Republic of the Philippines
Supreme Court
Manila
 
FIRST DIVISION
 
LYZAH SY FRANCO,   G.R. No. 171328
Petitioner,    
     
- versus -    
     
PEOPLE OF THE PHILIPPINES,    
Respondent.    
x- - - - - - - - - - - - - - - - - - - - - - - - - x    
     
STEVE BESARIO,   G.R. No. 171335
Petitioner,    
     
    Present:
     
    CORONA, C. J., Chairperson,
- versus -   VELASCO, JR.,
    LEONARDO-DE CASTRO,
    DEL CASTILLO, and
    PEREZ, JJ.
     
PEOPLE OF THE PHILIPPINES,   Promulgated:
Respondent.   February 16, 2011
x--------------------------------------------------------x
 
DECISION
 
 
DEL CASTILLO, J.:
 
 In the prosecution for the crime of estafa committed under Article 315, paragraph
2(a) of the Revised Penal Code, there must be evidence of false representation or false
pretense on the part of the accused to prove reasonable doubt. In this case, the employees
act of soliciting a client despite previous knowledge of several complaints against his or
her employer for failure to deliver the motor vehicle that was the subject of the
agreement, is tantamount to misrepresentation.

Factual Antecedents
 
These petitions for review on certiorari impugn the Decision[1] of the Court of Appeals
(CA) in CA-G.R. CR No. 27414 which affirmed with modifications the Decision [2] of the
Regional Trial Court of Manila, Branch 52, in Criminal Case No. 99-173688, convicting
petitioners Lyzah Sy Franco (Franco) and Steve Besario (Besario) of the crime of
Estafa. The Information filed against petitioners and their co-accused, Antonio Rule, Jr.
(Rule) and George Torres (Torres), contained the following accusatory allegations:
 
That on or about the first week of June 1998, in the City of Manila, Philippines,
the said accused, conspiring and confederating together and helping one another, did then
and there willfully, unlawfully and feloniously defraud MA. LOURDES G. ANTONIO,
in the following manner, to wit: the said accused by means of false manifestations and
fraudulent representations which they made to said Ma. Lourdes G. Antonio, to the effect
that they are employees of FINAL ACCESS MARKETING, a business entity engaged
in the sale and financing of used or repossessed cars, and as such could process and
facilitate the sale of a Mazda car 323 bearing plate number PVB-999 worth P130,000.00
provided they be given the amount of P80,000.00 as down payment and by means of
other deceits of similar import, induced and succeeded in inducing the said Ma. Lourdes
G. Antonio to give and deliver as in fact she gave and delivered to herein accused the said
amount of P80,000.00, and accused knowing fully well that their manifestations and
representations were false and untrue and were made only to obtain the said amount
of P80,000.00 which amount once in their possession, did then and there willfully,
unlawfully and feloniously misapply, misappropriate and convert the said amount
of P80,000.00 to their own personal use and benefit, to the damage and prejudice of said
MA. LOURDES G. ANTONIO in the aforesaid amount of P80,000.00 in its equivalent
amount to the Philippine Currency.
 
Contrary to law.[3]
 
During arraignment, petitioners entered separate pleas of not guilty. Rule and
Torres failed to appear and, to date, remain at large. After the termination of the pre-trial
conference, trial ensued.
  
 
The Version of the Prosecution
 
Ma. Lourdes G. Antonio (Lourdes) testified that petitioners swindled her. She claimed
that Franco was a friend of her niece and that she has known her for almost a year. In the
first week of June 1998, Franco came to her house and offered to assist her in purchasing
a used car. Franco introduced herself as Assistant Administrative Coordinator of Final
Access Marketing which was engaged in the sale and financing of second-hand and
repossessed vehicles. Franco gave her calling card after their conversation.
 
Lourdes was interested in the offer of Franco since she and her husband were actually
looking for a used car for their taxicab operation. She therefore contacted Franco to take
up her offer.
 
