LINA LIM LAO vs. COURT OF APPEALS, ET AL.

G.R. No. 119178 June 20, 1997

Facts:
Petitioner Lina Lao and co-accused was charged for violation of B.P. 22. The facts
reveal that Lina Lao was an employee of Premiere Financing Corporation, a corporation
engaged in investment management. She was a Junior Officer of the corporations
extension office in Binondo. In the regular coursel of her duties as a junior officer, she
was required to co-sign checks withdrawn against the account of the corporation. The
other co-signer was her head officer, Mr. Asprec, co-accused herein. Since part of her
duties required her to be mostly in the field and out of the office, it was normal
procedure for her to sign the check in blank that is without the names of the payee, the
amounts and the dates of maturity. It was likewise Mr. Asprec, as head of office who
alone decided to whom the checks were to be ultimately issued.
Later, complainant Father Peligo, the Provincial Treasurer of the Society of Divine Word,
was authorized to invest donations to the society and had been investing the societys
money with Premiere. He was issued Trader Royal Bank checks to guarantee payment
of investments placed by him with Premiere which was later dishonored. Said checks
were signed by petitioner and Teodoro Asprec.
Issue:
Whether the petitioner could avail the defense of lack of actual knowledge of the
insufficiency of funds at the time of the issuance of the checks and lack of personal
notice of dishonor.
In the main, petitioner contends that the public respondent committed a reversible error in
concluding that lack of actual knowledge of insufficiency of funds was not a defense in a
prosecution for violation of B.P. 22. Additionally, the petitioner argues that the notice of dishonor
sent to the main office of the corporation, and not to petitioner herself who holds office in that
corporation's branch office does not constitute the notice mandated in Section 2 of BP 22; thus,
there can be no prima facie presumption that she had knowledge of the insufficiency of funds.
Held:
Yes, knowledge of insufficiency of fund or credit in the drawee bank for the payment of a
check upon its presentment is an essential element of the offense. Since petitioner Lina
Lao signed the checks w/out knowledge of the insufficiency of funds, knowledge she
was not exulted or obliged to posses under the organizational structure of the
corporation. She may not be held liable, therefore, under B.P. 22. It is the Treasure
Department located at the main office in Cubao Q. C. and headed by Mr. Ocampo,

which alone had access to information as to account balances which alone were
responsible for funding the issued checks. Petitioner Lina Lim Lao is ACQUITTED.

The petition is meritorious.

Strict Interpretation of Penal Statutes
It is well-settled in this jurisdiction that penal statutes are strictly construed against the state and
liberally for the accused, so much so that the scope of a penal statute cannot be extended by good
intention, implication, or even equity consideration. Thus, for Petitioner Lina Lim Lao's acts to
be penalized under the Bouncing Checks Law or B.P. 22, "they must come clearly within both
the spirit and the letter of the statute."
The salient portions of B.P. 22 read:
Sec. 1. Checks without sufficient funds. Any person who makes or draws and
issues any check to apply on account or for value, knowing at the time of issue
that he does not have sufficient funds in or credit with the drawee bank for the
payment of such check in full upon its presentment, which check is subsequently
dishonored by the drawee bank for insufficiency of funds or credit or would have
been dishonored for the same reason had not the drawer, without any valid reason,
ordered the bank to stop payment, shall be punished by imprisonment of not less
than thirty days but not more than one (1) year or by a fine of not less than but not
more than double the amount of the check which fine shall in no case exceed Two
hundred thousand pesos, or both such fine and imprisonment at the discretion of
the court.
The same penalty shall be imposed upon any person who having sufficient funds
in or credit with the drawee bank when he makes or draws and issues a check,
shall fail to keep sufficient funds or to maintain a credit or to cover the full
amount of the check if presented within a period of ninety (90) days from the date
appearing thereon, for which reason it is dishonored by the drawee bank.
Where the check is drawn by a corporation, company or entity, the person or
persons who actually signed the check in behalf of such drawer shall be liable
under this Act.
Sec. 2. Evidence of knowledge of insufficient funds. The making, drawing and
issuance of a check payment of which is refused by the drawee because of
insufficient funds in or credit with such bank, when presented within ninety (90)
days from the date of the check, shall be prima facie evidence of knowledge of
such insufficiency of funds or credit unless such maker or drawer pays the holder
thereof the amount due thereon, or makes arrangements for payment in full by the
drawee of such check within five (5) banking days after receiving notice that such
check has not been paid by the drawee.
This Court listed the elements of the offense penalized under B.P. 22, as follows: "(1) the
making, drawing and issuance of any check to apply to account or for value; (2) the knowledge
of the maker, drawer or issuer that at the time of issue he does not have sufficient funds in or

credit with the drawee bank for the payment of such check in full upon its presentment; and (3)
subsequent dishonor of the check by the drawee bank for insufficiency of funds or credit or
dishonor for the same reason had not the drawer, without any valid cause, ordered the bank to
stop payment."
Justice Luis B. Reyes, an eminent authority in criminal law, also enumerated the elements of the
offense defined in the first paragraph of Section 1 of B.P. 22, thus:
1. That a person makes or draws and issues any check.
2. That the check is made or drawn and issued to apply on account or for value.
3. That the person who makes or draws and issues the check knows at the time of
issue that he does not have sufficient funds in or credit with the drawee bank for
the payment of such check in full upon its presentment.
4. That the check is subsequently dishonored by the drawee bank for insufficiency
of funds or credit, or would have been dishonored for the same reason had not the
drawer, without any valid reason, ordered the bank to stop payment.
Crux of the Petition
Petitioner raised as defense before the Court of Appeals her lack of actual knowledge of the
insufficiency of funds at the time of the issuance of the checks, and lack of personal notice of
dishonor to her. The respondent appellate court, however, affirmed the RTC decision, reasoning
that "the maker's knowledge of the insufficiency of funds is legally presumed from the dishonor
of his checks for insufficiency of funds. (People vs. Laggui, 171 SCRA 305; Nieras vs. Hon.
Auxencio C. Dacuycuy, 181 SCRA 1)" The Court of Appeals also stated that "her alleged lack of
knowledge or intent to issue a bum check would not exculpate her from any responsibility under
B.P. Blg. 22, since the act of making and issuing a worthless check is a malum prohibitum." In
the words of the Solicitor General, "(s)uch alleged lack of knowledge is not material for
petitioner's liability under B.P. Blg. 22."
Lack of Actual Knowledge of Insufficiency of Funds
Knowledge of insufficiency of funds or credit in the drawee bank for the payment of a check
upon its presentment is an essential element of the offense. There is a prima facie presumption of
the existence of this element from the fact of drawing, issuing or making a check, the payment of
which was subsequently refused for insufficiency of funds. It is important to stress, however, that
this is not a conclusive presumption that forecloses or precludes the presentation of evidence to
the contrary.
In the present case, the fact alone that petitioner was a signatory to the checks that were
subsequently dishonored merely engenders the prima facie presumption that she knew of the
insufficiency of funds, but it does not render her automatically guilty under B.P. 22. The
prosecution has a duty to prove all the elements of the crime, including the acts that give rise to
the prima facie presumption; petitioner, on the other hand, has a right to rebut the prima facie
presumption. Therefore, if such knowledge of insufficiency of funds is proven to be actually
absent or non-existent, the accused should not be held liable for the offense defined under the
first paragraph of Section 1 of B.P. 22. Although the offense charged is a malum prohibitum, the
prosecution is not thereby excused from its responsibility of proving beyond reasonable doubt all
the elements of the offense, one of which is knowledge of the insufficiency of funds.

After a thorough review of the case at bar, the Court finds that Petitioner Lina Lim Lao did not
have actual knowledge of the insufficiency of funds in the corporate accounts at the time she
affixed her signature to the checks involved in this case, at the time the same were issued, and
even at the time the checks were subsequently dishonored by the drawee bank.
The scope of petitioner's duties and responsibilities did not encompass the funding of the
corporation's checks; her duties were limited to the marketing department of the Binondo branch.
Under the organizational structure of Premiere Financing Corporation, funding of checks was the
sole responsibility of the Treasury Department. Veronilyn Ocampo, former Treasurer of
Premiere, testified thus:
Q Will you please tell us whose (sic) responsible for the funding of
checks in Premiere?
A The one in charge is the Treasury Division up to the Treasury
Disbursement and then they give it directly to Jose Cabacan,
President of Premiere.
Furthermore, the Regional Trial Court itself found that, since Petitioner Lina Lim Lao was often
out in the field taking charge of the marketing department of the Binondo branch, she signed the
checks in blank as to name of the payee and the amount to be drawn, and without knowledge of
the transaction for which they were issued. As a matter of company practice, her signature was
required in addition to that of Teodulo Asprec, who alone placed the name of the payee and the
amount to be drawn thereon. This is clear from her testimony:
q . . . Will you please or will you be able to tell us the condition of
this check when you signed this or when you first saw this check?
Witness
a I signed the check in blank. There were no payee. No amount, no
date, sir.
q Why did you sign this check in blank when there was no payee,
no amount and no date?
a It is in order to facilitate the transaction, sir.
xxx xxx xxx
COURT
(to witness)
q Is that your practice?
Witness
a Procedure, Your Honor.
COURT
That is quite (sic) unusual. That is why I am asking that last
question if that is a practice of your office.
a As a co-signer, I sign first, sir.

q So the check cannot be encashed without your signature, cosignature?

a Yes, sir.
Atty. Gonzales
(to witness)
q Now, you said that you sign first, after you sign, who signs the
check?
a Mr. Teodoro Asprec, sir.
q Is this Teodoro Asprec the same Teodoro Asprec, one of the
accused in all these cases?
a Yes, sir.
q Now, in the distribution or issuance of checks which according to
you, as a co-signee, you sign. Who determines to whom to issue or
to whom to pay the check after Teodoro Asprec signs the check?
Witness
a He is the one.
Atty. Gonzales
q Mr. Asprec is the one in-charge in . . . are you telling the
Honorable Court that it was Teodoro Asprec who determines to
whom to issue the check? Does he do that all the time?
Court
q Does he all the time?
(to witness)
a Yes, Your Honor.
q So the check can be negotiated? So, the check can be good only
upon his signing? Without his signing or signature the check
cannot be good?
a Yes, Your Honor.
Atty. Gonzales
(to witness)
q You made reference to a transaction which according to you, you
signed this check in order to facilitate the transaction . . . I
withdraw that question. I will reform.
COURT
(for clarification to witness)

Witness may answer.

q Only to facilitate your business transaction, so you signed the
other checks?
Witness
a Yes, Your Honor.
q So that when ever there is a transaction all is needed . . . all that
is needed is for the other co-signee to sign?
a Yes, Your Honor.
COURT
(To counsel)
Proceed.
Atty. Gonzales
(to witness)
q Why is it necessary for you to sign?
a Because most of the time I am out in the field in the afternoon,
so, in order to facilitate the transaction I sign so if I am not around
they can issue the check.
Petitioner did not have any knowledge either of the identity of the payee or the transaction which
gave rise to the issuance of the checks. It was her co-signatory, Teodulo Asprec, who alone filled
in the blanks, completed and issued the checks. That Petitioner Lina Lim Lao did not have any
knowledge or connection with the checks' payee, Artelijo Palijo, is clearly evident even from the
latter's testimony, viz.:
ATTY. GONZALES:
Q When did you come to know the accused Lina Lim Lao?
A I cannot remember the exact date because in their office
Binondo,
COURT: (before witness could finish)
Q More or less?
A It must have been late 1983.
ATTY. GONZALES:
Q And that must or that was after the transactions involving
alleged checks marked in evidence as Exhibits B and C?
A After the transactions.
Q And that was also before the transaction involving that
confirmation of sale marked in evidence as Exhibit A?
A It was also.

