656 SUPREME COURT REPORTS ANNOTATED

Vaca vs. Court of Appeals

*
G.R. No. 131714. November 16, 1998.

EDUARDO R. VACA and FERNANDO NIETO, petitioners,

vs. COURT OF APPEALS and the PEOPLE OF THE
PHILIPPINES, respondents.

Criminal Law; Checks; Bouncing Checks Law (Batas

Pambansa Blg. 22); Elements; The maker’s knowledge is presumed
from the dishonor of the check for insufficiency of funds.—The
elements of the offense penalized under B.P. Blg. 22, are: (1)
making, drawing, and issuance of any check to apply to account or
for value; (2) 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 the 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 of the
check for the same reason had not the drawer, without any valid
cause, ordered the bank to stop payment. The maker’s knowledge
is presumed from the dishonor of the check for insufficiency of
funds.

Same; Same; Same; Same; Even if another check was

intended to replace a bad one, its issuance 15 days after the
drawer had been notified of the dishonor of the previous check
cannot negate the presumption that the drawer knew of the
insufficiency of funds to cover the amount of his previous check.—
In this case, after being notified on March 29, 1988 of the
dishonor of their previous check, petitioners gave GARDS a check
for P19,860.16. They claim that this check had been intended by
them to replace the bad check they had previously issued to the
GARDS. Based on the testimony of a GARDS accountant,
however, the Court of Appeals found that the check was actually
payment for two bills, one for the period of January 16 to January
31, 1988 in the amount of P9,930.08 and another one for the
period of March 16 to March 31, 1988 in the same amount. But
even if such check was intended to replace the bad one, its
issuance on April 13, 1988—15 days after petitioners had been
notified on March 29, 1988 of the dishonor of their previous check
—cannot negate the presumption that petitioners knew of the
insufficiency of funds to cover the amount of their previous check.
Sec. 2 of B.P. Blg.

________________
 * SECOND DIVISION.

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VOL. 298, NOVEMBER 16, 1998 657

Vaca vs. Court of Appeals

22 requires that such check be given within five (5) days from the
notice of dishonor to them.

Same; Same; Same; Same; Even if the payee suffered no

damage as a result of the issuance of the bouncing check, the
damage to the integrity of the banking system cannot be denied—
damage to the payee is not an element of the crime punished in
B.P. Blg. 22.—The affidavit of desistance of the GARDS president
deserves no more than passing mention. The claim that this case
was simply the result of a misunderstanding between GARDS and
petitioners and that the former did not really suffer any damage
from the dishonor of the check is flimsy. After prosecuting the
case below with tenacity, complainants going so far as to file
another complaint after their first one had been dismissed, it is
trifling with this Court for complainants to now assert that the
filing of their case was simply a mistake. It is for reasons such as
this that affidavits of desistance, like retractions, are generally
disfavored. The affidavit in this case, which was made after
petitioners’ conviction, is nothing but a last-minute attempt to
save them from punishment. Even if the payee suffered no
damage as a result of the issuance of the bouncing check, the
damage to the integrity of the banking system cannot be denied.
Damage to the payee is not an element of the crime punished in
B.P. Blg. 22.

Same; Same; Same; Indeterminate Sentence Law; It would

best serve the ends of criminal justice if in fixing the penalty
within the range of discretion allowed by §1, par. 1 of B.P. Blg. 22,
the same philosophy underlying the Indeterminate Sentence Law
is observed, namely, that of redeeming valuable human material
and preventing unnecessary deprivation of personal liberty and
economic usefulness with due regard to the protection of the social
order; In the instant case, the sentence of imprisonment is deleted
and fine equivalent to double the amount of the check imposed on
the accused.—B.P. Blg. 22, §1, par. 1 provides a penalty of
“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.” Petitioners are first-time offenders.
They are Filipino entrepreneurs who presumably contribute to
the national economy. Apparently, they brought this appeal,
believing in all good faith, although mistakenly, that they had not
committed a violation of B.P. Blg. 22. Otherwise,
 658

658 SUPREME COURT REPORTS ANNOTATED

Vaca vs. Court of Appeals

they could simply have accepted the judgment of the trial court
and applied for probation to evade a prison term. It would best
serve the ends of criminal justice if in fixing the penalty within
the range of discretion allowed by §1, par. 1, the same philosophy
underlying the Indeterminate Sentence Law is observed, namely,
that of redeeming valuable human material and preventing
unnecessary deprivation of personal liberty and economic
usefulness with due regard to the protection of the social order. In
this case we believe that a fine in an amount equal to double the
amount of the check involved is an appropriate penalty to impose
on each of the petitioners. WHEREFORE, the decision of the
Court of Appeals is AFFIRMED with the modification that the
sentence of imprisonment is deleted and petitioners are each
ordered to pay a fine of P20,000.00 equivalent to double the
amount of the check.

