LUIS MARCOS P. LAUREL, G.R. No.

155076
Petitioner,

Present:
PANGANIBAN, C.J., Chairperson,
YNARES-SANTIAGO,
- versus - AUSTRIA-MARTINEZ,
CALLEJO, SR., and
CHICO-NAZARIO, JJ.
HON. ZEUS C. ABROGAR,
Presiding Judge of the Regional Trial
Court, Makati City, Branch 150, Promulgated:
PEOPLE OF THE PHILIPPINES
& PHILIPPINE LONG DISTANCE February 27, 2006
TELEPHONE COMPANY,
Respondents.
x--------------------------------------------------x

DECISION

CALLEJO, SR., J.:

Before us is a Petition for Review on Certiorari of the Decision[1] of the Court of

Appeals (CA) in CA-G.R. SP No. 68841 affirming the Order issued by Judge Zeus
C. Abrogar, Regional Trial Court (RTC), Makati City, Branch 150, which denied
the Motion to Quash (With Motion to Defer Arraignment) in Criminal Case No.
99-2425 for theft.

Philippine Long Distance Telephone Company (PLDT) is the holder of a

legislative franchise to render local and international telecommunication services
under Republic Act No. 7082.[2] Under said law, PLDT is authorized to establish,
operate, manage, lease, maintain and purchase telecommunication systems,
including transmitting, receiving and switching stations, for both domestic and
international calls. For this purpose, it has installed an estimated 1.7 million
telephone lines nationwide. PLDT also offers other services as authorized by
Certificates of Public Convenience and Necessity (CPCN) duly issued by the
National Telecommunications Commission (NTC), and operates and maintains an
International Gateway Facility (IGF). The PLDT network is thus principally
composed of the Public Switch Telephone Network (PSTN), telephone handsets
and/or telecommunications equipment used by its subscribers, the wires and cables
linking said telephone handsets and/or telecommunications equipment, antenna,
the IGF, and other telecommunications equipment which provide
interconnections.[3]

PLDT alleges that one of the alternative calling patterns that constitute
network fraud and violate its network integrity is that which is known as
International Simple Resale (ISR). ISR is a method of routing and completing
international long distance calls using International Private Leased Lines (IPL),
cables, antenna or air wave or frequency, which connect directly to the local or
domestic exchange facilities of the terminating country (the country where the call
is destined). The IPL is linked to switching equipment which is connected to a
PLDT telephone line/number. In the process, the calls bypass the IGF found at the
terminating country, or in some instances, even those from the originating
country.[4]

One such alternative calling service is that offered by Baynet Co., Ltd.
(Baynet) which sells Bay Super Orient Card phone cards to people who call their
friends and relatives in the Philippines. With said card, one is entitled to a 27-
minute call to the Philippines for about 37.03 per minute. After dialing the ISR
access number indicated in the phone card, the ISR operator requests the subscriber
to give the PIN number also indicated in the phone card. Once the callers identity
(as purchaser of the phone card) is confirmed, the ISR operator will then provide a
Philippine local line to the requesting caller via the IPL. According to PLDT, calls
made through the IPL never pass the toll center of IGF operators in
the Philippines. Using the local line, the Baynet card user is able to place a call to
any point in the Philippines, provided the local line is National Direct Dial (NDD)
capable.[5]

PLDT asserts that Baynet conducts its ISR activities by utilizing an IPL to
course its incoming international long distance calls from Japan. The IPL is linked
to switching equipment, which is then connected to PLDT telephone lines/numbers
and equipment, with Baynet as subscriber. Through the use of the telephone lines
and other auxiliary equipment, Baynet is able to connect an international long
distance call from Japan to any part of the Philippines, and make it appear as a call
originating from Metro Manila. Consequently, the operator of an ISR is able to
evade payment of access, termination or bypass charges and accounting rates, as
well as compliance with the regulatory requirements of the NTC. Thus, the ISR
operator offers international telecommunication services at a lower rate, to the
damage and prejudice of legitimate operators like PLDT.[6]

PLDT pointed out that Baynet utilized the following equipment for its ISR
activities: lines, cables, and antennas or equipment or device capable of
transmitting air waves or frequency, such as an IPL and telephone lines and
equipment; computers or any equipment or device capable of accepting
information applying the prescribed process of the information and supplying the
result of this process; modems or any equipment or device that enables a data
terminal equipment such as computers to communicate with other data terminal
equipment via a telephone line; multiplexers or any equipment or device that
enables two or more signals from different sources to pass through a common
cable or transmission line; switching equipment, or equipment or device capable of
connecting telephone lines; and software, diskettes, tapes or equipment or device
used for recording and storing information.[7]

PLDT also discovered that Baynet subscribed to a total of 123 PLDT

telephone lines/numbers.[8] Based on the Traffic Study conducted on the volume of
calls passing through Baynets ISR network which bypass the IGF toll center,
PLDT incurred an estimated monthly loss of P10,185,325.96.[9] Records at the
Securities and Exchange Commission (SEC) also revealed that Baynet was not
authorized to provide international or domestic long distance telephone service in
the country. The following are its officers: Yuji Hijioka, a Japanese national
(chairman of the board of directors); Gina C. Mukaida, a Filipina (board member
and president); Luis Marcos P. Laurel, a Filipino (board member and corporate
secretary); Ricky Chan Pe, a Filipino (board member and treasurer); and Yasushi
Ueshima, also a Japanese national (board member).