Q And so you came to know the accused Lina Lim Lao when all
those transactions were already consummated?
A Yes, sir.
Q And there has never been any occasion where you transacted
with accused Lina Lim Lao, is that correct?
A None, sir, there was no occasion.
Q And your coming to know Lina Lim Lao the accused in these
cases was by chance when you happened to drop by in the office at
Binondo of the Premier Finance Corporation, is that what you
mean?
A Yes, sir.
Q You indicated to the Court that you were introduced to the
accused Lina Lim Lao, is that correct?
A I was introduced.
xxx xxx xxx
Q After that plain introduction there was nothing which transpired
between you and the accused Lina Lim Lao?
A There was none.
Since Petitioner Lina Lim Lao signed the checks without knowledge of the insufficiency of
funds, knowledge she was not expected or obliged to possess under the organizational structure
of the corporation, she may not be held liable under B.P. 22. For in the final analysis, penal
statutes such as B.P. 22 "must be construed with such strictness as to carefully safeguard the
rights of the defendant . . ." The element of knowledge of insufficiency of funds having been
proven to be absent, petitioner is therefore entitled to an acquittal.
This position finds support in Dingle vs. Intermediate Appellate Court where we stressed that
knowledge of insufficiency of funds at the time of the issuance of the check was an essential
requisite for the offense penalized under B.P. 22. In that case, the spouses Paz and Nestor Dingle
owned a family business known as "PMD Enterprises." Nestor transacted the sale of 400 tons of
silica sand to the buyer Ernesto Ang who paid for the same. Nestor failed to deliver. Thus, he
issued to Ernesto two checks, signed by him and his wife as authorized signatories for PMD
Enterprises, to represent the value of the undelivered silica sand. These checks were dishonored
for having been "drawn against insufficient funds." Nestor thereafter issued to Ernesto another
check, signed by him and his wife Paz, which was likewise subsequently dishonored. No
payment was ever made; hence, the spouses were charged with a violation of B.P. 22 before the
trial court which found them both guilty. Paz appealed the judgment to the then Intermediate
Appellate Court which modified the same by reducing the penalty of imprisonment to thirty
days. Not satisfied, Paz filed an appeal to this Court "insisting on her innocence" and
"contending that she did not incur any criminal liability under B.P. 22 because she had no
knowledge of the dishonor of the checks issued by her husband and, for that matter, even the
transaction of her husband with Ang." The Court ruled in Dingle as follows:

The Solicitor General in his Memorandum recommended that petitioner be

acquitted of the instant charge because from the testimony of the sole prosecution
witness Ernesto Ang, it was established that he dealt exclusively with Nestor
Dingle. Nowhere in his testimony is the name of Paz Dingle ever mentioned in
connection with the transaction and with the issuance of the check. In fact, Ang
categorically stated that it was Nestor Dingle who received his two (2) letters of
demand. This lends credence to the testimony of Paz Dingle that she signed the
questioned checks in blank together with her husband without any knowledge of
its issuance, much less of the transaction and the fact of dishonor.
In the case of Florentino Lozano vs. Hon. Martinez, promulgated December 18,
1986, it was held that an essential element of the offense is knowledge on the part
of the maker or drawer of the check of the insufficiency of his funds.
WHEREFORE, on reasonable doubt, the assailed decision of the Intermediate
Appellate Court (now the Court of Appeals) is hereby SET ASIDE and a new one
is hereby rendered ACQUITTING petitioner on reasonable doubt.
In rejecting the defense of herein petitioner and ruling that knowledge of the insufficiency of
funds is legally presumed from the dishonor of the checks for insufficiency of funds, Respondent
Court of Appeals cited People vs. Laggui and Nierras vs. Dacuycuy. These, however, are
inapplicable here. The accused in both cases issued personal, not corporate, checks and did not
aver lack of knowledge of insufficiency of funds or absence of personal notice of the check's
dishonor. Furthermore, in People vs. Laggui the Court ruled mainly on the adequacy of
information which alleged lack of knowledge of insufficiency of funds at the time the check was
issued and not at the time of its presentment. On the other hand, the Court in Nierras vs.
Dacuycuy held mainly that an accused may be charged under B.P. 22 and Article 315 of the
Revised Penal Code for the same act of issuing a bouncing check.
The statement in the two case, that mere issuance of a dishonored check gives rise to the
presumption of knowledge on the part of the drawer that he issued the same without funds, does
not support the CA Decision. As observed earlier, there is here only a prima facie presumption
which does not preclude the presentation of contrary evidence. On the contrary, People vs.
Laggui clearly spells out as an element of the offense the fact that the drawer must have
knowledge of the insufficiency of funds in, or of credit with, the drawee bank for the payment of
the same in full on presentment; hence, it even supports the petitioner's position.
Lack of Adequate Notice of Dishonor
There is another equally cogent reason for the acquittal of the accused. There can be no prima
facie evidence of knowledge of insufficiency of funds in the instant case because no notice of
dishonor was actually sent to or received by the petitioner.
The notice of dishonor may be sent by the offended party or the drawee bank. The trial court
itself found absent a personal notice of dishonor to Petitioner Lina Lim Lao by the drawee bank
based on the unrebutted testimony of Ocampo "(t)hat the checks bounced when presented with
the drawee bank but she did not inform anymore the Binondo branch and Lina Lim Lao as there
was no need to inform them as the corporation was in distress." The Court of Appeals affirmed
this factual finding. Pursuant to prevailing jurisprudence, this finding is binding on this Court.

Indeed, this factual matter is borne by the records. The records show that the notice of dishonor
was addressed to Premiere Financing Corporation and sent to its main office in Cubao, Quezon
City. Furthermore, the same had not been transmitted to Premiere's Binondo Office where
petitioner had been holding office.
Likewise no notice of dishonor from the offended party was actually sent to or received by
Petitioner Lao. Her testimony on this point is as follows:
Atty. Gonzales
q Will you please tell us if Father Artelejo Palejo (sic) ever notified
you of the bouncing of the check or the two (2) checks marked as
Exhibit "B" or "C" for the prosecution?
Witness
a No, sir.
q What do you mean no, sir?
a I was never given a notice. I was never given notice from Father
Palejo (sic).
COURT
(to witness)
q Notice of what?
a Of the bouncing check, Your Honor.
Because no notice of dishonor was actually sent to and received by the petitioner, the prima facie
presumption that she knew about the insufficiency of funds cannot apply. Section 2 of B.P. 22
clearly provides that this presumption arises not from the mere fact of drawing, making and
issuing a bum check; there must also be a showing that, within five banking days from receipt of
the notice of dishonor, such maker or drawer failed to pay the holder of the check the amount
due thereon or to make arrangement for its payment in full by the drawee of such check.
It has been observed that the State, under this statute, actually offers the violator "a compromise
by allowing him to perform some act which operates to preempt the criminal action, and if he
opts to perform it the action is abated." This was also compared "to certain laws allowing illegal
possessors of firearms a certain period of time to surrender the illegally possessed firearms to the
Government, without incurring any criminal liability." In this light, the full payment of the
amount appearing in the check within five banking days from notice of dishonor is a "complete
defense." The absence of a notice of dishonor necessarily deprives an accused an opportunity to
preclude a criminal prosecution. Accordingly, procedural due process clearly enjoins that a notice
of dishonor be actually served on petitioner. Petitioner has a right to demand, and the basic
postulates of fairness require, that the notice of dishonor be actually sent to and received by her
to afford her the opportunity to avert prosecution under B.P. 22.
In this light, the postulate of Respondent Court of Appeals that "(d)emand on the Corporation
constitutes demand on appellant (herein petitioner)," is erroneous. Premiere has no obligation to
forward the notice addressed to it to the employee concerned, especially because the corporation
itself incurs no criminal liability under B.P. 22 for the issuance of a bouncing check.

Responsibility under B.P. 22 is personal to the accused; hence, personal knowledge of the notice
of dishonor is necessary. Consequently, constructive notice to the corporation is not enough to
satisfy due process. Moreover, it is petitioner, as an officer of the corporation, who is the latter's
agent for purposes of receiving notices and other documents, and not the other way around. It is
but axiomatic that notice to the corporation, which has a personality distinct and separate from
the petitioner, does not constitute notice to the latter.
Epilogue
In granting this appeal, the Court is not unaware of B.P. 22's intent to inculcate public respect for
and trust in checks which, although not legal tender, are deemed convenient substitutes for
currency. B.P. 22 was intended by the legislature to enhance commercial and financial
transactions in the Philippines by penalizing makers and issuers of worthless checks. The public
interest behind B.P. 22 is thus clearly palpable from its intended purpose.
At the same time, this Court deeply cherishes and is in fact bound by duty to protect our people's
constitutional rights to due process and to be presumed innocent until the contrary is proven.
These rights must be read into any interpretation and application of B.P. 22. Verily, the public
policy to uphold civil liberties embodied in the Bill of Rights necessarily outweighs the public
policy to build confidence in the issuance of checks. The first is a basic human right while the
second is only proprietary in nature. Important to remember also is B.P. 22's requirements that
the check issuer must know "at the time of issue that he does not have sufficient funds in or
credit with the drawee bank" and that he must receive "notice that such check has not been paid
by the drawee." Hence, B.P. 22 must not be applied in a manner which contravenes an accused's
constitutional and statutory rights.
There is also a social justice dimension in this case. Lina Lim Lao is only a minor employee who
had nothing to do with the issuance, funding and delivery of checks. Why she was required by
her employer to countersign checks escapes us. Her signature is completely unnecessary for it
serves no fathomable purpose at all in protecting the employer from unauthorized disbursements.
Because of the pendency of this case, Lina Lim Lao stood in jeopardy for over a decade of losing
her liberty and suffering the wrenching pain and loneliness of imprisonment, not to mention the
stigma of prosecution on her career and family life as a young mother, as well as the expenses,
effort and aches in defending her innocence. Upon the other hand, the senior official Teodoro
Asprec who appears responsible for the issuance, funding and delivery of the worthless checks
has escaped criminal prosecution simply because he could not be located by the authorities. The
case against him has been archived while the awesome prosecutory might of the government and
the knuckled ire of the private complainant were all focused on poor petitioner. Thus, this Court
exhorts the prosecutors and the police authorities concerned to exert their best to arrest and
prosecute Asprec so that justice in its pristine essence can be achieved in all fairness to the
complainant, Fr. Artelijo Palijo, and the People of the Philippines. By this Decision, the Court
enjoins the Secretary of Justice and the Secretary of Interior and Local Government to see that
essential justice is done and the real culprit(s) duly-prosecuted and punished.