PETITION for review on certiorari of a decision of the

Court of Appeals.

The facts are stated in the opinion of the Court.

     Ramon Quisumbing, Jr. Law Office for petitioners.
     The Solicitor General for respondents.

MENDOZA, J.:

Petitioners
1
seek a review of the decision, dated October
2
25,
1996, and the resolution, dated December 2, 1997, of the
Court of Appeals, affirming their conviction by the Regional
Trial Court of Quezon City (Branch 100) for violation of
B.P. Blg. 22, otherwise known as the “Bouncing Checks
Law.”
The facts are as follows:
Petitioner Eduardo R. Vaca is the president and owner
of Ervine International, Inc. (Ervine), which is engaged in
the manufacture and sale of refrigeration equipment, while
his

________________

1 Per Justice Celia Lipana-Reyes and concurred in by Justices Corona

Ibay-Somera and Salvador J. Valdez, Jr.
2 Per Justice Salvador J. Valdez, Jr. and concurred in by Justices
Corona Ibay-Somera and Conchita Carpio Morales.

659

VOL. 298, NOVEMBER 16, 1998 659

 Vaca vs. Court of Appeals

son-in-law, petitioner Fernando Nieto, is the firm’s

purchasing manager. On March 10, 1988, petitioners
issued a check for P10,000.00 to the General Agency for
Reconnaissance, Detection, and Security, Inc. (GARDS) in
partial payment of the security services rendered by
GARDS to Ervine. The check was drawn on the China
Banking Corporation (CBC). When deposited in the
Philippine Commercial International Bank (PCIBank)
branch at Shaw Boulevard, Mandaluyong, the check was
dishonored for insufficiency of funds.
On March 29, 1988, GARDS wrote Ervine a letter in
which it demanded payment in cash of the amount of the
check within seven days from notice. The letter was
received by Ervine on the same day, but petitioners did not
pay within the time given.
On April 13, 1988, petitioners issued a check for
P19,860.16 to GARDS. The check was drawn on the
Associated Bank. The voucher accompanying it stated that
the check was to replace the dishonored check, the
P9,860.16 balance being partial payment for Ervine’s
outstanding account. The check and the voucher were
received by a GARDS messenger, Nolan C. Pena, on April
15, 1988, but GARDS did not return the dishonored check.
On April 14, 1988, GARDS Operations Manager Jovito
C. Cabusara filed a criminal complaint against petitioners
for violation of B.P. Blg. 22. After preliminary
investigation, an information was filed in the Regional
Trial Court of Quezon City (Branch 97). However, the case
was dismissed by the court on May 11, 1989, upon motion
of the prosecution, on the ground that Ervine had already
paid the amount of the check.
On September 18, 1989, GARDS, through its Acting
Operations Manager Eduardo B. Alindaya, filed another
complaint for violation of B.P. Blg. 22 against petitioners.
This resulted in the filing of an information against
petitioners in the Regional Trial Court of Quezon City
(Branch 100). After trial, petitioners were found guilty of
the charge and each was sentenced to suffer one (1) year
imprisonment and to pay a fine of P10,000.00 and the costs.
660

660 SUPREME COURT REPORTS ANNOTATED

Vaca vs. Court of Appeals

On appeal, the Court of Appeals affirmed the decision. It

subsequently denied petitioners’ motion for
reconsideration. Hence, this petition. Petitioners contend:

A. Respondent Court gravely erred in not holding that

the prosecution failed to prove petitioners’ guilt
beyond reasonable doubt.
 B. Respondent Court gravely erred in basing
conviction on the alleged weakness of the evidence
of the defense rather than on the strength of the
evidence of the prosecution.
C. Respondent Court erred in not acquitting
petitioners on grounds of “mistake of fact” and “lack
of knowledge.”

