GEOFFREY F. GRIFFITH, Petitioner, v. HON. COURT OF APPEALS, RTC JUDGE EDWIN A. VILLASOR, MTC JUDGE MANUEL D.L. VILLAMAYOR and PHELPS DODGE PHILS., INC., Respondents.
D E C I S I O N
Assailed in this petition is the decision1 dated March 14, 1997 of the Court of Appeals in CA-G.R. SP No. 19621, affirming the Regional Trial Courts decision2 finding petitioner Geoffrey F. Griffith guilty on two counts for violation of Batas Pambansa Blg. 22 (the Bouncing Checks Law), and sentencing him to suffer imprisonment for a period of six months on each count, to be served consecutively. Also assailed is the Court of Appeals resolution3 dated July 8, 1997 denying petitioners motion for reconsideration.
The facts are as follows:
In 1985, Phelps Dodge
Philippines, Inc. leased its lot and factory building to Lincoln Gerard, Inc.
for a term of two years at a monthly rental of
Far East Bank and
Trust Co. Check No. 06B-C-075065, dated April 15, 1986 for
Far East Bank and
Trust Co. Check No. 06B-C-075066, dated May 1, 1986 for
The voucher for these checks contained the following instruction:
These checks are not to be presented without prior approval from this Corporation to be given not later than May 30, 1986.
Also written on the face of the voucher was the following note:
However, if written approval of Lincoln Gerard, Inc. is not given before May 30, 1986, Phelps Dodge, Phils. shall present the cheques for payment. This is final and irrevocable.5cräläwvirtualibräry
On May 29, 1986, Griffith wrote Phelps Dodge not to present the said checks for payment on May 30, 1986 because they could not be funded due to a four-week labor strike that had earlier paralyzed the business operations of Lincoln Gerard.6cräläwvirtualibräry
Previously, in a letter dated May 20, 1986, Phelps Dodge, through its treasurer Ricardo R. Manarang, advised Lincoln Gerard that it was transferring the contents of the Lincoln Gerard warehouse in the leased premises since a new tenant was moving in. Phelps Dodge told Lincoln Gerard that its properties would be placed in our compound and under our custody.7cräläwvirtualibräry
On June 2, 1986,8 when no further communication was received from Lincoln Gerard, Phelps Dodge presented the two checks for payment but these were dishonored by the bank for having been drawn against insufficient funds. Three days later, Phelps Dodge sent a demand letter to Lincoln Gerard, apprising Griffith of the dishonor of the checks and asking him to fund them within the time prescribed by law.9 Lincoln Gerard still failed to fund the checks but Griffith sent a letter to Phelps Dodge, explaining Lincolns inability to fund said checks due to the strike.10 Subsequently, on June 19, 1986, Phelps Dodge notified Lincoln Gerard that its properties would be foreclosed. Phelps Dodge went ahead with the foreclosure and auction sale on June 20, 1986,11 despite Lincoln Gerards protest.12cräläwvirtualibräry
On May 10, 1988, two informations for violation of B.P. 22 docketed as Criminal Cases Nos. 73260 and 73261 were filed against petitioner before the Regional Trial Court. The motion for reconsideration filed by Griffith was dismissed, and so were his petition for review filed before the Department of Justice and later on his motion to quash filed before the RTC. Griffith then filed a petition for certiorari before the Court of Appeals that was likewise denied.
Meanwhile, on November 6,
1987, Lincoln Gerard lodged a complaint for damages docketed as Civil Case No.
55276 before the Regional Trial Court of Pasig, Branch 69, against Phelps Dodge
and the notary public who conducted the auction sale.13 On July 19, 1991, the trial court ruled that
the foreclosure and auction sale were invalid, but applied the proceeds thereof
to Lincoln Gerards arrearages.
ordered Phelps Dodge to return to Lincoln Gerard the
The evidence shows that defendant corporation had already received
the amount of
On appeal, the Court of Appeals affirmed the RTC decision, and this became final and executory.16cräläwvirtualibräry
On August 25, 1994, the criminal cases against Griffith pending before the RTC were remanded to the Metropolitan Trial Court (MeTC), in view of Republic Act No. 7691 that expanded the jurisdiction of the MeTC.
