November 18, 2002 PEOPLE OF THE PHILIPPINES v.RICA G.

CUYUGAN FACTS: Private complainants RODRIGO and Norma ABAGAT are engaged in the business of supplying dry goods, such as materials for building construction as well as communication parts, to the Philippine Air Force. Accused appellant RICA G. CUYUGAN is a businesswoman who furnished the Armed Forces of the Philippines (AFP) with office supplies, construction materials, and signal and communication spare parts. Her husband is the cousin of private complainant Norma Abagat. Sometime on May 10, 1994, private complainants gave accused the amount totaling to P855,000 that accused needed to buy supplies for AFP provided that she would issue checks to complainants to cover the value of the money given her. When the checks were presented for payment, they were all dishonored either on account of DAIF (drawn against insufficient funds) or for reason of ACCOUNT CLOSED. three counts of estafa as defined and penalized under Article 315, paragraph 2 (d) of the Revised Penal Code were filed against accused, Rica G. Cuyugan before the Regional Trial Court of Pasay . Moreover, when demands were made on the accused, she failed and refused to redeem or make good the said checks face value to the damage and prejudice of the private Complainants. The trial court found appellant guilty beyond reasonable doubt of estafa committed by means of false pretenses or fraudulent acts executed prior to or simultaneously with the commission of the fraud, that is by postdating a check or issuing a check in payment of an obligation when the offender had no funds in the bank, or his funds deposited therein were not sufficient to cover the amount of the check. ISSUE: Whether or not the ACCUSED is GUILTY BEYOND REASONABLE DOUBT OF THREE (3) COUNTS OF ESTAFA pursuant to Article 315, 2 (d) of the Revised Penal Code as amended by P.D. No. 818. HELD: No, the accused is ACQUITTED by the Supreme Court for lack of sufficient evidence to prove fraud beyond reasonable doubt. However, she is ordered to pay private complainants the balance of her obligation in the amount of P430,000 plus interest of twelve percent (12%) per annum until fully paid. To constitute estafa under this provision the act of postdating or issuing a check in payment of an obligation must be the efficient cause of defraudation, and as such it should be either prior to, or simultaneous with the act of fraud. The offender must be able to obtain money or property from the offended party because of the issuance of a check whether postdated or not. That is, the latter would not have parted with his money or other property were it not for the issuance of the check. In this case, the trial court failed to consider the testimonies of both the private complainants with respect to the agreement that the checks issued by appellant shall be mere guarantees for the eventual payment of the money given to appellant. The Supreme Court held that the transaction between appellant and the Abagat spouses, was one for a loan of money to be used by appellant in her business and she issued checks to guarantee the payment of the loan. As such, she has the obligation to make good the payment of the money borrowed by her. But such obligation is civil in character and in the absence of fraud, no criminal liability under the Revised Penal Code arises from the mere issuance of postdated checks as a guarantee of repayment. It further found that appellants allegation, that the Abagat spouses entered into a joint venture agreement with her for the supply of materials with the AFP, is self-serving. The Court also noted that the trial court convicted appellant on a general allegation that all the elements of estafa under Article 315, 2 (d) of the Revised Penal Code had been proved by the prosecution without making any reference to or giving any proof of the actual fraud that appellant allegedly committed to make her liable for

estafa. It is elementary that where an allegation in the information is an essential element of the crime, the same must be proved beyond reasonable doubt to sustain a conviction. In this case, the prosecution did not establish specifically and conclusively the fraud alleged as an element of the offenses charged. Furthermore, Appellant cannot be convicted of a crime for which she was not properly charged, for that would violate appellants constitutional right to be informed of the accusation against her. The informations filed with the regional trial court were for three counts of estafa. Earlier, the informations for BP 22 covering the same checks filed with the Metropolitan Trial Court of Pasay City, Branch 44, were provisionally dismissed on November 13, 1996. These cases were not re-filed nor consolidated with the informations for estafa before the RTC of Pasay. Accordingly, appellant was never apprised of the fact that she may still be held liable for BP 22 and so never had an opportunity to defend herself against an accusation for