Petitioners pray that the case against them be dismissed

or, in the alternative, that the decision of the trial court be
modified by sentencing each to an increased fine but
without imprisonment.
By supplemental petition, dated January 29, 1998,
petitioners submitted an affidavit of desistance executed by
GARDS president Dominador R. Santiago which states
that the case arose from a mere “accounting difference”
between petitioners and GARDS, that the latter had not
really suffered any damage as a result of the issuance of
the check in question and, that GARDS was no longer
interested in prosecuting the case.
On May 28, 1998, petitioners filed another supplemental
petition, this time
3
invoking the recent decision in Lao v.
Court of Appeals, in which this Court reversed a conviction
for violation of B.P. Blg. 22 upon a showing that the
accused had no knowledge of the insufficiency of funds.
The Solicitor General opposes the appeal. He contends
that the facts of Lao v. Court of Appeals are different from
those of the case at bar and that the affidavit of desistance
of Dominador Santiago is of no moment, such affidavit
having been made only after petitioners’ conviction.

________________

3 274 SCRA 572 (1997).

661

VOL. 298, NOVEMBER 16, 1998 661

Vaca vs. Court of Appeals

After due review of the decision in this case, we find that

petitioners’ conviction for violation of B.P. Blg. 22 is well
founded.
First. The elements of the offense penalized under B.P.
Blg. 22 are: (1) making, drawing, and issuance of any check
to apply to account or for value; (2) 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 the 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 of the
check for the same reason had not the drawer, without 4
any
valid cause, ordered the bank to stop payment. The
maker’s knowledge is presumed from the dishonor of the
 5
check for insufficiency of funds. Thus, §2 of B.P. Blg. 22
expressly 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 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 this case, after being notified on March 29, 1988 of the

dishonor of their previous check, petitioners gave GARDS a
check for P19,860.16. They claim that this check had been
intended by them to replace the bad check they had
previously issued to the GARDS. Based on the testimony of
a GARDS accountant, however, the Court of Appeals found
that the check was actually payment for two bills, one for
the period of January 16 to January 31, 1988 in the
amount of P9,930.08 and another one for the period of
March 16 to

________________

4 Navarro v. Court of Appeals, 234 SCRA 639, 643-644 (1994).

5 People v. Laggui, 171 SCRA 305, 311 (1989).

662

662 SUPREME COURT REPORTS ANNOTATED

Vaca vs. Court of Appeals

March 31, 1988 in the same amount. But even if such check
was intended to replace the bad one, its issuance on April
13, 1988—15 days after petitioners had been notified on
March 29, 1988 of the dishonor of their previous check—
cannot negate the presumption that petitioners knew of the
insufficiency of funds to cover the amount of their previous
check. Sec. 2 of B.P. Blg. 22 requires that such check be
given within five (5) days from the notice of dishonor to
them.
Petitioners contend that, in6 accordance with the ruling
in Lao v. Court of Appeals, they should be acquitted
because the preparation of checks is the responsibility of
the company accountant and all they do is sign the checks.
They claim that they rely on the word of the accountant
that there are sufficient funds in the bank to pay for the
checks.
In the Lao case, the accused, as the Court found, had
merely been made by her employer, Premiere Investment
House, to countersign checks in blank. The accused was a
mere employee who did not have anything to do with the
issuance of checks for the company. She did not know to
whom the checks would be paid as the names of payees
were written only later by the head of operations.
Moreover, no notice of dishonor was given to her as
required by B.P. Blg. 22, §2. It could thus rightly be
concluded that the accused issued checks to apply to
account not knowing that at the time of issuance funds
were insufficient to pay for the checks.
Petitioners in this case cannot pretend ignorance of the
insufficiency of funds. While it may be true that it was the
company’s accountant who actually prepared the rubber
check, the fact remains that petitioners are the owners and
officers of the company. Sec. 1 of B.P. Blg. 22 provides that
“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.”
In fact, petitioner Nieto testified that after the check in
question was dishonored, he instructed their company ac-

________________

6 274 SCRA 572 (1997).

