Lack of notice

In case of violation of the bouncing checks law, it is essential that the maker or drawer be notified of the dishonor of his or her check, so he or she could pay the value thereof or make arrangements for its payment within five banking days after receiving the notice. The absence of a notice of dishonor necessarily deprives an accused the opportunity to preclude a criminal prosecution and negates the presumption that he or she had knowledge of the insufficiency of his or her funds when he or she issued the checks. This is illustrated in this case of Nelda.

Nelda obtained from Cherry on installment various gift checks and purchase orders from a big department store. In payment thereof , she issued 15 post dated checks drawn on her bank over a period of three months, from February to May. Their usual arrangement was that before the checks were deposited she replaced them with cash. But Nelda started having problems with her cash flow resulting in her inability to replace the checks with cash. So when the checks were presented for deposit or encashment, they were all dishonored for the reason "account closed".

According to Cherry, she asked Nelda to pay the value of the checks and she hired lawyers to prepare and send demand letters. Two of said letters which were purportedly sent to Nelda were marked in evidence. But none of them contained an indication that they were actually received by Nelda. No acknowledgment receipt nor return card were offered in evidence. In fact Nelda denied having received any of such letters.

Because of this failure on the part of the prosecution to show that she has been properly notified of the dishonor, Nelda contended that she could not be guilty of violating the bouncing checks law.

Was Nelda correct?

Yes.

The absence of proof that Nelda received any notice informing her of the fact that her checks were dishonored and giving her five banking days to make arrangements for the payment of the said checks prevents the application of the disputable presumption that she had knowledge of the insufficiency of her funds at the time she issued the checks. Absent such presumption, the burden shifts to the prosecution to prove that Nelda had knowledge of the insufficiency of her funds when she issued said checks, otherwise, she can not be held liable under the law. The prosecution has not overcome this burden. While Cherry said that she verbally asked Nelda to pay the checks, there is no mention of when the demand was made, whether before or after the checks were dishonored by the drawee bank. What is pertinent here is prior notice to the drawer that her checks have been dishonored.

Even more crucial, the absence of any notice of dishonor personally sent to and received by Nelda of violation of her right to due process as it deprives her of the opportunity to avert prosecution.

But while Nelda is not liable for violation of the bouncing checks law, she is not relieved of her civil obligations she might have incurred by reason of her transactions with Cherry especially as in this case where she does not deny having issued the subject checks (Caras vs. Court of Appeals, G.R. 129900 October 2, 2001).

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