SOCORRO F. ONGKINGCO and MARIE PAZ B.

ONGKINGCO law's coverage a check issued as a mere guarantee, the final

vs. KAZUHIRO SUGIYAMA and PEOPLE OF THE PHILIPPINES version of the bill as approved and enacted deleted the
[G.R. No. 217787. September 18, 2019.] aforementioned qualifying proviso deliberately to make the
enforcement of the act more effective. It is, therefore, clear that the
FACTS: real intention of the framers of B.P. 22 is to make the mere act of
Sugiyama entered into a "Contract Agreement" with New Rhia Car issuing a worthless check malum prohibitum and, thus, punishable
Services, Inc. where Socorro is the President and Chairperson of the under such law. 32
Board of Directors, and petitioner Maria Paz is a Board Director.
Under the Agreement, Sugiyama would receive a monthly dividend Inasmuch as the second element involves a state of mind of the
of P90,675.00 for five years in exchange for his investment of person making, drawing or issuing the check which is difficult to
P2,200,000.00 in New Rhia Car Services, Inc. To cover Sugiyama's prove, Section 2 of B.P. 22 creates a prima facie presumption of
monthly dividends, petitioners issued six (6) checks. The first three such knowledge, thus:
(3) checks, dated September 10, 2011, October 10, 2001 and SEC. 2. Evidence of knowledge of
November 10, 2001, were good checks, but the remaining 3 checks insufficient funds. — The making, drawing
bounced for having been draw against insufficient funds. and issuance of a check payment of which is
refused by the drawee because of insufficient
In a Memorandum of Agreement, Socorro, obtained a loan from funds in or credit with such bank, when
Sugiyama amounting to P500,000.00 with a five percent (5%) presented within ninety (90) days from the
interest for a period of one (1) month. As a guarantee and payment date of the check, shall be prima
for the said obligation, Socorro issued a check amounting to facie evidence of knowledge of such
P525,000.00. When the check was presented for payment, it was insufficiency of funds or credit unless such
dishonored for having been drawn against insufficient funds, just like maker or drawer pays the holder thereof the
the 3 other checks initially issued by petitioners. A formal demand amount due thereon, or makes arrangements
letter was delivered to Socorro's office, but no payment was made. for payment in full by the drawee of such
Thus, Sugiyama filed a complaint against petitioners for four (4) check within five (5) banking days after
counts of violation of Batas Pambansa Bilang (B.P.) 22. receiving notice that such check has not been
paid by the drawee.
Both petitioners pleaded not guilty to the four (4) charges.
Subsequently, Socorro and Sugiyama executed an "Addendum to For this presumption to arise, the prosecution must prove the
Contract Agreement," 11 agreeing on a new schedule of payment following: (a) the check is presented within ninety (90) days from the
with interests, but the obligation remain unpaid. date of the check; (b) the drawer or maker of the check receives
notice that such check has not been paid by the drawee; and (c) the
MeTC- BP 22 (4 counts) both accused drawer or maker of the check fails to pay the holder of the check the
RTC- affirmed amount due thereon, or make arrangements for payment in full
CA- affirmed within five (5) banking days after receiving notice that such check
SC- Socorro (guilty of BP 22 4 counts); Marie Paz (acquitted) has not been paid by the drawee. 33 In other words, the
presumption is brought into existence only after it is proved that the
ISSUE: issuer had received a notice of dishonor and that within five (5) days
1. WON the receipt of notice of dishonor was sufficiently from receipt thereof, he failed to pay the amount of the check or to
proven. (YES) make arrangements for its payment. 34 The presumption or prima
2. WON petitioners are criminally liable even if they only sign facie evidence, as provided in this Section, cannot arise if such
it as a mere officer of the corporation. (YES) notice of nonpayment by the drawee bank is not sent to the maker
or drawer, or if there is no proof as to when such notice was
HELD: The petition is partly meritorious. received by the drawer, since there would simply be no way of
reckoning the crucial 5-day period. 35
To sustain a conviction of violation of B.P. 22, the prosecution must The prosecution was able to establish beyond
prove beyond reasonable doubt three (3) essential elements, reasonable doubt the presence of the second element with
namely: respect to petitioner Socorro, who received the notice of dishonor
1. The accused makes, draws or issues any check to through her secretary. Prosecution witness Marilou La Serna, a
apply to account or for value; legal staff of Sugiyama's private counsel, testified that the letter
2. The accused knows at the time of the issuance that demanding payment of the dishonored checks was received by
he or she does not have sufficient funds in, or the secretary of petitioner Socorro, as shown by the handwritten
credit with, drawee bank for payment of the signature on the face of the said letter. 
