BP 22

1. https://www.lawphil.net/judjuris/juri2000/nov2000/gr_140665_2000.html
2. https://lawphil.net/judjuris/juri1997/jun1997/gr_119178_1997.html
3. https://lawphil.net/judjuris/juri2004/mar2004/gr_150792_2004.html

G.R. No. 140665 November 13, 2000

VICTOR TING "SENG DEE" and EMILY CHAN-AZAJAR, petitioners,

vs.
COURT OF APPEALS and PEOPLE OF THE PHILIPPINES, respondents.

MELO, J.:

Before us is a petition for certiorari under Rule 45 seeking the reversal of the February 12, 1999
decision of the Court of Appeals which affirmed that of the Regional Trial Court of the National
Capital Judicial Region (Manila, Branch 45) finding petitioners guilty of seven (7) counts of violation
of Batas Pambansa Blg. 22.

Petitioners' version of the background events is as follows:

From 1991 to 1992, Juliet Ting "Chan Sioc Hiu" obtained loans, in the aggregate amount of
P2,750,000.00, from private complainant Josefina K. Tagle for use in Juliet's furniture business. As
payment thereof, Juliet issued eleven (11) post-dated checks which, upon maturity, were dishonored
for reasons of "Closed Account" or "Drawn Against Insufficient Funds." Juliet was subsequently
prosecuted for violation of Batas Pambansa Blg. 22.

Due to her financial difficulties, Juliet requested her husband Victor Ting "Seng Dee" and her sister
Emily Chan-Azajar (petitioners herein) to take over her furniture business, including the obligations
appurtenant thereto. Agreeing to Juliet's request, petitioners issued nineteen (19) checks in
replacement of the eleven (11) checks earlier issued by Juliet. The planned take-over, however,
never materialized since the Naga Hope Christian School, petitioner Emily Chan-Azajar's employer
in Naga, refused to let her resign to attend to her sister's business. Since the planned take-over did
not take place, petitioners requested Juliet to reassume her obligation to private complainant Tagle
by replacing the checks they had previously issued to the latter. Thus, Juliet replaced the nineteen
(19) checks issued by petitioners with twenty-three (23) Far East Bank checks in favor of Tagle.
Petitioners then requested private complainant Tagle to return the nineteen (19) checks they had
issued to her. Instead of returning the checks, Tagle deposited seven of the checks with MetroBank
where they were dishonored for being "Drawn Against Insufficient Funds."

On the other hand, private complainant Tagle alleged that sometime in April 1993, petitioners
obtained a loan of P950,000.00 from her, issuing several post-dated checks in payment thereof.
When the checks were deposited by Tagle with MetroBank, they were dishonored for having been
drawn against insufficient funds. Tagle alleged that despite verbal and written demands, petitioners
failed to pay her the value of the dishonored checks.

Consequently, seven informations for violation of Batas Pambansa Blg. 22 were filed against
petitioners. Said informations are similarly worded except with respect to the check number, the
amount involved, and the date the check was issued. The information in Criminal Case No. 94-
131945 (the other cases are Criminal Case No. 94-131946, Criminal Case No. 94-131947, Criminal
Case No. 94-131948, Criminal Case No. 94-131949, Criminal Case No. 94-131950, and Criminal
Case No. 94-131951) charged:

That sometime prior to May 27, 1993, in the City of Manila, Philippines, the said accused,
conspiring and confederating together and mutually helping each other, did then and there
wilfully, unlawfully and feloniously make or draw and issue to JOSEPHINE K. TAGLE, to
apply on account or for value Producers Bank of the Philippines, Check No. 946072 dated
May 27, 1993 payable to CASH in the amount of P250,000.00 said accused well knowing
that at the time of issue they did not have sufficient funds in or credit with the drawee bank
for payment of such check in full upon its presentment, which check when presented for
payment within ninety (90) days from the date thereof, was subsequently dishonored by the
drawee bank for Drawn Against Insufficient Funds and despite receipt of notice of such
dishonor, said accused failed to pay said JOSEFINA K. TAGLE the amount of the check or
to make arrangements for full payment of the same within five (5) banking days after
receiving said notice.

(p. 2, Original Records.)

Criminal Cases No. 94-131945 to 94-131951 were consolidated and jointly tried. When arraigned,
petitioners, assisted by counsel, pleaded not guilty. During trial, the prosecution presented only one
witness, the private complainant, the testimony of Producer's Bank representative Ferdinand Lazo
being dispensed with after counsel for petitioners admitted the dishonor of the checks subject matter
of the action.

On March 16, 1995, the trial court found petitioners guilty of violating Batas Pambansa Blg. 22 in
each of the seven cases, disposing as follows:

WHEREFORE, in view of the foregoing, accused VICTOR TING and EMILY CHAN AZAJAR
are hereby found "GUILTY" beyond reasonable doubt of all the charges contained in
Criminal Case Nos. 94-131945; 94-131946; 94-131947; 94-131948; 94-131949; 94-131950
and 94-131951 and for each count, they are hereby sentenced to suffer the penalty of one
(1) year imprisonment; to pay Josefina K. Tagle the total amount of P950,000.00; and to pay
the cost.

(p. 294, Rollo.)

Aggrieved, petitioners filed an appeal with the Court of Appeals which was docketed therein as C.A.-
G.R. No. 18054. However, the appellate court, on February 12, 1999, affirmed. Petitioners' motion
for reconsideration was, likewise, denied for lack of merit. Hence, the instant petition.

Petitioners claim that the Court of Appeals erred in affirming the decision of the trial court, given the
absence of proof beyond reasonable doubt or in the presence of facts creating reasonable doubt.

The petition has merit.

Section 1 of Batas Pambansa Blg. 22, otherwise known as the Bouncing Checks Law, provides:

Section 1. Checks without sufficient funds. — Any person who makes or draws and issues
any check to apply on account or for value, knowing at the time of issue that he does not
have sufficient funds in or credit with the drawee bank for the payment of such check in full
upon its presentment, which check is subsequently dishonored by the drawee bank for
 insufficiency of funds or credit or would have been dishonored for the same reason had not
the drawer, without any valid reason, ordered the bank to stop payment, shall be punished
by imprisonment of not less than thirty days but not more than one (1) year or by a fine of not
less than but not more double the amount of the check which fine shall in no case exceed
Two hundred thousand pesos, or both such fine and imprisonment at the discretion of the
court.

The same penalty shall be imposed upon any person who having sufficient funds in or credit
with the drawee bank when he makes or draws and issues a check, shall fail to keep
sufficient funds or to maintain a credit to cover the full amount of the check if presented
within a period of ninety (90) days from the date appearing thereon, for which reason it is
dishonored by the drawee bank.

Where the check is drawn by a corporation, company or entity, the person or persons who
actually signed the check in behalf of such drawer shall be liable under this Act.

For a violation of Batas Pambansa Blg. 22 to be committed, the following elements must be
present:

(1) the making, drawing, and issuance of any check to apply for account or for value;

(2) the knowledge of the maker, drawer, or issuer that at the time of issue there are no
sufficient funds in or credit with the drawee bank for the payment of such check in full upon is
presentment; and

(3) the subsequent dishonor of the check by the drawee bank for insufficiency of funds or
credit or dishonor for the same reason had not the drawer, without any valid cause, ordered
the bank to stop payment (Sycip, Jr. vs. CA, G.R. No. 125059, March 17, 2000).

An analysis of the evidence presented, however, shows that not all the aforementioned elements
have been established by the prosecution beyond reasonable doubt.

That the seven checks in question were issued by petitioners is beyond dispute. Not only were the
dishonored checks presented in court, but petitioners even admitted signing the checks and issuing
them to private complainant. From the evidence on record, it is clear that petitioners signed and
issued the seven checks in question.

That the checks were dishonored is also clearly established. Section 3 of Batas Pambansa Blg. 22
provides that "the introduction in evidence of any unpaid and dishonored check, having the drawee's
refusal to pay stamped or written thereon, or attached thereto, with the reason therefor as aforesaid,
shall be prima facie evidence of the making or issuance of said check, and the due presentment to
the drawee for payment and the dishonor thereof, and that the same was properly dishonored for the
reason written, stamped, or attached by the drawee on such dishonored check." In the instant case,
the fact of the checks' dishonor is sufficiently shown by the return slips issued by MetroBank, the
depository bank, stating that the checks had been returned for the reason "DAIF — Drawn Against
Insufficient Funds." Not only are these check return slips prima facie evidence that the drawee bank
dishonored the checks, but the defense did not present any evidence to rebut these documents. In
fact, counsel for petitioners even admitted the fact of the checks' dishonor, agreeing to dispense with
the presentation of the bank representative who was supposed to prove the fact of dishonor of said
checks (p. 162, Rollo.).
However, for liability to attach under Batas Pambansa Blg. 22, it is not enough that the prosecution
establishes that a check was issued and that the same was subsequently dishonored. The
prosecution must also prove the second element, that is, it must further show that the issuer, at the
time of the check's issuance, had knowledge that he did not have enough funds or credit in the bank
for payment thereof upon its presentment. Since the second element involves a state of mind which
is difficult to verify, Section 2 of Batas Pambansa Blg. 22 creates a presumption juris tantum that the
second element prima facie exists when the first and third elements of the offense are present
(Magno v. People, 210 SCRA 471 [1992]). Section 2 provides:

Section 2. Evidence of knowledge of insufficient funds.— The making, drawing, and issuance
of a check payment of which is refused by the drawee because of insufficient funds or credit
with such bank, when presented within ninety days from the date of the check, shall be prima
facie evidence of knowledge of such insufficiency of funds or credit unless such maker or
drawer pays the holder thereof the amount due thereon, or makes arrangements for payment
in full by the drawee of such check within five (5) banking days after receiving notice that
such check has not been paid by the drawee."

