Tan v. Mendez
REITERATIONFacts
The Antecedents: Petitioners Steve Tan and Marciano Tan, owners of Master Tours and Travel Corporation and operators of Philippine Lawin Bus Co., Inc., opened a credit line with respondent Fabian Mendez, Jr. for fuel and lubricants. Respondent was also designated as the booking and ticketing agent for the bus company in Iriga City. Petitioners issued checks to respondent as payment for fuel and oil products, and respondent issued checks to petitioners for ticket sales remittances. One such check, FEBTC check no. 704227 dated June 4, 1991, for P58,237.75, issued as payment for gasoline and oil products, was dishonored for being drawn against insufficient funds. Procedural History: Respondent sent a demand letter to petitioners, which went unheeded. An information for violation of Batas Pambansa Blg. 22 (B.P. 22) was filed. The Regional Trial Court (RTC) of Iriga City, Branch 37, convicted petitioners and sentenced them to six months imprisonment and to indemnify the private complainant. The Court of Appeals (CA) affirmed the RTC decision. Petitioners' motion for reconsideration was denied. The Petition: Petitioners filed a petition for review on certiorari with the Supreme Court, assailing the CA's decision and resolution. They argued that the CA erred in not considering payment by offsetting prior to the demand letter, and that if offsetting was contentious, they should have been acquitted due to reasonable doubt. They also argued that even if offsetting occurred, it should not abate the crime.
Issue(s)
Whether or not petitioners can be held liable for violation of B.P. 22. Whether or not payment through compensation or offset can preclude prosecution for violation of B.P. 22.
Ruling
The Supreme Court denied the petition and affirmed the decision of the Court of Appeals with modification. Petitioners were ordered to indemnify respondent in the amount of P58,237.75 with legal interest. The sentence of imprisonment was set aside, and in lieu thereof, a fine of P116,475.50 was imposed, with subsidiary imprisonment in case of insolvency or non-payment.
Ratio Decidendi
On the issue of liability for violation of B.P. 22: The Court held that all elements of B.P. 22 were present. Petitioner Marciano admitted drawing the subject check as payment for fuel and oil products, knowing he had insufficient funds due to uncollected receivables. The check was subsequently dishonored. The Court reiterated that B.P. 22 makes the mere act of issuing a bum check a malum prohibitum, an act proscribed by legislature for being inimical to public welfare. The gravamen of the offense is the issuance of a worthless check, and even if there had been payment through compensation or other means, prosecution for violation of B.P. 22 can still proceed. The Court emphasized that the issue of whether obligations were paid by compensation or offset is a factual issue not proper for a petition for review on certiorari, as the Supreme Court is not a trier of facts. The findings of the CA, affirming the RTC, that the alleged compensation was not supported by clear and positive evidence were accorded respect and finality. The RTC noted that the total amount of checks issued by petitioners exceeded the amount of returned checks, and no application of payment was made. Furthermore, applying Article 1289 in relation to Article 1254 of the Civil Code, the unencashed checks should have been applied to the earlier dishonored check, which was more onerous. The Court also found that compensation could not take place because respondent was not a debtor of petitioners for the Baao ticket sales, as he only acted as an intermediary. The defense of compensation was also deemed unavailing as it was not raised at the earliest opportunity, and there was no evidence that petitioners redeemed or took back the checks. The Court concluded that no reversible error was committed by the lower courts in finding petitioners guilty of violation of B.P. 22. On the issue of whether payment through compensation or offset can preclude prosecution for violation of B.P. 22: The Court ruled that payment through compensation or offset does not preclude prosecution for violation of B.P. 22. The law penalizes the act of issuing a worthless check, which is considered a malum prohibitum. The gravamen of the offense is the act of issuing a check that is dishonored upon presentment for payment. Therefore, even if payment, through compensation or some other means, occurred after the issuance of the check, the criminal offense has already been committed. The Court cited its rulings in Eduardo Vaca vs. Court of Appeals and Rosa Lim vs. People of the Philippines, which established the philosophy of redeeming valuable human material and preventing unnecessary deprivation of liberty, suggesting a preference for imposing a fine alone in certain circumstances, particularly when good faith or a clear mistake of fact is evident. In this case, the Court noted that petitioners had exerted efforts to settle their obligations and returned unencashed checks, indicating good faith. Consequently, the penalty of imprisonment was set aside, and a fine was imposed instead, with subsidiary imprisonment in case of insolvency.
Main Doctrine
The act of issuing a worthless check, defined as a malum prohibitum, is penalized under Batas Pambansa Blg. 22 regardless of subsequent payment or compensation, as the gravamen of the offense lies in the act of issuing the dishonored check itself. Furthermore, the Supreme Court will not delve into factual issues such as the existence of compensation or offset in a petition for review on certiorari, as findings of fact by lower courts are generally conclusive.