Upon complaint of PLDT against Baynet for network fraud, and on the
strength of two search warrants[10] issued by the RTC of Makati, Branch 147,
National Bureau of Investigation (NBI) agents searched its office at the
7th Floor, SJGBuilding, Kalayaan Avenue, Makati City on November 8, 1999.
Atsushi Matsuura, Nobuyoshi Miyake, Edourd D. Lacson and Rolando J. Villegas
were arrested by NBI agents while in the act of manning the operations of Baynet.
Seized in the premises during the search were numerous equipment and devices
used in its ISR activities, such as multiplexers, modems, computer monitors,
CPUs, antenna, assorted computer peripheral cords and microprocessors,
cables/wires, assorted PLDT statement of accounts, parabolic antennae and voltage
regulators.
 State Prosecutor Ofelia L. Calo conducted an inquest investigation and
issued a Resolution[11] on January 28, 2000, finding probable cause for theft under
Article 308 of the Revised Penal Code and Presidential Decree No. 401 [12] against
the respondents therein, including Laurel.

On February 8, 2000, State Prosecutor Calo filed an Information with the

RTC of Makati City charging Matsuura, Miyake, Lacson and Villegas with theft
under Article 308 of the Revised Penal Code. After conducting the requisite
preliminary investigation, the State Prosecutor filed an Amended Information
impleading Laurel (a partner in the law firm of Ingles, Laurel, Salinas, and, until
November 19, 1999, a member of the board of directors and corporate secretary of
Baynet), and the other members of the board of directors of said corporation,
namely, Yuji Hijioka, Yasushi Ueshima, Mukaida, Lacson and Villegas, as
accused for theft under Article 308 of the Revised Penal Code. The inculpatory
portion of the Amended Information reads:

On or about September 10-19, 1999, or prior thereto, in Makati City, and within
the jurisdiction of this Honorable Court, the accused, conspiring and
confederating together and all of them mutually helping and aiding one another,
with intent to gain and without the knowledge and consent of the Philippine Long
Distance Telephone (PLDT), did then and there willfully, unlawfully and
feloniously take, steal and use the international long distance calls belonging to
PLDT by conducting International Simple Resale (ISR), which is a method of
routing and completing international long distance calls using lines, cables,
antennae, and/or air wave frequency which connect directly to the local or
domestic exchange facilities of the country where the call is destined, effectively
stealing this business from PLDT while using its facilities in the estimated amount
of P20,370,651.92 to the damage and prejudice of PLDT, in the said amount.

CONTRARY TO LAW.[13]

Accused Laurel filed a Motion to Quash (with Motion to Defer

Arraignment) on the ground that the factual allegations in the Amended
Information do not constitute the felony of theft under Article 308 of the Revised
Penal Code. He averred that the Revised Penal Code, or any other special penal
law for that matter, does not prohibit ISR operations. He claimed that telephone
calls with the use of PLDT telephone lines, whether domestic or international,
belong to the persons making the call, not to PLDT. He argued that the caller
merely uses the facilities of PLDT, and what the latter owns are the
telecommunication infrastructures or facilities through which the call is made. He
also asserted that PLDT is compensated for the callers use of its facilities by way
of rental; for an outgoing overseas call, PLDT charges the caller per minute, based
on the duration of the call. Thus, no personal property was stolen from PLDT.
According to Laurel, the P20,370,651.92 stated in the Information, if anything,
represents the rental for the use of PLDT facilities, and not the value of anything
owned by it. Finally, he averred that the allegations in the Amended Information
are already subsumed under the Information for violation of Presidential Decree
(P.D.) No. 401 filed and pending in the Metropolitan Trial Court of Makati City,
docketed as Criminal Case No. 276766.

The prosecution, through private complainant PLDT, opposed the

motion,[14] contending that the movant unlawfully took personal property
belonging to it, as follows: 1) intangible telephone services that are being offered
by PLDT and other telecommunication companies, i.e., the connection and
interconnection to their telephone lines/facilities; 2) the use of those facilities over
a period of time; and 3) the revenues derived in connection with the rendition of
such services and the use of such facilities.[15]

The prosecution asserted that the use of PLDTs intangible telephone

services/facilities allows electronic voice signals to pass through the same, and
ultimately to the called partys number. It averred that such service/facility is akin
to electricity which, although an intangible property, may, nevertheless, be
appropriated and be the subject of theft. Such service over a period of time for a
consideration is the business that PLDT provides to its customers, which enables
the latter to send various messages to installed recipients. The service rendered by
PLDT is akin to merchandise which has specific value, and therefore, capable of
appropriation by another, as in this case, through the ISR operations conducted by
the movant and his co-accused.

The prosecution further alleged that international business calls and revenues
constitute personal property envisaged in Article 308 of the Revised Penal Code.
Moreover, the intangible telephone services/facilities belong to PLDT and not to
the movant and the other accused, because they have no telephone services and
facilities of their own duly authorized by the NTC; thus, the taking by the movant
and his co-accused of PLDT services was with intent to gain and without the latters
consent.