In truth, this Court declared in King v. People (G.R. No. 131540, December 2, 1999) that "the prima
facie presumption arises when the check is issued. But the law also provides that the presumption
does not arise when the issuer pays the amount of the check or makes arrangement for its payment
'within five banking days after receiving notice that such check has not been paid by the drawee.'
Verily, BP 22 gives the accused an opportunity to satisfy the amount indicated in the check and thus
avert prosecution… This opportunity, however, can be used only upon receipt by the accused of a
notice of dishonor." Thus, the presumption that the issuer had knowledge of the insufficiency of
funds is brought into existence only after it is proved that the issuer had received a notice of
dishonorand that, within five days from receipt thereof, he failed to pay the amount of the check or to
make arrangement for its payment.

King v. People, decided by this Division, involves a set of facts similar to the case at bar. In said
case, the accused therein was proven to have issued eleven checks, all of which were duly filled up
and signed by her. It was also clearly established that these eleven checks were dishonored, as
shown by the checks themselves which were stamped "ACCOUNT CLOSED" and further supported
by the return tickets issued by PCI Bank stating that the checks had been dishonored. Yet, even if
the prosecution had already established the issuance of the checks and their subsequent dishonor,
this Court still required the prosecution to show that the issuer knew of the insufficiency of funds by
proving that he or she received a notice of dishonor and, within five banking days thereafter, failed to
satisfy the amount of the check or make arrangement for its payment.

Moreover, in Lina Lim Lao v. CA (274 SCRA 572 [1997]), we emphasized that "the full payment of
the amount appearing in the check within five banking days from notice of dishonor is a 'complete
defense.' The absence of a notice of dishonor necessarily deprives an accused an opportunity to
preclude a criminal prosecution. Accordingly, procedural due process clearly enjoins that a notice of
dishonor be actually served on petitioner. Petitioner has a right to demand — and the basic postulate
of fairness require — that the notice of dishonor be actually sent to and received by her to afford her
the opportunity to avert prosecution under BP 22."

To prove that petitioners received a notice of dishonor, the prosecution presented a copy of the
demand letter allegedly sent to petitioners through registered mail and its corresponding registry
receipt. Private complainant Josefina Tagle, the sole witness for the prosecution, testified thus:

Q: Now, when these seven (7) checks bounced for insufficiency of funds, what step
did you take?
A: I demanded the return of my money from them.

Q: Now, what was the reply of the two accused?

A: They kept on promising that they will pay but up to now they have not paid any
single centavo.

Q: What other step did you take?

A: I requested my lawyer to write a demand letter.

Q: And that demand letter was sent to the accused?

A: Yes, Sir.

Q: In what manner?

A: By registered mail.

Q: Now, was that demand letter received by the two accused?

A: Yes, Sir.

Q: What is your evidence?

A: The return card.

Q: If you are shown anew the copy of the demand letter which is already marked as
Exhibit B, would you be able to recognize the same?

A: Yes, Sir.

Q: Is that the one that you are referring to?

A: Yes, Sir.

Q: How about the return card, is that correct?

A: Yes, Sir, this is the one.

Q: Now, upon receipt of this letter by the two accused, did the two accused pay the
amount of the said check?

A: No, Sir.

Q: So what did you do next?

A: I told my lawyer to file charges against them.

Q: You mean the present charge?

 A: Yes, Sir.

Atty. Acuesta:

That is all, Your Honor.

(TSN, Aug. 24, 1994, p. 8-9.)

Aside from the above testimony, no other reference was made to the demand letter by the
prosecution. As can be noticed from the above exchange, the prosecution alleged that the demand
letter had been sent by mail. To prove mailing, it presented a copy of the demand letter as well as
the registry return receipt. However, no attempt was made to show that the demand letter was
indeed sent through registered mail nor was the signature on the registry return receipt
authenticated or identified. It cannot even be gleaned from the testimony of private complainant as to
who sent the demand letter and when the same was sent. In fact, the prosecution seems to have
presumed that the registry return receipt was proof enough that the demand letter was sent through
registered mail and that the same was actually received by petitioners or their agents.

As adverted to earlier, it is necessary in cases for violation of Batas Pambansa Blg. 22, that the
prosecution prove that the issuer had received a notice of dishonor. It is a general rule that when
service of notice is an issue, the person alleging that the notice was served must prove the fact of
service (58 Am Jur 2d, Notice, § 45). The burden of proving notice rests upon the party asserting its
existence. Now, ordinarily, preponderance of evidence is sufficient to prove notice. In criminal cases,
however, the quantum of proof required is proof beyond reasonable doubt. Hence, for Batas
Pambansa Blg. 22 cases, there should be clear proof of notice. Moreover, it is a general rule that,
when service of a notice is sought to be made by mail, it should appear that the conditions on which
the validity of such service depends had existence, otherwise the evidence is insufficient to establish
the fact of service (C.J.S., Notice, § 18). In the instant case, the prosecution did not present proof
that the demand letter was sent through registered mail, relying as it did only on the registry return
receipt. In civil cases, service made through registered mail is proved by the registry receipt issued
by the mailing office and an affidavit of the person mailing of facts showing compliance with Section
7 of Rule 13 (See Section 13, Rule 13, 1997 Rules of Civil Procedure). If, in addition to the registry
receipt, it is required in civil cases that an affidavit of mailing as proof of service be presented, then
with more reason should we hold in criminal cases that a registry receipt alone is insufficient as proof
of mailing. In the instant case, the prosecution failed to present the testimony, or at least the
affidavit, of the person mailing that, indeed, the demand letter was sent.

Moreover, petitioners, during the pre-trial, denied having received the demand letter (p. 135, Rollo.).
Given petitioners' denial of receipt of the demand letter, it behooved the prosecution to present proof
that the demand letter was indeed sent through registered mail and that the same was received by
petitioners. This, the prosecution miserably failed to do. Instead, it merely presented the demand
letter and registry return receipt as if mere presentation of the same was equivalent to proof that
some sort of mail matter was received by petitioners. Receipts for registered letters and return
receipts do not prove themselves; they must be properly authenticated in order to serve as proof of
receipt of the letters (Central Trust Co. v. City of Des Moines, 218 NW 580).

Likewise, for notice by mail, it must appear that the same was served on the addressee or a duly
authorized agent of the addressee. In fact, the registry return receipt itself provides that "[a]
registered article must not be delivered to anyone but the addressee, or upon the addressee's
written order, in which case the authorized agent must write the addressee's name on the proper
space and then affix legibly his own signature below it." In the case at bar, no effort was made to
show that the demand letter was received by petitioners or their agent. All that we have on record is
an illegible signature on the registry receipt as evidence that someone received the letter. As to
whether this signature is that of one of the petitioners or of their authorized agent remains a mystery.
From the registry receipt alone, it is possible that petitioners or their authorized agent did receive the
demand letter. Possibilities, however, cannot replace proof beyond reasonable doubt. There being
insufficient proof that petitioners received notice that their checks had been dishonored, the
presumption that they knew of the insufficiency of the funds therefor cannot arise.

As we stated in Savage v. Taypin (G.R. No. 134217, May 11, 2000), "penal statutes must be strictly
construed against the State and liberally in favor of the accused." Likewise, the prosecution may not
rely on the weakness of the evidence for the defense to make up for its own blunders in prosecuting
an offense. Having failed to prove all the elements of the offense, petitioners may not thus be
convicted for violation of Batas Pambansa Blg. 22.

That petitioners are civilly liable to private complainant is also doubtful. Private complainant claims
that petitioners borrowed Nine Hundred Fifty Thousand (P950,000.00) Pesos from her on or about
the end of April 1993, in payment of which petitioners issued several post-dated checks in her favor.
The seven checks issued by petitioners as payment for the amount borrowed add up to
P950,000.00. If private complainant is the businesswoman that she claims to be, she should be
collecting interest on the loan she granted to petitioners. In other words, the amount to be repaid by
petitioners should be more than P950,000.00, to account for interest on the loan. The checks issued
by petitioners, however, do not provide for interest. It is thus more credible that the seven checks
involved in this case form part of nineteen checks issued to replace the checks issued by Juliet Ting
to private complainant. This conclusion is bolstered by private complainant's admission in her reply-
affidavit that more than seven checks were issued by petitioners (p. 11, Original Records). In said
reply-affidavit, private complainant states that "respondents issued and delivered to me in Manila
several checks, which partially include their seven (7) bouncing checks herein. I say 'partially'
because I will have to file additional bouncing check cases against them, as these other checks
likewise bounced." Furthermore, in the same reply-affidavit, private complainant claims that the
checks in question were not replaced, allegedly because the replacement checks must first be
cleared, which did not happen in this case. By implication, had the 23 Far East Bank checks issued
by Juliet Ting to replace the nineteen checks issued by petitioners been cleared, then private
complainant would have considered the checks in question as having been replaced. This only
supports our conclusion that it was Juliet Ting who owed money to private complainant, not
petitioners.

