Home / A Dose of Law / Checks and Crosses: Liability under BP 22

Published 22 April 2019, The Daily Tribune

A check oft en serves as a substi tute for money. It allows transacti ons to proceed without
money actually switching hands. However, the convenience aff orded by checks need to be
balanced with the threat which unfunded or “bum” checks pose on commercial
transacti ons. These checks are deemed to have pernicious eff ects on the integrity of
banking and other fi nancial transacti ons and therefore, injurious to public interest.

To curb the practi ce of issuing worthless checks, Batas Pambansa (BP) 22 was enacted.
The following essenti al elements must be present in order to be liable under BP 22:

(1) the person accused of violati ng the law makes, draws or issues any check for account
or for value;

(2) he has knowledge at the ti me he issued the check that he does not have suffi cient
funds in or credit with the drawee bank for the payment of the check when presented for
payment; and,

(3) the drawee bank dishonors the check because of insuffi ciency of funds, or it would
have dishonored the check for the same reason if the issuer did not order the bank to
stop payment for no valid reason.

The law presumes that the issuer knew of the insuffi ciency of his funds if the check is
dishonored within 90 days from the date of the check. This presumpti on is overcome only
if the issuer pays or makes arrangements for payment of the full amount of the check
within fi ve banking days aft er receiving a noti ce of its dishonor. Further, there must be
proof that that the issuer was noti fi ed of the fact of dishonor, and proof that the issuer
had received such noti ce of dishonor.

Who are liable

Even an “accommodati on party” is liable under BP 22. An accommodati on party is one

who has signed the check without receiving value in exchange, and who issues the check
for the purpose of lending his name to some other person. He is sti ll liable even though
the holder of the check knew him to be only an accommodati on party.
In case a check is issued in behalf of a corporati on or other legal enti ty, the person who
actually signed the bounced check is liable.

Filing a criminal complaint; aft er the verdict

Any alleged violati on of BP 22 pursued through the fi ling of a criminal complaint must be
fi led within four years from the dishonor of the check, before the offi ce of the public
prosecutor. If the public prosecutor fi nds probable cause (i.e., determines that a check
without suffi cient funds was indeed issued, and it was the respondent who had issued it),
an Informati on will be fi led before the proper Metropolitan Trial Court or Municipal Trial
Court. Trial will follow.

If the accused is found guilty, BP 22 provides that the penalty for its violati on is
imprisonment for at least 30 days but not more than one year, or a fi ne of at least double
the amount of the check but not to exceed P200,000.

However, in 2001, the Supreme Court (SC) issued Administrati ve Circular (AC) 12-2000
recommending that fi nes be imposed instead of a prison sentence for verdicts involving
BP 22. In its later issuance, AC 13-2001, the SC clarifi ed that imprisonment under BP 22 is
sti ll possible. A fi ne is only preferred over an imprisonment sentence if it would bett er
serve the interests of justi ce — such as if the accused is a fi rst ti me off ender, or there is
good faith involved. Even if only a fi ne is imposed, the accused may sti ll suff er subsidiary
imprisonment if he is unable to pay.

In case the accused is acquitt ed and the reason for the acquitt al is insuffi ciency of
evidence, the accused may sti ll be held civilly liable and ordered to pay the value of the
bounced check. This is because the civil liability of the accused is not automati cally
exti nguished upon dismissal of the criminal case on ground of failure to establish guilt
beyond reasonable doubt.