an offense under the special law. BP 22 cannot be deemed necessarily included in the crime of estafa under RPC, Article 315, 2 (d). The offense of fraud defined under the Revised Penal Code is malum in se, whereas BP 22, also known as Bouncing Checks Law, is a special law which punishes the issuance of bouncing checks, a malum prohibitum. They are different offenses, having different elements.32 In this case, since appellant is accused of violating a particular provision of the Revised Penal Code on estafa, she may not be convicted for violation of BP 22 without trenching on fundamental fairness. January 18, 2001 PEOPLE OF THE PHILIPPINES v. GULION FACTS: Danilo Gulion, accused-appellant, and Marilyn Miones, accused-at-large, had separate checking accounts with the Far East Bank and Trust Company ("FEBTC") in Tagum, Davao: The checks subject of this case, while bearing the signature of accused-appellant, came from the check booklet of accused-at-large. Three checks were negotiated to private complainant Roselier Molina sometime on February 1990 under an arrangement termed "rediscounting", i.e., in exchange for cash, accused-appellant issued to Molina the checks, and the latter deducted ten percent (10%) from the proceeds thereof. Thus, for two Checks, both in the amount of P15,000.00, Molina paid for each check P13,500.00 cash, and for other Check in the amount of P5,000.00, he paid P4,500.00 cash. Such appears to be a long-standing practice between Molina and accused-appellant, and Molina was in fact familiar with accusedappellant's signature as the latter often transacted with him using checks, instead of cash. On all their previous transactions, Molina was able to recover the amounts he loaned out to accused-appellant. The checks in the instant case were delivered by accused-at-large to Molina at the latter's residence in Apokon Road, Tagum, Davao. The checks, which as earlier stated were signed by accused-appellant, were paid to "CASH" and indorsed by accused-atlarge on their respective dorsal portions. Such checks in exchange of cash in favor of Roselier Molina upon presentation for payment of the bank within 90 days from date of issue, were all dishonored for reason "Account Closed" and that inspite of notice of dishonor and repeated demands made, the said accused failed to make the necessary deposit to cover the amount of the check or to pay the same, to the damage and prejudice of Roselier Molina. Three criminal cases were filed for the three checks which were jointly heard by the Regional Trial Court (Branch 1) of Tagum, Davao only against accused-appellant Gulion. Accused Marilyn Miones remained at large. On February 10, 1992, the trial court rendered a decision convicting accused-appellant DANILO GULION guilty beyond reasonable doubt of estafa pursuant to Article 315, par. 2(d) of the Revised Penal Code, as amended by P.D. 818 which were affirmed by the Sixth Division of the Court of Appeals. The trial court found the existence of an implied conspiracy between accused-appellant and accused-at-large, as manifested in accused-appellant's unique modus operandus of drawing checks from his co-conspirator's checking account to confuse the payee and evade liability. The Court of Appeals upheld the trial court's finding of conspiracy, and held that based upon the conduct of the two accused in the instant case, their closeness of personal association,

concerted action and community of design, it is obvious that they conspired to defraud private complainant through issuing worthless checks. ISSUES: (1) Whether or not the accused-appellant conspired with accused-at-large by signing the checks and can be held guilty for estafa under Article 315, paragraph 2(d) of the Revised Penal Code . HELD: The elements of estafa under Article 315, paragraph 2(d) of the Revised Penal Code, as amended, are the following: (1) postdating or issuing checks in payment of an obligation contracted at the time the checks were issued; (2) lack or insufficiency of funds to cover said checks; (3) knowledge on the part of the drawer of checks of such lack or insufficiency of funds; and (4) damage capable of pecuniary estimation to the payee thereof.16 Underlying all these must be the presence of fraud or deceit. The peculiarity of the instant case rests on the fact that the person who issued the checks is not the lawful owner of the checking account from which the checks were drawn. Thus, at the time these checks were issued by Gulion it is a foregone conclusion that Molina would never recover from the checks because the drawee bank would not recognize the signature of Gulion. In other words, the dishonor of the checks will not only be on account of lack or insufficiency of funds in Miones's account but also because the checks are invalid for having been issued by an unauthorized person. Thus, while to an extent we agree with accusedappellant that there was no valid issuance of the said checks we hold that accused-appellant could still