Moreover, the original debtor Juliet Ting was convicted by the Regional Trial Court of Manila in
Criminal Cases 93-126581-91 for eleven counts of violation of Batas Pambansa Blg. 22. These
eleven bouncing check cases involved the same obligation being sued upon by private complainant
Tagle herein. The trial court expressly acknowledged in said cases that nineteen (19) checks were
issued by petitioners as payment for Juliet Ting's obligation. In its August 7, 1997 decision convicting
Juliet Ting for violation of Batas Pambansa Blg. 22, the trial court declared that "to cover the
additional loans, accused (Juliet Ting) delivered 19 post-dated checks issued by Victor Ting and
Emily Azajar (p. 55, Rollo.)." The trial court's decision further provides:

Since she could not fund the other checks (Exhs. B to K), she replaced the same with 19
post-dated checks of her husband Victor Ting and her sister Emily Azajar totaling
P2,450,000.00. They issued the checks as they would take over her furniture business. The
intended partnership of Victor and Emily was aborted as the latter was not allowed to resign
from her teaching post in Naga City. She then replaced the checks issued by Victor and
Emily with her own checks – 23 FEB post-dated checks per list (Exh. 9) prepared by
Suzanne Azajar.
 Despite receipt of the replacement checks, complainant refused to return the checks of
Victor and Emily and even filed cases against them.

(p. 56, Rollo.)

Not having borrowed the amount of Nine Hundred Fifty Thousand (P950,000.00) from private
complainant, petitioners may not thus be held liable therefor.

WHEREFORE, premises considered, the instant petition is GRANTED and the assailed decision of
the Court of Appeals dated February 12, 1999 REVERSED and SET ASIDE. Petitioners Victor Ting
"Seng Dee" and Emily Chan-Azajar are hereby ACQUITTED of the charges against them for
violation of Batas Pambansa Blg. 22, for lack of sufficient evidence to prove the offenses charged
beyond reasonable doubt. No special pronouncement is made as to costs.

SO ORDERED.

Vitug, Panganiban, and Gonzaga-Reyes, JJ., concur.

G.R. No. 119178 June 20, 1997

LINA LIM LAO, petitioner,

vs.
COURT OF APPEALS and PEOPLE OF THE PHILIPPINES, respondents.

PANGANIBAN, J.:

May an employee who, as part of her regular duties, signs blank corporate checks — with the name
of the payee and the amount drawn to be filled later by another signatory — and, therefore, does so
without actual knowledge of whether such checks are funded, be held criminally liable for violation of
Batas Pambansa Bilang 22 (B.P. 22), when checks so signed are dishonored due to insufficiency of
funds? Does a notice of dishonor sent to the main office of the corporation constitute a valid notice to
the said employee who holds office in a separate branch and who had no actual knowledge thereof?
In other words, is constructive knowledge of the corporation, but not of the signatory-employee,
sufficient?

These are the questions raised in the petition filed on March 21, 1995 assailing the Decision 1 of
Respondent Court of Appeals 2 promulgated on December 9, 1994 in CA-G.R. CR No. 14240
dismissing the appeal of petitioner and affirming the decision dated September 26, 1990 in Criminal
Case Nos. 84-26967 to 84-26969 of the Regional Trial Court of Manila, Branch 33. The dispositive
portion of the said RTC decision affirmed by the respondent appellate court reads: 3
 WHEREFORE, after a careful consideration of the evidence presented by the
prosecution and that of the defense, the Court renders judgment as follows:

In Criminal Case No. 84-26969 where no evidence was presented by the prosecution
notwithstanding the fact that there was an agreement that the cases be tried jointly
and also the fact that the accused Lina Lim Lao was already arraigned, for failure of
the prosecution to adduce evidence against the accused, the Court hereby declares
her innocent of the crime charged and she is hereby acquitted with cost de oficio.

For Criminal Case No. 84-26967, the Court finds the accused Lina Lim Lao guilty
beyond reasonable doubt of the crime charged and is hereby sentenced to suffer the
penalty of ONE (1) YEAR imprisonment and to pay a fine of P150,000.00 without
subsidiary imprisonment in case of insolvency.

For Criminal Case No. 84-26968, the Court finds the accused Lina Lim Lao guilty
beyond reasonable doubt of the crime charged and is hereby sentenced to suffer the
penalty of ONE (1) YEAR imprisonment and to pay a fine of P150,000.00 without
subsidiary imprisonment in case of of (sic) insolvency.

For the two cases the accused is ordered to pay the cost of suit.

The cash bond put up by the accused for her provisional liberty in Criminal Case No.
84-26969 where she is declared acquitted is hereby ordered cancelled (sic).

With reference to the accused Teodulo Asprec who has remained at large, in order
that the cases as against him may not remain pending in the docket for an indefinite
period, let the same be archived without prejudice to its subsequent prosecution as
soon as said accused is finally apprehended.

Let a warrant issue for the arrest of the accused Teodulo Asprec which warrant need
not be returned to this Court until the accused is finally arrested.

SO ORDERED.

The Facts

Version of the Prosecution

The facts are not disputed. We thus lift them from the assailed Decision, as follows:

Appellant (and now Petitioner Lina Lim Lao) was a junior officer of Premiere
Investment House (Premiere) in its Binondo Branch. As such officer, she was
authorized to sign checks for and in behalf of the corporation (TSN, August 16, 1990,
p. 6). In the course of the business, she met complainant Father Artelijo Pelijo, the
provincial treasurer of the Society of the Divine Word through Mrs. Rosemarie
Lachenal, a trader for Premiere. Father Palijo was authorized to invest donations to
the society and had been investing the society's money with Premiere (TSN, June
23, 1987, pp. 5, 9-10). Father Palijo had invested a total of P514,484.04, as
evidenced by the Confirmation of Sale No. 82-6994 (Exh "A") dated July 8, 1993.
Father Palijo was also issued Traders Royal Bank (TRB) checks in payment of
interest, as follows:
 Check Date Amount

299961 Oct. 7, 1993 (sic) P 150,000.00 (Exh. "B")

299962 Oct. 7, 1983 P 150,000.00 (Exh. "C")

323835 Oct. 7, 1983 P 26,010.73

All the checks were issued in favor of Artelijo A. Palijo and signed by appellant
(herein petitioner) and Teodulo Asprec, who was the head of operations. Further
evidence of the transaction was the acknowledgment of postdated checks dated July
8, 1983 (Exh. "D") and the cash disbursement voucher (Exh. "F", TSN, supra, at pp.
11-16).

When Father Palijo presented the checks for encashment, the same were
dishonored for the reason "Drawn Against Insufficient Funds" (DAIF). Father Palijo
immediately made demands on premiere to pay him the necessary amounts. He first
went to the Binondo Branch but was referred to the Cubao Main Branch where he
was able to talk with the President, Mr. Cariño. For his efforts, he was paid
P5,000.00. Since no other payments followed, Father Palijo wrote Premiere a formal
letter of demand Subsequently, Premiere was placed under receivership
(TSN, supra, at pp. 16-19). 4

Thereafter, on January 24, 1984, Private Complainant Palijo filed an affidavit-complaint against
Petitioner Lina Lim Lao and Teodulo Asprec for violation of B.P. 22. After preliminary
investigation, 5 three Informations charging Lao and Asprec with the offense defined in the first
paragraph of Section 1, B.P. 22 were filed by Assistant Fiscal Felix S. Caballes before the trial court
on May 11, 1984, 6 worded as follows:

1. In Criminal Case No. 84-26967:

That on or about October 7, 1983 in the City of Manila, Philippines, the said accused
did then and there wilfully and unlawfully draw and issue to Artelijo A. Palijo to apply
on account or for value a Traders Royal Bank Check No. 299962 for P150,000.00
payable to Fr. Artelijo A. Palijo dated October 7, 1983 well knowing that at the time of
issue he/she did not have sufficient funds in or credit with the drawee bank for full
payment of the said check upon its presentment as in fact the said check, when
presented within ninety (90) days from the date thereof, was dishonored by the
drawee bank for the reason: "Insufficient Funds"; that despite notice of such
dishonor, said accused failed to pay said Artelijo A. Palijo the amount of the said
check or to make arrangement for full payment of the same within five (5) banking
days from receipt of said notice.

CONTRARY TO LAW.

2. In Criminal Case No. 84-26968:

That on or about October 7, 1983 in the City of Manila, Philippines, the said accused
did then and there wilfully and unlawfully draw and issue to Artelijo A. Palijo to apply
on account or for value a Traders Royal Bank Check No. 299961 for P150,000.00
payable to Fr. Artelijo A. Palijo dated October 7, '83 well knowing that at the time of
 issue he/she did not have sufficient funds in or credit with the drawee bank for full
payment of the said check upon its presentment as in fact the said check, when
presented within ninety (90) days from the date thereof, was dishonored by the
drawee bank for the reason: "Insufficient Funds"; that despite notice of such
dishonor, said accused failed to pay said Artelijo A. Palijo the amount of the said
check or to make arrangement for full payment of the same within five (5) banking
days from receipt of said notice.

CONTRARY TO LAW.

3. And finally in Criminal Case No. 84-26969:

That on or about July 8, 1983 in the City of Manila, Philippines, the said accused did
then and there wilfully and unlawfully draw and issue to Artelijo A. Palijo to apply on
account for value a Traders Royal Bank Check No. 323835 for P26,010.03 payable
to Fr. Artelijo A. Palijo dated October 7, 1983 well knowing that at the time of issue
he/she did not have sufficient funds in or credit with the drawee bank for full payment
of the said check upon its presentment as in fact the said check, when presented
within ninety (90) days from the date thereof, was dishonored by the drawee bank for
the reason: "Insufficient Funds"; that despite notice of such dishonor, said accused
failed to pay said Artelijo A. Palijo the amount of the said check or to make
arrangement for full payment of the same within five (5) banking days from receipt of
said notice.