The prosecution pointed out that the accused, as well as the movant, were
paid in exchange for their illegal appropriation and use of PLDTs telephone
services and facilities; on the other hand, the accused did not pay a single centavo
for their illegal ISR operations. Thus, the acts of the accused were akin to the use
of a jumper by a consumer to deflect the current from the house electric meter,
thereby enabling one to steal electricity. The prosecution emphasized that its
position is fortified by the Resolutions of the Department of Justice in PLDT v.
Tiongson, et al. (I.S. No. 97-0925) and in PAOCTF-PLDT v. Elton John Tuason, et
al. (I.S. No. 2000-370) which were issued on August 14, 2000 finding probable
cause for theft against the respondents therein.

On September 14, 2001, the RTC issued an Order[16] denying the Motion to
Quash the Amended Information. The court declared that, although there is no law
that expressly prohibits the use of ISR, the facts alleged in the Amended
Information will show how the alleged crime was committed by conducting ISR, to
the damage and prejudice of PLDT.

Laurel filed a Motion for Reconsideration[17] of the Order, alleging that

international long distance calls are not personal property, and are not capable of
appropriation. He maintained that business or revenue is not considered personal
property, and that the prosecution failed to adduce proof of its existence and the
subsequent loss of personal property belonging to another. Citing the ruling of the
Court in United States v. De Guzman,[18] Laurel averred that the case is not one
with telephone calls which originate with a particular caller and terminates with the
called party. He insisted that telephone calls are considered privileged
communications under the Constitution and cannot be considered as the property
of PLDT. He further argued that there is no kinship between telephone calls and
electricity or gas, as the latter are forms of energy which are generated and
consumable, and may be considered as personal property because of such
characteristic. On the other hand, the movant argued, the telephone business is not
a form of energy but is an activity.

In its Order[19] dated December 11, 2001, the RTC denied the movants
Motion for Reconsideration. This time, it ruled that what was stolen from PLDT
was its business because, as alleged in the Amended Information, the international
long distance calls made through the facilities of PLDT formed part of its
business. The RTC noted that the movant was charged with stealing the business of
PLDT. To support its ruling, it cited Strochecker v. Ramirez,[20] where the Court
ruled that interest in business is personal property capable of appropriation. It
further declared that, through their ISR operations, the movant and his co-accused
deprived PLDT of fees for international long distance calls, and that the ISR used
by the movant and his co-accused was no different from the jumper used for
stealing electricity.
 Laurel then filed a Petition for Certiorari with the CA, assailing the Order of
the RTC. He alleged that the respondent judge gravely abused his discretion in
denying his Motion to Quash the Amended Information.[21] As gleaned from the
material averments of the amended information, he was charged with stealing the
international long distance calls belonging to PLDT, not its business. Moreover,
the RTC failed to distinguish between the business of PLDT (providing services
for international long distance calls) and the revenues derived therefrom. He
opined that a business or its revenues cannot be considered as personal property
under Article 308 of the Revised Penal Code, since a business is (1) a commercial
or mercantile activity customarily engaged in as a means of livelihood and
typically involving some independence of judgment and power of decision; (2) a
commercial or industrial enterprise; and (3) refers to transactions, dealings or
intercourse of any nature. On the other hand, the term revenue is defined as the
income that comes back from an investment (as in real or personal property); the
annual or periodical rents, profits, interests, or issues of any species of real or
personal property.[22]

Laurel further posited that an electric companys business is the production

and distribution of electricity; a gas companys business is the production and/or
distribution of gas (as fuel); while a water companys business is the production and
distribution of potable water. He argued that the business in all these cases is the
commercial activity, while the goods and merchandise are the products of such
activity. Thus, in prosecutions for theft of certain forms of energy, it is the
electricity or gas which is alleged to be stolen and not the business of providing
electricity or gas. However, since a telephone company does not produce any
energy, goods or merchandise and merely renders a service or, in the words of
PLDT, the connection and interconnection to their telephone lines/facilities, such
service cannot be the subject of theft as defined in Article 308 of the Revised Penal
Code.[23]

He further declared that to categorize business as personal property under

Article 308 of the Revised Penal Code would lead to absurd consequences; in
prosecutions for theft of gas, electricity or water, it would then be permissible to
allege in the Information that it is the gas business, the electric business or the
water business which has been stolen, and no longer the merchandise produced by
such enterprise.[24]

Laurel further cited the Resolution of the Secretary of Justice in Piltel v.

Mendoza,[25] where it was ruled that the Revised Penal Code, legislated as it was
before present technological advances were even conceived, is not adequate to
address the novel means of stealing airwaves or airtime. In said resolution, it was
noted that the inadequacy prompted the filing of Senate Bill 2379 (sic) entitled The
Anti-Telecommunications Fraud of 1997 to deter cloning of cellular phones and
other forms of communications fraud. The said bill aims to protect in number
(ESN) (sic) or Capcode, mobile identification number (MIN), electronic-
international mobile equipment identity (EMEI/IMEI), or subscriber identity
module and any attempt to duplicate the data on another cellular phone without the
consent of a public telecommunications entity would be punishable by
law.[26] Thus, Laurel concluded, there is no crime if there is no law punishing the
crime.