On June 26, 1998, Franco and Lourdes went to a showroom on Houston Street, San
Juan, Metro Manila, where Lourdes immediately chose a blue Mazda 323 car with Plate
No. PVB No. 999 from those that were on display.
 
At around 7 oclock in the evening of July 2, 1998, Franco went to the house
of Lourdes and presented a sales proposal. She was with Besario and Rule, whom she
introduced as her superiors.Rule then made a presentation on the Mazda 323 car
informing Lourdes that she can buy it for P130,000.00 with a downpayment
of P80,000.00 and the balance to be paid in 12 equal monthly installments. Rule also
told Lourdes that the car would be delivered within three days from receipt of her money.
 
Lourdes agreed to pay the downpayment the following day. Before the petitioners
departed, Rule ordered Franco to sign the sales proposal as sales executive. Lourdes also
signed the document. Rule then issued a receipt dated July 3, 1998 and instructed Franco
and Besario to give it to Lourdes after receiving her downpayment upon their return on
the next day.
The following day, July 3, 1998, Franco and Besario returned to the house of Lourdes to
collect the downpayment of P80,000.00. Besario received and counted the money and
handed it to Franco. After counting the money, Franco returned the same to Besario, who
put it inside the bag he was carrying. They gave to Lourdes the receipt dated July 3, 1998
that was signed by Rule.At the same time, they assured her that the car would be
delivered in three days.
 
The car, however, was not delivered as promised. Lourdes called up Final Access
Marketings office and was able to talk to the owner/manager, Torres, who assured her
that her downpayment would be refunded or that they would look for a replacement.
 
Meanwhile, Lourdes and her husband returned to the showroom on Houston Street, San
Juan, where they saw the Mazda car already clean. The security guard told them it was
ready for release in the afternoon.
 
When the car was still undelivered, Lourdes sought the aid of Hoy Gising, a television
show that broadcasts grievances of people against fraudulent schemes. During a visit to
the shows office, Lourdes learned that 12 other persons were victimized by the group of
petitioners.
 
Lourdes also met with Atty. Renz Jaime, legal counsel of Final Access Marketing, who
assured her that Final Access Marketing would return her money by August. When he
reneged on his promise, formal demand was made on him to settle the obligation of said
business enterprise.
 
Erlinda Acosta (Erlinda) was one of the alleged victims of petitioners
whom Lourdes met while airing her complaint in the television program Hoy
Gising. Erlinda testified that she was referred to Besario when she was looking for a
second-hand vehicle. She went to the office of Final Access Marketing in Timog
Avenue, Quezon City, and was shown by Besario several pictures of vehicles from
which she chose a Mitsubishi Pajero.
 
On April 7, 1998, Erlinda and her son met Besario, Rule and their other companions in a
restaurant. They brought the vehicle Erlinda wanted to purchase and her son drove it for
a road test.Thereafter, she agreed to buy the vehicle for P600,000.00. She signed a
Vehicle Sales Proposal and handed to Rule a downpayment of US$3,000.00.
 
On April 20, 1998, Erlinda delivered to Besario and Rule a managers check in the
amount of P245,000.00 as payment for the entire balance. She was then assured that the
vehicle will be delivered a week later. However, Besario and Rule reneged on their
promise. Erlinda went to the office of Final Access Marketing and complained to Franco
but to no avail. Her motor vehicle was never delivered. Thus, she went to Hoy Gising.
 
Juanito Antonio corroborated the testimony of his wife, Lourdes. He was present when
petitioners Franco and Besario, together with Rule, went to their house in the evening of
July 2, 1998 with a written proposal for the sale of a vehicle. After his wife signed the
document, she gave a downpayment of P80,000.00. When the car was not delivered on
the date agreed upon, he and his wife went to the office of Final Access Marketing. Upon
their inquiries, the security guard on duty said that the car they purchased already had a
gate pass and would be delivered in the afternoon. However, the said vehicle was never
delivered to them.
 