On July 25, 1995, the MeTC, in Criminal Cases Nos. 41678 and 41679, found Griffith guilty on both counts for violation of B.P. 22,17 and sentenced him to suffer imprisonment for six months on each count, to be served consecutively. Thus:
WHEREFORE, premises considered, this court finds the accused GEOFFREY F. GRIFFITH, GUILTY OF VIOLATION of Section 1 of Batas Pambansa Blg. 22, otherwise known as the Bouncing Checks Law on two counts.
The accused is therefore hereby sentence (sic) to suffer imprisonment for a period of SIX (6) MONTHS in Criminal Case No. 41678 and another SIX (6) MONTHS in Criminal Case No. 41679, both of which shall be served consecutively.
Considering that the civil aspect of these cases has already been decided by the Regional Trial Court Branch 69, Pasig, regardless of its finality, of which this court has no record, this Court shall not resolve the same because they are either Res Judicata or Pendente Litis.
On appeal, the RTC affirmed in toto the lower courts decision.
Petitioner then appealed his conviction to the Court of Appeals. In a consolidated decision dated March 14, 1997, the appellate court ruled:
WHEREFORE, absent any prima facie merit in it, the Petition for Review under consideration is hereby DENIED DUE COURSE. Costs against petitioner.
SO ORDERED. 19cräläwvirtualibräry
Petitioner moved for a reconsideration of said decision but this was denied by the appellate court in a resolution dated July 8, 1997.20 Hence, this petition seeking reversal of the CA decision and resolution on the criminal cases, anchored on the following grounds:
I. THE COURT OF APPEALS DECISION DATED 14 MARCH 1997 AND ITS RESOLUTION DATED 8 JULY 1997 ARE CONTRARY TO THE RULING IN MAGNO V. COURT OF APPEALS, WHERE THIS HONORABLE COURT LAID DOWN THE DOCTRINE THAT A CONVICTION UNDER B.P. 22 CANNOT BE BASED ON AN INVERSE APPLICATION OF THE ELEMENT OF KNOWLEDGE.
II. THE COURT OF APPEALS DECISION DATED 14 MARCH 1997 AND ITS RESOLUTON DATED 8 JULY 1997 RESULT IN AN UNCONSTITUTIONAL APPLICATION OF THE PROVISIONS OF B.P. 22.
III. THE COURT OF APPEALS DECISION DATED 14 MARCH 1997 AND ITS RESOLUTION DATED 8 JULY 1997 STATING THAT PAYMENT THROUGH NOTARIAL FORECLOSURE BEFORE THE FILING OF THE CRIMINAL INFORMATIONS UNDER B.P. 22 DOES NOT ABATE CRIMINAL LIABILITY, ARE ERRONEOUS AND RESULT IN THE INIQUITOUS INTERPRETATION OF THE LAW.
IV. THE COURT OF APPEALS DECISION DATED 14 MARCH 1997 AND ITS RESOLUTION DATED 8 JULY 1997 ARE INCONSISTENT WITH ITS OWN FINDINGS AND CONCLUSIONS IN A RELATED CASE (CA-G.R. NO. 20980) INVOLVING THE SAME PETITIONER AND RESPONDENT AND THE SAME TRANSACTION SUBJECT OF THIS CASE.
V. THE COURT OF APPEALS DECISION DATED 14 MARCH 1997 AND ITS RESOLUTION DATED 8 JULY 1997 WHICH RELIED ON THE RULING IN THE CASE OF LIM V. COURT OF APPEALS ON VENUE TO JUSTIFY ITS FINDING THAT PETITIONER HAS COMMITTED TWO COUNTS OF VIOLATION OF B.P. 22, ARE CONTRAY TO LAW AND JURISPRUDENCE. 21cräläwvirtualibräry
Petitioner points out that he communicated to Phelps Dodge through a note on the voucher attached to the checks, the fact that said checks were unfunded at the time of their issuance. Petitioner contends that this good faith on his part negates any intent to put worthless checks in circulation, which is what B.P. 22 seeks to penalize. Moreover, as regards the second check that was postdated, petitioner contends that there could not be any violation of B.P. 22 with said check since the element of knowledge of insufficiency of funds is absent. Petitioner could not have known at the time of its issuance that the postdated check would be dishonored when presented for payment later on.