On August 30, 2002, the CA rendered judgment dismissing the

petition.[27] The appellate court ruled that a petition for certiorari under Rule 65 of
the Rules of Court was not the proper remedy of the petitioner. On the merits
of the petition, it held that while business is generally an activity

which is abstract and intangible in form, it is nevertheless considered property

under Article 308 of the Revised Penal Code. The CA opined that PLDTs business
of providing international calls is personal property which may be the object of
theft, and cited United States v. Carlos[28] to support such conclusion. The tribunal
also cited Strochecker v. Ramirez,[29] where this Court ruled that one-half interest
in a days business is personal property under Section 2 of Act No. 3952, otherwise
known as the Bulk Sales Law. The appellate court held that the operations of the
ISR are not subsumed in the charge for violation of P.D. No. 401.

Laurel, now the petitioner, assails the decision of the CA, contending that -
THE COURT OF APPEALS ERRED IN RULING THAT THE
PERSONAL PROPERTY ALLEGEDLY STOLEN PER THE INFORMATION
IS NOT THE INTERNATIONAL LONG DISTANCE CALLS BUT THE
BUSINESS OF PLDT.

THE COURT OF APPEALS ERRED IN RULING THAT THE TERM

BUSINESS IS PERSONAL PROPERTY WITHIN THE MEANING OF ART.
308 OF THE REVISED PENAL CODE.[30]

Petitioner avers that the petition for a writ of certiorari may be filed to
nullify an interlocutory order of the trial court which was issued with grave abuse
of discretion amounting to excess or lack of jurisdiction. In support of his petition
before the Court, he reiterates the arguments in his pleadings filed before the CA.
He further claims that while the right to carry on a business or an interest or
participation in business is considered property under the New Civil Code, the term
business, however, is not. He asserts that the Philippine Legislature, which
approved the Revised Penal Code way back in January 1, 1932, could not have
contemplated to include international long distance calls and business as personal
property under Article 308 thereof.

In its comment on the petition, the Office of the Solicitor General (OSG)
maintains that the amended information clearly states all the essential elements of
the crime of theft. Petitioners interpretation as to whether an international long
distance call is personal property under the law is inconsequential, as a reading of
the amended information readily reveals that specific acts and circumstances were
alleged charging Baynet, through its officers, including petitioner, of feloniously
taking, stealing and illegally using international long distance calls belonging to
respondent PLDT by conducting ISR operations, thus, routing and completing
international long distance calls using lines, cables, antenna and/or airwave
frequency which connect directly to the local or domestic exchange facilities of the
country where the call is destined. The OSG maintains that the international long
distance calls alleged in the amended information should be construed to mean
business of PLDT, which, while abstract and intangible in form, is personal
property susceptible of appropriation.[31] The OSG avers that what was stolen by
petitioner and his co-accused is the business of PLDT providing international long
distance calls which, though intangible, is personal property of the PLDT.[32]

For its part, respondent PLDT asserts that personal property under Article
308 of the Revised Penal Code comprehends intangible property such as electricity
and gas which are valuable articles for merchandise, brought and sold like other
personal property, and are capable of appropriation. It insists that the business of
international calls and revenues constitute personal property because the same are
valuable articles of merchandise. The respondent reiterates that international calls
involve (a) the intangible telephone services that are being offered by it, that is, the
connection and interconnection to the telephone network, lines or facilities; (b) the
use of its telephone network, lines or facilities over a period of time; and (c) the
income derived in connection therewith.[33]
PLDT further posits that business revenues or the income derived in
connection with the rendition of such services and the use of its telephone network,
lines or facilities are personal properties under Article 308 of the Revised Penal
Code; so is the use of said telephone services/telephone network, lines or facilities
which allow electronic voice signals to pass through the same and ultimately to the
called partys number. It is akin to electricity which, though intangible property,
may nevertheless be appropriated and can be the object of theft. The use of
respondent PLDTs telephone network, lines, or facilities over a period of time for
consideration is the business that it provides to its customers, which enables the
latter to send various messages to intended recipients. Such use over a period of
time is akin to merchandise which has value and, therefore, can be appropriated by
another. According to respondent PLDT, this is what actually happened when
petitioner Laurel and the other accused below conducted illegal ISR operations.[34]
The petition is meritorious.

The issues for resolution are as follows: (a) whether or not the petition
for certiorari is the proper remedy of the petitioner in the Court of Appeals; (b)
whether or not international telephone calls using Bay Super Orient Cards through
the telecommunication services provided by PLDT for such calls, or, in short,
PLDTs business of providing said telecommunication services, are proper subjects
of theft under Article 308 of the Revised Penal Code; and (c) whether or not the
trial court committed grave abuse of discretion amounting to excess or lack of
jurisdiction in denying the motion of the petitioner to quash the amended
information.

On the issue of whether or not the petition for certiorari instituted by the
petitioner in the CA is proper, the general rule is that a petition for certiorari under
Rule 65 of the Rules of Court, as amended, to nullify an order denying a motion to
quash the Information is inappropriate because the aggrieved party has a remedy of
appeal in the ordinary course of law. Appeal and certiorari are mutually exclusive
of each other. The remedy of the aggrieved party is to continue with the case in due
course and, when an unfavorable judgment is rendered, assail the order and the
decision on appeal. However, if the trial court issues the order denying the motion
to quash the Amended Information with grave abuse of discretion amounting to
excess or lack of jurisdiction, or if such order is patently erroneous, or null and
void for being contrary to the Constitution, and the remedy of appeal would not
afford adequate and expeditious relief, the accused may resort to the extraordinary
remedy of certiorari.[35]A special civil action for certiorari is also available where
there are special circumstances clearly demonstrating the inadequacy of an
appeal. As this Court held in Bristol Myers Squibb (Phils.), Inc. v. Viloria:[36]