The Version of the Petitioners
 
Franco denied involvement in the alleged conspiracy to commit estafa
against Lourdes. She alleged that it was Torres, the owner of Final Access Marketing,
who was the swindler. And like Lourdes, she was a victim in this case.
Franco claimed that petitioner Besario hired her as a clerk-typist. She was
promoted to the position of Assistant Administrative Coordinator and was authorized to
solicit clients for Final Access Marketing.
 
Franco learned from her sister that Lourdes wanted to purchase a second-hand
car. She went to see Lourdes and presented to the latter a list of repossessed
vehicles. She gave her calling card to Lourdes before they parted. Later
on, Lourdes called and visited the office of Final Access Marketing, where Franco
introduced Lourdes to Besario and Rule.
 
Franco accompanied Lourdes to showrooms where the latter chose a blue Mazda
car with Plate No. PVB 999. Rule agreed to sell the car
to Lourdes for P130,000.00. Thus, on the evening of July 2, 1998, she, Besario and Rule
went to the house of Lourdes with a Vehicle Sales Proposal. Franco signed the document
without reading and understanding the same upon the insistence of Rule. Rule then
signed an official receipt and instructed Franco and Besario to return the next day to give
the same to Lourdes after collecting her downpayment. Lourdes was also assured that
the car would be delivered within three days from receipt of the downpayment.
 
On July 3, 1998, at around 10 a.m., Franco and Besario came back to collect the
downpayment. Lourdes gave her cash payment to Besario, who counted it. He gave said
cash to Franco, who counted it again. When the money was handed back to Besario, he
put it inside a black bag. Thereafter, Franco and Besario went to a restaurant to pick-up
Rule. They rode a taxi and proceeded to the house of Torres, but it was only Besario and
Rule who went inside. Franco went home without receiving a single centavo for her
transportation fare.
 
When the car was not delivered, Lourdes called Franco who in turn reminded her
boss to expedite its release. However, the continued failure to receive the vehicle
compelled Lourdes to report the incident to Hoy Gising. It was only during this period
that Franco learned of similar complaints from other
customers. Thereafter, Lourdes called her intermittently asking for a
reimbursement. However, the latter could not do anything since her employers no longer
reported to the office. Rule and Torres left Manila and went to Cebu. She was not aware
of their whereabouts at the time of her testimony.
 
On the other hand, Besario failed to attend several hearings. The notice to appear
and to present evidence sent to him was returned unserved since he moved to another
address without informing the trial court. Thus, upon motion of the prosecution, he was
declared to have waived his right to present evidence. The case was consequently
submitted for decision.
 
The Ruling of the Regional Trial Court
 
On October 23, 2001, the trial court rendered its Decision finding petitioners guilty
beyond reasonable doubt of the crime of estafa under Article 315, par. 1(b) of the
Revised Penal Code. The dispositive portion reads as follows:
 
ACCORDINGLY, above premises all considered, the Court finding accused
Lyzah Sy Franco and Steve Besario GUILTY, beyond reasonable doubt, of the crime
charged in the Information, the Court hereby sentences said two accused to each suffer
the indeterminate penalty of imprisonment ranging from seventeen (17) years
 of reclusion temporal as MAXIMUM to eight (8) years and one (1) day
of prisonmayor as MINIMUM and to suffer all the accessory penalties as provided by
law.
Accused Franco and Besario, jointly and severally are likewise ordered to pay
private complainant Ma. Lourdes Antonio the sum of P80,000.00 as actual damages.
SO ORDERED.[4]
 
 
The Ruling of the Court of Appeals
 
On July 26, 2005, the CA promulgated its Decision that affirmed with
modification the decision of the trial court. It convicted the petitioners for the crime of
estafa under Article 315, par. 2(a) of the Revised Penal Code and modified the
penalty. The dispositive portion of its Decision reads as follows:
 
WHEREFORE, in view of the foregoing premises, the Decision dated October
23, 2001 rendered by the trial court is hereby AFFIRMED, with modification to the
effect that the penalty imposed upon each of the appellants is hereby MODIFIED to an
indeterminate sentence of Four (4) years, Two (2) months, and One (1) day of prision
correccional as minimum to Thirteen (13) years of reclusion temporal as maximum.
 