be held liable for estafa under Article 315, paragraph 2(d) of the Revised Penal Code even if he is not the owner of the checking account in question if it is shown that he conspired with accused-at-large by knowingly signing the latter's checks to ensure Molina's inability to encash the said checks. Under a theory of conspiracy, it is sufficient that the accused is possessed of guilty knowledge that his co-accused had no funds in the bank when the checks were negotiated. The existence of a conspiracy may be implied from the conduct of the accused before, during and after the commission of the crime, showing that the accused had acted under a common purpose or design.18 Like the crime itself, the conspiracy must be proven beyond reasonable doubt. For circumstantial evidence to convict, the Rules of Court require that: (1) there is more than one circumstance; (2) the facts from which the inferences are derived are proven; and (3) the combination of all the circumstances is such as to produce a conviction beyond reasonable doubt.The Supreme Court held that while circumstances establish the friendship between the two accused and the trust that accused-appellant reposed upon accused-at-large, they are insufficient to merit the conclusion that accused-appellant conspired with accused-at-large by affixing his signatures on the latter's checks knowingly and with an intent to defraud Molina. A closer look at the circumstances under which the checks were negotiated reveal that it was Miones alone who delivered the checks to Molina and received payment therefor. There is no evidence that Miones was authorized by accused-appellant to exchange, on his behalf, the checks for cash. There is also no evidence that accused-appellant received from Miones any portion of the proceeds of the said checks. It is principal in a case of estafa through postdated checks that the accused must have been shown to have obtained money or property from the offended party because of the issuance of the check. There is likewise no showing of past instances where Molina "rediscounted" Gulion's checks through Miones; the lower courts simply and unquestioningly accepted as fact that Miones was an authorized agent of Gulion in transacting with Molina. In other words, the prosecution failed to show by the conduct of accused-appellant before, during and after the commission of the crime that he was a participant to the defraudation of Molina. It certainly cannot be conclusively inferred from proof of his friendship with accused-atlarge, or from his adamant refusal to pay Molina, or to even recognize the existence of the debt.

In contrast to the weakness of the prosecution's evidence, accused-appellant presented a fairly cohesive and logical explanation for how his signatures figured in the questioned checks. He stated that as the proprietor of an insurance agency, he habitually signed blank checks for agents' commissions and office bills, which his secretary then filled out with the pertinent names of payees, dates and amounts. He signed Miones's checks while in a hurry as he had an appointment at another town, thinking them to be the usual blank checks laid out by his secretary on his table for his signature. His insistence that the checks were so much like his own is believable, because he also had a checking account with FEBTC. Following his version of the story, it is not altogether improbable that a trusted friend of his like Miones (who was frequently in and out of his office and could have been very familiar with his work habits and schedules) took advantage of his carelessness and stealthily placed her three blank checks on his office table with the design to obtain money from Molina using his signature. Then Miones filled in the other details in the checks, by postdating them, making them payable to "CASH", and even affixing her signature thereto as indorser. Not surprisingly, the checks were dishonored upon presentment, for the reason "Account Closed and Signature Differs on File." Accused-appellant came to know of his alleged involvement in these unpaid obligations only when Molina's lawyer sent him a demand letter, to which his reaction was to disown owing any debts to, or having issued any checks in favor of, Molina. Good faith is a defense to a charge of estafa by postdating a check.22 This may be manifested by the accused's offering to make arrangements with his creditor as to the manner of payment23 or, as in the present case, averring that his placing his signature on the questioned checks was purely a result of his gullibility and inadvertence, with the unfortunate result that he himself became a victim of the trickery and manipulations of accused-at-large. Based on all the foregoing, we hold that accused-appellant cannot be held guilty for estafa under Article 315, paragraph 2(d) of the Revised Penal Code because the evidence of the prosecution absolutely failed to prove his guilt. KAZUHIRO HASEGAWA v. KITAMURA, November 23, 