RICARDO SUAREZ VS. PEOPLE OF THE PHILIPPINES AND A.H. SHOPPERS'

MART, INC.
G. R. No. 172573

June 19, 2008

Facts:
Ricardo Suarez opened a credit line to purchase goods with Shoppers Mart. As
payment for the goods, Suarez issued two postdated checks payable to the order of
Shoppers Mart. Shoppers Mart deposited the checks. However, DBP dishonored the
checks for having been drawn against a closed account. Shoppers Mart sent Suarez a
demand letter to pay for the value of the checks, but Suarez failed to make payment.
Issue:
Whether the prosecution proved the element of knowledge of insufficiency of funds to
hold the petitioner liable for violation of B.P. Blg. 22.
Held:
The prosecution did not prove that Suarez received the notice of dishonor. Registry
return cards must be authenticated to serve as proof of receipt of letters sent through
registered mail. The presentation of the registry card, with an unauthenticated signature,
does not meet the required proof beyond reasonable doubt that Suarez received such
notice, especially considering that he denied receiving it. As there is insufficient proof
that Suarez received notice of dishonor, the presumption that he had knowledge of
insufficiency of funds cannot arise. Petitioner is ACQUITTED.
To commit a violation of B.P. Blg. 22, the following elements must be present and proved:
1. the making, drawing and issuance of any check to apply for account or for value;
2. the knowledge of the maker, drawer, or issuer that at the time of issue he does not have
sufficient funds in or credit with the drawee bank for the payment of such check in full
upon its presentment; and
3. the subsequent dishonor of the check by the drawee bank for insufficiency of funds or
credit or dishonor for the same reason had not the drawer, without any valid cause,
ordered the bank to stop payment.
B.P. Blg. 22 creates a presumption of knowledge of insufficiency of funds under the following
circumstances:
Sec. 2. Evidence of knowledge of insufficient funds. The making, drawing, and issuance of a
check payment of which is refused by the drawee because of insufficient funds or credit with

such bank, when presented within ninety days from the date of the check, shall be prima facie
evidence of knowledge of such insufficiency of funds or credit unless such maker or drawer pays
the holder thereof the amount due thereon, or makes arrangements for payment in full by the
drawee of such check within five (5) banking days after receiving notice that such check has not
been paid by the drawee.
The presumption arises when it is proved that the issuer had received this notice, and that within
five banking days from its receipt, he failed to pay the amount of the check or to make
arrangements for its payment. The full payment of the amount appearing in the check within five
banking days from notice of dishonor is a complete defense. Accordingly, procedural due process
requires that a notice of dishonor be sent to and received by the petitioner to afford the
opportunity to avert prosecution under B.P. Blg. 22.
The evidence shows that the prosecution proved that a notice of dishonor was sent to petitioner
through registered mail. The prosecution presented a copy of the demand letter and properly
authenticated the registry return receipt. However, it is not enough for the prosecution to prove
that a notice of dishonor was sent to the petitioner. It is also incumbent upon the prosecution to
show "that the drawer of the check received the said notice because the fact of service provided
for in the law is reckoned from receipt of such notice of dishonor by the drawee of the check."
A review of the records shows that the prosecution did not prove that the petitioner received the
notice of dishonor. Registry return cards must be authenticated to serve as proof of receipt of
letters sent through registered mail. Thus, we held:
...it must appear that the same was served on the addressee or a duly authorized agent of the
addressee. In fact, the registry return receipt itself provides that `[a] registered article must not be
delivered to anyone but the addressee, or upon the addressee's written order, in which case the
authorized agent must write the addressee's name on the proper space and then affix legibly his
own signature below it.'
The failure of the prosecution to properly authenticate and identify the signature on the registry
return card as that of the petitioner is evident from the testimony of its sole witness, the
Collection Manager of Shoppers' Mart:
Q:

The return card evidencing actual receipt by the defendant, it is also included in Branch
2, City Court?

A:

Yes, sir.

Q:

I show you a return receipt, is this the return receipt you are referring to?

A:

Yes, sir.

The presentation of the registry card, with an unauthenticated signature, does not meet the
required proof beyond reasonable doubt that the petitioner received such notice, especially
considering that he denied receiving it. As there is insufficient proof that the petitioner received
notice of dishonor, the presumption that he had knowledge of insufficiency of funds cannot
arise.

EVANGELINE DANAO vs. COURT OF APPEALS and PEOPLE OF THE

PHILIPPINES
G.R. No. 122353, June 6, 2001
Facts:
Evangeline Danao went to see Arturo Estrada to seek an additional loan. Estrada had to
refuse Danao's request, considering that her existing loan had not yet been fully
liquidated. Estrada informed Danao that he knew one who lends money with postdated
checks as security. Danao agreed to the arrangement, Estrada phoned Luviminda
Macasieb. Macasieb talked with Evangeline Danao over the phone and explained that
the checks would be subject to a 10% interest every month. After the telephone
conversation with Evangeline Danao, Macasieb instructed Estrada to release the
amount of P29,750.00 from the petty cash fund entrusted by her to Estrada. After
Danao received the said amount from Estrada, she issued two postdated checks in the
total amount of P29,750.00.
On the maturity dates of the two checks, Luviminda deposited the same. However, the
checks were dishonored for the reason that the account of Danao had already been
closed. Macasieb later received check slips together with the returned checks. The
returned checks bear the stamped words "ACCOUNT CLOSED". Estrada informed
Danao of the dishonor of the checks and asked her to redeem the same but to no avail.
A letter was sent by Atty. Jose S. Padolina, counsel for private complainant, demanding
that Danao settle her obligation. Danao, however, failed to heed the demand letter.
Issue:
Whether there was a violation of B.P. Blg. 22 on two counts for insufficiency of evidence.
Held:
To hold a person liable under the first paragraph of Section 1 of BP Blg. 22, it is not
enough to establish that a check issued was subsequently dishonored. It must be
shown further that the person who issued the check knew at the time of issue that he
did not have sufficient funds in or to his credit with the drawee bank for the payment of
such check in full upon its presentment. Because this element involves a state of mind
which is difficult to establish, Section 2 of the law creates a prima facie presumption of
such knowledge when it is shown that the drawer received a notice of dishonor and,
within five banking days thereafter, failed to satisfy the amount of the check or to make
arrangement for its payment. If such notice of non-payment by the drawee bank is not
sent to the maker or drawer of the bum check, or if there is no proof as to when such
notice was received by the drawer, then the presumption or prima facie evidence as

provided for in Section 2 cannot arise, since there would be no way of reckoning the
crucial five-day period. Although the offense charged is malum prohibitum, the
prosecution is not excused from its responsibility of proving beyond reasonable doubt all
the elements of the offense, one of which is knowledge of the insufficiency of funds. It is
clear that the essential element of knowledge of insufficiency of funds or credit on the
part of petitioner is absent in the case at bar, not having been proved by the
prosecution. On this ground alone, petitioner should be acquitted.
It is settled that factual findings of the trial court are accorded great weight, even finality on
appeal, except when it has failed to appreciate certain facts and circumstances which, if taken
into account, would materially affect the result of the case. This exception is present here.
We find that the totality of the evidence presented does not support petitioner's conviction for
violation of B.P. Blg. 22, since the prosecution failed to prove beyond reasonable doubt all the
elements of the offense.
The Information in each of the two criminal cases charges that petitioner Evangeline issued the
subject check, "knowing that at the time of issue thereof," she "did not have sufficient funds in or
credit with the drawee bank for the payment in full of the face amount of the check upon its
presentment," and that "despite receipt of notice of dishonor, the said accused failed to pay the
payee the face amount of the check or to make arrangement for full payment thereof within five
(5) banking days after receiving notice."
Petitioner was specifically charged with violation of the first paragraph of Section 1 of BP Blg.
22, which provides:
"SECTION 1. Checks without sufficient funds. - Any person who makes or draws and issues
any check to apply on account or for value, knowing at the time of issue that he does not have
sufficient funds in or credit with the drawee bank for the payment of such check in full upon its
presentment, which check is subsequently dishonored by the drawee bank for insufficiency of
funds or credit or would have been dishonored for the same reason had not the drawer, without
any valid reason, ordered the bank to stop payment, shall be punished by imprisonment of not
less than thirty days but not more than one (1) year or by a fine of not less than but not more than
double the amount of the check which fine shall in no case exceed Two Hundred Thousand
Pesos, or both such fine and imprisonment at the discretion of the court." (Underscoring
supplied)
The elements of the offense under the abovequoted provision are:
1. The accused makes, draws or issues any check to apply to account or for value;

2. The accused knows at the time of the issuance that he or she does not have sufficient funds in,
or credit with, the drawee bank for the payment of the check in full upon its presentment; and
3. The check is subsequently dishonored by the drawee bank for insufficiency of funds or credit,
or it would have been dishonored for the same reason had not the drawer, without any valid
reason, ordered the bank to stop payment.
In King vs. People, this Court, through Justice Artemio V. Panganiban, held: "To hold a person
liable under B.P. Blg. 22, it is not enough to establish that a check issued was subsequently
dishonored. It must be shown further that the person who issued the check knew 'at the time of
issue that he does not have sufficient funds in or credit with the drawee bank for the payment of
such check in full upon its presentment.' Because this element involves a state of mind which is
difficult to establish, Section 2 of the law creates a prima facie presumption of such knowledge,
as follows:
'SEC. 2. Evidence of knowledge of insufficient funds. - The making, drawing and issuance of a
check payment of which is refused by the drawee because of insufficient funds in or credit with
such bank, when presented within ninety (90) days from the date of the check, shall be prima
facie evidence of knowledge of such insufficiency of funds or credit unless such maker or drawer
pays the holder thereof the amount due thereon, or makes arrangements for payment in full by
the drawee of such check within five (5) banking days after receiving notice that such check has
not been paid by the drawee.'
Thus, this Court further ruled in King, "in order to create the prima facie presumption that the
issuer knew of the insufficiency of funds, it must be shown that he or she received a notice of
dishonor and, within five banking days thereafter, failed to satisfy the amount of the check or
make arrangement for its payment."
Indeed, the prima facie presumption in Section 2 of B.P. Blg. 22 "gives the accused an
opportunity to satisfy the amount indicated in the check and thus avert prosecution." This
opportunity, as this Court stated in Lozano vs. Martinez, serves to "mitigate the harshness of the
law in its application.
In other words, if such notice of non-payment by the drawee bank is not sent to the maker or
drawer of the bum check, or if there is no proof as to when such notice was received by the
drawer, then the presumption or prima facie evidence as provided in Section 2 of B.P. Blg. 22
cannot arise, since there would simply be no way of reckoning the crucial 5-day period.

In the present case, no proof of receipt by petitioner of any notice of non-payment of the checks
was ever presented during the trial. As found by the trial court itself, "(t)he evidence however is
not clear when Macasieb (private complainant) made the demands. There is no proof of the
date when DANAO received the demand letter (Exh. F)."
Obviously, in the instant case, there is no way of determining when the 5-day period prescribed
in Section 2 of B.P. Blg. 22 would start and end. Thus, the presumption or prima facie evidence
of knowledge by the petitioner of the insufficiency of funds or credit at the times she issued the
checks did not arise.
It is clear that the essential element of knowledge of insufficiency of funds or credit on the part
of petitioner is absent in the case at bar, not having been proved by the prosecution. On this
ground alone, petitioner should be acquitted.
Again, the ruling of this Court in King bears repeating:
"Under Batas Pambansa Blg. 22 (BP 22), the prosecution must prove not only that the accused
issued a check that was subsequently dishonored. It must also establish that the accused was
actually notified that the check was dishonored, and that he or she failed, within five banking
days from receipt of the notice, to pay the holder of the check the amount due thereon or to make
arrangement for its payment. Absent proof that the accused received such notice, a prosecution
for violation of the Bouncing Checks Law cannot prosper.
In the same vein, we clarified in Lao vs. Court of Appeal that "(a)lthough the offense charged is a
malum prohibitum, the prosecution is not thereby excused from its responsibility of proving
beyond reasonable doubt all the elements of the offense, one of which is knowledge of the
insufficiency of funds."
The remaining assigned errors raised by petitioner are closely interrelated since they pertain to
her payment of the amounts of the subject checks even prior to complainants letter of demand.
We shall discuss them jointly.
Petitioner contends that while the demand letter is dated June 17, 1992 (Exh. F), the Statement
of Account (Exhs. 1 & 1-A) shows that as of June 5, 1992, she had paid to complainant
Macasieb P30,514.00, thus covering the amount of P29,500.00 of the two checks.
We find that the payment made by Evangeline in the total amount of P30,514.00 has been
sufficiently and convincingly established by the very testimony of complainant herself. The
respondents, through the Solicitor General, argued that petitioner's payments were for "other

accounts". But that is not so, as can be clearly gleaned from the following testimony of
complainant Macasieb:
"Q: Regarding those other transactions, was Evangeline Danao ever able to make good those
other transactions as you mentioned several transactions?
"A: I do not think so because what she is using is the check of her mother. I forgot the name Samonte I think."
"Q: How much was the partial payment?
"A: More or less I think P30,000.00 something but that is for the other accounts with me using
the other checks of her clients."
"Q: You mean to say, after filing these cases or before filing these cases and after the first
transaction was not made good you still continue doing business with her in the rediscounting
business?
"A: Not anymore because what she was furnishing before are I think the checks of the
customers and through the checks of the customers I accepted."
"Q: Going back to this particular transaction - is this the only transaction of Evangeline Danao
which is under her name made between you and her?
"A: Yes, sir."
"Q: But you still remember that statement of account in your own handwriting which was given
to her?
"A: Yes, Attorney. This is my handwriting because sometime in June 1992 she asked for an
audience with me. This is the statement of account and these are the payments that she was able
to make from February to June.
"Q: Under your oath you will affirm that you have issued this statement of account?
"A: Yes.