663

VOL. 298, NOVEMBER 16, 1998 663

Vaca vs. Court of Appeals

7
countant to prepare a replacement check. This belies
petitioners’8
claim that they had no hand in the preparation
of checks and shows that petitioners were in control of the
finances of the company.
Second. The affidavit of desistance of the GARDS
president deserves no more than passing mention. The
claim that this case was simply the result of a
misunderstanding between GARDS and petitioners and
that the former did not really suffer any damage from the
dishonor of the check is flimsy. After prosecuting the case
below with tenacity, complainants going so far as to file
another complaint after their first one had been dismissed,
it is trifling with this Court for complainants to now assert
that the filing of their case was simply a mistake. It is for
reasons such as this that affidavits 9
of desistance, like
retractions, are generally disfavored. The affidavit in this
case, which was made after petitioners’ conviction, is
nothing but a last-minute attempt to save them from
punishment. Even if the payee suffered no damage as a
result of the issuance of the bouncing check, the damage to
the integrity of the banking system cannot be denied.
Damage to the payee is not an element of the crime
punished in B.P. Blg. 22.
Third. Petitioners pray that, in the alternative, the
penalty be modified by deleting the sentence of
imprisonment and, in lieu thereof, a fine in an increased
amount be imposed on them. In support of their plea, they
allege that they do not have any record of prior conviction;
that Eduardo Vaca is of advanced age (late 60s); and, that
they come from good families. Petitioners claim that “with
their family background and social standing there is no
reason why they will refuse to pay a due and demandable
debt of only P10,000.00. It is precisely because of their
founded belief that the subject obligation has

________________

7 Supplemental Petition, dated May 27, 1998, pp. 2-4; Rollo, pp. 59-61.
8 Petition, p. 13; id., p. 33.
9 E.g., People v. Ballabare, 264 SCRA 350 (1996); Molina v. People, 259
SCRA 138 (1996); People v. Romero, 224 SCRA 749 (1993).

664

664 SUPREME COURT REPORTS ANNOTATED

Vaca vs. Court of Appeals

been paid that they refused to be intimidated by a criminal

charge.”
The Court of Appeals dismissed these allegations as
irrelevant to the question of petitioners’ guilt. We think so
ourselves. However, we believe that they can be considered
in determining the appropriate penalty to impose on
petitioners.
B.P. Blg. 22, §1, par. 1 provides a penalty of
“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.”
Petitioners are first-time offenders. They are Filipino
entrepreneurs who presumably contribute to the national
economy. Apparently, they brought this appeal, believing
in all good faith, although mistakenly, that they had not
committed a violation of B.P. Blg. 22. Otherwise, they could
simply have accepted the judgment of the trial court and
applied for probation to evade a prison term. It would best
serve the ends of criminal justice if in fixing the penalty
within the range of discretion allowed by §1, par. 1, the
same philosophy underlying the Indeterminate Sentence
Law is observed, namely, that of redeeming valuable
human material and preventing unnecessary deprivation of
personal liberty and economic usefulness
10
with due regard
to the protection of the social order. In this case we believe
that a fine in an amount equal to double the amount of the
check involved is an appropriate penalty to impose on each
of the petitioners.
WHEREFORE, the decision of the Court of Appeals is
AFFIRMED with the modification that the sentence of
imprisonment is deleted and petitioners are each ordered
to pay a fine of P20,000.00 equivalent to double the amount
of the check.
 ________________

10 See People v. Ducosin, 59 Phil. 109, 117 (1933).

665

VOL. 298, NOVEMBER 16, 1998 665

Vaca vs. Court of Appeals

SO ORDERED.

     Melo (Actg. Chairman) and Puno, JJ., concur.

     Martinez, J., On official leave.

Judgment affirmed with modification.

Notes.—Knowledge involves a state of mind difficult to

establish, thus B.P. Blg. 22 creates a prima facie
presumption, i.e., that the drawer had knowledge of the
insufficiency of his funds in or credit with the bank at the
time of the issuance and on the check’s presentment for
payment. (Llamado vs. Court of Appeals, 270 SCRA 423
[1997])
The legislature was not thoughtless in imposing severe
penalties for violation of par. 2(d) of Article 315 of the
Revised Penal Code—the history of the law will show that
the severe penalties were intended to stop the upsurge of
swindling by issuance of bouncing checks. (People vs.
Tongko, 290 SCRA 595 [1998])
To establish a person’s culpability under B.P. 22 and
Article 315 (2)(d) of the Revised Penal Code, it is
indispensable that the checks he or she issued for which he
or she was subsequently charged, be offered in evidence
because the gravamen of the offense charged is the act of
knowingly issuing a check with insufficient funds.
(Gutierrez vs. Palattao, 292 SCRA 26 [1998])
For an act to be punishable under B.P. 22, it must come
clearly within both the spirit and the letter of the statute.
(Idos vs. Court of Appeals, 296 SCRA 194 [1998])

——o0o——

666

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