2007 FACTS: On March 30, 1999, petitioner Nippon Engineering Consultants Co., Ltd. (Nippon), a Japanese consultancy firm providing technical and management support in the infrastructure projects of foreign governments entered into an Independent Contractor Agreement (ICA) with respondent Minoru Kitamura, a Japanese national permanently residing in the Philippines which provides that respondent was to extend professional services to Nippon for a year starting on April 1, 1999.Then, Nippon assigned respondent to work as the project manager of the Southern Tagalog Access Road (STAR) Project in the Philippines, following the company's consultancy contract with the Philippine Government. On February 28, 2000, petitioner Kazuhiro Hasegawa, Nippon's general manager for its International Division, informed respondent that the company had no more intention of automatically renewing his ICA. His services would be engaged by the company only up to the substantial completion of the STAR Project on March 31, 2000, just in time for the ICA's expiry. Threatened with impending unemployment, respondent, through his lawyer, requested a negotiation conference and demanded that he be assigned to the BBRI project. Because of Nippons refusal to negotiate for the renewal of the ICA , respondent consequently initiated on June 1, 2000, a civil case for specific performance and damages with the Regional Trial Court of Lipa City. For their part, petitioners, contending that the ICA had been perfected in Japan and executed by and between Japanese nationals, moved to dismiss the complaint for lack of jurisdiction. They asserted that the claim for improper pre-termination of

respondent's ICA could only be heard and ventilated in the proper courts of Japan following the principles of lex loci celebrationis and lex contractus. In the meantime, on June 20, 2000, the DPWH approved Nippon's request for the replacement of Kitamura by a certain Y. Kotake as project manager of the BBRI Project.1 On June 29, 2000, the RTC, denied the motion to dismiss and subsequently denied petitioners' motion for reconsideration,prompting them to file with the appellate court, on August 14, 2000, their first Petition for Certiorari under Rule 65. The CA ruled, among others, that the principle of lex loci celebrationis was not applicable to the case, because nowhere in the pleadings was the validity of the written agreement put in issue. The CA thus declared that the trial court was correct in applying instead the principle of lex loci solutionis. Petitioners' motion for reconsideration was subsequently denied by the CA. ISSUES: whether the subject matter jurisdiction of Philippine courts in civil cases for specific performance and damages involving contracts executed outside the country by foreign nationals may be assailed on the principles of lex loci celebrationis, lex contractus, the state of the most significant relationship rule, or forum non conveniens. HELD: No, the Supreme Court held that RTC is vested by law with the power to entertain and hear the civil case filed by respondent and the grounds raised by petitioners to assail that jurisdiction are inappropriate. The ICA subject of the litigation was entered into and perfected in Tokyo, Japan, by Japanese nationals, and written wholly in the Japanese language. Thus, petitioners posit that local courts have no substantial relationship to the parties following the [state of the] most significant relationship rule in Private International Law. To elucidate, in the judicial resolution of conflicts problems, three consecutive phases are involved: jurisdiction, choice of law, and recognition and enforcement of judgments. Corresponding to these phases are the following questions: (1) Where can or should litigation be initiated? (2) Which law will the court apply? and (3) Where can the resulting judgment be enforced?2[53] Analytically, jurisdiction and choice of law are two distinct concepts. 3[54] Jurisdiction considers whether it is fair to cause a defendant to travel to this state; choice of law asks the further question whether the application of a substantive law which will determine the merits of the case is fair to both parties. The power to exercise jurisdiction does not automatically give a state constitutional authority to apply forum law. While jurisdiction and the choice of the lex fori will often coincide, the minimum contacts for one do not always provide the necessary significant contacts for the other.4[55] The question of whether the law of a state can be applied to a transaction is different from the question of whether the courts of that state have jurisdiction to enter a judgment.5[56] In this case, only the first phase is at issuejurisdiction. Jurisdiction, however, has various aspects. For a court to validly exercise its power to adjudicate a controversy, it must have jurisdiction over the plaintiff or the petitioner, over the defendant or the respondent, over
1 2 3 4 5