"Q: And to the total amount of P30,514.00?

"A: Yes.
"ATTY. DY:
I am presenting this as evidence for the accused. I request that the same be marked as Exh.
1 for the accused and then the amount of P30,514.00 be enclosed in parenthesis and to be marked
as our Exh. 1-A." (Emphasis supplied)
It is plain that complainant established by her own admission that the subject checks are the only
particular transactions between her and petitioner and that the so-called "other transactions" or
checks are in the names of the latter's mother, clients or customers. There can be no other
conclusion then than that petitioner's payment of P30,514.00 pertains only to the subject checks.
In sum, we find that the prosecution failed to prove by evidence beyond reasonable doubt the
guilt of herein petitioner for violations of B.P. 22.

EVANGELINE CABRERA vs. PEOPLE OF THE PHILIPPINES and LUIS GO

G.R. No. 150618

July 24, 2003

Facts:
Luis Go required Boni Co to issue postdated checks in payment for his purchases.
Since Co had no checking account with any bank, he offered to pay for his purchases
with postdated checks drawn and issued by Cabrera. Co assured Go that he and
Cabrera had a business arrangement. Since Go also believed that Co was a good
businessman, he finally agreed to accept the postdated checks issued by Cabrera. Go
and Co also agreed that on the due date of the checks, Co would either pay the amount
thereof in cash by way of replacement for the same, or Go would negotiate, or deposit
the checks in his account and/or the account of DMPH Co.
When Co failed to pay for his purchases, Go deposited the three postdated checks in
his account. As of July 31, 1999, Cabrera had P700.00 in her account. When the checks
were deposited, Cabreras account with the bank had a balance of only P100.04. The
bank had closed Cabreras account on August 4, 1992 after applying the said amount to
the payment of bank charges. The drawee bank thus dishonored Cabreras postdated
checks, and duly stamped Account Closed on the front and dorsal portions of each
check. The drawee bank returned the checks to the FEBTC with the corresponding
check return slips. Nevertheless, Go continued selling merchandise to Co, who likewise
continued to draw and issue postdated checks; this time drawn against his personal
account. Go accepted Cos personal checks, hoping that he would eventually be paid.
Cos personal checks were all dishonored by the drawee bank.
Go notified Cabrera that her three checks were dishonored by the drawee bank. She
saw Go in his office and confirmed that she and Co had a business arrangement. She
asked Go to give Co more time to redeem the postdated checks with cash. Go agreed.
However, Co again failed to redeem the checks. Cabrera likewise failed to pay the
amounts of the checks despite Gos repeated demands.
Issue:
Whether or not the petitioner is liable for violation of B.P. Blg. 22.
In the petition at bar, the petitioner ascribes several errors to the CA. However, this Court
believes that the threshold issue to be resolved is whether or not the petitioner is liable for
violation of B.P. Blg. 22, on her plea that:
In fact under the law, a drawer of a check is entitled to a notice of dishonor and
only if said drawer fails to make good the same within five (5) banking days from
receipt of said notice that bad faith or fraud is prima facie presumed to exist.
In the case at bar, no such notice of dishonor was afforded the accused. Hence, for

lack of bad faith or fraudulent intent, the accused may not be convicted of the offense
charged.
Moreover, the accused may not be said to have knowledge that she has no funds in
the bank at the time of issuance because when subject checks were borrowed from her,
the obligation of Boni Co and its maturity was not fixed.
Under the foregoing facts and circumstances, it is unjust for the accused to be fined
the total sum of P191,175.45 as a penalty for alleged violation of Batas Pambansa Blg.
22.
Held:
In this case, the prosecution failed to adduce in evidence any notice of dishonor of the
three postdated checks or any letter of demand sent to and received by the petitioner.
The bare testimony of Luis Go that he sent letters of demand to the petitioner notifying
her of the dishonor of her checks is utterly insufficient.
For failure of the prosecution to show that notices of dishonor of the three postdated
checks were served on the petitioner, or at the very least, that she was sent a demand
letter notifying her of the said dishonor, the prima facie presumption under Section 2 of
B.P. Blg. 22 that she knew of the insufficiency of funds cannot arise. Thus, there can be
no basis for establishing the presence of actual knowledge of insufficiency of funds.
In light of such failure, we find and so declare that the prosecution failed to prove
beyond reasonable doubt all the elements of violation of B.P. Blg. 22. Hence, the need
to reverse and set aside the decisions of both the Court of Appeals and the trial court
convicting the petitioner of the crime of violation of B.P. Blg. 22. Petitioner Evangeline
Cabrera is ACQUITTED of violations of B.P. Blg. 22 on the ground that her guilt for the
said crimes has not been proved beyond reasonable doubt.
The petition is impressed with merit.
Section 1 of B.P. Blg. No. 22 provides that:
SECTION 1. Checks without sufficient funds.Any person who makes or draws and issues any
check to apply on account or for value, knowing at the time of issue that he does not have
sufficient funds in or credit with the drawee bank for the payment of such check in full upon its
presentment, which check is subsequently dishonored by the drawee bank for insufficiency of
funds or credit or would have been dishonored for the same reason had not the drawer, without
any valid reason, ordered the bank to stop payment, shall be punished by imprisonment of not
less than thirty days but not more than one (1) year or by a fine of not less than but not more than
double the amount of the check which fine shall in no case exceed Two Hundred Thousand
pesos, or both such fine and imprisonment at the discretion of the court.

The same penalty shall be imposed upon any person who having sufficient funds in or credit with
the drawee bank when he makes or draws and issues a check, shall fail to keep sufficient funds or
to maintain a credit to cover the full amount of the check if presented within a period of ninety
(90) days from the date appearing thereon, for which reason it is dishonored by the drawee bank.
Where the check is drawn by a corporation, company or entity, the person or persons who
actually signed the check in behalf of such drawer shall be liable under this Act.
The law enumerates the elements of the offense penalized under B.P. Blg. 22 as follows: (1) the
drawing, making and issuance of any check to apply to account or for value; (b) the knowledge
of the maker, drawer or issuer that at the time of issue he does not have sufficient funds in or
credit with the drawee bank for the payment of such check in full upon its presentment; and (3)
subsequent dishonor of the check by the drawee bank for insufficiency of funds or credit or
dishonor for the same reason had not the drawer, without any valid cause, ordered the bank to
stop payment. The barefaced fact that the petitioner was the signatory to the checks that were
subsequently dishonored merely gave rise to a prima facie presumption that she knew of the
insufficiency of funds; it did not render her automatically liable for violating B.P. Blg. 22. The
prosecution is burdened to prove all the elements of the crime beyond reasonable doubt.
To prove the first and third elements of the crime, Section 3 of the law provides that the
introduction in evidence of the unpaid or dishonored check, having the drawees refusal to pay
stamped or written thereon, or attached thereto, with the reason therefor as aforesaid shall be
prima facie evidence of the making or issuing of the said checks and the due presentment to the
drawee for payment and the dishonor thereof, and that the same was properly dishonored for the
reason written, stamped or attached thereto by the drawee on such dishonored checks. It is
difficult for the prosecution to prove the second element because knowledge involves a state of
mind.[15] Hence, Section 2 of the law provides that:
SEC. 2. Evidence of knowledge of insufficient funds.The making, drawing and issuance of a
check payment of which is refused by the drawee because of insufficient funds in or credit with
such bank, when presented within ninety (90) days from the date of the check, shall be prima
facie evidence of knowledge of such insufficiency of funds or credit unless such maker or drawer
pays the holder thereof the amount due thereon, or makes arrangements for payment in full by
the drawee of such check within five (5) banking days after receiving notice that such check has
not been paid by the drawee.[16]
In order to create the prima facie presumption, that the issuer knew of the insufficiency of funds,
it must be shown that he or she received a notice of dishonor and within five banking days
thereafter, failed to satisfy the amount of the check or shall arrange for its payment.[17] The
prosecution is burdened to prove the acts that gave rise to the prima facie presumption. On the
other hand, the drawer has the right to adduce evidence to rebut the same. It is important to stress
that this presumption is not conclusive, or one that forecloses or precludes the presentation of

evidence to the contrary.[18] Thus, the drawer of the check can still overturn the prima facie
presumption by proving that the holder thereof was paid the amount due thereon, or that
arrangements were made for payment in full by the drawee of the check within five banking
days after receipt of notice that such check has not been paid by the drawee bank.
In Lao vs. Court of Appeals,[19] this Court ruled that the full payment of the amount of the
check within five banking days from receipt of notice of dishonor is a complete defense. Hence,
the absence of a notice of dishonor necessarily deprives the drawer of the check the opportunity
to preclude criminal prosecution:
It has been observed that the State, under this statute, actually offers the violator a compromise
by allowing him to perform some act which operates to preempt the criminal action, and if he
opts to perform it the action is abated. This was also compared to certain laws allowing illegal
possessors of firearms a certain period of time to surrender the illegally possessed firearms to the
Government, without incurring any criminal liability. In this light, the full payment of the
amount appearing in the check within five banking days from notice of dishonor is a complete
defense. The absence of a notice of dishonor necessarily deprives an accused an opportunity to
preclude a criminal prosecution. Accordingly, procedural due process clearly enjoins that a notice
of dishonor be actually served on petitioner. Petitioner has a right to demandand the basic
postulates of fairness requirethat the notice of dishonor be actually sent to and received by her
to afford her the opportunity to avert prosecution under B.P. Blg. 22.[20]
In Domagsang vs. Court of Appeals,[21] this Court held that a mere oral notice or demand to pay
is insufficient compliance with the requirements of the law:
Petitioner counters that the lack of a written notice of dishonor is fatal. The Court agrees.
While, indeed, Section 2 of B.P. Blg. 22 does not state that the notice of dishonor be in writing,
taken in conjunction, however, with Section 3 of the law, i.e., that where there are no sufficient
funds in or credit with such drawee bank, `such fact shall always be explicitly stated in the notice
of dishonor or refusal, a mere oral notice or demand to pay would appear to be insufficient for
conviction under the law. The Court is convinced that both the spirit and letter of the Bouncing
Checks Law would require for the act to be punished thereunder not only that the accused issued
a check that is dishonored, but that likewise the accused has actually been notified in writing of
the fact of dishonor. The consistent rule is that penal statutes have to be construed strictly against
the State and liberally in favor of the accused.
Evidently, the appellate court did not give weight and credence to the assertion that a demand
letter was sent by a counsel of the complainant because of the failure of the prosecution to
formally offer it in evidence. Courts are bound to consider as part of the evidence only those
which are formally offered for judges must base their findings strictly on the evidence submitted