CONTRARY TO LAW.

Upon being arraigned, petitioner assisted by counsel pleaded "not guilty." Asprec was not arrested;
he has remained at large since the trial, and even now on appeal.

After due trial, the Regional Trial Court convicted Petitioner Lina Lim Lao in Criminal Case Nos. 84-
26967 and 84-26968 but acquitted her in Criminal Case No. 84-26969. 7 On appeal, the Court of
Appeals affirmed the decision of the trial court.

Version of the Defense

Petitioner aptly summarized her version of the facts of the case thus:

Petitioner Lina Lim Lao was, in 1983, an employee of Premiere Financing

Corporation (hereinafter referred to as the "Corporation"), a corporation engaged in
investment management, with principal business office at Miami, Cubao, Quezon
City. She was a junior officer at the corporation who was, however, assigned not at
its main branch but at the corporation's extension office in (Binondo) Manila.
(Ocampo, T . S. N ., 16 August 1990, p. 14)

In the regular course of her duties as a junior officer, she was required to co-sign
checks drawn against the account of the corporation. The other co-signor was her
head of office, Mr. Teodulo Asprec. Since part of her duties required her to be mostly
in the field and out of the office, it was normal procedure for her to sign the checks in
blank, that is, without the names of the payees, the amounts and the dates of
maturity. It was likewise Mr. Asprec, as head of office, who alone decided to whom
the checks were to be ultimately issued and delivered. (Lao, T . S. N., 28 September
1989, pp. 9-11, 17, 19.)
In signing the checks as part of her duties as junior officer of the corporation,
petitioner had no knowledge of the actual funds available in the corporate account.
(Lao, T . S. N., 28 September 1989, p. 21) The power, duty and responsibility of
monitoring and assessing the balances against the checks issued, and funding the
checks thus issued, devolved on the corporation's Treasury Department in its main
office in Cubao, Quezon City, headed then by the Treasurer, Ms. Veronilyn Ocampo.
(Ocampo, T . S. N., 19 July 1990, p. 4; Lao, T . S. N., 28 September 1989, pp. 21-23)
All bank statements regarding the corporate checking account were likewise sent to
the main branch in Cubao, Quezon City, and notin Binondo, Manila, where petitioner
was holding office. (Ocampo, T . S. N., 19 July 1990, p. 24;Marqueses, T . S. N., 22
November 1988, p. 8)

The foregoing circumstances attended the issuance of the checks subject of the
instant prosecution.

The checks were issued to guarantee payment of investments placed by private

complainant Palijo with Premiere Financing Corporation. In his transactions with the
corporation, private complainant dealt exclusively with one Rosemarie Lachenal, a
trader connected with the corporation, and he never knew nor in any way dealt with
petitioner Lina Lim Lao at any time before or during the issuance of the delivery of
the checks. (Palijo, T . S. N., 23 June 1987, pp. 28-29, 32-34; Lao, T . S. N., 15 May
1990, p. 6; Ocampo, T . S. N., p. 5) Petitioner Lina Lim Lao was not in any way
involved in the transaction which led to the issuance of the checks.

When the checks were co-signed by petitioner, they were signed in advance and in
blank, delivered to the Head of Operations, Mr. Teodulo Asprec, who subsequently
filled in the names of the payee, the amounts and the corresponding dates of
maturity. After Mr. Asprec signed the checks, they were delivered to private
complainant Palijo. (Lao, T . S. N ., 28 September 1989, pp. 8-11, 17, 19; note also
that the trial court in its decision fully accepted the testimony of petitioner [Decision of
the Regional Trial Court, p. 12], and that the Court of Appeals affirmed said decision
in toto)

Petitioner Lina Lim Lao was not in any way involved in the completion, and the
subsequent delivery of the check to private complainant Palijo.

At the time petitioner signed the checks, she had no knowledge of the sufficiency or
insufficiency of the funds of the corporate account. (Lao, T . S. N ., 28 September
1989, p. 21) It was not within her powers, duties or responsibilities to monitor and
assess the balances against the issuance; much less was it within her (duties and
responsibilities) to make sure that the checks were funded. Premiere Financing
Corporation had a Treasury Department headed by a Treasurer, Ms. Veronilyn
Ocampo, which alone had access to information as to account balances and which
alone was responsible for funding the issued checks. (Ocampo, T . S. N ., 19 July
1990, p. 4; Lao, T . S. N ., 28 September 1990, p. 23) All statements of account were
sent to the Treasury Department located at the main office in Cubao, Quezon City.
Petitioner was holding office at the extension in Binondo Manila. (Lao, T . S. N., 28
September 1989, p. 24-25) Petitioner Lina Lim Lao did not have knowledge of the
insufficiency of the funds in the corporate account against which the checks were
drawn.
 When the checks were subsequently dishonored, private complainant sent a notice
of said dishonor to Premier Financing Corporation at its head office in Cubao,
Quezon City. (Please refer to Exh. "E";Palijo, T . S. N., 23 June 1987, p. 51) Private
complainant did not send notice of dishonor to petitioner. (Palijo, T . S. N., 24 July
1987, p. 10) He did not follow up his investment with petitioner. (Id.) Private
complainant never contacted, never informed, and never talked with, petitioner after
the checks had bounced. (Id., at p. 29) Petitioner never had notice of the dishonor of
the checks subject of the instant prosecution.

The Treasurer of Premiere Financing Corporation, Ms. Veronilyn Ocampo testified

that it was the head office in Cubao, Quezon City, which received notice of dishonor
of the bounced checks. (Ocampo, T . S. N ., 19 July 1990 pp. 7-8) The dishonor of
the check came in the wake of the assassination of the late Sen. Benigno Aquino, as
a consequence of which event a majority of the corporation's clients pre-terminated
their investments. A period of extreme illiquidity and financial distress followed, which
ultimately led to the corporation's being placed under receivership by the Securities
and Exchange Commission. (Ocampo, T . S. N ., 16 August 1990, p. 8,
19; Lao, T . S. N ., 28 September 1989, pp. 25-26; Please refer also to Exhibit
"1", the order of receivership issued by the Securities and Exchange Commission)
Despite the Treasury Department's and (Ms. Ocampo's) knowledge of the dishonor
of the checks, however, the main office in Cubao, Quezon City never informed
petitioner Lina Lim Lao or anybody in the Binondo office for that matter. (Ocampo,
T .S. N ., 16 August 1990, pp. 9-10) In her testimony, she justified her omission by
saying that the checks were actually the responsibility of the main office
(Ocampo, T . S. N ., 19 July 1990, p. 6) and that, at that time of panic withdrawals
and massive pre-termination of clients' investments, it was futile to inform the
Binondo office since the main office was strapped for cash and in deep financial
distress. (Id., at pp. 7-9) Moreover, the confusion which came in the wake of the
Aquino assassination and the consequent panic withdrawals caused them to lose
direct communication with the Binondo office. (Ocampo, T . S. N ., 16 August 1990,
p. 9-10)

As a result of the financial crisis and distress, the Securities and Exchange
Commission placed Premier Financing Corporation under receivership, appointing a
rehabilitation receiver for the purpose of settling claims against the corporation. (Exh.
"1") As he himself admits, private complainant filed a claim for the payment of the
bounced check before and even after the corporation had been placed under
receivership. (Palijo, T . S. N ., 24 July 1987, p. 10-17) A check was prepared by the
receiver in favor of the private complainant but the same was not claimed by him.
(Lao, T . S. N ., 15 May 1990, p. 18)

Private complainant then filed the instant criminal action. On 26 September 1990, the
Regional Trial Court of Manila, Branch 33, rendered a decision convicting petitioner,
and sentencing the latter to suffer the aggregate penalty of two (2) years and to pay
a fine in the total amount of P300,000.00. On appeal, the Court of Appeals affirmed
said decision. Hence, this petition for review. 8

The Issue

In the main, petitioner contends that the public respondent committed a reversible error in
concluding that lack of actual knowledge of insufficiency of funds was not a defense in a prosecution
for violation of B.P. 22. Additionally, the petitioner argues that the notice of dishonor sent to the main
office of the corporation, and not to petitioner herself who holds office in that corporation's branch
office, does not constitute the notice mandated in Section 2 of BP 22; thus, there can be no prima
facie presumption that she had knowledge of the insufficiency of funds.

The Court's Ruling

The petition is meritorious.

Strict Interpretation of Penal Statutes

It is well-settled in this jurisdiction that penal statutes are strictly construed against the state and
liberally for the accused, so much so that the scope of a penal statute cannot be extended by good
intention, implication, or even equity consideration. Thus, for Petitioner Lina Lim Lao's acts to be
penalized under the Bouncing Checks Law or B.P. 22, "they must come clearly within both the spirit
and the letter of the statute." 9

The salient portions of B.P. 22 read:

Sec. 1. Checks without sufficient funds. — Any person who makes or draws and
issues any check to apply on account or for value, knowing at the time of issue that
he does not have sufficient funds in or credit with the drawee bank for the payment of
such check in full upon its presentment, which check is subsequently dishonored by
the drawee bank for insufficiency of funds or credit or would have been dishonored
for the same reason had not the drawer, without any valid reason, ordered the bank
to stop payment, shall be punished by imprisonment of not less than thirty days but
not more than one (1) year or by a fine of not less than but not more than double the
amount of the check which fine shall in no case exceed Two hundred thousand
pesos, or both such fine and imprisonment at the discretion of the court.