Accused Franco and Besario are likewise ordered to pay, jointly and severally,
private complainant, Ma. Lourdes Antonio, the sum of P80,000.00 as actual damages.
SO ORDERED.[5]
 
 
Hence, petitioners filed separate petitions for review on certiorari assailing the
Decision of the CA. Franco contends that the Court of Appeals decided the case on a
mistaken inference and [misappreciation] of facts bordering on speculations, surmises or
conjectures.[6]
 
On the other hand, Besario ascribes the following error to the CA:
 
PUBLIC RESPONDENT COURT OF APPEALS COMMITTED REVERSIBLE
ERROR BY DISREGARDING THE LAW, JURISPRUDENCE AND EVIDENCE
WHEN IT RULED THAT PETITIONER BESARIO IS GUILTY OF THE CRIME OF
ESTAFA AS CHARGED IN THE INFORMATION.[7]
 
 
In its Consolidated Comment, the Solicitor General opposes the petitions by arguing that
petitioners raise[d] questions of fact which are inappropriate in a petition for review
on certiorari. x x x.[8] The Solicitor General also believes the prosecutions evidence was
sufficient to convict petitioners of estafa under Article 315, par. 2(a) of the Revised Penal
Code and that petitioners defenses failed to overturn the evidence showing their guilt
beyond reasonable doubt.
 
Our Ruling
 
The petitions are not meritorious.
 
Exception to the Finality and Conclusiveness
of Factual Findings of the Court of Appeals
 
 
[A]s a rule, our jurisdiction in cases brought to us from the Court of Appeals is limited to
the review and revision of errors of law allegedly committed by the appellate court, as
findings of fact are deemed conclusive and we are not duty-bound to analyze and weigh
all over again the evidence already considered in the proceedings below.[9] While this rule
is not without exception, there are no exceptional circumstances in these cases that
warrant a departure from the findings of facts of the trial court, as affirmed by the
CA. Even after considering the merits, the petitions deserve outright denial.
 
The conviction of Franco and Besario for conspiring to commit estafa
against Lourdes must therefore stand. The prosecution satisfactorily established their
participation in the scheme to defraud Lourdes, their acts were not isolated from but
related to a plot to deceive her. The prosecution likewise proved beyond reasonable
doubt that the well-planned swindling scheme of Franco and Besario resulted to estafa.
 
Conspiracy must be Shown as Clearly as the
Commission of the Offense[10]
 
There is conspiracy when two or more persons agree to commit a felony
and decide to commit it.[11] Conspiracy must be proven on the same quantum of evidence
as the felony subject of the agreement of the parties. [It] may be proved by direct or
circumstantial evidence consisting of acts, words, or conduct of the alleged conspirators
[prior to], during and after the commission of the felony to achieve a common design or
purpose.[12]
 
Several circumstances in this case conclusively show Francos role in
defrauding Lourdes. She was the one who personally approached Lourdes and actively
made representations on behalf of Final Access Marketing despite previous knowledge of
the companys failure to deliver the vehicle sold to Erlinda. She offered to
help Lourdes purchase a second-hand car by presenting herself as an Assistant
Administrative Coordinator of said company. She also assisted Lourdes in selecting a car
she wanted to buy. Six days later, Franco arrived with Besario and Rule in the house
of Lourdes after regular business hours. Franco made the necessary introductions and
they commenced with a presentation that persuaded Lourdes to part with her
money. They showed Lourdes a prepared Sales Proposal Agreement that Franco signed
as a sales executive.
 