by the parties at the trial. Without the written notice of dishonor, there can be no basis,
considering what has heretofore been said, for establishing the presence of actual knowledge of
insufficiency of funds.[22]
It is not enough for the prosecution to prove that a notice of dishonor was sent to the drawee of
the check. It must also show that the drawer of the check received the said notice because the
fact of service provided for in the law is reckoned from receipt of such notice of dishonor by the
drawee of the check.
As adverted to earlier, it is necessary in cases for violation of Batas Pambansa Blg. 22, that the
prosecution prove that the issuer had received a notice of dishonor. It is a general rule that when
service of notice is an issue, the person alleging that the notice was served must prove the fact of
service. (58 Am. Jur. 2d, Notice 45). The burden of proving notice rests upon the party asserting
its existence. Now, ordinarily, preponderance of evidence is sufficient to prove notice. In
criminal cases, however, the quantum of proof required is proof beyond reasonable doubt.
Hence, for Batas Pambansa Blg. 22 cases, there should be clear proof of notice. Moreover, it is a
general rule that, when service of a notice is sought to be made by mail, it should appear that the
conditions on which the validity of such service depends had existence, otherwise the evidence is
insufficient to establish the fact of service (C.J.S., Notice, 18). In the instant case, the
prosecution did not present proof that the demand letter was sent through registered mail, relying
as it did only on the registry return receipt. In civil cases, service made through registered mail
is proved by the registry receipt issued by the mailing office and an affidavit of the person
mailing of facts showing compliance with Section 7 of Rule 13 (See Section 13, Rule 13, 1997
Rules of Civil Procedure). If, in addition to the registry receipt, it is required in civil cases that an
affidavit of mailing as proof of service be presented, then with more reason should we hold in
criminal cases that a registry receipt alone is insufficient as proof of mailing. In the instant case,
the prosecution failed to present the testimony, or at least the affidavit, of the person mailing that,
indeed, the demand letter was sent.
In this case, the prosecution failed to adduce in evidence any notice of dishonor of the three
postdated checks or any letter of demand sent to and received by the petitioner. The bare
testimony of Luis Go that he sent letters of demand to the petitioner notifying her of the dishonor
of her checks is utterly insufficient.
For failure of the prosecution to show that notices of dishonor of the three postdated checks were
served on the petitioner, or at the very least, that she was sent a demand letter notifying her of the
said dishonor, the prima facie presumption under Section 2 of B.P. Blg. 22 that she knew of the
insufficiency of funds cannot arise. Thus, there can be no basis for establishing the presence of
actual knowledge of insufficiency of funds.
In light of such failure, we find and so declare that the prosecution failed to prove beyond
reasonable doubt all the elements of violation of B.P. Blg. 22. Hence, the need to reverse and set

aside the decisions of both the Court of Appeals and the trial court convicting the petitioner of
the crime of violation of B.P. Blg. 22.
However, we uphold the decision of the CA affirming the trial courts decision ordering the
petitioner to pay to the private respondent the total face value of the checks in the amount of
P209,175.45. We stress that a check is an evidence of debt against the drawer, and although may
not be intended to be presented, has the same effect as an ordinary check, and if passed upon to a
third person, will be valid in his hands like any other check. Hence, the petitioner is obliged to
pay to the private respondent Luis Go the said amount of P209,175.45 with 12% legal interest
per annum, from the filing of the information until the finality of this decision, the sum of which,
inclusive of interest, shall be subject thereafter to 12% per annum interest until the amount due is
fully paid, conformably to our ruling that when an obligation is breached, and it consists in the
payment of a sum of money, i.e. a loan or forbearance of money, the interest due should be that
which may have been stipulated in writing. In the absence of such stipulation, the rate shall be
12% per annum computed from default, i.e. judicial or extrajudicial demand. In this case, the rate
of interest was not stipulated in writing by the petitioner, the private respondent and Boni Co.
Thus, the applicable interest rate is 12% per annum.

ELVIRA YU OH vs. COURT OF APPEALS and PEOPLE OF THE PHILIPPINES

G.R. No. 125297, June 6, 2003
Facts:
Elvira Yu Oh purchased pieces of jewelry from Solid Gold International Traders, Inc.
Due to her failure to pay the purchase price, Solid Gold filed civil cases against her for
specific performance. On September 17, 1990, Yu Oh and Solid Gold, through its
general manager Joaquin Novales III, entered into a compromise agreement to settle
said civil cases. The compromise agreement, as approved by the trial court, provided
that Yu Oh shall issue a total of ninety-nine post-dated checks in the amount of
P50,000.00 each, dated every 15th and 30th of the month starting October 1, 1990 and
the balance of over P1 million to be paid in lump sum on November 16, 1994 which is
also the due date of the 99th and last postdated check. Yu Oh issued ten checks at
P50,000.00 each, for a total of P500,000.00, drawn against her account at the Equitable
Banking Corporation (EBC), Grace Park, Caloocan City Branch. Novales then deposited
each of the ten checks on their respective due dates with the Far East Bank and Trust
Company (FEBTC). However, said checks were dishonored by EBC for the reason
"Account Closed." Dishonor slips were issued for each check that was returned to
Novales.
Issue:
Whether or not notice of dishonor is dispensable in the case at bar.
Held:
It is essential for the maker or drawer to be notified of the dishonor of her check, so she
could pay the value thereof or make arrangements for its payment within the period
prescribed by law and omission or neglect on the part of the prosecution to prove that
the accused received such notice of dishonor is fatal to its cause. Thus, absent a clear
showing that petitioner actually knew of the dishonor of her checks and was given the
opportunity to make arrangements for payment as provided for under the law, we
cannot with moral certainty convict her of violation of B.P. Blg. 22. The failure of the
prosecution to prove that petitioner was given the requisite notice of dishonor is a clear
ground for her acquittal.
Anent the second issue: whether or not notice of dishonor is dispensable in the case at bar.
Petitioner failed to show any cogent reason for us to disturb the findings of the RTC and the
Court of Appeals.

B.P. Blg. 22 or the Bouncing Checks Law seeks to prevent the act of making and issuing checks
with the knowledge that at the time of issue, the drawer does not have sufficient funds in or
credit with the bank for payment and the checks were subsequently dishonored upon
presentment.[39] To be convicted thereunder, the following elements must be proved:
1.

The accused makes, draws or issues any check to apply to account or for value;

2.
The accused knows at the time of the issuance that he or she does not have sufficient funds
in, or credit with, the drawee bank for the payment of the check in full upon its presentment; and
3.
The check is subsequently dishonored by the drawee bank for insufficiency of funds or
credit or it would have been dishonored for the same reason had not the drawer, without any
valid reason, ordered the bank to stop payment.
For liability to attach under B.P. Blg. 22, it is not enough that the prosecution establishes that
checks were issued and that the same were subsequently dishonored. The prosecution must also
prove that the issuer, at the time of the checks issuance, had knowledge that he did not have
enough funds or credit in the bank of payment thereof upon its presentment.
Since the second element involves a state of mind which is difficult to establish, Section 2 of B.P.
Blg. 22 created a prima facie presumption of such knowledge, as follows:
SEC. 2. Evidence of knowledge of insufficient funds. The making, drawing and issuance of a
check payment of which is refused by the drawee because of insufficient funds in or credit with
such bank, when presented within ninety (90) days from the date of the check, shall be prima
facie evidence of knowledge of such insufficiency of funds or credit unless such maker or drawer
pays the holder thereof the amount due thereon, or makes arrangements for payment in full by
the drawee of such check within five (5) banking days after receiving notice that such check has
not been paid by the drawee.
Based on this section, the presumption that the issuer had knowledge of the insufficiency of
funds is brought into existence only after it is proved that the issuer had received a notice of
dishonor and that within five days from receipt thereof, he failed to pay the amount of the check
or to make arrangement for its payment. The presumption or prima facie evidence as provided in
this section cannot arise, if such notice of non-payment by the drawee bank is not sent to the
maker or drawer, or if there is no proof as to when such notice was received by the drawer, since
there would simply be no way of reckoning the crucial 5-day period.
In this case, it is not disputed that checks were issued by petitioner and said checks were
subsequently dishonored. The question however is, was petitioner furnished a notice of

dishonor? If not, is it sufficient justification to exonerate petitioner from her criminal and civil
liabilities for issuing the bouncing checks?
The trial court ruled that the second element is present because:
the accused knew at the time of issuance of the checks that she did not have sufficient funds
in or credit with her drawee bank for the payment of the checks in full upon their presentment
[as] admitted by her in the Counter-Affidavit she executed during the preliminary investigation
of these criminal cases (itals. ours), to wit:
4.
That the time of the issuance of the said checks, due notice and information had been so
given to Solid Gold anent the actual status of the checks that the same might not be able to cover
the amount of the said checks so stated therein (Exhibit N, 1, underscoring supplied).
This fact became evident again during the cross-examination by the accuseds counsel of the
prosecutions witness, Joaquin Novales III:
ATTY. TAGANAS:
Q: And the reason you agreed to the terms and conditions for the issuance of post-dated checks
because you are also aware the particular time the accused Mrs. Elvira Yu Oh did not also have
enough funds or money in the bank within which to cover the amount of the checks?
A: I am not aware, sir.
...
Q: To your knowledge when the accused had already admitted to you that she had not enough
money to pay you?
A: That is the terms and promise and agreed upon, sir.
Q: But inspite of the fact that she already told you about that, that you never suspected that she
did not have enough money to cover the checks agreed upon and issued to you?
A: Yes, sir.

Q: And inspite of the fact she told you you never suspected that she did not have enough money
to cover you . . .
Q: You still believe that although she does not have enough money she still issued checks to
you?
A: Yes, sir. (TSN, April 6, 1993, pp. 24-26)
At any rate, there is already prima facie evidence of knowledge of insufficiency of funds on the
part of the accused from her failure to pay the amount due on the checks or to make
arrangements for payment in full by the drawee bank within five banking days after she received
notice of their dishonor, each of the checks having been presented within ninety days from their
respective dated (B.P. Blg. 22, Sec. 2). The defense did not controvert this evidence. (itals. ours)
[44]
Although the trial court in its decision, mentioned that herein petitioner received notices of
dishonor, nowhere in the records is there proof that the prosecution ever presented evidence that
petitioner received or was furnished a notice of dishonor. The notices of dishonor that were
presented in court and marked as Exhibits D-2, E-2, F-2, G-2, H-2, I-2, J-2, K2, L-2, C-2[45] were all sent to the private complainant, Solid Gold, and not to petitioner.
In convicting petitioner, the trial court, gave probative weight on the admission of petitioner in
her Counter-Affidavit which she submitted during the preliminary investigation that at the time
of issuance of the subject checks, she was aware and even told private complainant that the
checks might not be able to cover the amount stated therein.
The Court of Appeals sustained the RTC, to wit:
. . . Neither can We agree that accused-appellant was still entitled to notice of dishonor of the
bouncing checks as she had no more checking account with the drawee bank at the time of the
dishonor of the ten checks in question. Accused-appellant must have realized that by closing her
checking account after issuing the ten postdated checks, all of said checks would bounce.
Knowing that she had already closed her checking account with the drawee bank, certainly
accused-appellant would not have expected, even in her wildest imagination, that her postdated
checks would be honored by the drawee bank. Thus, accused-appellant need not be notified
anymore of the obvious dishonor of her rubber checks. (itals. ours)
Based on the law and existing jurisprudence, we find that the appellate court erred in convicting
petitioner.