The same penalty shall be imposed upon any person who having sufficient funds in
or credit with the drawee bank when he makes or draws and issues a check, shall fail
to keep sufficient funds or to maintain a credit or to cover the full amount of the check
if presented within a period of ninety (90) days from the date appearing thereon, for
which reason it is dishonored by the drawee bank.

Where the check is drawn by a corporation, company or entity, the person or persons
who actually signed the check in behalf of such drawer shall be liable under this Act.

Sec. 2. Evidence of knowledge of insufficient funds. — The making, drawing and

issuance of a check payment of which is refused by the drawee because of
insufficient funds in or credit with such bank, when presented within ninety (90) days
from the date of the check, shall be prima facie evidence of knowledge of such
insufficiency of funds or credit unless such maker or drawer pays the holder thereof
the amount due thereon, or makes arrangements for payment in full by the drawee of
such check within five (5) banking days after receiving notice that such check has not
been paid by the drawee.

This Court listed the elements of the offense penalized under B.P. 22, as follows: "(1) the making,
drawing and issuance of any check to apply to account or for value; (2) the knowledge of the maker,
drawer or issuer that at the time of issue he does not have sufficient funds in or credit with the
drawee bank for the payment of such check in full upon its presentment; and (3) subsequent
dishonor of the check by the drawee bank for insufficiency of funds or credit or dishonor for the same
reason had not the drawer, without any valid cause, ordered the bank to stop payment." 10

Justice Luis B. Reyes, an eminent authority in criminal law, also enumerated the elements of the
offense defined in the first paragraph of Section 1 of B.P. 22, thus:

1. That a person makes or draws and issues any check.

2. That the check is made or drawn and issued to apply on account or for value.

3. That the person who makes or draws and issues the check knows at the time of
issue that he does not have sufficient funds in or credit with the drawee bank for the
payment of such check in full upon its presentment.

4. That the check is subsequently dishonored by the drawee bank for insufficiency of
funds or credit, or would have been dishonored for the same reason had not the
drawer, without any valid reason, ordered the bank to stop payment. 11

Crux of the Petition

Petitioner raised as defense before the Court of Appeals her lack of actual knowledge of the
insufficiency of funds at the time of the issuance of the checks, and lack of personal notice of
dishonor to her. The respondent appellate court, however, affirmed the RTC decision, reasoning that
"the maker's knowledge of the insufficiency of funds is legally presumed from the dishonor of his
checks for insufficiency of funds. (People vs. Laggui, 171 SCRA 305; Nieras vs. Hon. Auxencio C.
Dacuycuy, 181 SCRA 1)" 12 The Court of Appeals also stated that "her alleged lack of knowledge or
intent to issue a bum check would not exculpate her from any responsibility under B.P. Blg. 22, since
the act of making and issuing a worthless check is a malum prohibitum." 13 In the words of the
Solicitor General, "(s)uch alleged lack of knowledge is not material for petitioner's liability under B.P.
Blg. 22." 14

Lack of Actual Knowledge of Insufficiency of Funds

Knowledge of insufficiency of funds or credit in the drawee bank for

the payment of a check upon its presentment is an essential element of the offense. 15 There is
a prima faciepresumption of the existence of this element from the fact of drawing, issuing or making
a check, the payment of which was subsequently refused for insufficiency of funds. It is important to
stress, however, that this is not a conclusive presumption that forecloses or precludes the
presentation of evidence to the contrary.

In the present case, the fact alone that petitioner was a signatory to the checks that were
subsequently dishonored merely engenders the prima facie presumption that she knew of the
insufficiency of funds, but it does not render her automatically guilty under B.P. 22. The prosecution
has a duty to prove all the elements of the crime, including the acts that give rise to the prima
facie presumption; petitioner, on the other hand, has a right to rebut the prima
faciepresumption. 16 Therefore, if such knowledge of insufficiency of funds is proven to
be actually absent or non-existent, the accused should not be held liable for the offense defined
under the first paragraph of Section 1 of B.P. 22. Although the offense charged is a malum
prohibitum, the prosecution is not thereby excused from its responsibility of proving beyond
reasonable doubt all the elements of the offense, one of which is knowledge of the insufficiency of
funds.
After a thorough review of the case at bar, the Court finds that Petitioner Lina Lim Lao did not have
actual knowledge of the insufficiency of funds in the corporate accounts at the time she affixed her
signature to the checks involved in this case, at the time the same were issued, and even at the time
the checks were subsequently dishonored by the drawee bank.

The scope of petitioner's duties and responsibilities did not encompass the funding of the
corporation's checks; her duties were limited to the marketing department of the Binondo
branch. 17 Under the organizational structure of Premiere Financing Corporation, funding of checks
was the sole responsibility of the Treasury Department. Veronilyn Ocampo, former Treasurer of
Premiere, testified thus:

Q Will you please tell us whose (sic) responsible for the funding of
checks in Premiere?

A The one in charge is the Treasury Division up to the Treasury

Disbursement and then they give it directly to Jose Cabacan,
President of Premiere. 18

Furthermore, the Regional Trial Court itself found that, since Petitioner Lina Lim Lao was often out in
the field taking charge of the marketing department of the Binondo branch, she signed the checks in
blank as to name of the payee and the amount to be drawn, and without knowledge of the
transaction for which they were issued. 19 As a matter of company practice, her signature was
required in addition to that of Teodulo Asprec, who alone placed the name of the payee and the
amount to be drawn thereon. This is clear from her testimony:

q . . . Will you please or will you be able to tell us the condition of this
check when you signed this or when you first saw this check?

Witness

a I signed the check in blank. There were no payee. No amount, no

date, sir.

q Why did you sign this check in blank when there was no payee, no
amount and no date?

a It is in order to facilitate the transaction, sir.

xxx xxx xxx

COURT

(to witness)

q Is that your practice?

Witness

a Procedure, Your Honor.

COURT
That is quiet (sic) unusual. That is why I am asking that last question
if that is a practice of your office.

a As a co-signer, I sign first, sir.

q So the check cannot be encashed without your signature, co-

signature?

a Yes, sir.

Atty. Gonzales

(to witness)

q Now, you said that you sign first, after you sign, who signs the
check?

a Mr. Teodoro Asprec, sir.

q Is this Teodoro Asprec the same Teodoro Asprec, one of the

accused in all these cases?

a Yes, sir.

q Now, in the distribution or issuance of checks which according to

you, as a co-signee, you sign. Who determines to whom to issue or to
whom to pay the check after Teodoro Asprec signs the check?

Witness

a He is the one.

Atty. Gonzales

q Mr. Asprec is the one in-charge in . . . are you telling the Honorable
Court that it was Teodoro Asprec who determines to whom to issue
the check? Does he do that all the time?

Court

q Does he all the time?

(to witness)

a Yes, Your Honor.

q So the check can be negotiated? So, the check can be good only
upon his signing? Without his signing or signature the check cannot
be good?
 a Yes, Your Honor.

Atty. Gonzales

(to witness)

q You made reference to a transaction which according to you, you

signed this check in order to facilitate the transaction . . . I withdraw
that question. I will reform.

COURT

(for clarification to witness)

Witness may answer.

q Only to facilitate your business transaction, so you signed the other

checks?

Witness

a Yes, Your Honor.

q So that when ever there is a transaction all is needed . . . all that is

needed is for the other co-signee to sign?

a Yes, Your Honor.

COURT

(To counsel)

Proceed.

Atty. Gonzales

(to witness)

q Why is it necessary for you to sign?

a Because most of the time I am out in the field in the afternoon, so,
in order to facilitate the transaction I sign so if I am not around they
can issue the check. 20

Petitioner did not have any knowledge either of the identity of the payee or the transaction which
gave rise to the issuance of the checks. It was her co-signatory, Teodulo Asprec, who alone filled in
the blanks, completed and issued the checks. That Petitioner Lina Lim Lao did not have any
knowledge or connection with the checks' payee, Artelijo Palijo, is clearly evident even from the
latter's testimony, viz.:
ATTY. GONZALES:

Q When did you come to know the accused Lina Lim Lao?

A I cannot remember the exact date because in their office Binondo,

—

COURT: (before witness could finish)

Q More or less?

A It must have been late 1983.

ATTY. GONZALES:

Q And that must or that was after the transactions involving alleged
checks marked in evidence as Exhibits B and C?

A After the transactions.

Q And that was also before the transaction involving that confirmation
of sale marked in evidence as Exhibit A?

A It was also.

Q And so you came to know the accused Lina Lim Lao when all those
transactions were already consummated?

A Yes, sir.

Q And there has never been any occasion where you transacted with
accused Lina Lim Lao, is that correct?

A None, sir, there was no occasion.

Q And your coming to know Lina Lim Lao the accused in these cases
was by chance when you happened to drop by in the office at
Binondo of the Premier Finance Corporation, is that what you mean?

A Yes, sir.

Q You indicated to the Court that you were introduced to the accused
Lina Lim Lao, is that correct?

