G.R. No.

L-60033 April 4, 1984

TEOFISTO GUINGONA, JR., ANTONIO I. MARTIN, and TERESITA SANTOS, petitioners,

vs.
THE CITY FISCAL OF MANILA, HON. JOSE B. FLAMINIANO, ASST. CITY FISCAL FELIZARDO N. LOTA and CLEMENT
DAVID, respondents.

MAKASIAR, Actg. C.J.

Facts:

David invested several deposits with the Nation Savings and Loan Association [NSLA]. He said that he was induced
into making said investments by an Australian national who was a close associate of the petitioners [NSLA
officials]. On March 1981, NSLA was placed under receivership by the Central Bank, so David filed claims for his
and his sister’s investments.

Guingona and Martin, upon David’s request, assumed the bank’s obligation to David by executing a joint promissory
note. Later, David received a report that only a portion of his investments was entered in the NSLA records.

David filed a case before the Office of the City Fiscal, charging petitioners with estafa and violation of Central Bank
Circular No. 364 and related regulations on foreign exchange transactions, which was assigned to Asst. City Fiscal
Lota for preliminary investigation.

At the inception of the preliminary investigation before respondent Lota, petitioners moved to dismiss the charges
against them for lack of jurisdiction because David's claims allegedly comprised a purely civil obligation which was
itself novated. Fiscal Lota denied the motion to dismiss

But, after the presentation of David's principal witness, petitioners filed the instant petition because: (a) the
production of the Promisory Notes, Banker's Acceptance, Certificates of Time Deposits and Savings Account
allegedly showed that the transactions between David and NSLA were simple loans, i.e., civil obligations on the part
of NSLA which were novated when Guingona, Jr. and Martin assumed them; and (b) David's principal witness
allegedly testified that the duplicate originals of the aforesaid instruments of indebtedness were all on file with NSLA,
contrary to David's claim that some of his investments were not record  

Issue:

Whether or not the public respondents acted without jurisdiction when they investigated the charges against the
petitioners.

RULE

.While the Bank has the obligation to return the amount deposited, it has no obligation to return or deliver the same
money that was deposited. Failure to return the amount deposited will not constitute estafa through
misappropriation, but it will only give rise to civil liability.

APPLICATION/ANALYSIS

Petitioners’ liability is civil in nature, so respondents have no jurisdiction over the estafa charge.

When David invested his money on time and savings deposits with NSLA, the contract that was perfected
was a contract of simple loan or mutuum and not a contract of deposit. The relationship between David and
NSLA is that of creditor and debtor. While the Bank has the obligation to return the amount deposited, it has no
obligation to return or deliver the same money that was deposited. NSLA’s failure to return the amount
deposited will not constitute estafa through misappropriation, but it will only give rise to civil liability over
which the public respondents have no jurisdiction.

Considering that petitioners’ liability is purely civil in nature and that there is no clear showing that they engaged in
foreign exchange transactions, public respondents acted without jurisdiction when they investigated the charges
against the petitioners. Public respondents should be restrained from further proceeding with the criminal case for to
allow the case to continue would work great injustice to petitioners and would render meaningless the proper
administration of justice.

Even granting that NSLA’s failure to pay the time and savings deposits would constitute a violation of RPC 315,
paragraph 1(b), any incipient criminal liability was deemed avoided. When NSLA was placed under receivership,
Guingona and Martin assumed the obligation to David, thereby resulting in the novation of the original contractual
obligation. The original trust relation between NSLA and David was converted into an ordinary debtor-
creditor relation between the petitioners and David. While it is true that novation does not extinguish
criminal liability, it may prevent the rise of criminal liability as long as it occurs prior to the filing of the
criminal information in court. 

CONCLUSION

THE PETITION IS HEREBY GRANTED; THE TEMPORARY RESTRAINING ORDER PREVIOUSLY ISSUED IS
MADE PERMANENT