Nonetheless, the settled rule is that a writ of certiorari may be granted in

cases where, despite availability of appeal after trial, there is at least a prima
facie showing on the face of the petition and its annexes that: (a) the trial court
issued the order with grave abuse of discretion amounting to lack of or in excess
of jurisdiction; (b) appeal would not prove to be a speedy and adequate remedy;
(c) where the order is a patent nullity; (d) the decision in the present case will
arrest future litigations; and (e) for certain considerations such as public welfare
and public policy.[37]
 In his petition for certiorari in the CA, petitioner averred that the trial court
committed grave abuse of its discretion amounting to excess or lack of jurisdiction
when it denied his motion to quash the Amended Information despite his claim that
the material allegations in the Amended Information do not charge theft under
Article 308 of the Revised Penal Code, or any offense for that matter. By so doing,
the trial court deprived him of his constitutional right to be informed of the nature
of the charge against him. He further averred that the order of the trial court is
contrary to the constitution and is, thus, null and void. He insists that he should not
be compelled to undergo the rigors and tribulations of a protracted trial and incur
expenses to defend himself against a non-existent charge.

Petitioner is correct.

An information or complaint must state explicitly and directly every act or

omission constituting an offense[38] and must allege facts establishing conduct that
a penal statute makes criminal;[39] and describes the property which is the subject
of theft to advise the accused with reasonable certainty of the accusation he is
called upon to meet at the trial and to enable him to rely on the judgment
thereunder of a subsequent prosecution for the same offense.[40] It must show, on
its face, that if the alleged facts are true, an offense has been committed. The rule is
rooted on the constitutional right of the accused to be informed of the nature of the
crime or cause of the accusation against him. He cannot be convicted of an offense
even if proven unless it is alleged or necessarily included in the Information filed
against him.

As a general prerequisite, a motion to quash on the ground that the

Information does not constitute the offense charged, or any offense for that matter,
should be resolved on the basis of said allegations whose truth and veracity are
hypothetically committed;[41] and on additional facts admitted or not denied by the
prosecution.[42] If the facts alleged in the Information do not constitute an offense,
the complaint or information should be quashed by the court.[43]

We have reviewed the Amended Information and find that, as mentioned by

the petitioner, it does not contain material allegations charging the petitioner of
theft of personal property under Article 308 of the Revised Penal Code. It, thus,
behooved the trial court to quash the Amended Information. The Order of the trial
court denying the motion of the petitioner to quash the Amended Information is a
patent nullity.

On the second issue, we find and so hold that the international telephone
calls placed by Bay Super Orient Card holders, the telecommunication services
provided by PLDT and its business of providing said services are not personal
properties under Article 308 of the Revised Penal Code. The construction by the
respondents of Article 308 of the said Code to include, within its coverage, the
aforesaid international telephone calls, telecommunication services and business is
contrary to the letter and intent of the law.

The rule is that, penal laws are to be construed strictly. Such rule is founded
on the tenderness of the law for the rights of individuals and on the plain principle
that the power of punishment is vested in Congress, not in the judicial
department. It is Congress, not the Court, which is to define a crime, and ordain its
punishment.[44] Due respect for the prerogative of Congress in defining
crimes/felonies constrains the Court to refrain from a broad interpretation of penal
laws where a narrow interpretation is appropriate. The Court must take heed to
language, legislative history and purpose, in order to strictly determine the wrath
and breath of the conduct the law forbids.[45] However, when the congressional
purpose is unclear, the court must apply the rule of lenity, that is, ambiguity
concerning the ambit of criminal statutes should be resolved in favor of lenity. [46]

Penal statutes may not be enlarged by implication or intent beyond the fair
meaning of the language used; and may not be held to include offenses other than
those which are clearly described, notwithstanding that the Court may think that
Congress should have made them more comprehensive.[47] Words and phrases in a
statute are to be construed according to their common meaning and accepted usage.

As Chief Justice John Marshall declared, it would be dangerous,

indeed, to carry the principle that a case which is within the reason or

mischief of a statute is within its provision, so far as to punish a crime not

enumerated in the statute because it is of equal atrocity, or of kindred character
with those which are enumerated.[48] When interpreting a criminal statute that does
not explicitly reach the conduct in question, the Court should not base an
expansive reading on inferences from subjective and variable understanding.[49]

Article 308 of the Revised Penal Code defines theft as follows:

 Art. 308. Who are liable for theft. Theft is committed by any person who,
with intent to gain but without violence, against or intimidation of persons nor
force upon things, shall take personal property of another without the latters
consent.

The provision was taken from Article 530 of the Spanish Penal Code which
reads:
1. Los que con nimo de lucrarse, y sin violencia o intimidacin en las
personas ni fuerza en las cosas, toman las cosas muebles ajenas sin la voluntad
de su dueo.[50]

For one to be guilty of theft, the accused must have an intent to steal (animus
furandi) personal property, meaning the intent to deprive another of his
ownership/lawful possession of personal property which intent is apart from and
concurrently with the general criminal intent which is an essential element of a
felony of dolo (dolus malus).