A I was introduced.

xxx xxx xxx

Q After that plain introduction there was nothing which transpired

between you and the accused Lina Lim Lao?
 A There was none. 21

Since Petitioner Lina Lim Lao signed the checks without knowledge of the insufficiency of funds,
knowledge she was not expected or obliged to possess under the organizational structure of the
corporation, she may not be held liable under B.P. 22. For in the final analysis, penal statutes such
as B.P. 22 "must be construed with such strictness as to carefully safeguard the rights of the
defendant . . ." 22 The element of knowledge of insufficiency of funds having been proven to be
absent, petitioner is therefore entitled to an acquittal.

This position finds support in Dingle vs. Intermediate Appellate Court 23 where we stressed that
knowledge of insufficiency of funds at the time of the issuance of the check was an essential
requisite for the offense penalized under B.P. 22. In that case, the spouses Paz and Nestor Dingle
owned a family business known as "PMD Enterprises." Nestor transacted the sale of 400 tons of
silica sand to the buyer Ernesto Ang who paid for the same. Nestor failed to deliver. Thus, he issued
to Ernesto two checks, signed by him and his wife as authorized signatories for PMD Enterprises, to
represent the value of the undelivered silica sand. These checks were dishonored for having been
"drawn against insufficient funds." Nestor thereafter issued to Ernesto another check, signed by him
and his wife Paz, which was likewise subsequently dishonored. No payment was ever made; hence,
the spouses were charged with a violation of B.P. 22 before the trial court which found them both
guilty. Paz appealed the judgment to the then Intermediate Appellate Court which modified the same
by reducing the penalty of imprisonment to thirty days. Not satisfied, Paz filed an appeal to this Court
"insisting on her innocence" and "contending that she did not incur any criminal liability under B.P.
22 because she had no knowledge of the dishonor of the checks issued by her husband and, for that
matter, even the transaction of her husband with Ang." The Court ruled in Dingle as follows:

The Solicitor General in his Memorandum recommended that petitioner be acquitted

of the instant charge because from the testimony of the sole prosecution witness
Ernesto Ang, it was established that he dealt exclusively with Nestor Dingle.
Nowhere in his testimony is the name of Paz Dingle ever mentioned in connection
with the transaction and with the issuance of the check. In fact, Ang categorically
stated that it was Nestor Dingle who received his two (2) letters of demand. This
lends credence to the testimony of Paz Dingle that she signed the questioned checks
in blank together with her husband without any knowledge of its issuance, much less
of the transaction and the fact of dishonor.

In the case of Florentino Lozano vs. Hon. Martinez, promulgated December 18,
1986, it was held that an essential element of the offense is knowledge on the part of
the maker or drawer of the check of the insufficiency of his funds.

WHEREFORE, on reasonable doubt, the assailed decision of the Intermediate

Appellate Court (now the Court of Appeals) is hereby SET ASIDE and a new one is
hereby rendered ACQUITTING petitioner on reasonable doubt. 24

In rejecting the defense of herein petitioner and ruling that knowledge of the insufficiency of funds is
legally presumed from the dishonor of the checks for insufficiency of funds, Respondent Court of
Appeals cited People vs.Laggui 25 and Nierras vs. Dacuycuy. 26 These, however, are inapplicable
here. The accused in both cases issued personal — not corporate — checks and did not aver lack of
knowledge of insufficiency of funds or absence of personal notice of the check's dishonor.
Furthermore, in People vs. Laggui 27 the Court ruled mainly on the adequacy of an information which
alleged lack of knowledge of insufficiency of funds at the time the check was issued and not at the
time of its presentment. On the other hand, the Court in Nierras vs. Dacuycuy 28 held mainly that an
accused may be charged under B.P. 22 and Article 315 of the Revised Penal Code for the same act
of issuing a bouncing check.

The statement in the two cases — that mere issuance of a dishonored check gives rise to the
presumption of knowledge on the part of the drawer that he issued the same without funds — does
not support the CA Decision. As observed earlier, there is here only a prima facie presumption which
does not preclude the presentation of contrary evidence. On the contrary, People vs. Laggui clearly
spells out as an element of the offense the fact that the drawer must have knowledge of the
insufficiency of funds in, or of credit with, the drawee bank for the payment of the same in full on
presentment; hence, it even supports the petitioner's position.

Lack of Adequate Notice of Dishonor

There is another equally cogent reason for the acquittal of the accused. There can be no prima
facie evidence of knowledge of insufficiency of funds in the instant case because no notice of
dishonor was actually sent to or received by the petitioner.

The notice of dishonor may be sent by the offended party or the drawee bank. The trial court itself
found absent a personal notice of dishonor to Petitioner Lina Lim Lao by the drawee bank based on
the unrebutted testimony of Ocampo "(t)hat the checks bounced when presented with the drawee
bank but she did not inform anymore the Binondo branch and Lina Lim Lao as there was no need to
inform them as the corporation was in distress." 29 The Court of Appeals affirmed this factual finding.
Pursuant to prevailing jurisprudence, this finding is binding on this Court. 30

Indeed, this factual matter is borne by the records. The records show that the notice of dishonor was
addressed to Premiere Financing Corporation and sent to its main office in Cubao, Quezon City.
Furthermore, the same had not been transmitted to Premiere's Binondo Office where petitioner had
been holding office.

Likewise no notice of dishonor from the offended party was actually sent to or received by Petitioner
Lao. Her testimony on this point is as follows:

Atty. Gonzales

q Will you please tell us if Father Artelejo Palejo (sic) ever notified
you of the bouncing of the check or the two (2) checks marked as
Exhibit "B" or "C" for the prosecution?

Witness

a No, sir.

q What do you mean no, sir?

a I was never given a notice. I was never given notice from Father
Palejo (sic).

COURT

(to witness)
 q Notice of what?

a Of the bouncing check, Your Honor. 31

Because no notice of dishonor was actually sent to and received by the petitioner, the prima
facie presumption that she knew about the insufficiency of funds cannot apply. Section 2 of B.P. 22
clearly provides that this presumption arises not from the mere fact of drawing, making and issuing a
bum check; there must also be a showing that, within five banking days from receipt of the notice of
dishonor, such maker or drawer failed to pay the holder of the check the amount due thereon or to
make arrangement for its payment in full by the drawee of such check.

It has been observed that the State, under this statute, actually offers the violator "a compromise by
allowing him to perform some act which operates to preempt the criminal action, and if he opts to
perform it the action is abated." This was also compared "to certain laws 32 allowing illegal
possessors of firearms a certain period of time to surrender the illegally possessed firearms to the
Government, without incurring any criminal liability." 33 In this light, the full payment of the amount
appearing in the check within five banking days from notice of dishonor is a "complete
defense." 34 The absence of a notice of dishonor necessarily deprives an accused an opportunity to
preclude a criminal prosecution. Accordingly, procedural due process clearly enjoins that a notice of
dishonor be actually served on petitioner. Petitioner has a right to demand — and the basic
postulates of fairness require — that the notice of dishonor be actually sent to and received by her to
afford her the opportunity to avert prosecution under B.P. 22.

In this light, the postulate of Respondent Court of Appeals that "(d)emand on the Corporation
constitutes demand on appellant (herein petitioner)," 35 is erroneous. Premiere has no obligation to
forward the notice addressed to it to the employee concerned, especially because the corporation
itself incurs no criminal liability under B.P. 22 for the issuance of a bouncing check. Responsibility
under B.P. 22 is personal to the accused; hence, personal knowledge of the notice of dishonor is
necessary. Consequently, constructive notice to the corporation is not enough to satisfy due
process. Moreover, it is petitioner, as an officer of the corporation, who is the latter's agent for
purposes of receiving notices and other documents, and not the other way around. It is but axiomatic
that notice to the corporation, which has a personality distinct and separate from the petitioner, does
not constitute notice to the latter.

Epilogue

In granting this appeal, the Court is not unaware of B.P. 22's intent to inculcate public respect for and
trust in checks which, although not legal tender, are deemed convenient substitutes for currency.
B.P. 22 was intended by the legislature to enhance commercial and financial transactions in the
Philippines by penalizing makers and issuers of worthless checks. The public interest behind B.P. 22
is thus clearly palpable from its intended purpose. 36

At the same time, this Court deeply cherishes and is in fact bound by duty to protect our people's
constitutional rights to due process and to be presumed innocent until the contrary is
proven. 37 These rights must be read into any interpretation and application of B.P. 22. Verily, the
public policy to uphold civil liberties embodied in the Bill of Rights necessarily outweighs the public
policy to build confidence in the issuance of checks. The first is a basic human right while the second
is only proprietary in nature. 38 Important to remember also is B.P. 22's requirements that the check
issuer must know "at the time of issue that he does not have sufficient funds in or credit with the
drawee bank" and that he must receive "notice that such check has not been paid by the drawee."
Hence, B.P. 22 must not be applied in a manner which contravenes an accused's constitutional and
statutory rights.
There is also a social justice dimension in this case. Lina Lim Lao is only a minor employee who had
nothing to do with the issuance, funding and delivery of checks. Why she was required by her
employer to countersign checks escapes us. Her signature is completely unnecessary for it serves
no fathomable purpose at all in protecting the employer from unauthorized disbursements. Because
of the pendency of this case, Lina Lim Lao stood in jeopardy — for over a decade — of losing her
liberty and suffering the wrenching pain and loneliness of imprisonment, not to mention the stigma of
prosecution on her career and family life as a young mother, as well as the expenses, effort and
aches in defending her innocence. Upon the other hand, the senior official — Teodulo Asprec —
who appears responsible for the issuance, funding and delivery of the worthless checks has
escaped criminal prosecution simply because he could not be located by the authorities. The case
against him has been archived while the awesome prosecutory might of the government and the
knuckled ire of the private complainant were all focused on poor petitioner. Thus, this Court exhorts
the prosecutors and the police authorities concerned to exert their best to arrest and prosecute
Asprec so that justice in its pristine essence can be achieved in all fairness to the complainant, Fr.
Artelijo Palijo, and the People of the Philippines. By this Decision, the Court enjoins the Secretary of
Justice and the Secretary of Interior and Local Government to see that essential justice is done and
the real culprit(s) duly-prosecuted and punished.