Franco, together with Besario, returned the next day to collect the downpayment
of Lourdes. After counting the money and putting it inside a bag, they
assured Lourdes that the car would be delivered within three days. When they failed to
fulfill their promise and their unlawful scheme was unraveled, she did not do anything to
placate Lourdes.
 
We cannot lend credence to Francos assertion that she only knew of her
employers fraudulent scheme after Lourdes reported the same to Hoy Gising. For sure,
before their former clients reported their anomalous transactions to Hoy Gising, they first
lodged their complaints with the company itself. Hence, we are at a loss why Franco, as
the companys Assistant Administrative Coordinator would feign ignorance of the
same. We also could not understand why after discovering her employers fraudulent
transactions, and after said employers absconded, Franco continued to report to their
office. She did not even bother to inform Lourdes that her employers had already
absconded. Finally, since she made representations to Lourdesthat the car would be
delivered in three days time, the least that Franco could have done was to investigate the
matter and explain to Lourdes the companys failure to deliver the car. After all, Franco
was a friend of Lourdes niece.
 
 Besario, for his part, actively conspired with Franco by inducing Lourdes to part
with her money. He also went to the house of Lourdes and induced the latter to make a
downpayment on the car she wanted to purchase and sign the Sales Proposal
Agreement. He and Franco collected the money from Lourdes and promised her that the
car would be delivered three days later even if he had knowledge from the previous
transaction with Erlinda that the delivery would never happen. Thereafter, he could not
be reached or found when the car was still undelivered and their devious plot was
exposed.
 
Evidently, petitioners actions were in relation to the attainment of a common
objective. They had vital roles in the nefarious scheme to sell a vehicle that they knew
would never be delivered, but for which they obtained a substantial sum of money
from Lourdes.
 
Having established the existence of a conspiracy between Franco and Besario, the
prosecution proceeded to present evidence to prove that the acts of the petitioners
constituted estafa.
 
Estafa by Means of Deceit
 
Article 315, par. 2(a) of the Revised Penal Code penalizes fraud or deceit when
committed as follows:
xxxx
 
2. by means of any of the following false pretenses or fraudulent acts executed
prior to or simultaneously with the commission of fraud:
 
(a)          by using fictitious name, or actions, falsely pretending to
possess power, influence, qualification, property, credit, agency, business or
imaginary transactions, or by means of other similar deceits.
 
 
The elements of the crime of estafa under the foregoing provision are: (1) there
must be a false pretense, fraudulent acts or fraudulent means; (2) such false pretense,
fraudulent act or fraudulent means must be made or executed prior to or simultaneously
with the commission of the fraud; (3) the offended party must have relied on the false
pretense, fraudulent act or fraudulent means and was thus induced to part with his money
or property; and (4) as a result thereof, the offended party suffered damage.[13]
 
Petitioners presented themselves to Lourdes as persons possessing the authority
and capacity to engage in the financing of used vehicles in behalf of Final Access
Marketing. This was a clear misrepresentation considering their previous knowledge not
only of Erlindas complaint but also of several others as regards the failure of Final Access
Marketing to deliver the motor vehicles bought. Lourdes relied on their
misrepresentations and parted with her money. Almost a week passed by, but petitioners
and Rule did not deliver the said motor vehicle. They also did not fulfill their subsequent
promise to provide a replacement or to refund her payment. When Lourdes visited the
office of Final Access Marketing to demand the return of her money, it was already
closed. She could not locate any of them except for Franco who denied any
wrongdoing. Consequently, she suffered damage.
 
If indeed they were innocent as they claimed to be, Erlindas complaint to
petitioners and the 12 other similar complaints with Hoy Gising regarding undelivered
vehicles should have dissuaded petitioners from further soliciting customers. The fact
that they continued to offer for sale a second-hand car to Lourdes is indicative of deceit
and their complicity in the conspiracy to commit estafa. The manner in which petitioners
transacted business with Erlinda and Lourdes as well as their awareness of 12 other
similar complaints with Hoy Gising were sufficient to establish the existence of a modus
operandi.
 