An information or complaint for simple theft must allege the following

elements: (a) the taking of personal property; (b) the said property belongs to
another; (c) the taking be done with intent to gain; and (d) the taking be
accomplished without the use of violence or intimidation of person/s or force upon
things.[51]

One is apt to conclude that personal property standing alone, covers both
tangible and intangible properties and are subject of theft under the Revised Penal
Code. But the words Personal property under the Revised Penal Code must be
considered in tandem with the word take in the law. The statutory definition of
taking and movable property indicates that, clearly, not all personal properties may
be the proper subjects of theft. The general rule is that, only movable properties
which have physical or material existence and susceptible of occupation by another
are proper objects of theft.[52] As explained by Cuelo Callon: Cosa juridicamente es
toda sustancia corporal, material, susceptible de ser aprehendida que tenga un
valor cualquiera.[53]

According to Cuello Callon, in the context of the Penal Code, only those
movable properties which can be taken and carried from the place they are found
are proper subjects of theft. Intangible properties such as rights and ideas are not
subject of theft because the same cannot be taken from the place it is found and is
occupied or appropriated.
 Solamente las cosas muebles y corporales pueden ser objeto de hurto. La
sustraccin de cosas inmuebles y la cosas incorporales (v. gr., los derechos, las
ideas) no puede integrar este delito, pues no es posible asirlas, tomarlas, para
conseguir su apropiacin. El Codigo emplea la expresin cosas mueble en el
sentido de cosa que es susceptible de ser llevada del lugar donde se encuentra,
como dinero, joyas, ropas, etctera, asi que su concepto no coincide por completo
con el formulado por el Codigo civil (arts. 335 y 336).[54]

Thus, movable properties under Article 308 of the Revised Penal Code
should be distinguished from the rights or interests to which they relate. A naked
right existing merely in contemplation of law, although it may be very valuable to
the person who is entitled to exercise it, is not the subject of theft or
larceny.[55] Such rights or interests are intangible and cannot be taken by another.
Thus, right to produce oil, good will or an interest in business, or the right to
engage in business, credit or franchise are properties. So is the credit line
represented by a credit card. However, they are not proper subjects of theft or
larceny because they are without form or substance, the mere breath of the
Congress. On the other hand, goods, wares and merchandise of businessmen and
credit cards issued to them are movable properties with physical and material
existence and may be taken by another; hence, proper subjects of theft.

There is taking of personal property, and theft is consummated when the

offender unlawfully acquires possession of personal property even if for a short
time; or if such property is under the dominion and control of the thief. The taker,
at some particular amount, must have obtained complete and absolute possession
and control of the property adverse to the rights of the owner or the lawful
possessor thereof.[56] It is not necessary that the property be actually carried away
out of the physical possession of the lawful possessor or that he should have made
his escape with it.[57] Neither asportation nor actual manual possession of property
is required. Constructive possession of the thief of the property is enough.[58]

The essence of the element is the taking of a thing out of the possession of
the owner without his privity and consent and without animus revertendi.[59]

Taking may be by the offenders own hands, by his use of innocent persons
without any felonious intent, as well as any mechanical device, such as an access
device or card, or any agency, animate or inanimate, with intent to gain. Intent to
gain includes the unlawful taking of personal property for the purpose of deriving
utility, satisfaction, enjoyment and pleasure.[60]
 We agree with the contention of the respondents that intangible properties
such as electrical energy and gas are proper subjects of theft. The reason for this is
that, as explained by this Court in United States v. Carlos[61] and United States v.
Tambunting,[62] based on decisions of the Supreme Court of Spain and of the courts
in England and the United States of America, gas or electricity are capable of
appropriation by another other than the owner. Gas and electrical energy may be
taken, carried away and appropriated. In People v. Menagas,[63] the Illinois State
Supreme Court declared that electricity, like gas, may be seen and felt. Electricity,
the same as gas, is a valuable article of merchandise, bought and sold like other
personal property and is capable of appropriation by another. It is a valuable
article of merchandise, bought and sold like other personal property, susceptible of
being severed from a mass or larger quantity and of being transported from
place to place.Electrical energy may, likewise, be taken and carried away. It is a
valuable commodity, bought and sold like other personal property. It may be
transported from place to place. There is nothing in the nature of gas used for
illuminating purposes which renders it incapable of being feloniously taken and
carried away.

In People ex rel Brush Electric Illuminating Co. v. Wemple,[64] the Court of

Appeals of New York held that electric energy is manufactured and sold in
determinate quantities at a fixed price, precisely as are coal, kerosene oil, and
gas. It may be conveyed to the premises of the consumer, stored in cells of
different capacity known as an accumulator; or it may be sent through a wire, just
as gas or oil may be transported either in a close tank or forced through a pipe.
Having reached the premises of the consumer, it may be used in any way he may
desire, being, like illuminating gas, capable of being transformed either into heat,
light, or power, at the option of the purchaser. In Woods v. People,[65] the Supreme
Court of Illinois declared that there is nothing in the nature of gas used for
illuminating purposes which renders it incapable of being feloniously taken and
carried away. It is a valuable article of merchandise, bought and sold like other
personal property, susceptible of being severed from a mass or larger quantity
and of being transported from place to place.

