Inconsequential

Is the cause or reason for the issuance of a check material in determining liability under the bouncing checks law? This is one of the issues raised and answered in this case of Lina.

Lina was engaged in manufacturing garments for export. To finance the operation of her business, she used to borrow money from Mila and a financing company. As a condition for the grant of the loan in her favor, Mila required Lina to issue four checks in the aggregate amount of P188,400 over a period of four months starting September to December 1988. On maturity dates, Mila deposited said checks with her bank. The checks, however, were later returned, with the notation “Insufficient Funds” stamped on the dorsal portion of each check.

Mila notified Lina of the dishonor of her checks and warned her that she will be filing an action for violation of the bouncing checks law if she would not replace said checks with cash. Lina requested Mila to give her more time to settle her account because business has not been good for the past year. Mila acceded but Lina still failed to pay the amount of the checks. So Mila was constrained to file four criminal cases for violation of the bouncing checks law.

After trial and following reception of evidence, the lower court found Lina guilty and sentenced her to suffer one year imprisonment for each count and to indemnify Mila the sum of P47,100 in each case. The Court of Appeals affirmed the said decision in toto.

On further appeal to the Supreme Court, Lina contended that she should not be held liable for violation of the bouncing checks law because there was an absolute lack of consideration for the subject checks which were issued only as a condition for the grant of loan in her favor. Was Lina correct?

No. The cause or reason for the issuance of the check is inconsequential in determining criminal liability. A check issued as an evidence of debt, although not intended for encashment, has the same effect like any other check and is within the contemplation of the bouncing checks law (BP 22). Once a check is presented for payment, the drawee bank gives it the usual course whether issued in payment of an obligation or just as guaranty of an obligation. BP 22 does not appear to concern itself with what might be envisioned by the parties, its primordial intention being to instead ensure the stability and commercial value of checks, being virtual substitutes for currency. It is a policy that can easily be eroded if one has yet to determine the reason for which checks are issued, or the terms and conditions of their issuance, before an appropriate application of the legislative enactment can be made. The gravamen of the offense under BP 22 is the act of making or issuing a worthless check or a check that is dishonored upon presentment for payment. The act effectively declares the offense to be malum prohibitum. The only valid query then is whether the law has been breached, i.e., by the mere act of issuing a bad check, without so much regard as to the criminal intent of the issuer.

So Lina is guilty. However, given the circumstances, the sentence of the trial court should be modified by deleting the prison sentence of one year each and, in its stead, a fine of P94,200.00 in each of the cases should be imposed (Meriz vs. People G.R. 134498, November 13, 2001).

Note: Books containing compilation of my articles on Labor Law and Criminal Law (Vols. I and II) are now available. Call tel. 7249445.

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