check in full upon its presentment; and The testimony of La Serna shows that it was the
3. The check is subsequently dishonored by the drawee secretary of petitioner Socorro who acknowledged receipt of the
bank for insufficiency of funds or credit; or it demand letter dated March 5, 2002, with the permission of
would have been dishonored for the same Socorro, who was just in another room of her office. Suffice it to
reason had not the drawer, without any valid state that when the secretary of Socorro left for a while, came
reasons, ordered the bank to stop payment. back shortly, and acknowledged receipt of the same demand
The presence of the first and third elements is undisputed. However, letter, the requisite receipt of the notice of dishonor was satisfied.
while the prosecution established the second element, i.e., receipt of Against the affirmative testimony of La Serna, Socorro
the notice of dishonor, with respect to petitioner Socorro, it failed to merely denied knowledge and receipt of the demand letter dated
do so in the case of petitioner Marie Paz. March 5, 2002. It is well settled that the defense of denial is
inherently weak and unreliable by virtue of its being an excuse too
It is of no moment that the subject checks were issued as a easy and too convenient for the guilty to make. Denial should be
guarantee and upon the insistence of private complainant substantiated by clear and convincing evidence, and the accused
Sugiyama. What is significant is that the accused had deliberately cannot solely rely on her negative and self-serving negations, for
issued the checks in question to cover accounts and those same such defense carries no weight in law and has no greater
checks were dishonored upon presentment, regardless of the evidentiary value than the testimony of credible witnesses who
purpose for such issuance. 31 The legislative intent behind the testify on affirmative matters.
enactment of B.P. 22, as may be gathered from the statement of the Socorro could have easily presented, but failed to
bill's sponsor when then Cabinet Bill No. 9 was introduced before proffer the testimony of her secretary to dispute the testimony of
the Batasan Pambansa, is to discourage the issuance of bouncing La Serna. Socorro neither denied that she permitted her secretary
checks, to prevent checks from becoming "useless scraps of paper" to receive the demand letter, nor explained why her secretary
and to restore respectability to checks, all without distinction as to acknowledged receipt of the said letter while she was in the other
the purpose of the issuance of the checks. Said legislative intent is room of her office. Socorro also failed to dispute La Serna's claim
made all the more certain when it is considered that while the that there were several calls in the office of Socorro, as well as a
original text of the bill had contained a proviso excluding from the time when she went to the law office of Sugiyama's counsel, to
inform that she acknowledged receipt of that demand letter. fixed monthly dividends for 5 years, to enter into a loan, and to
Socorro did not, likewise, ascribe ill-motive on the part of La adopt a new schedule of payment with the same director, all in
Serna to testify falsely against her. behalf of the corporation. It would be the height of injustice for the
Meanwhile, Marie Paz cannot be faulted for failing Court to allow Socorro to hide behind the separate and distinct
to refute with evidence the allegation against her, because corporate personality of New Rhia Car Services, Inc., just to
Sugiyama and La Serna hardly testified as to the service of a evade the corporate obligation which she herself bound to
notice of dishonor upon her. La Serna never mentioned that personally undertake.