In cases for violation of B.P. Blg. 22, it is necessary that the prosecution prove that the issuer had
received a notice of dishonor. Since service of notice is an issue, the person alleging that the
notice was served must prove the fact of service. Basic also is the doctrine that in criminal cases,
the quantum of proof required is proof beyond reasonable doubt. Hence, for cases of B.P. Blg.
22 there should be clear proof of notice.
Indeed, this requirement cannot be taken lightly because Section 2 provides for an opportunity
for the drawer to effect full payment of the amount appearing on the check, within five banking
days from notice of dishonor. The absence of said notice therefore deprives an accused of an
opportunity to preclude criminal prosecution. In other words, procedural due process demands
that a notice of dishonor be actually served on petitioner. In the case at bar, appellant has a right
to demand and the basic postulate of fairness requires that the notice of dishonor be actually
sent to and received by her to afford her to opportunity to aver prosecution under B.P. Blg. 22.
The Solicitor General contends that notice of dishonor is dispensable in this case considering that
the cause of the dishonor of the checks was Account Closed and therefore, petitioner already
knew that the checks will bounce anyway. This argument has no merit. The Court has decided
numerous cases where checks were dishonored for the reason, Account Closed and we have
explicitly held in said cases that it is essential for the maker or drawer to be notified of the
dishonor of her check, so she could pay the value thereof or make arrangements for its payment
within the period prescribed by law and omission or neglect on the part of the prosecution to
prove that the accused received such notice of dishonor is fatal to its cause.
A perusal of the testimony of the prosecution witness Joaquin Novales III, General Manager of
complainant Solid Gold, discloses that no personal demands were made on appellant before the
filing of the complaints against her. Thus, absent a clear showing that petitioner actually knew of
the dishonor of her checks and was given the opportunity to make arrangements for payment as
provided for under the law, we cannot with moral certainty convict her of violation of B.P. Blg.
22. The failure of the prosecution to prove that petitioner was given the requisite notice of
dishonor is a clear ground for her acquittal.
Moreover, as understood by the trial court itself in the herein aforequoted portion of its decision,
General Manager Novales knew of the non-availability of sufficient funds when appellant issued
the subject checks to him. This Court has held that there is no violation of B.P. 22 if complainant
was told by the drawer that he has no sufficient funds in the bank.
For these reasons, we reverse the ruling of the Court of Appeals affirming the trial courts
conviction of petitioner for violation of B.P. Blg. 22. This is without prejudice, however, to her
civil liability towards private complainant Solid Gold in the amount of P500,000.00 plus interest
thereon at the rate of 12% per annum from date of finality of herein judgment.

VICTOR TING "SENG DEE" and EMILY CHAN-AZAJAR vs. COURT OF APPEALS
and PEOPLE OF THE PHILIPPINES
G.R. No. 140665

November 13, 2000

Facts:
Juliet Ting obtained loans from Josefina Tagle for use in Juliet's furniture business. Juliet
issued 11 post-dated checks which, upon maturity, were dishonored for reasons of
"Closed Account" or "Drawn Against Insufficient Funds." Juliet was subsequently
prosecuted for violation of Batas Pambansa Blg. 22.
Juliet requested her husband Victor Ting and her sister Emily Chan-Azajar (petitioners
herein) to take over her furniture business. Petitioners issued 19 checks in replacement
of the 11 checks earlier issued by Juliet. The planned take-over did not take place, so
petitioners requested Juliet to reassume her obligation to private complainant Tagle by
replacing the checks they had previously issued to the latter. Thus, Juliet replaced the
19 checks issued by petitioners with 23 Far East Bank checks in favor of Tagle.
Petitioners then requested private complainant Tagle to return the 19 checks they had
issued to her. Instead of returning the checks, Tagle deposited seven of the checks with
MetroBank where they were dishonored for being "Drawn Against Insufficient Funds."
On the other hand, Tagle alleged that sometime in April 1993, petitioners obtained a
loan of from her, issuing several post-dated checks in payment thereof. When the
checks were deposited by Tagle with MetroBank, they were dishonored for having been
drawn against insufficient funds. Tagle alleged that despite verbal and written demands,
petitioners failed to pay her the value of the dishonored checks.
Issue:
Whether there was a violation of BP 22.
Held:
It is necessary that the prosecution prove that the issuer had received a notice of
dishonor. It is a general rule that when service of notice is an issue, the person alleging
that the notice was served must prove the fact of service. Moreover, when service of a
notice is sought to be made by mail, it should appear that the conditions on which the
validity of such service depends had existence, otherwise the evidence is insufficient to
establish the fact of service.
The prosecution did not present proof that the demand letter was sent through
registered mail, relying as it did only on the registry return receipt. If, in addition to the
registry receipt, it is required in civil cases that an affidavit of mailing as proof of service
be presented, then with more reason should we hold in criminal cases that a registry

receipt alone is insufficient as proof of mailing. In the instant case, the prosecution failed
to present the testimony, or at least the affidavit, of the person mailing that, indeed, the
demand letter was sent.
In the case at bar, no effort was made to show that the demand letter was received by
petitioners or their agent. All that we have on record is an illegible signature on the
registry receipt as evidence that someone received the letter. As to whether this
signature is that of one of the petitioners or of their authorized agent remains a mystery.
From the registry receipt alone, it is possible that petitioners or their authorized agent
did receive the demand letter. Possibilities, however, cannot replace proof beyond
reasonable doubt. There being insufficient proof that petitioners received notice that
their checks had been dishonored, the presumption that they knew of the insufficiency
of the funds therefore cannot arise . The prosecution may not rely on the weakness of
the evidence for the defense to make up for its own blunders in prosecuting an offense.
Having failed to prove all the elements of the offense, petitioners may not thus be
convicted for violation of Batas Pambansa Blg. 22.
Petitioners claim that the Court of Appeals erred in affirming the decision of the trial court,
given the absence of proof beyond reasonable doubt or in the presence of facts creating
reasonable doubt.
The petition has merit.
Section 1 of Batas Pambansa Blg. 22, otherwise known as the Bouncing Checks Law, provides:
Section 1. Checks without sufficient funds. Any person who makes or draws and issues any
check to apply on account or for value, knowing at the time of issue that he does not have
sufficient funds in or credit with the drawee bank for the payment of such check in full upon its
presentment, which check is subsequently dishonored by the drawee bank for insufficiency of
funds or credit or would have been dishonored for the same reason had not the drawer, without
any valid reason, ordered the bank to stop payment, shall be punished by imprisonment of not
less than thirty days but not more than one (1) year or by a fine of not less than but not more
double the amount of the check which fine shall in no case exceed Two hundred thousand pesos,
or both such fine and imprisonment at the discretion of the court.
The same penalty shall be imposed upon any person who having sufficient funds in or credit with
the drawee bank when he makes or draws and issues a check, shall fail to keep sufficient funds or
to maintain a credit to cover the full amount of the check if presented within a period of ninety
(90) days from the date appearing thereon, for which reason it is dishonored by the drawee bank.
Where the check is drawn by a corporation, company or entity, the person or persons who
actually signed the check in behalf of such drawer shall be liable under this Act.

For a violation of Batas Pambansa Blg. 22 to be committed, the following elements must be
present:
(1) the making, drawing, and issuance of any check to apply for account or for value;
(2) the knowledge of the maker, drawer, or issuer that at the time of issue there are no sufficient
funds in or credit with the drawee bank for the payment of such check in full upon is
presentment; and
(3) the subsequent dishonor of the check by the drawee bank for insufficiency of funds or credit
or dishonor for the same reason had not the drawer, without any valid cause, ordered the bank to
stop payment (Sycip, Jr. vs. CA, G.R. No. 125059, March 17, 2000).
An analysis of the evidence presented, however, shows that not all the aforementioned elements
have been established by the prosecution beyond reasonable doubt.
That the seven checks in question were issued by petitioners is beyond dispute. Not only were
the dishonored checks presented in court, but petitioners even admitted signing the checks and
issuing them to private complainant. From the evidence on record, it is clear that petitioners
signed and issued the seven checks in question.
That the checks were dishonored is also clearly established. Section 3 of Batas Pambansa Blg. 22
provides that "the introduction in evidence of any unpaid and dishonored check, having the
drawee's refusal to pay stamped or written thereon, or attached thereto, with the reason therefor
as aforesaid, shall be prima facie evidence of the making or issuance of said check, and the due
presentment to the drawee for payment and the dishonor thereof, and that the same was properly
dishonored for the reason written, stamped, or attached by the drawee on such dishonored
check." In the instant case, the fact of the checks' dishonor is sufficiently shown by the return
slips issued by MetroBank, the depository bank, stating that the checks had been returned for the
reason "DAIF/Drawn Against Insufficient Funds." Not only are these check return slips prima
facie evidence that the drawee bank dishonored the checks, but the defense did not present any
evidence to rebut these documents. In fact, counsel for petitioners even admitted the fact of the
checks' dishonor, agreeing to dispense with the presentation of the bank representative who was
supposed to prove the fact of dishonor of said checks (p. 162, Rollo.).
However, for liability to attach under Batas Pambansa Blg. 22, it is not enough that the
prosecution establishes that a check was issued and that the same was subsequently dishonored.
The prosecution must also prove the second element, that is, it must further show that the issuer,
at the time of the check's issuance, had knowledge that he did not have enough funds or credit in

the bank for payment thereof upon its presentment. Since the second element involves a state of
mind which is difficult to verify, Section 2 of Batas Pambansa Blg. 22 creates a presumption
juris tantum that the second element prima facie exists when the first and third elements of the
offense are present (Magno v. People, 210 SCRA 471 [1992]). Section 2 provides:
Section 2. Evidence of knowledge of insufficient funds. The making, drawing, and issuance of a
check payment of which is refused by the drawee because of insufficient funds or credit with
such bank, when presented within ninety days from the date of the check, shall be prima facie
evidence of knowledge of such insufficiency of funds or credit unless such maker or drawer pays
the holder thereof the amount due thereon, or makes arrangements for payment in full by the
drawee of such check within five (5) banking days after receiving notice that such check has not
been paid by the drawee."
In truth, this Court declared in King v. People (G.R. No. 131540, December 2, 1999) that "the
prima facie presumption arises when the check is issued. But the law also provides that the
presumption does not arise when the issuer pays the amount of the check or makes arrangement
for its payment 'within five banking days after receiving notice that such check has not been paid
by the drawee.' Verily, BP 22 gives the accused an opportunity to satisfy the amount indicated in
the check and thus avert prosecution. This opportunity, however, can be used only upon receipt
by the accused of a notice of dishonor." Thus, the presumption that the issuer had knowledge of
the insufficiency of funds is brought into existence only after it is proved that the issuer had
received a notice of dishonor and that, within five days from receipt thereof, he failed to pay the
amount of the check or to make arrangement for its payment.
King v. People, decided by this Division, involves a set of facts similar to the case at bar. In said
case, the accused therein was proven to have issued eleven checks, all of which were duly filled
up and signed by her. It was also clearly established that these eleven checks were dishonored, as
shown by the checks themselves which were stamped "ACCOUNT CLOSED" and further
supported by the return tickets issued by PCI Bank stating that the checks had been dishonored.
Yet, even if the prosecution had already established the issuance of the checks and their
subsequent dishonor, this Court still required the prosecution to show that the issuer knew of the
insufficiency of funds by proving that he or she received a notice of dishonor and, within five
banking days thereafter, failed to satisfy the amount of the check or make arrangement for its
payment.
Moreover, in Lina Lim Lao v. CA (274 SCRA 572 [1997]), we emphasized that "the full payment
of the amount appearing in the check within five banking days from notice of dishonor is a
'complete defense.' The absence of a notice of dishonor necessarily deprives an accused an
opportunity to preclude a criminal prosecution. Accordingly, procedural due process clearly
enjoins that a notice of dishonor be actually served on petitioner. Petitioner has a right to demand
and the basic postulate of fairness require that the notice of dishonor be actually sent to and
received by her to afford her the opportunity to avert prosecution under BP 22."

To prove that petitioners received a notice of dishonor, the prosecution presented a copy of the
demand letter allegedly sent to petitioners through registered mail and its corresponding registry
receipt. Private complainant Josefina Tagle, the sole witness for the prosecution, testified thus:
Q:
Now, when these seven (7) checks bounced for insufficiency of funds, what step did you
take?
A:

I demanded the return of my money from them.

Q:

Now, what was the reply of the two accused?

A:
They kept on promising that they will pay but up to now they have not paid any single
centavo.
Q:

What other step did you take?