Petitioner argues that his conviction in this case would be violative of the constitutional proscription against imprisonment for failure to pay a debt, since petitioner would be punished not for knowingly issuing an unfunded check but for failing to pay an obligation when it fell due.
Petitioner also asserts that the payment made by Lincoln Gerard through the proceeds of the notarial foreclosure and auction sale extinguished his criminal liability.
On the other hand, private respondent contends that all the elements that comprise violation of B.P. 22 are present in this case. Moreover, the payment in this case was made beyond the five-day period, counted from notice of dishonor, provided by the law and thus did not extinguish petitioners criminal liability.
For the State, the Solicitor General contends that Lincoln Gerard assured Phelps Dodge, through the note on the voucher attached to the checks, that said checks would be covered with sufficient funds by May 30, 1996, which assurance was final and irrevocable.22 The OSG also argues that B.P. 22 does not distinguish between a check that is postdated and one that is not, for as long as the drawer issued the checks with knowledge of his insufficient funds and the check is dishonored upon presentment.
There is no unconstitutional punishment for failure to pay a debt in this case, since according to the OSG, what B.P. 22 penalizes is the act of making and issuing a worthless check that is dishonored upon presentation for payment, not the failure to pay a debt.23cräläwvirtualibräry
The OSG asserts that the supposed payment that resulted from Phelps Dodges notarial foreclosure of Lincoln Gerards properties could not bar prosecution under B.P. 22, since damage or prejudice to the payee is immaterial. Moreover, said payment was made only after the violation of the law had already been committed. It was made beyond the five-day period, from notice of dishonor of the checks, provided under B.P. 22.
The principal issue in this case is whether petitioner Geoffrey F. Griffith, president of Lincoln Gerard, Inc., has been erroneously convicted and sentenced for violation of the Bouncing Checks Law (Batas Pambansa Blg. 22). His conviction on two counts and sentence of six months imprisonment for each count by the respondent MTC Judge Manuel Villamayor was upheld by respondent RTC Judge Edwin Villasor and affirmed by the respondent Court of Appeals. But private respondent appears to have collected more than the value of the two checks in question before the filing in the trial court of the case for violation of B.P. 22. Hence, petitioner insists he has been wrongfully convicted and sentenced. To resolve this issue, we must determine whether the alleged payment of the amount of the checks two years prior to the filing of the information for violation of B.P. 22 justifies his acquittal.
Whether there is an unconstitutional application of the provisions of B.P. 22 in this case, however, does not appear to us an appropriate issue for consideration now. A purported constitutional issue raised by petitioner may only be resolved if essential to the decision of a case and controversy. But here we find that this case can be resolved on other grounds. Well to remember, courts do not pass upon constitutional questions that are not the very lis mota of a case.24cräläwvirtualibräry
In the present case, the checks were conditionally issued for arrearages on rental payments incurred by Lincoln Gerard, Inc. The checks were signed by petitioner, the president of Lincoln Gerard. It was a condition written on the voucher for each check that the check was not to be presented for payment without clearance from Lincoln Gerard, to be given at a specific date. However, Lincoln Gerard was unable to give such clearance owing to a labor strike that paralyzed its business and resulted to the companys inability to fund its checks. Still, Phelps Dodge deposited the checks, per a note on the voucher attached thereto that if written approval was not received from Lincoln Gerard before May 30, 1986, the checks would be presented for payment. This is final and irrevocable, according to the note that was written actually by an officer of Phelps Dodge, not by petitioner. The checks were dishonored and Phelps Dodge filed criminal cases for violation of B.P. 22 against petitioner. But this filing took place only after Phelps Dodge had collected the amount of the checks, with more than one million pesos to spare, through notarial foreclosure and auction sale of Lincoln Gerards properties earlier impounded by Phelps Dodge.