Marie Paz was, likewise, served with a notice of dishonor. It is not amiss to stress that the power to declare
There is also no proof that Socorro's secretary was duly dividends under Section 43 of the Corporation Code of the
authorized to receive the demand letter on behalf of Marie Philippines lies in the hands of the board of directors of a stock
Paz. corporation, and can be declared only out of its unrestricted
When service of notice is an issue, the person alleging retained earnings. Assuming arguendo that Socorro was
that notice was served must prove the fact of service, and the authorized by the Board to fix the monthly dividends of Sugiyama
burden of proving notice rests upon the party asserting its as a corporate director, it appears that she committed an ultra
existence. 41 Failure of the prosecution to prove that the person vires act because dividends can be declared only out of
who issued the check was given the requisite notice of dishonor is unrestricted retained earnings of a corporation, which earnings
a clear ground for acquittal. It bears emphasis that the giving of cannot obviously be fixed and pre-determined 5 years in advance.
the written notice of dishonor does not only supply proof for the
element arising from the presumption of knowledge the law puts
up, but also affords the offender due process. 42 The law thereby
allows the offender to avoid prosecution if she pays the holder of
the check the amount due thereon, or makes arrangements for
the payment in full of the check by the drawee within five banking
days from receipt of the written notice that the check had not been
paid. 43 Thus, the absence of a notice of dishonor is a deprivation
of petitioner's statutory right. 44
After reviewing the records and applying the
foregoing principles to this case, the Court rules that the
prosecution has proven beyond reasonable doubt that
petitioner Socorro received a notice of dishonor of the four
(4) subject checks, but failed to do so in the case of
petitioner Marie Paz.
Perforce, petitioner Socorro should be convicted of
the four (4) charges for violation of  B.P. 22, but petitioner
Marie Paz should be acquitted of the said charges.

As a general rule, when a corporate officer issues a

worthless check in the corporate's name, he or she may be held
personally liable for violating a penal statute, 45 i.e., Section 1
of B.P. 22. 46 However, a corporate officer who issues a
bouncing corporate check can only be held civilly liable when he
or she is convicted. 47 Conversely, once acquitted of the offense
of violating B.P. 22, a corporate officer is discharged of any civil
liability arising from the issuance of the worthless check in the
name of the corporation he or she represents. 48 This is without
regard as to whether his acquittal was based on reasonable doubt
or that there was a pronouncement by the trial court that the act
or omission from which the civil liability might arise did not
exist. 49
Here, petitioner Socorro should be held civilly liable for
the amounts covered by the dishonored checks, in light of her
conviction of the four (4) charges for violation of B.P. 22 and
because she made herself personally liable for the fixed monthly
director's dividends in the amount of P90,675.00 and the
P525,000.00 loan with interest, based on the Contract Agreement
dated April 6, 2011, the Addendum to Contract Agreement dated
February 4, 2003, and the Memorandum of Agreement dated
October 2001, which were all formally offered by the
prosecution, 50 and admitted in evidence by the trial court. 51 To
be sure, petitioner Marie Paz was never shown to have been part
of or privy to any of the said agreements; thus, she cannot be
held civilly liable for the dishonored checks.
Generally, the stockholders and officers are not
personally liable for the obligations of the corporation except only
when the veil of corporate fiction is being used as a cloak or cover
for fraud or illegality, or to work injustice. 55 Here, petitioner
Socorro bound herself personally liable for the monthly director's
dividends in the fixed amount of P90,675.00 for a period of five (5)
years and for the P500,000.00 loan, for which she issued the
subject four (4) dishonored checks. She then admitted having
incurred serious delay in the payment of the said fixed monthly
dividends and loan, and further agreed to adopt a new payment
schedule of payment therefor, but to no avail.
Granted that Socorro is authorized to sign checks as
corporate officer and authorized signatory of New Rhia Car
Services, Inc., there is still no evidence on record that she was
duly authorized, through a Board Resolution or Secretary's
Certificate, to guarantee a corporate director thereof [Sugiyama]