UNIVERSITY OF THE PHILIPPINES COLLEGE OF LAW Evid

E2024 Professor Jacoba

Tanzo v. Drilon
March 30, 2000
Second division | De Leon, Jr., J.

Topic: Admissions and Confessions; Confessions; Art. III, Sections 12 and 17, 1987 Consti; Rule
130, Section 34, Rule 133, Section 3

Article/s Invoked:
SEC. 4. Judicial admissions. — An admission, verbal or written, made by a party in the course of
the proceedings in the same case, does not require proof. The admission may be contradicted only
by showing that it was made through palpable mistake or that no such admission was made. [Rule
129]

SEC. 26. Admissions of a party. — The act, declaration or omission of a party as to a relevant fact
may be given in evidence against him. [Rule 130]

SEC. 33. Confession. — The declaration of an accused acknowledging his guilt of the offense
charged, or of any offense necessarily included therein, may be given in evidence against him. [Rule
130]

Parties:
PETITIONER RESPONDENTS
Harry Tanzo Hon. Franklin Drilon, Sec’y of Justice
Manual Salazar
Mario Salazar

FACTS OF THE CASE

The Salazars were engaged in the business of forwarding and transporting balikbayan boxes from
California to Manila; Manuel managed the Philippine side via MANSAL Forwarders, while Mario
handeld the US side as GM of MJS International. Mario tried to convince Tanzo to invest money in
the said business in California. Mario allegedly represented that Tanzo’s money will be held in trust
and administered by both him and Manuel for the exclusive use of their business. Tanzo further
alleged that Mario promise him an ROI equivalent to 10% for one month, at the end of which his
money + interest shall be returned.

Upon returning to the Philippines, Tanzo was persuaded by Manuel to part with his money under
the investment scheme. Tanzo agreed to invest $34,000 which he entrusted to his aunt, Liwayway
Dee Tanzo, who was residing in the US. Six checks were issued payable to Liwayway, Calfed, or
cash, and only one was encashed by Mario himself. Mario encountered serious liquidity problems
that made him petition for a release from his debts to the US Bankruptcy court, and he was ordered
released from all dischargeable debts.

Upon the expiration of the 30-day investment period, Tanzo demanded from Mario and Manuel
proper accounting of his financial investment and/or return of his capital plus interest earned. After
trying to avoid Tanzo, Manuel finally admitted that their shipments had encountered some problems
with the Bureau of Customs. Thus, Manuel executed a letter authorizing the petitioner to withdraw
documents to assist in the release of their shipments from the Bureau of Customs. However, when
Tanzo attempted to secure the release of the "balikbayan" boxes from the Bureau of Customs, he
discovered that the same had actually contained smuggled goods and were accordingly seized and
forfeited in favor of the government.

Tanzo eventually filed a complaint-affidavit for estafa against the Salazars, but the prosecutor
disimssde the complaint on the ground of lack of jurisdiction. Tanzo then filed a petition for review
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E2024 Professor Jacoba
of the dismissal of his complaint for estafa with Sec’y of Justice Drilon, but this was also dismismsed
based on lack of jurisdiction. His MFR was also denied, as he did not present any convincing
evidence to support the same. On the contrary, Tanzo’s evidence showed that he transacted with
Mario through his aunt, Liwayway Dee. This bolsters the claim of Manuel that the sums of money
received by Mario were simple loans as shown by the contract of loans executed by them in
California;