Gas and electrical energy should not be equated with business or services
provided by business entrepreneurs to the public. Business does not have an exact
definition. Business is referred as that which occupies the time, attention and labor
of men for the purpose of livelihood or profit. It embraces everything that which a
person can be employed.[66] Business may also mean employment, occupation or
profession. Business is also defined as a commercial activity for gain benefit or
advantage.[67] Business, like services in business, although are properties, are not
proper subjects of theft under the Revised Penal Code because the same cannot be
taken or occupied. If it were otherwise, as claimed by the respondents, there would
be no juridical difference between the taking of the business of a person or the
services provided by him for gain, vis--vis, the taking of goods, wares or
merchandise, or equipment comprising his business.[68] If it was its intention to
include business as personal property under Article 308 of the Revised Penal Code,
the Philippine Legislature should have spoken in language that is clear and
definite: that business is personal property under Article 308 of the Revised Penal
Code.[69]
We agree with the contention of the petitioner that, as gleaned from the
material averments of the Amended Information, he is charged of stealing the
international long distance calls belonging to PLDT and the use thereof, through
the ISR. Contrary to the claims of the OSG and respondent PLDT, the petitioner is
not charged of stealing P20,370,651.95 from said respondent. Said amount
of P20,370,651.95 alleged in the Amended Information is the aggregate amount of
access, transmission or termination charges which the PLDT expected from the
international long distance calls of the callers with the use of Baynet Super Orient
Cards sold by Baynet Co. Ltd.

In defining theft, under Article 308 of the Revised Penal Code, as the taking
of personal property without the consent of the owner thereof, the Philippine
legislature could not have contemplated the human voice which is converted into
electronic impulses or electrical current which are transmitted to the party called
through the PSTN of respondent PLDT and the ISR of Baynet Card Ltd. within its
coverage. When the Revised Penal Code was approved, on December 8, 1930,
international telephone calls and the transmission and routing of electronic voice
signals or impulses emanating from said calls, through the PSTN, IPL and ISR,
were still non-existent. Case law is that, where a legislative history fails to
evidence congressional awareness of the scope of the statute claimed by the
respondents, a narrow interpretation of the law is more consistent with the usual
approach to the construction of the statute. Penal responsibility cannot be extended
beyond the fair scope of the statutory mandate.[70]

Respondent PLDT does not acquire possession, much less, ownership of the
voices of the telephone callers or of the electronic voice signals or current
emanating from said calls. The human voice and the electronic voice signals or
current caused thereby are intangible and not susceptible of possession, occupation
or appropriation by the respondent PLDT or even the petitioner, for that matter.
PLDT merely transmits the electronic voice signals through its facilities and
equipment. Baynet Card Ltd., through its operator, merely intercepts, reroutes the
calls and passes them to its toll center. Indeed, the parties called receive the
telephone calls from Japan.

In this modern age of technology, telecommunications systems have become so

tightly merged with computer systems that it is difficult to know where one starts
and the other finishes. The telephone set is highly computerized and allows
computers to communicate across long distances.[71] The instrumentality at issue in
this case is not merely a telephone but a telephone inexplicably linked to a
computerized communications system with the use of Baynet Cards sold by the
Baynet Card Ltd. The corporation uses computers, modems and software, among
others, for its ISR.[72]

The conduct complained of by respondent PLDT is reminiscent of phreaking (a

slang term for the action of making a telephone system to do something that it
normally should not allow by making the phone company bend over and grab its
ankles). A phreaker is one who engages in the act of manipulating phones and
illegally markets telephone services.[73] Unless the phone company replaces all its
hardware, phreaking would be impossible to stop. The phone companies in North
America were impelled to replace all their hardware and adopted full digital
switching system known as the Common Channel Inter Office
Signaling. Phreaking occurred only during the 1960s and 1970s, decades after the
Revised Penal Code took effect.

The petitioner is not charged, under the Amended Information, for theft of
telecommunication or telephone services offered by PLDT. Even if he is, the term
personal property under Article 308 of the Revised Penal Code cannot be
interpreted beyond its seams so as to include telecommunication or telephone
services or computer services for that matter. The word service has a variety of
meanings dependent upon the context, or the sense in which it is used; and, in
some instances, it may include a sale. For instance, the sale of food by restaurants
is usually referred to as service, although an actual sale is involved. [74] It may also
mean the duty or labor to be rendered by one person to another; performance of
labor for the benefit of another.[75] In the case of PLDT, it is to render local and
international telecommunications services and such other services as authorized by
the CPCA issued by the NTC. Even at common law, neither time nor services may
be taken and occupied or appropriated.[76] A service is generally not considered
property and a theft of service would not, therefore, constitute theft since there can
be no caption or asportation.[77] Neither is the unauthorized use of the equipment
and facilities of PLDT by the petitioner theft under the aforequoted provision of
the Revised Penal Code.[78]
 If it was the intent of the Philippine Legislature, in 1930, to include services
to be the subject of theft, it should have incorporated the same in Article 308 of the
Revised Penal Code. The Legislature did not. In fact, the Revised Penal Code does
not even contain a definition of services.