WHEREFORE, the questioned Decision of the Court of Appeals affirming that of the Regional Trial
Court, is hereby REVERSED and SET ASIDE. Petitioner Lina Lim Lao is ACQUITTED. The Clerk of
Court is hereby ORDERED to furnish the Secretary of Justice and the Secretary of Interior and Local
Government with copies of this Decision. No costs.

SO ORDERED.

Narvasa, C.J., Davide, Jr. and Melo, JJ., concur.

Francisco, J., is on leave.

G.R. No. 150792 March 3, 2004

HON. REMEDIOS L. PETILLA, petitioner,

vs.
COURT OF APPEALS (Former Thirteenth Division), CIVIL SERVICE COMMISSION and JERIEL
L. ARDIENTE,respondents.

DECISION

CARPIO, J.:

The Case
Before this Court is a petition for certiorari1 to nullify the Court of Appeals’ Resolutions2 in CA-G.R.
SP No. 65192 dated 22 June 2001 ("First Resolution") and 29 October 2001 ("Second Resolution").
The First Resolution denied due course and dismissed the petition for review3 of petitioner Governor
Remedios L. Petilla ("petitioner") while the Second Resolution denied the motion for reconsideration.

The Antecedents

On 1 July 1999, respondent Jeriel L. Ardiente ("respondent"), Nurse I of the Hilongos District
Hospital, Hilongos, Leyte, filed a letter-protest before the Civil Service Commission ("CSC"), Region
8 Office. Respondent assailed his transfers to the Provincial Health Office, Government Center,
Palo, Leyte, effective 6 May 1999, and to the Northwestern Leyte District Hospital, Calubian, Leyte,
effective 21 May 1999.

Meanwhile, respondent applied for sick and vacation leave from 1 June to 31 August 1999. In a
letter dated 7 September 1999,4 the Provincial Health Office returned and disapproved respondent’s
leave applications based on Section 23(q), Rule XIV of the CSC Rules.5 During the same period until
4 October 1999, respondent continuously failed to report to his new workstation at the Northwestern
Leyte District Hospital.

On 4 October 1999, petitioner issued Memorandum No. 99-255 dropping respondent from the roll of
employees of the Leyte Provincial Government for unauthorized absences. Petitioner based her
action on Section 35, Rule XVI6 of the CSC Rules.

On 8 October 1999, respondent received Memorandum No. 99-255. Respondent did not appeal or
challenge the memorandum in the appropriate forum.

On 14 February 2000, the CSC7 issued Resolution No. 00-0441 declaring respondent’s
reassignments void. The dispositive portion of the Resolution reads:

WHEREFORE, the Orders issued by Governor Remedios L. Petilla, Province of Leyte,

reassigning Jeriel L. Ardiente are hereby declared void. Accordingly, Governor Petilla is
hereby directed to restore Ardiente to his former workstation at the Hilongos District Hospital,
Hilongos, Leyte.8

Petitioner filed a Motion for Reconsideration of CSC Resolution No. 00-0441.9 The CSC10 denied the
motion for lack of merit in its Resolution No. 01-0726 dated 2 April 2001.11

Subsequently, petitioner filed with the Court of Appeals a Motion for Extension of Time to File
Petition for Review dated 29 May 2001 to question CSC Resolutions Nos. 00-0441 and 01-0726.
Petitioner attached to her motion for extension the joint affidavit of Celia Maria dela Cruz ("Celia")
and Ruth A. Loreto ("Ruth").12 At the time, Celia was the Executive Assistant while Ruth was the
Receiving Clerk of the Governor’s Office. In their joint affidavit, Ruth stated that she received CSC
Resolution No. 01-0726 on 24 April 2001 and forwarded the same to Celia on the same date. Celia
did not give CSC Resolution No. 01-0726 to petitioner because the latter was then in the west coast
of Leyte attending to election matters. Meanwhile, Celia kept CSC Resolution No. 01-0726 inside the
office’s filing cabinet. It was only on 29 May 2001 that Celia and Ruth gave CSC Resolution No. 01-
0726 to petitioner.

On 31 May 2001, without awaiting the Court of Appeals’ resolution of the motion for extension,
petitioner filed with the Court of Appeals a Petition for Review assailing CSC Resolutions Nos. 00-
0441 and 01-0726, docketed as CA-G.R. SP No. 65192.
On 22 June 2001, the Court of Appeals issued the First Resolution denying due course and
dismissing CA-G.R. SP No. 65192 for petitioner’s failure to comply with the requirements of Section
6, Rule 43 of the Rules of Court.

On 19 September 2001, respondent filed a Motion for Execution13 of CSC Resolution No. 00-0441
with the Court of Appeals to which petitioner filed a Comment on 21 October 2001.

On 12 October 2001, petitioner filed a Motion for Reconsideration of the First Resolution attaching
the certified true copies of the documents enumerated in the First Resolution. The appellate court
denied the motion for reconsideration in the Second Resolution dated 29 October 2001.

Hence, this petition.

The Ruling of the Court of Appeals

The First Resolution denied due course and dismissed petitioner’s petition for review for failure to
append clearly legible duplicate originals or certified true copies of the following:

(a) CSC Resolution No. 00-0441 declaring respondent’s transfer and reassignment as void;

(b) Petitioner’s Motion for Reconsideration of CSC Resolution No. 00-0441;

(c) Respondent’s letter-protest with the CSC, Region 8 Office, protesting his reassignments;
and

(d) Petitioner’s answer, if any, to respondent’s letter-protest.

The Court of Appeals stated that this failure violates Section 6, Rule 43 of the Rules of Court which
provides:

SEC. 6. Contents of the petition. – The petition for review shall (a) xxx (c) be accompanied
by a clearly legible duplicate original or a certified true copy of the award, judgment, final
order or resolution appealed from, together with certified copies of such material portions of
the record referred to therein and other supporting papers; xxx

Citing Section 7 of Rule 43,14 the appellate court held that petitioner’s failure to comply with any of the
requirements under Section 6, Rule 43 justifies dismissal of the petition for review.

The Second Resolution denied petitioner’s motion for reconsideration on the ground that petitioner
filed the motion beyond the fifteen-day reglementary period. The pertinent portion of the Second
Resolution reads:

Contrary to petitioner’s claim, as purportedly shown in her Annex A, that it was allegedly only
on Sept. 28, 2001 that she received a copy of this Court’s Resolution of June 22, 2001,
outrightly dismissing her petition for review for the reasons therein stated: Registry Return
Receipt No. 89778, dated June 22, 2001, clearly shows that a copy of our June 22, 2001
Resolution addressed to the Hon. Remedios L. Petilla, petitioner in CA-G.R. SP No. 65192,
was sent to Purisima Street, Palo, Leyte, which could either be the petitioner’s official
residence or her private abode, and was received thereat on the same date by a certain
Jaime Santos. This means that the last day of the 15-day reglementary period within which
to file a Motion for Reconsideration of the aforesaid resolution under Sec. 1, Rule 52 of the
 Rules of Court, or to appeal therefrom to the Supreme Court expired on July 14, 2001.
Inexorably, therefore, the Motion for Reconsideration which was filed (posted) at the
Hilongos, Leyte Post Office on Sept. 20, 2001, was filed more than two (2) months after the
expiry date of the reglementary period within which to file a Motion for Reconsideration of the
said Resolution of June 22, 2001, xxx

The Issue

The sole issue in this case is whether the Court of Appeals erred in issuing the assailed resolutions.
The First Resolution denied due course and dismissed outright the petition for review for failure to
comply with Section 6, Rule 43 of the Rules of Court. The Second Resolution denied the motion for
reconsideration for being filed out of time.

The Court’s Ruling

The petition lacks merit.

The Court of Appeals correctly denied due course and dismissed the petition for review but the
denial should be on an entirely different ground.

The Court of Appeals should have denied due course and dismissed outright the petition for review
for being filed out of time. Petitioner herself admits that the petition for review was "filed after the
lapse of the 15-day period to appeal."15 Petitioner reasons that her employees, namely Ruth and
Celia, gave her a copy of CSC Resolution No. 01-0726 only on 29 May 2001 because before that
she was "at the West Coast of Leyte busy on election matters."