ISSUE/S & RATIO/S

W/N prima facie evidence exists that the Salazars had committed the crime of estafa and
should be held for trial—NO.
• Must be noted that Drilon dismissed the criminal charges on the ground of lack of jurisdiction,
as the crime was committed in the US, and eh found Tanzo’s evidence insufficient to support
his charge of estafa.
• A judicious scrutiny of the evidence shows that the transaction between respondents and
petitioner were simple loans and did not constitute a trust agreement, the violation of which
would hold the Salazars liable for estafa.
o Tanzo failed to present evidence other than his bare assertion that he had invested
money in the Salazars’ business on the basis of a trust agreement. The photocopies
of ht echecks allegedly subject of the trust agreement did more damage than good to
Tanzo’s proposition.
▪ None of the checks were issued to either Manuel or Mario; they were payable
to Liwayway Dee Tanzo, Calfed, or Cash. Moreover, only one of these checks
were actually encashed by Mario, the rest by Liwayway Dee Tanzo.
▪ On the basis of the foregoing alone, the Salazars could have completely denied
the existence of their liability to Tanzo as neither proof in writing nor witnesses
exist to substantiate Tanzo’s claim of a trust agreement between himself and
the Salazars.
▪ On the contrary, Manual does not deny that Mario had indeed received money
from Tanzo, albeit claiming that his liability was purely civil in nature for being
rooted in a simple loan contract.
▪ Mario offered in evidence copies of contracts of loan entered into between
MJS International and Liwayway Dee Tanzo. The SC agreed that these loan
contracts do not by themselves prove that Tanzo’s agreement with the Salazars
was also a loan. Tanzo was not a party to these contracts that clearly stipulated
Liwayway Dee Tanzo as creditor and MJS International represented by its GM,
Mario Salazar, as debtor.
o However, these loan contracts may be given evidentiary value in support of
Manuel’s claim that the agreement with Tanzo was no different from the loan
contracts with LIwayway.
▪ Under res inter alios acta, evidence that one did or did not do a certain thing at
one time is not admissible to prove that he did or did not do the same or similar
thing at another time, but it may be received to prove a specific intent or
knowledge, identity, plan, system, scheme, habit, custom or usage, and the
like.
▪ The series of transactions between MJS International and Liwayway were
entered into under similar circumstances as those surrounding the contract
between Tanzo and Mario, the loan contracts between MJS and Liwayway
provide that the creditor shall lend to the debtor a specific amount for use by
the latter in its business operations.
• Tanzo also admitted that he entrusted the checks to LIwayway for
investment in the Salazars’ business. This shows that the Salazars were
transacting directly with LIwayway in the usual manner that they conduct
business, that is the loan of money for stipulated interest. Hence, the
 UNIVERSITY OF THE PHILIPPINES COLLEGE OF LAW Evid
E2024 Professor Jacoba
Salazar’s modus operandi, if there ever was one, in raising additional
capital for MJS International was to borrow money from willing investors.
• It is thus unlikely that the Salazars would suddenly deviate from an
established business practice to enter into a trust agreement with Tanzo.
• In view of the foregoing and the unfortunate fact that Tanzo failed to present controverting
evidence, the SC adopted the Salazars’ position that the agreement was in the nature of a
simple loan agreement.
o Therefore, Tanzo’s contention that the Salazars committed estafa necessarily fails.
When the relation is purely that of debtor and creditor, the debtor cannot be held liable
for the crime of estafa by merely refusing to pay or by denying indebtedness.
o Rationale for rule: In order that a person be convicted of estafa under Art. 315, par.
1(b), it must be proven that he has the obligation to deliver or return the same money,
goods or personal property that he has received.
▪ The obligation to deliver exactly the same money, that is, bills or coins, is
nonexistent in a simple loan of money because in the latter, the borrow acquires
ownership of the money borrowed. Being owner, the borrow can dispose of the
thing borrowed and his act will not be considered misappropriation.
o Alternatively, Tanzo relied on estafa under Art. 315, par. 2(a). He contended that he
was deceived by the Salazars to part with his money on their representation that the
same would be held in trust for investment in their legitimate freight business only to
find out later that the Salazars used his money for the illicit activity of smuggling goods.
▪ This contention cannot be sustained for lack of evidence. The fact that several
shipments from MJS International were seized and forfeited by the Bureau of
Customs for containing smuggled items do not prove that Tanzo’s money was
used by the Salazars in the illegal activity.
▪ Tanzo himself admitted that he and his relatives were regular clients of the
Salazars since 1988. It cannot be doubted that the Salazars were likewise
engaged in a legitimate forwarding business in which Tanzo’s money could
have actually been invested.
▪ The letter issued by Manuel authorizing Tanzo to withdraw documents covering
the containers that were later seized by the Bureau of Custos bears little weight
in view of the fact that the same were not even presented before the prosecutor
and the Sec’y of Justice. It is a mere blank form that does not even indicate
Tanzo’s name as authorized bearer.
• Tanzo failed to prove and establish deceit by acts distinct from and independent of the non-
complaince of the promise.

RULING
Petition dismissed.

NOTES