A:

I requested my lawyer to write a demand letter.

Q:

And that demand letter was sent to the accused?

A:

Yes, Sir.

Q:

In what manner?

A:

By registered mail.

Q:

Now, was that demand letter received by the two accused?

A:

Yes, Sir.

Q:

What is your evidence?

A:

The return card.

Q:
If you are shown anew the copy of the demand letter which is already marked as Exhibit
B, would you be able to recognize the same?
A:

Yes, Sir.

Q:

Is that the one that you are referring to?

A:

Yes, Sir.

Q:

How about the return card, is that correct?

A:

Yes, Sir, this is the one.

Q:
Now, upon receipt of this letter by the two accused, did the two accused pay the amount of
the said check?
A:

No, Sir.

Q:

So what did you do next?

A:

I told my lawyer to file charges against them.

Q:

You mean the present charge?

A:

Yes, Sir.

Atty. Acuesta:
That is all, Your Honor.
(TSN, Aug. 24, 1994, p. 8-9.)

Aside from the above testimony, no other reference was made to the demand letter by the
prosecution. As can be noticed from the above exchange, the prosecution alleged that the demand
letter had been sent by mail. To prove mailing, it presented a copy of the demand letter as well as
the registry return receipt. However, no attempt was made to show that the demand letter was
indeed sent through registered mail nor was the signature on the registry return receipt
authenticated or identified. It cannot even be gleaned from the testimony of private complainant
as to who sent the demand letter and when the same was sent. In fact, the prosecution seems to
have presumed that the registry return receipt was proof enough that the demand letter was sent
through registered mail and that the same was actually received by petitioners or their agents.
As adverted to earlier, it is necessary in cases for violation of Batas Pambansa Blg. 22, that the
prosecution prove that the issuer had received a notice of dishonor. It is a general rule that when
service of notice is an issue, the person alleging that the notice was served must prove the fact of
service (58 Am Jur 2d, Notice, 45). The burden of proving notice rests upon the party asserting
its existence. Now, ordinarily, preponderance of evidence is sufficient to prove notice. In
criminal cases, however, the quantum of proof required is proof beyond reasonable doubt.
Hence, for Batas Pambansa Blg. 22 cases, there should be clear proof of notice. Moreover, it is a
general rule that, when service of a notice is sought to be made by mail, it should appear that the
conditions on which the validity of such service depends had existence, otherwise the evidence is
insufficient to establish the fact of service (C.J.S., Notice, 18). In the instant case, the prosecution
did not present proof that the demand letter was sent through registered mail, relying as it did
only on the registry return receipt. In civil cases, service made through registered mail is proved
by the registry receipt issued by the mailing office and an affidavit of the person mailing of facts
showing compliance with Section 7 of Rule 13 (See Section 13, Rule 13, 1997 Rules of Civil
Procedure). If, in addition to the registry receipt, it is required in civil cases that an affidavit of
mailing as proof of service be presented, then with more reason should we hold in criminal cases
that a registry receipt alone is insufficient as proof of mailing. In the instant case, the prosecution
failed to present the testimony, or at least the affidavit, of the person mailing that, indeed, the
demand letter was sent.
Moreover, petitioners, during the pre-trial, denied having received the demand letter (p. 135,
Rollo.). Given petitioners' denial of receipt of the demand letter, it behooved the prosecution to
present proof that the demand letter was indeed sent through registered mail and that the same
was received by petitioners. This, the prosecution miserably failed to do. Instead, it merely
presented the demand letter and registry return receipt as if mere presentation of the same was
equivalent to proof that some sort of mail matter was received by petitioners. Receipts for
registered letters and return receipts do not prove themselves; they must be properly
authenticated in order to serve as proof of receipt of the letters (Central Trust Co. v. City of Des
Moines, 218 NW 580).
Likewise, for notice by mail, it must appear that the same was served on the addressee or a duly
authorized agent of the addressee. In fact, the registry return receipt itself provides that "[a]
registered article must not be delivered to anyone but the addressee, or upon the addressee's
written order, in which case the authorized agent must write the addressee's name on the proper

space and then affix legibly his own signature below it." In the case at bar, no effort was made to
show that the demand letter was received by petitioners or their agent. All that we have on record
is an illegible signature on the registry receipt as evidence that someone received the letter. As to
whether this signature is that of one of the petitioners or of their authorized agent remains a
mystery. From the registry receipt alone, it is possible that petitioners or their authorized agent
did receive the demand letter. Possibilities, however, cannot replace proof beyond reasonable
doubt. There being insufficient proof that petitioners received notice that their checks had been
dishonored, the presumption that they knew of the insufficiency of the funds therefor cannot
arise.
As we stated in Savage v. Taypin (G.R. No. 134217, May 11, 2000), "penal statutes must be
strictly construed against the State and liberally in favor of the accused." Likewise, the
prosecution may not rely on the weakness of the evidence for the defense to make up for its own
blunders in prosecuting an offense. Having failed to prove all the elements of the offense,
petitioners may not thus be convicted for violation of Batas Pambansa Blg. 22.
That petitioners are civilly liable to private complainant is also doubtful. Private complainant
claims that petitioners borrowed Nine Hundred Fifty Thousand (P950,000.00) Pesos from her on
or about the end of April 1993, in payment of which petitioners issued several post-dated checks
in her favor. The seven checks issued by petitioners as payment for the amount borrowed add up
to P950,000.00. If private complainant is the businesswoman that she claims to be, she should be
collecting interest on the loan she granted to petitioners. In other words, the amount to be repaid
by petitioners should be more than P950,000.00, to account for interest on the loan. The checks
issued by petitioners, however, do not provide for interest. It is thus more credible that the seven
checks involved in this case form part of nineteen checks issued to replace the checks issued by
Juliet Ting to private complainant. This conclusion is bolstered by private complainant's
admission in her reply-affidavit that more than seven checks were issued by petitioners (p. 11,
Original Records). In said reply-affidavit, private complainant states that "respondents issued and
delivered to me in Manila several checks, which partially include their seven (7) bouncing
checks herein. I say 'partially' because I will have to file additional bouncing check cases against
them, as these other checks likewise bounced." Furthermore, in the same reply-affidavit, private
complainant claims that the checks in question were not replaced, allegedly because the
replacement checks must first be cleared, which did not happen in this case. By implication, had
the 23 Far East Bank checks issued by Juliet Ting to replace the nineteen checks issued by
petitioners been cleared, then private complainant would have considered the checks in question
as having been replaced. This only supports our conclusion that it was Juliet Ting who owed
money to private complainant, not petitioners.
Moreover, the original debtor Juliet Ting was convicted by the Regional Trial Court of Manila in
Criminal Cases 93-126581-91 for eleven counts of violation of Batas Pambansa Blg. 22. These
eleven bouncing check cases involved the same obligation being sued upon by private
complainant Tagle herein. The trial court expressly acknowledged in said cases that nineteen (19)
checks were issued by petitioners as payment for Juliet Ting's obligation. In its August 7, 1997
decision convicting Juliet Ting for violation of Batas Pambansa Blg. 22, the trial court declared

that "to cover the additional loans, accused (Juliet Ting) delivered 19 post-dated checks issued by
Victor Ting and Emily Azajar (p. 55, Rollo.)." The trial court's decision further provides:
Since she could not fund the other checks (Exhs. B to K), she replaced the same with 19 postdated checks of her husband Victor Ting and her sister Emily Azajar totaling P2,450,000.00.
They issued the checks as they would take over her furniture business. The intended partnership
of Victor and Emily was aborted as the latter was not allowed to resign from her teaching post in
Naga City. She then replaced the checks issued by Victor and Emily with her own checks 23
FEB post-dated checks per list (Exh. 9) prepared by Suzanne Azajar.
Despite receipt of the replacement checks, complainant refused to return the checks of Victor and
Emily and even filed cases against them.
(p. 56, Rollo.)
Not having borrowed the amount of Nine Hundred Fifty Thousand (P950,000.00) from private
complainant, petitioners may not thus be held liable therefor.

BETTY KING vs. PEOPLE OF THE PHILIPPINES

G.R. No. 131540. December 2, 1999
Facts:
Betty King discounted with complainant Ellen Fernandez several Equitable Bank checks
postdated from July 23 to 29, 1992 in the total amount of P1, 070,000.00 in exchange
for cash in the amount of P1, 000,000.00. When the checks were deposited for
payment, they were dishonored by the drawee bank because they were drawn against
an account without sufficient funds. Betty King failed to make good the checks despite
demand. During the hearing on the merits of this case on September 17, 1998, the
prosecution offered in evidence its documentary evidence. Betty King admitted the
genuineness and due execution of the documents presented.
As noted earlier, Betty King filed a Demurrer to Evidence without leave of court. In
doing so, she waived her right to present evidence and submitted the case for judgment
on the basis of the documentary exhibits adduced by the prosecution.
In affirming the trial court, the Court of Appeals explained that the prosecution proved all
the elements of the crime. The CA also pointed out that the failure of Betty King to sign
the pretrial order was not fatal to the prosecution, because her conviction was based on
the evidence presented during the trial.
Ellen Fernandez sent Betty King a registered mail, informing the latter that the checks
had been dishonored. But the records show that petitioner did not receive it. In fact,
Postmaster Wilfredo Ulibarris letter addressed to complainants counsel certified that
the subject registered mail was returned to sender on September 22, 1992.
Issue:
(1) Admissibility of documentary evidence
(2) Sufficiency of the prosecution evidence
Held:
We emphasized that "the full payment of the amount appearing in the check within five
banking days from notice of dishonor is a complete defense. The absence of a notice of
dishonor necessarily deprives an accused an opportunity to preclude a criminal
prosecution. Accordingly, procedural due process clearly enjoins that a notice of
dishonor be actually served on petitioner. Petitioner has a right to demand and the

basic postulates of fairness require that the notice of dishonor be actually sent to and
received by her to afford her the opportunity to avert prosecution under BP 22.
Notwithstanding the clear import of the postmasters certification, the prosecution failed
to adduce any other proof that petitioner received the post office notice but unjustifiably
refused to claim the registered mail. It is possible that the drawee bank sent petitioner a
notice of dishonor, but the prosecution did not present evidence that the bank did send
it, or that petitioner actually received it. It was also possible that she was trying to flee
from complainant by staying in different addresses. Speculations and possibilities,
however, cannot take the place of proof. Conviction must rest on proof beyond
reasonable doubt. Clearly, the evidence on hand demonstrates the indelible fact that
petitioner did not receive notice that the checks had been dishonored. Necessarily, the
presumption that she knew of the insufficiency of funds cannot arise.
Thus, in order to create the prima facie presumption that the issuer knew of the
insufficiency of funds, it must be shown that he or she received a notice of dishonor
and, within five banking days thereafter, failed to satisfy the amount of the check or
make arrangement for its payment. Petitioner Betty King is ACQUITTED for failure of
the prosecution to prove all the elements of the crimes charged.

First Issue:
Admissibility of Documentary Evidence
Because the first, the second and the third issues raised by petitioner all refer to the same matter,
they will be discussed together. She contends that the pieces of documentary evidence presented
by the prosecution during pretrial are inadmissible, because she did not sign the pretrial
agreement as required under Section 4 of Rule 118 of the Rules of Court. Hence, she argues that
there is no basis for her conviction.
True, a pretrial agreement not signed by a party is inadmissible. However, the conviction of
petitioner was based not on that agreement but on the documents submitted during the trial, all of
which were admitted without any objection from her counsel. During the hearing on September
17, 1993, the prosecution offered as evidence the dishonored checks, the return check tickets
addressed to private complainant, the notice from complainant addressed to petitioner that the
checks had been dishonored, and the postmaster's letter that the notice had been returned to
sender. Petitioner's counsel did not object to their admissibility. This is shown by the transcript of
stenographic notes taken during the hearing on September 17, 1993:
COURT:
You have no objection to the admissibility, not that the Court will
believe it.
ATTY. MANGERA
No, Your Honor.