the subject matter, over the issues of the case and, in cases involving property, over the res or the thing which is the subject of the litigation.6[57] In assailing the trial court's jurisdiction herein, petitioners are actually referring to subject matter jurisdiction. Jurisdiction over the subject matter in a judicial proceeding is conferred by the sovereign authority which establishes and organizes the court. It is given only by law and in the manner prescribed by law.7[58] It is further determined by the allegations of the complaint irrespective of whether the plaintiff is entitled to all or some of the claims asserted therein. 8[59] To succeed in its motion for the dismissal of an action for lack of jurisdiction over the subject matter of the claim,9[60] the movant must show that the court or tribunal cannot act on the matter submitted to it because no law grants it the power to adjudicate the claims. In the instant case, petitioners, in their motion to dismiss, do not claim that the trial court is not properly vested by law with jurisdiction to hear the subject controversy for, indeed, the civil case for specific performance and damages is one not capable of pecuniary estimation and is properly cognizable by the RTC of Lipa City.10[62] What they rather raise as grounds to question subject matter jurisdiction are the principles of lex loci celebrationis and lex contractus, and the state of the most significant relationship rule. Lex loci celebrationis relates to the law of the place of the ceremony11[63] or the law of the place where a contract is made.12[64] The doctrine of lex contractus or lex loci contractus means the law of the place where a contract is executed or to be performed.13[65] It controls the nature, construction, and validity of the contract14[66] and it may pertain to the law voluntarily agreed upon by the parties or the law intended by them either expressly or implicitly.15[67] Under the state of the most significant relationship rule, to ascertain what state law to apply to a dispute, the court should determine which state has the most substantial connection to the occurrence and the parties. In a case involving a contract, the court should consider where the contract was made, was negotiated, was to be performed, and the domicile, place of business, or place of incorporation of the parties.16[68] This rule takes into account several contacts and evaluates them according to their relative importance with respect to the particular issue to be resolved.17[69] Since these three principles in conflict of laws make reference to the law applicable to a dispute, they are rules proper for the second phase, the choice of law.18[70] They determine which state's law is to be applied in resolving the substantive issues of a conflicts problem. 19[71]
6 7 8 9 10 11 12 13 14 15 16 17 18 19

Necessarily, as the only issue in this case is that of jurisdiction, choice-of-law rules are not only inapplicable but also not yet called for. Further, petitioners' premature invocation of choice-of-law rules is exposed by the fact that they have not yet pointed out any conflict between the laws of Japan and ours. Before determining which law should apply, first there should exist a conflict of laws situation requiring the application of the conflict of laws rules.20[72] Also, when the law of a foreign country is invoked to provide the proper rules for the solution of a case, the existence of such law must be pleaded and proved.21[73] It should be noted that when a conflicts case, one involving a foreign element, is brought before a court or administrative agency, there are three alternatives open to the latter in disposing of it: (1) dismiss the case, either because of lack of jurisdiction or refusal to assume jurisdiction over the case; (2) assume jurisdiction over the case and apply the internal law of the forum; or (3) assume jurisdiction over the case and take into account or apply the law of some other State or States.22[74] The courts power to hear cases and controversies is derived from the Constitution and the laws. While it may choose to recognize laws of foreign nations, the court is not limited by foreign sovereign law short of treaties or other formal agreements, even in matters regarding rights provided by foreign sovereigns. Neither can the other ground raised, forum non conveniens, be used to deprive the trial court of its jurisdiction herein. First, it is not a proper basis for a motion to dismiss because Section 1, Rule 16 of the Rules of Court does not include it as a ground. Second, whether a suit should be entertained or dismissed on the basis of the said doctrine depends largely upon the facts of the particular case and is addressed to the sound discretion of the trial court. In this case, the RTC decided to assume jurisdiction. Third, the propriety of dismissing a case based on this principle requires a factual determination; hence, this conflicts principle is more properly considered a matter of defense.