If taking of telecommunication services or the business of a person, is to be

proscribed, it must be by special statute[79] or an amendment of the Revised Penal
Code. Several states in the United States, such as New York, New
Jersey, Californiaand Virginia, realized that their criminal statutes did not contain
any provisions penalizing the theft of services and passed laws defining and
penalizing theft of telephone and computer services. The Pennsylvania Criminal
Statute now penalizes theft of services, thus:
(a) Acquisition of services. --

(1) A person is guilty of theft if he intentionally obtains services for

himself or for another which he knows are available only for compensation, by
deception or threat, by altering or tampering with the public utility meter or
measuring device by which such services are delivered or by causing or
permitting such altering or tampering, by making or maintaining any unauthorized
connection, whether physically, electrically or inductively, to a distribution or
transmission line, by attaching or maintaining the attachment of any unauthorized
device to any cable, wire or other component of an electric, telephone or cable
television system or to a television receiving set connected to a cable television
system, by making or maintaining any unauthorized modification or alteration to
any device installed by a cable television system, or by false token or other trick
or artifice to avoid payment for the service.

In the State of Illinois in the United States of America, theft of labor or

services or use of property is penalized:

(a) A person commits theft when he obtains the temporary use of property,
labor or services of another which are available only for hire, by means of threat
or deception or knowing that such use is without the consent of the person
providing the property, labor or services.
In 1980, the drafters of the Model Penal Code in the United States of
America arrived at the conclusion that labor and services, including professional
services, have not been included within the traditional scope of the term property
in ordinary theft statutes. Hence, they decided to incorporate in the Code Section
223.7, which defines and penalizes theft of services, thus:
 (1) A person is guilty of theft if he purposely obtains services which he
knows are available only for compensation, by deception or threat, or by false
token or other means to avoid payment for the service. Services include labor,
professional service, transportation, telephone or other public service,
accommodation in hotels, restaurants or elsewhere, admission to exhibitions, use
of vehicles or other movable property. Where compensation for service is
ordinarily paid immediately upon the rendering of such service, as in the case of
hotels and restaurants, refusal to pay or absconding without payment or offer to
pay gives rise to a presumption that the service was obtained by deception as to
intention to pay; (2) A person commits theft if, having control over the disposition
of services of others, to which he is not entitled, he knowingly diverts such
services to his own benefit or to the benefit of another not entitled thereto.

Interestingly, after the State Supreme Court of Virginia promulgated its

decision in Lund v. Commonwealth,[80] declaring that neither time nor services may
be taken and carried away and are not proper subjects of larceny, the General
Assembly of Virginia enacted Code No. 18-2-98 which reads:
Computer time or services or data processing services or information or
data stored in connection therewith is hereby defined to be property which may be
the subject of larceny under 18.2-95 or 18.2-96, or embezzlement under 18.2-111,
or false pretenses under 18.2-178.

In the State of Alabama, Section 13A-8-10(a)(1) of the Penal Code of

Alabama of 1975 penalizes theft of services:

A person commits the crime of theft of services if: (a) He intentionally

obtains services known by him to be available only for compensation by
deception, threat, false token or other means to avoid payment for the services

In the Philippines, Congress has not amended the Revised Penal Code to
include theft of services or theft of business as felonies. Instead, it approved a law,
Republic Act No. 8484, otherwise known as the Access Devices Regulation Act of
1998, on February 11, 1998. Under the law, an access device means any card,
plate, code, account number, electronic serial number, personal identification
number and other telecommunication services, equipment or instrumentalities-
identifier or other means of account access that can be used to obtain money,
goods, services or any other thing of value or to initiate a transfer of funds other
than a transfer originated solely by paper instrument. Among the prohibited acts
enumerated in Section 9 of the law are the acts of obtaining money or anything of
value through the use of an access device, with intent to defraud or intent to gain
and fleeing thereafter; and of effecting transactions with one or more access
devices issued to another person or persons to receive payment or any other thing
of value. Under Section 11 of the law, conspiracy to commit access devices fraud
is a crime. However, the petitioner is not charged of violation of R.A. 8484.

Significantly, a prosecution under the law shall be without prejudice to any

liability for violation of any provisions of the Revised Penal Code inclusive of theft
under Rule 308 of the Revised Penal Code and estafa under Article 315 of the
Revised Penal Code. Thus, if an individual steals a credit card and uses the same to
obtain services, he is liable of the following: theft of the credit card under Article
308 of the Revised Penal Code; violation of Republic Act No. 8484;
and estafa under Article 315(2)(a) of the Revised Penal Code with the service
provider as the private complainant. The petitioner is not charged of estafa before
the RTC in the Amended Information.

Section 33 of Republic Act No. 8792, Electronic Commerce Act of 2000

provides:
Sec. 33. Penalties. The following Acts shall be penalized by fine and/or
imprisonment, as follows:

a) Hacking or cracking which refers to unauthorized access into or

interference in a computer system/server or information and communication
system; or any access in order to corrupt, alter, steal, or destroy using a computer
or other similar information and communication devices, without the knowledge
and consent of the owner of the computer or information and communications
system, including the introduction of computer viruses and the like, resulting on
the corruption, destruction, alteration, theft or loss of electronic data messages or
electronic documents shall be punished by a minimum fine of One hundred
thousand pesos (P100,000.00) and a maximum commensurate to the damage
incurred and a mandatory imprisonment of six (6) months to three (3) years.

IN LIGHT OF ALL THE FOREGOING, the petition is GRANTED. The

assailed Orders of the Regional Trial Court and the Decision of the Court of
Appeals are REVERSED and SET ASIDE. The Regional Trial Court is directed
to issue an order granting the motion of the petitioner to quash the Amended
Information.

SO ORDERED.