COURT:
Exhibits "A" to "A" to "K" are admitted.
ATTY. MAKALINTAL:
We offer Exhibit "L", the return-check ticket dated July 27, 1992,
relative to checks No. 021745 and 021746 indicating that these
checks were returned DAIF, drawn against insufficient funds; Exh.
M, returned check ticket dated July 28, 1992, relative to Check No.
021727, 021711 and 021720 likewise indicating the said checks to
have been drawn against insufficient funds, Your Honor. Exhibit N,
returned check ticket dated July 29, 1992, relative to Check Nos.
021749 and 021748, having the same indications;
Exhibits O, returned check ticket dated July 29, 1992 relative to
Check Nos. 021750 and 021753, with the same indications;
Exhibits P, returned check ticket dated August 4, 1992 relative to
Check No. 021752, having the same indication as being drawn
against insufficient funds;
Exhibit Q, the demand letter sent to the accused by Atty. Horacio
Makalintal dated August 3, 1992;
Exhibit R, the letter-request for certification addressed to the
Postmaster General sent by the same law office dated 17
September 1992, showing that the said letter was dispatched
properly by the Central Post Office of Makati;
Exhibit S, 1st Indorsement of the Makati Central Post Office dated
21 September 1992;
Exhibit T, the Philippine Postal Corporation Central Post Office
letter dated 24 September 1992, addressed to this representation
showing that there were 3 notices sent to the herein accused who
received the said letter.
COURT:
Let's go to the third check slip; any objection to the third slip?
ATTY. MANGERA:
We have no objection as to the due execution and authenticity.
COURT:
Admitted.
ATTY. MAKALINTAL:
We are offering Exhibits Q, R, S and T, for the purpose of showing
that there was demand duly made on the accused and that the same
had been appropriately served by the Central Post Office Services
of Manila.

ATTY. MANGERA:
We admit as to the due execution and authenticity only as to that
portion, Your Honor.
COURT:
We are talking of admissibility now, so admitted. In other words, at
this point, he makes an offer and the Court will either grant
admission, [admit] it in evidence or deny it. It can deny admission
if it is not properly identified etcetera.
ATTY. MANGERA:
I think it is already provided.
COURT:
So, admitted.
ATTY. MAKALINTAL:
With the admission of our offer, Your Honor, the prosecution
rests.
From the foregoing, it is clear that the prosecution evidence consisted of documents offered and
admitted during the trial. In view of this, the CA correctly ruled that Fule v. Court of Appeals
would not apply to the present controversy. In that case, a hearing was conducted during which
the prosecution presented three exhibits. However, Fule's conviction was "based solely on the
stipulation of facts made during rile pre-trial on August 8, 1985, which was not signed by the
petitioner, nor by his counsel." Because the stipulation was inadmissible in evidence under
Section 4 of Rule 118, the Court held that there was no proof of his guilt.
In the present case, petitioner's conviction was based on the evidence presented during trial, and
not on the stipulations made during the pretrial. Hence, petitioner's admissions during the trial
are governed not by the Fule ruling or by Section 4 of Rule 118, but by Section 4 of Rule 129
which reads:
Sec. 4. Judicial Admissions. An admission, verbal or written, made by a party in
the course of the proceedings in the same case, does not require proof. The
admission may be contradicted only by showing that it was made through
palpable mistake or that no such admission was made.
Hence, the trial court and the Court of Appeals did not err in taking cognizance of the said
documentary evidence.
Second Issue:
Sufficiency of Prosecution Evidence
Petitioner argues that the prosecution failed to prove beyond reasonable doubt the elements of
the offense. After a careful consideration of the records of this case, we believe and so rule that
the totality of the evidence presented does not support petitioner's conviction for violation of BP
22.

Sec. 1 of BP 22 defines the offense as follows:

Sec. 1. Checks without sufficient funds. Any person who makes or draws and
issues any check to apply on account or for value, knowing at the time of issue
that he does not have sufficient funds in or credit with the drawee bank for the
payment of such check in full upon its presentment, which check is subsequently
dishonored by the drawee bank for insufficiency of funds or credit or would have
been dishonored for the same reason had not the drawer, without any valid reason,
ordered the bank to stop payment, shall be punished by imprisonment of not less
than thirty days but not more than one (1) year or by a fine of not less than but not
more than double the amount of the check which fine shall in no case exceed Two
hundred thousand pesos, or both such fine and imprisonment at the discretion of
the court.
The same penalty shall be imposed upon any person who having sufficient funds
in or credit with the drawee bank when he makes or draws and issues a check,
shall fail to keep sufficient funds or to maintain a credit to cover the full amount
of the check if presented within a period of ninety (90) days from the date
appearing thereon, for which reason it is dishonored by the drawee bank.
Where the check is drawn by a corporation, company or entity, the person or
persons who actually signed the check in behalf of such drawer shall be liable
under this Act.
Accordingly, this Court has held that the elements of the crime are as follows:
1. The accused makes, draws or issues any check to apply to
account or for value.
2. The checks subsequently dishonored by the drawee bank for
insufficiency of funds or credit; or it would have been dishonored
for the same reason had not the drawer, without any valid reason,
ordered the bank to stop payment.
3. The accused knows at the time of the issuance that he or she
does not have sufficient funds in, or credit with, drawee bank for
the payment of the check in full upon its presentment.
We shall analyze the evidence, purportedly establishing each of the aforementioned elements
which the trial and the appellate courts relied upon.
Issuance of the Questioned Checks
Contending that the prosecution failed to prove the first element, petitioner maintains that she
merely signed the questioned checks without indicating therein the date and the amount
involved. She adds that they were improperly filled up by Eileen Fernandez. Thus, she
concludes, she did not "issue" the dishonored checks in the context of the Negotiable Instruments
Law, which defines "issue" as the "first delivery of the instrument complete in form to a person
who takes it as a holder." 19

Petitioner's contentions are not meritorious. The questioned checks, marked as Exhibits "A" to
"K," contained the date of issue and the amount involved. In fact, petitioner even admitted that
she signed those checks. On the other hand, no proof was adduced to show that petitioner merely
signed them in blank, or that complainant filled them up in violation of the former's instructions
or their previous agreement. The evidence on record is clear that petitioner issued eleven checks,
all of which were duly filled up and signed by her.
Checks Dishonored
Neither are we persuaded by petitioner's argument that "there appears no evidence on record that
the subject checks were unpaid and dishonored." 20 Under Section 3 of BP 22, "the introduction
in evidence of any unpaid and dishonored check, having the drawee's refusal to pay stamped or
written thereon, or attached thereto, with the reason therefor as aforesaid, shall be prima facie
evidence of the making or issuance of said check, and the due presentment to the drawee for
payment and the dishonor thereof, and that the same was properly dishonored for the reason
written, stamped, or attached by the drawee on such dishonored check."
In the present case, the fact that the checks were dishonored was sufficiently shown by the
checks themselves, which were stamped with the words "ACCOUNT CLOSED." This was
further supported by the returned check tickets issued by PCI Bank, the depository bank, stating
that the checks had been dishonored.
Clearly, these documents constitute prima facie evidence that the drawee bank dishonored the
checks. Again, no evidence was presented to rebut the prosecution's claim.
Knowledge of Insufficiency of Funds
To hold a person liable under BP 22, it is not enough to establish that a check issued was
subsequently dishonored. It must be shown further that the person who issued the check knew "at
the time of issue that he does not have sufficient funds in or credit with the drawee bank for the
payment of such check in full upon its presentment." Because this element involves a state of
mind which is difficult to establish, Section 2 of the law creates a prima facie presumption of
such knowledge, as follows:
Sec. 2. Evidence of knowledge of insufficient funds. The making, drawing and
issuance of a check payment of which is refused by the drawee because of
insufficient funds in or credit with such bank, when presented within ninety (90)
days from the date of the check, shall be prima facie evidence of knowledge of
such insufficiency of funds or credit unless such maker or drawer pays the holder
thereof the amount due thereon, or makes arrangements for payment in full by the
drawee of such check within five (5) banking days after receiving notice that such
check has not been paid by the drawee.
In other words, the prima facie presumption arises when a check is issued. But the law also
provides that the presumption does not arise when the issuer pays the amount of the check or
makes arrangement for its payment "within five banking days after receiving notice that such
check has not been paid by the drawee." Verily, BP 22 gives the accused an opportunity to satisfy
the amount indicated in the check and thus avert prosecution. As the Court held in Lozano v.

Martinez, the aforecited provision serves to "mitigate the harshness of the law in its application."
This opportunity, however, can be used only upon receipt by the accused of a notice of dishonor.
This point was underscored by the Court in Lina Lim Lao v. Court of Appeals:
It has been observed that the State, under this statute, actually offers the violator a
"compromise by allowing him to perform some act which operates to preempt the
criminal action, and if he opts to perform it the action is abated." This was also
compared "to certain laws allowing illegal possessors of firearms a certain period
of time to surrender the illegally possessed firearms to the Government, without
incurring any criminal liability." In this light, the full payment of the amount
appearing in the check within five banking days from notice of dishonor is a
"complete defense." The absence of a notice of dishonor necessarily deprives an
accused an opportunity to preclude a criminal prosecution. Accordingly,
procedural due process clearly enjoins that a notice of dishonor be actually served
on petitioner. Petitioner has a right to demand and the basic postulates of fairness
require that the notice of dishonor be actually sent to and received by her to afford
her the opportunity to avert prosecution under BP 22.
Thus, in order to create the prima facie presumption that the issuer knew of the insufficiency of
funds, it must be shown that he or she received a notice of dishonor and, within five banking
days thereafter, failed to satisfy the amount of the check or make arrangement for its payment.
To prove that petitioner knew of the insufficiency of her funds, the prosecution presented
Exhibits "Q" to "T." Based on these documents, the Court of Appeals concluded that "[p]rivate
complainant sent a demand letter to appellant to make good said checks . . .. Appellant failed to
pay the face value of the eleven checks or make arrangement for the full payment thereof within
90 days after receiving the notice." 24
Upon closer examination of these documents, we find no evidentiary basis for the holding of the
trial court and the Court of Appeals that petitioner received a notice that the checks had been
dishonored.
True, complainant sent petitioner a registered mail, as shown in Exhibit "Q" informing the latter
that the checks had been dishonored. But the records show that petitioner did not receive it. In
fact, Postmaster Wilfredo Ulibarri's letter addressed to complainant's counsel certified that the
"subject registered mail was returned to sender on September 22, 1992 . . .. "
Notwithstanding the clear import of the postmaster's certification, the prosecution failed to
adduce any other proof that petitioner received the post office notice but unjustifiably refused to
claim the registered mail. It is possible that the drawee bank sent petitioner a notice of dishonor,
but the prosecution did not present evidence that the bank did send it, or that petitioner actually
received it. It was also possible that she was trying to flee from complainant by staying in
different address. Speculations and possibilities, however, cannot take the place of proof.
Conviction must rest on proof beyond reasonable doubt. Clearly, the evidence on hand
demonstrates the indelible fact that petitioner did not receive notice that the checks had been
dishonored. Necessarily, the presumption that she knew of the insufficiency of funds cannot
arise.
Be that as it may, the Court must point out that it cannot rule on petitioner's civil liability, for the
issue was not raised in the pleadings submitted before us.

We must stress that BP 22, like all penal statutes, is construed strictly against the State and
liberally in favor of the accused. Likewise, the prosecution has the burden to prove beyond
reasonable doubt each element of the crime. Hence, the prosecution's case must rise or fall on the
strength of its own evidence, never on the weakness or even absence of that of the defense.