In our view, considering the circumstances of the case, the instant petition is meritorious.
The Bouncing Checks Law was devised to safeguard the interest of the banking system and the legitimate public checking account user.25 It was not designed to favor or encourage those who seek to enrich themselves through manipulation and circumvention of the purpose of the law.26 Noteworthy, in Administrative Circular No. 12-2000, this Court has expressed a policy preference for fine as penalty in cases of B.P. 22 violations rather than imprisonment to best serve the ends of criminal justice.
Moreover, while the
philosophy underlying our penal system leans toward the classical school that
imposes penalties for retribution,27 such retribution should be aimed at actual
and potential wrongdoers.28 Note that in the two criminal cases filed by
Phelps Dodge against petitioner, the checks issued were corporate checks that
Lincoln Gerard allegedly failed to fund for a valid reason duly communicated to
Further, it bears repeating
that Phelps Dodge, through a notarial foreclosure and auction that were later
on judicially declared invalid, sold Lincoln Gerards property for cash
That is why we find quite instructive the reasoning of the Court of Appeals earlier rendered in deciding the petition for Certiorari and Injunction, Griffith v. Judge Milagros Caguioa, CA-G.R. SP No. 20980, in connection with the petitioners motion to quash the charges herein before they were tried on the merits.32cräläwvirtualibräry
Said Justice C. Francisco with the concurrence of Justices Reynato S. Puno and Asaali S. Isnani:
We are persuaded that the defense has good and solid defenses
against both charges in Criminal Cases Nos. 73260-61. We can even say that the decision rendered in Branch 69 in Civil
Case No. 55276, well-written as it is, had put up a formidable obstacle to any
conviction in the criminal cases with the findings therein made that the sale
by public auction of the properties of Lincoln was illegal and had no
justification under the facts; that also the proceeds realized in the said sale
should be deducted from the account of Lincoln with Phelps, so that only
Petitioners efforts to quash in the Court of Appeals the charges against him was frustrated on procedural grounds because, according to Justice Francisco, appeal and not certiorari was the proper remedy.34 In a petition for certiorari, only issues of jurisdiction including grave abuse of discretion are considered, but an appeal in a criminal case opens the entire case for review.
While we agree with the private respondent that the gravamen of violation of B.P. 22 is the issuance of worthless checks that are dishonored upon their presentment for payment, we should not apply penal laws mechanically.35 We must find if the application of the law is consistent with the purpose of and reason for the law. Ratione cessat lex, et cessat lex. (When the reason for the law ceases, the law ceases.) It is not the letter alone but the spirit of the law also that gives it life. This is especially so in this case where a debtors criminalization would not serve the ends of justice but in fact subvert it. The creditor having collected already more than a sufficient amount to cover the value of the checks for payment of rentals, via auction sale, we find that holding the debtors president to answer for a criminal offense under B.P. 22 two years after said collection, is no longer tenable nor justified by law or equitable considerations.
In sum, considering that the money value of the two checks issued by petitioner has already been effectively paid two years before the informations against him were filed, we find merit in this petition. We hold that petitioner herein could not be validly and justly convicted or sentenced for violation of B.P. 22. Whether the number of checks issued determines the number of violations of B.P. 22, or whether there should be a distinction between postdated and other kinds of checks need no longer detain us for being immaterial now to the determination of the issue of guilt or innocence of petitioner.
WHEREFORE, the petition is hereby GRANTED. The decision of the Court of Appeals in CA-G.R. No. 19621 dated March 14, 1997, and its resolution dated July 8, 1997, are REVERSED and SET ASIDE. Petitioner Geoffrey F. Griffith is ACQUITTED of the charges of violation of B.P. 22 in Criminal Cases Nos. 41678 and 41679.
Costs de officio.
Bellosillo, (Chairman), Mendoza, Buena, and De Leon, Jr., JJ., concur.
Search for www.chanrobles.com
|Copyright © ChanRoblesPublishing Company| Disclaimer | E-mailRestrictions|
ChanRobles™Virtual Law Library ™ | chanrobles.com™