filed 26 Informations against petitioner with the RTC of Bulacan for violation of BP 22 also known as the Anti-Bouncing Checks Law. The trial court convicted petitioner on all counts and imposed the penalty of six months for each conviction which the Court of Appeals later affirmed. (1) Whether or not the trial court was incorrect to accept as evidence photocopies of the original checks and (2) Whether the accused acted in good faith (3) Whether or not the penalty of imprisonment was incorrectly imposed on petitioner in the light of Administrative Circular No. 12-2000 HELD: (1) The Supreme Court held that the trial court did not commit any reversible error in admitting in evidence the photostatic copies of the subject checks in lieu of the originals thereof in the possession of the. It bears stressing that the raison detre of the proscription against the admission of secondary evidence in lieu or in substitution of the original thereof is to prevent the commission of fraud on the part of the offeror who is in possession of the best evidence.The petitioner admitted in his testimonies, albeit impliedly, that the photostatic copies of the checks admitted in evidence by the Court a quo were the faithful reproduction of the original copies in his possession, thus, petitioner cured whatever flaw might have existed in the prosecutions evidence. The fact that these originals were all stamped account closed merely confirmed the allegations of the respondent that the checks were dishonored by reason of the account being closed. Because they were entirely consistent with its main theory, the prosecution correctly adopted these originals as its own evidence. In addition, by petitioners own admission, five of the original checks were lost, thus rendering the photocopies thereof admissible as exceptions to the Best Evidence Rule. (2) Regarding petitioners allegation of good faith, suffice it to say that such a claim is immaterial, the offense in question being malum prohibitum.The gravamen of the offense is the issuance of a bad check and therefore, whether or not malice and intent attended such issuance is unimportant. (3)In invoking of A.C. No. 12-2000, petitioner adopts the interpretation of Justice Villarama to the effect that the circular mandates judges to impose fines rather than imprisonment on violators of BP 22. The Supreme Court noted that the clear tenor and intention of Administrative Order No. 122000 is not to remove imprisonment as an alternative penalty, but to lay down a rule of preference in the application of the penalties provided for in B.P. Blg. 22. The pursuit of this purpose clearly does not foreclose the possibility of imprisonment for violators of B.P. Blg. 22. Neither does it defeat the legislative intent behind the law. Thus, Administrative Circular No. 12-2000 establishes a rule of preference in the application of the penal provisions of B.P. Blg. 22 such that where the circumstances of both the offense and the offender clearly indicate good faith or a clear mistake of fact without taint of negligence, the imposition of a fine alone should be considered as the more appropriate penalty. Needless to say, the determination of whether the circumstances warrant the imposition of a fine alone rests solely upon the Judge. Should the Judge decide that imprisonment is the more appropriate penalty, Administrative Circular No. 12-2000 ought not to be deemed a hindrance (emphasis ours). Clearly, the imposition of either a fine or imprisonment remains entirely within the sound discretion of the judge trying the case, based on his assessment of the offender and the facts.

ALBINO JOSEF, G.R. No. 146424 -versus PEOPLE OF THE PHILIPPINES November 18, 2005 FACTS From the period of June to August, 1991, Albino Josef, petitioner, a Marikina-based manufacturer and seller of shoes, purchased materials from respondent Agustin Alarilla, a seller of leather products from Meycauayan, Bulacan, for which the former issued a total of 26 postdated checks against his account with the Associated Bank and Far East Bank & Trust Company (Marikina Branches). When private respondent presented these checks for encashment, they were dishonored because the accounts against which they were drawn were closed. Private respondent informed petitioner of the dishonor and demanded payment of their value. After some negotiations, petitioner drew and delivered a new set of postdated checks in replacement of the dishonored ones. Private respondent, in turn, returned to petitioner the originals of the dishonored postdated checks but retained photocopies thereof. When private respondent deposited the replacement checks in his account with the Westmont Bank, these were also dishonored by the drawee bank. As a result, the private respondent filed criminal complaints against petitioner for violation of BP 22 with the Office of the Provincial Prosecutor of Bulacan. After preliminary investigation, the Provincial Prosecutor
20 21 22