 45 of the Rules of Court before the Supreme Court, assailing the CA's Decision and Resolution. She argued that the criminal complaint was not predicated on Bernardo's refusal to issue receipts but on breach of implied trust under Article 1456 of the Civil Code, which was repudiated upon demand in December 2018. She contended that the "discovery" for prescription purposes, as per People v. Duque, occurred in 2017 (GCG letter) or December 2018 (demand), not 1989 or 1993. She maintained that all elements of Estafa with Abuse of Confidence were present, citing Bernardo's fraudulent receipt, failure to account, damages, and confirmation of fraud through missing loan documents. She also argued that private respondents committed Other Deceits by falsely representing Quedancor's possession of original loan documents.
Issue(s)
Whether the Court of Appeals (CA) erred in not finding grave abuse of discretion on the part of the Regional Prosecution Office XI (RPO-XI) when it found that the crimes of Estafa with Abuse of Confidence and Other Deceits had already prescribed; and whether the crimes, if any, that may have been committed by private respondents had already prescribed. Whether there is probable cause to indict private respondents for the crime of Estafa with Abuse of Confidence and Other Deceits.
Ruling
The Petition for Review on Certiorari is DENIED. The Decision dated March 15, 2024, and the Resolution dated September 30, 2024, of the Court of Appeals in CA-G.R. SP No. 10508-MIN are AFFIRMED. Jaromay Laurente & Associates Law Offices and its associates, namely: Attys. Ma. Rebecca G. Evangelista-Olavere, Angeline DC. Rodriguez, and Agatha Bernice G. Malalad, are directed to explain in writing within 10 days from notice why they should not be sanctioned for violating Rule 7, Section 3 of the Revised Rules of Court and the Code of Professional Responsibility and Accountability.
Ratio Decidendi
On Issue 1: The Court found no grave abuse of discretion on the part of the RPO-XI in dismissing the complaint for lack of probable cause and prescription. The determination of probable cause during a preliminary investigation is fundamentally an executive function, and courts generally adhere to the principle of non-interference in the prosecutor's exercise of discretion, unless it is tainted with grave abuse of discretion amounting to lack or excess of jurisdiction. Buenaflor failed to demonstrate that the RPO-XI exercised its powers in an arbitrary, capricious, whimsical, or despotic manner. The RPO-XI's conclusions were found to be in accord with the law and the evidence before it, thus making the dismissal of Buenaflor's criminal complaint proper. Furthermore, the Court reiterated that in Rule 45 proceedings, only questions of law may be raised, not questions of fact, and Buenaflor's contention regarding her alleged payment was a question of fact that had already been settled by the CA. The Court also found Buenaflor's assertion of payment inherently improbable due to the lack of a receipt for a substantial amount and her significant delay in demanding one, which is contrary to common human experience for a businesswoman. The Court affirmed that the crimes, if any, that may have been committed by private respondents had already prescribed. It rejected Buenaflor's reliance on People v. Duque, clarifying that the principle enunciated therein regarding the reckoning of the prescriptive period from the "discovery of the unlawful nature of the act" applies to offenses under special laws, which are often not malum in se. For crimes punishable under the Revised Penal Code, such as Estafa, which are malum in se, the prescriptive period is generally reckoned from the actual discovery of the crime by the offended party, the authorities, or their agents, or when they had reasonable means of knowing its commission. The Court held that the prescriptive period began in November 1993, when Quedancor filed a collection suit against Buenaflor and her late husband due to the alleged non-payment of their loan obligations. This served as clear and unequivocal notice to Buenaflor that her supposed payment to Bernardo had not been credited to their loans, thus indicating a misappropriation. The subsequent inability of Quedancor to produce the original loan documents in 2017 did not change the fact that Buenaflor was aware, or should have been aware, of the alleged misappropriation much earlier. Considering the highest imposable penalties for Estafa with Abuse of Confidence (10 years), Other Deceits (15 years), Theft (10 years), and Qualified Theft (20 years), and that approximately 25 years and 2 months had passed between November 1993 and January 16, 2019 (when the criminal complaint was filed), all potential crimes had long prescribed. On Issue 2: The Court ruled that no probable cause exists to indict private respondents for Estafa with Abuse of Confidence or Other Deceits. For Estafa with Abuse of Confidence under Article 315, paragraph 1(b) of the Revised Penal Code, the Court emphasized that the offender must acquire both material and juridical possession of the money or property. In this case, when Buenaflor purportedly delivered PHP 950,000.00 to Bernardo, who was UCPB-Magsaysay's general manager, Bernardo only acquired mere material possession of the funds, holding them on behalf of the bank. He had no personal or independent right or title over these funds that he could set up against either Buenaflor or UCPB-Magsaysay, thus lacking juridical possession. The Court also rejected Buenaflor's argument that an implied trust under Article 1456 of the Civil Code was created, which was later repudiated, thereby extending the prescriptive period. It clarified that Article 1456 pertains to the acquisition of property through mistake or fraud, not erroneous payments on existing loans, for which solutio indebiti under Article 2154 of the Civil Code would be more applicable. Crucially, the Court held that a constructive trust, unlike an express trust, does not emanate from or generate a fiduciary relation, which is an essential element of Estafa with Abuse of Confidence. Without a fiduciary relationship, there can be no breach of confidence. Regarding Other Deceits, the Court found no evidence that Bernardo employed any fraud or deceit to convince Buenaflor to part with her money, as she allegedly gave the amount voluntarily in full satisfaction of existing loans. The Court further found Buenaflor's allegations of conspiracy against Casiño, Jr., Atty. Millares, Atty. Hubilla, and Atty. Anastacio unsubstantiated, noting their limited roles and lack of personal knowledge regarding the alleged payment and misappropriation.
Main Doctrine
The determination of probable cause during a preliminary investigation is fundamentally an executive function entrusted to the public prosecutor or the investigating officer, with courts generally adhering to the principle of non-interference unless grave abuse of discretion is shown. For the crime of Estafa with Abuse of Confidence under Article 315, paragraph 1(b) of the Revised Penal Code, it is essential that the offender acquires both material and juridical possession of the money or property, implying a fiduciary relationship where the offender has an independent right or title over the received property. A constructive trust, as contemplated by Article 1456 of the Civil Code, does not establish such a fiduciary relationship and therefore cannot be the basis for this specific form of Estafa. Furthermore, the prescriptive period for malum in se crimes, such as Estafa, is generally reckoned from the actual discovery of the crime by the offended party or authorities, or when they had reasonable means of knowing its commission, rather than from the discovery of the 'unlawful nature' of the act, which is a principle more applicable to offenses under special laws.