158. Jaime Guinhawa v.
People o Upon receiving their complaints, Guinhawa informed the
GR No. 162822, Aug 25, 2005
Facts:
Petitioner Guinhawa was engaged in the business of selling brand new
motor vehicles through his business, Guinrox Motor Sales, operating
out of Naga City. In March of 1995, Guinhawa bought a brand-new
Mitsubishi Versa Van from Union Motors Corp., in Manila.
o However, while en route from Manila to Naga City, Guinhawas
driver, one Leopoldo Olayan, suffered a heart attack, causing the
van to go out of control, causing damage to the van as well.
o The incident was reported on the police blotter, though the van
was later repaired and offered for sale in Guinrox showroom.
In October of 1995, Sps. Silo wanted to buy a new van for their garment
business; Inspecting the Versa van in Guinrox showroom, and being
under the impression that it was brand new, they decided to purchase
the van.
o Gil Azotea, Guinhawas sales manager, & the Spouses came to a
payment arrangement, with a total price of PhP 591,000.00, a
downpayment of PhP 161,470.00, & the remainder of the
amount being paid by a UCPB loan, secured by a chattel
mortgage over the van.
o Guinhawa executed the deed of sale, and the couple paid the
P161,470.00 downpayment, and the Spouses were furnished a
Service Manual, which contained the warranty terms and
conditions.
o Ralph Silo no longer conducted a test drive, under the
assumption that there were no defects in the van as it was brand
new.
Later that same month, Josephine Silo, accompanied by Bayani &
Glenda Pingol, went to Manila aboard the van, with Bayani as the driver.
While the trip was uneventful, on the return trip, Pingol heard a
squeaking sound coming from under the van. Stopping at a Shell gas
station to have it examined, it was found that some parts underneath
the van had in fact been welded.
Spouses that the defects were mere factory defects.
o As the problems continued, the Sps. requested that Guinhawa
change the van with two Charade-Daihatsu vehicles, with the
costs to be taken against their downpayment. The Spuses also
stopped paying the monthly amortization on their loan,
pending the replacement of the van.
o Guinhawa initially agreed to the couples proposal, but later
changed his mind and told them that he had to sell the van first.
The spouses then brought the vehicle for further examination at
another auto clinic, where it was found that the left front stabilizer of
the car was producing the sound, and that it had already been repaired
previously.
The Spouses filed a complaint for the recission of the sale and the
refund of their money with the DTI, after which Guinhawa admitted
that the van was not in fact brand new, and had sustained damage on a
trip from Manila to Naga.
The spouses therefore withdrew their civil complaint, and in February
of 1996, filed a criminal complaint against Guinhawa under Art. 318 of
the RPC (Other Deceits, discussing estafa), and an information for said
violation was filed against Guinhawa.
o The Municipal Trial Court convicted Guinhawa of Other Deceits,
awarding civil damages as well, in accordance with Arts. 2201
& 2202. This was later affirmed by the RTC & CA as well.
o The Court held that Guinhawas false representations as to the
provenance of the van fraudulently misled the Spouses.
o The CA later added that the Spouses had the right to assume
that the van was brand new because Guinhawa advertised
himself as a seller of brand-new vehicles, and his failure to give
notice that the van sold was not in fact brand new was
tantamount to deceit on his part.
Issue:
Whether or not Guinhawas conviction for deceit was proper.
Held:
 Guinhawa claims that the Sps. belief that the van was brand-new Sps. was clearly not brand new, the principle of caveat emptor
stemmed from their own lack of due diligence, since he said nothing to cannot apply.
indicate that the van was brand new. He argues that, based on the o The fact of fraudulent misrepresentation on the part of
principle of caveat emptor, since the Sps. purchased the van without Guinhawa makes him liable as a fraudulent seller.
inspecting it, they must suffer the consequences. o In this case, the buyer may rightfully rely on the truth of the
The SC held that in the case a seller makes a false or fraudulent sellers representations as to its kind, quality, and value made
representation that what he offers for sale is brand new, when, in fact, in the course of negotiation for the purpose of inducing the
it is not, is covered under Art. 318 of the RPC. purchase.
o For one to be liable under this provision, the prosecution must
Hence, Guinhawas conviction is proper.
prove the following essential elements:
False pretence, not falling under all those previously
discussed;
That such false pretence was made prior to or
simultaneously with the commission of the fraud; and
That such false pretence caused damage or prejudice to
the offended party.
o It also is essential that such false statement or fraudulent
representation constitutes the very cause or the only motive for
the private complainant to part with her property.
Guinhawas claim that he made no personal representation cannot
stand, since he advertised himself as a dealer of brand-new cars, a fact
he did not contest.
o Therefore, when private complainant went to petitioners
showroom, the former had every right to assume that she was
being sold brand new vehicles there being nothing to indicate
otherwise.
o But as it turned out, not only did private complainant get a
defective and used van, the vehicle had also earlier figured in a
road accident when driven by no less than petitioners own
driver.
The evidence shows that the van was defective when the petitioner sold
it to the private complainant. Azotea and the Guinhawa deliberately
concealed these facts from the Sps. when she bought the van, obviously
so as not to derail the sale and the profit from the transaction.
o Since it has been established that Guinhawa held himself out to
the public as a seller of brand-new cars, and the car sold to the