Albenson Enterprises Corp. v.

Court of Appeals, 217 SCRA 16

This petition assails the decision of respondent Court of Appeals in CA-GR CV No. 14948
entitled "Eugenio S. Baltao, plaintiff-appellee vs. Albenson Enterprises Corporation, et al,
defendants-appellants", which modified the judgment of the Regional Trial Court of Quezon
City, Branch XCVIII in Civil Case No. Q-40920 and ordered petitioner to pay private
respondent, among others, the sum of P500,000.00 as moral damages and attorney's fees in
the amount of P50,000.00.

FACTS:

Petitioner Albenson Enterprises Corporation delivered to Guaranteed Industries, Inc. mild

steel plates which the latter ordered. As payment, Albenson received a Pacific Banking
Corporation Check in the amount of P2, 575.00, drawn against the account of E.L.
Woodworks. Upon encashment, it was discovered that the account is closed hence the check
dishonored. Thereafter, petitioner Albenson through counsel traced the origin of the check
and later found out through the Securities and Exchange Commission that said account is
under the name Eugenio S. Baltao and upon further inquiry, Albenson was informed that E.L
Woodworks was registered under the name of Eugenio Baltao and so does the signature
appearing on the dishonored check. Albenson through counsel made an extrajudicial demand
upo provate responded Eugenio S. Baltao, president of Guaranteed to replace and/or make
good the dishonored check. Respondent Baltao, through counsel, denied that he issued the
check, or that the signature appearing thereon is his. He further alleged that Guaranteed was a
defunct entity and could not have transacted business with Albenson. On February 14, 1983,
Albenson filed with the Office of the Provincial Fiscal of Rizal a complaint against Eugenio
S. Baltao for violation of Batas Pambansa Bilang 22 with an affidavit of Albenson employee
Benjamin Mendiona. However it was later on found out that the respondent has a
namesake, his son Eugenio Baltao II who manages a business establishment, E.L.
Woodworks on the same address as that of Guaranteed.

On September 5, 1983, Assistant Fiscal Ricardo Sumaway filed an information against

Eugenio S. Baltao for Violation of Batas Pambansa Bilang 22. In filing said information,
Fiscal Sumaway claimed that he had given Eugenio S. Baltao opportunity to submit
controverting evidence, but the latter failed to do so and therefore, was deemed to have
waived his right. Respondent Baltao, claiming ignorance of the complaint against him,
immediately filed with the Provincial Fiscal of Rizal a motion for reinvestigation, alleging
that it was not true that he had been given an opportunity to be heard in the preliminary
investigation conducted by Fiscal Sumaway, and that he never had any dealings with
Albenson or Benjamin Mendiona, consequently, the check for which he has been accused of
having issued without funds was not issued by him and the signature in said check was not
his. Because of the alleged unjust filing of a criminal case against him for allegedly issuing a
check which bounced in violation of Batas Pambansa Bilang 22 for a measly amount of
P2,575.00, respondent Baltao filed before the Regional Trial Court of Quezon City a
complaint for damages against herein petitioners Albenson Enterprises, Jesse Yap, its owner,
and Benjamin Mendiona, its employee which was ruled by the court. Dissatisfied with the
ruling, petitioners Albenson Enterprises Corp., Jesse Yap, and Benjamin Mendiona filed the
instant Petition ruled under Article . Petitioners contend that the civil case filed in the lower
court was one for malicious prosecution. Private respondent, on the other hand, anchored his
complaint for Damages on Articles 19, 20, and 21 of the Civil Code.

ISSUE:

WON there was violation of Articles 19, 20, 21 of the civil code on the petitioners’ part as
claimed by private respondent.

HELD:

The elements of an abuse of right under Article 19 are the following:

(1) There is a legal right or duty;

(2) which is exercised in bad faith;

(3) for the sole intent of prejudicing or injuring another.

Article 20 speaks of the general sanction for all other provisions of law which do not
especially provide for their own sanction. Thus, anyone who, whether willfully or negligently,
in the exercise of his legal right or duty, causes damage to another, shall indemnify his victim
for injuries suffered thereby.

Article 21 deals with acts contra bonus mores, and has the following elements:

1) There is an act which is legal;

2) but which is contrary to morals, good custom, public order, or public policy;

3) and it is done with intent to injure.

Neither of these laws were violated therein by petitioners as they have meticulously
investigated to get the proper information regarding the dishonored check and its origin and
background. They even sent a letter to private respondent to make good of the check issued.
On the part of private respondent, he did nothing to clarify the mistaken identity. He also
denied the letter sent beforehand by petitioners. Private respondent does not deny that the
mild steel plates were ordered by and delivered to Guaranteed at Baltao building and as part
payment thereof, the bouncing check was issued by one Eugenio Baltao. Neither had private
respondent conveyed to petitioner that there are two Eugenio Baltaos conducting business in
the same building — he and his son Eugenio Baltao III.

WHEREFORE, the petition is GRANTED and the decision of the Court of Appeals in C.A.
G.R. C.V. No. 14948 dated May 13, 1989, is hereby REVERSED and SET ASIDE. Costs
against respondent Baltao.