Petitioner’s justification for the late filing of the petition for review is not meritorious. Indisputably,
Ruth and Celia received on 24 April 2001 a copy of CSC Resolution No. 01-0726 denying
petitioner’s motion for reconsideration of CSC Resolution No. 00-0441. There is also no question
that Celia as Executive Assistant and Ruth as Receiving Clerk of the Office of the Governor had
authority to receive on behalf of petitioner notices or court processes including CSC Resolution No.
01-0726. While petitioner physically received CSC Resolution No. 01-0726 only on 29 May 2001,
or 35 days from 24 April 2001,16 the date of receipt of CSC Resolution No. 01-0726 should be 24
April 2001 for computing the period to appeal. This is precisely because Ruth and Celia, absent any
showing that petitioner did not authorize them to receive CSC Resolution No. 01-0726, received the
resolution on 24 April 2001. In short, receipt by Ruth and Celia of CSC Resolution No. 01-0726 on
24 April 2001 is deemed receipt by petitioner. In Laza v. Court of Appeals,17 where the petitioners
claimed that the person who received the trial court’s decision had no authority to receive mails for
Laza, we ruled:

xxx As to Leticia Ramos who had signed for the receipt of the said copy caused to be
delivered by the Postmaster at Benjamin’s given address, there was no showing, at all, from
the records of the case, that Leticia was not a person of sufficient discretion to receive the
mail at the proper address appearing on the envelope which contained the registered
mail. Petitioners’ claim was that she was not Benjamin’s agent or authorized
representative to receive mails in his behalf. To follow petitioners’ stand would render
nugatory the provisions on service by registered mail. Every house maid or house boy
or any other person other than the addressee of registered mail would have to have a
special power-of-attorney to receive such mail in behalf of the addressee. We agree
with the respondent Court of Appeals’ finding that petitioners’ excuse for the late filing of their
motion for reconsideration was rather flimsy and unrealistic. (Emphasis supplied)
In the present case, petitioner does not even claim that she did not authorize Ruth and Celia to
receive CSC Resolution No. 01-0726. Moreover, the record is barren as to any explanation why
Ruth and Celia did not immediately inform petitioner about the resolution. There is also absolutely no
evidence showing that petitioner could not be reached or located when Ruth and Celia received the
resolution. Furthermore, there is no showing that petitioner could not possibly have a copy of CSC
Resolution No. 01-0726 before the period to appeal expired. Absent in the record is any proof that
petitioner did not report for work or drop by her office for 35 days, from 24 April to 29 May 2001.
Thus, petitioner’s excuse for the late filing of the petition for review is clearly flimsy.

Perfecting an appeal within the prescribed period is not only mandatory but also jurisdictional as
held in Videogram Regulatory Board v. Court of Appeals,18 thus:

xxx There are certain procedural rules that must remain inviolable, like those setting the
periods for perfecting an appeal or filing a petition for review, for it is doctrinally entrenched
that the right to appeal is a statutory right and one who seeks to avail of that right must
comply with the statute or rules. The rules, particularly the requirements for perfecting an
appeal within the reglementary period specified in the law, must be strictly followed as they
are considered indispensable interdictions against needless delays and for orderly discharge
of judicial business. Furthermore, the perfection of an appeal in the manner and within
the period permitted by law is not only mandatory but also jurisdictional and the
failure to perfect the appeal renders the judgment of the court final and executory. Just
as a losing party has the right to file an appeal within the prescribed period, the winning party
also has the correlative right to enjoy the finality of the resolution of his/her case.

These periods are carefully guarded and lawyers are well-advised to keep track of their
applications. After all, a denial of a petition for being time-barred is a decision on the merits.
(Emphasis supplied)

Since petitioner received CSC Resolution No. 01-0726 on 24 April 2001, she had until 9 May 2001 to
file with the Court of Appeals her appeal or motion for extension.19 However, the motion for extension
to file petition for review and petition for review were both filed only on 31 May 2001. Clearly,
petitioner filed the motion for extension and the petition for review beyond the prescribed period.
In Ditching v. Court of Appeals,20 we ruled that if a motion for extension is filed after the lapse of the
period sought to be extended, then there is no longer any period to extend. In such event, the
judgment or order is already final and executory.

Petitioner cannot correctly argue that "the Court of Appeals accepted the reasons and explanations
on the circumstances why the Petition for Review was filed only on May 31, 2001."21 Otherwise,
petitioner continues, the appellate court would have stated the late filing as another ground for
dismissing the petition for review.22

To reiterate, perfection of an appeal in the manner and within the period prescribed by law is
mandatory and jurisdictional.23 Failure to interpose a timely appeal renders the assailed decision or
order final and executory and deprives the appellate body of any jurisdiction to alter the final
judgment.24 The appellate court has power only to dismiss the appeal.25 To rule that the appellate
court accepted petitioner’s reason for the late filing of the petition for review, absent any exceptional
circumstances to warrant such delay, is patently against settled jurisprudential rules.26

Thus, we hold that petitioner clearly failed to perfect her appeal in the Court of Appeals. The Court of
Appeals correctly denied due course and dismissed the petition for review.
At any rate, petitioner contends that respondent’s unchallenged dismissal from the roll of employees
on 4 October 1999 rendered the CSC resolutions moot and academic. Petitioner also maintains that
it is impossible to reinstate respondent to his former workstation because he is "no longer a bona
fide employee of the Provincial Government of Leyte."27

Petitioner issued the memorandum dismissing respondent while respondent’s protest was pending
with the CSC and before the CSC declared his transfers illegal. Further, petitioner did not manifest
before the CSC about her action, which would certainly affect the result of the case. Petitioner
manifested about respondent’s dismissal for the first time in the Court of Appeals.28 Petitioner
believes that she had no obligation to inform the CSC about her action. Petitioner insists that it is
respondent as the aggrieved party who should have manifested before the CSC about his dismissal.
Petitioner further argues that she can even raise this issue for the first time before this Court
because the instant petition is an original action for certiorari.

On the other hand, respondent did not challenge the validity of his dismissal in the appropriate forum
and within the prescribed period. Respondent questioned the legality of his dismissal for the first
time before this Court.

Evidently, both parties are at fault. Petitioner raised for the first time before this Court the issue of
whether the respondent’s dismissal rendered the CSC resolutions moot.29 Petitioner could have
manifested about her action or moved for the dismissal of respondent’s protest when it was pending
in the CSC. Had petitioner moved for the dismissal of respondent’s protest in the CSC on the ground
that it was already moot, the CSC could have acted on it and properly decided the case. Moreover,
petitioner’s action in dismissing respondent while the latter’s protest was pending in the CSC gives
the impression that it was designed to render the CSC resolutions moot. On the other hand,
respondent did not question the legality of his dismissal in the appropriate forum and within the
prescribed period. However, this Court believes respondent deserves under the circumstances one
last chance to defend his side and assail the legality of his dismissal in the interest of substantial
justice.

Petitioner failed to show clearly that respondent openly defied the reassignment orders. A careful
review of the records discloses that respondent’s absence from work from 1 June to 31 August 1999
was based on his applications for sick and vacation leave. The records also show that it was only on
9 September 1999 that the Provincial Health Office notified respondent of the disapproval of his
leave applications. Therefore, it is safe to state that prior to 9 September 1999 respondent did not
know that the Provincial Health Office had denied his leave applications. Since respondent was not
aware of the denial of his leave applications, respondent cannot automatically be considered to be
on absence without leave ("AWOL") for that period.

AWOL means that the employee is leaving or abandoning his post without justifiable reason and
without notifying his employer.30 In this case, petitioner gravely failed to show that respondent had the
least intention to go on AWOL. Otherwise, respondent would not even have bothered to file his
applications for sick and vacation leave. Moreover, had respondent intended to go on AWOL,
respondent would not even have protested his reassignments in the first place, and seek his
reinstatement to his former workstation. Respondent’s protest of his reassignments clearly
contradicts petitioner’s claim that respondent was on AWOL. We apply by analogy the ruling
in Cariño v. Daoas31where we held that petitioner is "justified in not heeding her reassignment order
because her basis was xxx the legal opinion of a regional office of the Civil Service Commission"
that the reassignment is illegal. In that case, we ordered the reinstatement of petitioner who was
dropped from the rolls for her absence without leave for more than thirty days. In this case,
respondent’s absence was based on his leave applications, albeit denied, and not on his deliberate
refusal to heed the reassignment orders.
However, no leave application supported respondent’s continuous absence from 1 September to 4
October 1999. Furthermore, respondent had already exhausted his leave credits. Nevertheless, the
records do not show that respondent intended to leave or abandon his post. On the contrary,
respondent contested the validity of the reassignment order. We cannot consider respondent on
AWOL to justify petitioner’s act of dropping respondent from the rolls considering that the CSC
declared void petitioner’s reassignment order. We consider respondent on leave without pay from 1
September to 4 October 1999.32 While respondent did not obtain a clearance from the Provincial
Health Office, which is required for leave without pay in excess of one month,33 this omission does
not ipso factoamount to being on AWOL considering the circumstances of this case. Respondent’s
absence from 1 September to 4 October 1999 was due principally to the pendency of his case with
the CSC on the validity of his reassignment, which the CSC subsequently declared void.

The absence of notice to respondent before his dismissal is no longer an issue since respondent
was not on AWOL. Nevertheless, for clarity, we shall state the rule on notice. Section 35, Rule XVI of
the CSC Rules, which expressly states that an employee who is on AWOL34 shall be dropped from
the service after due notice, has been amended. Section 63 of CSC Resolution No. 983142 already
allows the dismissal of a government employee who is on AWOL without prior notice.35 However,
the government official or employee who is on AWOL shall be informed of his separation from the
service not later than five days from its effectivity.

WHEREFORE, we DISMISS the petition. The assailed Resolutions of the Court of Appeals are
AFFIRMED. Costs against petitioner.

SO ORDERED.

Davide, Jr., C.J., Vitug, Quisumbing, Ynares-Santiago, Sandoval-Gutierrez, Austria-Martinez,

Corona, Carpio-Morales, Azcuna, and Tinga, JJ., concur.
Puno, J., on leave.
Panganiban, J., on official leave.
Callejo, Sr., J., no part.