ORIEL MAGNO vs.

COURT OF APPEALS
G.R. No. 96132 June 26, 1992

Facts: Oriel Magno, lacking fund in acquiring complete set of equipment to make his car repair shop
operational, approached Corazon Teng, Vice President of Mancor Industries. VP Teng referred Magno to
LS Finance and Management Corporation, advising its Vice President, Joey Gomez, that Mancor was
willing to supply the pieces of equipment needed if LS Finance could accommodate Magno and and
provide him credit facilities. The arrangement went on requiring Magno to pay 30% of the total amount of
the equipment as warranty deposit but Magno couldn't afford to pay so he requested VP Gomez to look
for third party who could lend him that amount. Without Magno's knowledge, Corazon was the one who
provided that amount. As payment to the equipment, Magno issued six checks, two of them were cleared
and the rest had no sufficient fund. Because of the unsuccessful venture, Magno failed to pay LS Finance
which then pulled out the equipment. Magno was charged of violation of BP Blg. 2 (The Bouncing
Checks Law) and found guilty.

Issue: WON Magno should be punished for the issuance of the checks in question.

Held: No. To charge Magno for the refund of a warranty deposit which he did not withdraw as it was not
his own account, it having remained with LS Finance, is to even make him pay an unjust debt since he did
not receive the amount in question. All the while, said amount was in the safekeeping of the financing
company which is managed by the officials and employees of LS Finance.