Francos attempt to escape culpability by feigning ignorance of the previously
failed transactions on the delivery of vehicles by Final Access Marketing cannot be
countenanced. As gleaned from the testimony of Erlinda, Franco was already with Final
Access Marketing at the time these transactions occurred. She was therefore familiar
with the companys procedure and policy on the sales of second-hand vehicles. She even
accompanied Lourdes to showrooms and introduced her to Besario and Rule.
 
As an employee of Final Access Marketing, Franco was expected to be familiar
with its daily activities. It would be unworthy of belief that she did not know of the
complaints for the unexplained failure of Final Access Marketing to deliver vehicles to its
customers. Human nature and experience would compel her to make queries on her own
to discover the reasons for the non-delivery of the vehicles. Her continued insistence in
soliciting Lourdes as a client by introducing herself as an Assistant Administrative
Coordinator of Final Access Marketing with the ability to provide financing for a vehicle
of her choice is therefore indicative of fraudulent misrepresentation.
 
The petitioners also contend that they are not criminally liable since the transaction
with Lourdes was a contract of sale. This contention does not deserve serious
consideration. While the fact that they entered into a contract with Lourdes cannot be
denied, the transaction transpired due to their deceit. It was their misrepresentation that
induced Lourdes to sign the Sales Proposal agreement and part with her money.
 
In denying any criminal wrongdoing, petitioners blame their co-accused, Torres,
whom they claim to be the owner of Final Access Marketing. The shifting of blame is
common among conspirators in their attempt to escape liability. It is a desperate strategy
to compensate for their weak defense. We are not readily influenced by such a
proposition since its obvious motive is to distort the truth and frustrate the ends of justice.
[14]

 
The Penalty
 
Having committed the crime of estafa, the petitioners must suffer the proper
penalties provided by law. The law imposes the penalty of prision correccional in its
maximum period to prision mayor in its minimum period if the amount is
over P12,000.00 but does not exceed P22,000.00. If the amount swindled
exceeds P22,000.00, the penalty shall be imposed in its maximum period, adding one
year for each additional P10,000.00, but the total penalty which may be imposed shall
not exceed 20 years.[15] To determine the minimum of the indeterminate penalty, prision
correccional in its maximum period to prision mayor in its minimum period shall be
reduced by one degree, that is, to prision correccional in its minimum and medium
periods. The minimum period of the indeterminate penalty shall be taken from the full
range of the penalty of prision correccional in its minimum and medium periods, which
is six (6) months and one (1) day to four (4) years and two (2) months. With the amount
of the fraud at P80,000.00, there is P58,000.00 in excess of P22,000.00. Five years must
therefore be added to the maximum period of the prescribed penalty ranging from six (6)
years, eight (8) months and twenty-one (21) days to eight (8) years. Thus, the maximum
term of the penalty would range from eleven (11) years, eight (8) months and twenty-one
(21) days to thirteen (13) years. This is in accord with our ruling in People v. Temparada,
[16]
 viz:
The prescribed penalty for estafa under Article 315, par. 2(d) of the RPC, when
the amount defrauded exceeds P22,000.00, is prision correccional maximum to prision
mayor minimum. The minimum term is taken from the penalty next lower or anywhere
within prision correccional minimum and medium (i.e. from 6 months and 1 day to 4
years and 2 months). Consequently, the RTC correctly fixed the minimum term for the
five estafa cases at 4 years and 2 months of prision correccional since this is within the
range of prision correccional minimum and medium.
 
On the other hand, the maximum term is taken from the prescribed penalty
of prision correccional maximum to prision mayor minimum in its maximum period,
adding 1 year of imprisonment for every P10,000.00 in excess of P22,000.00, provided
that the total penalty shall not exceed 20 years. However, the maximum period of the
prescribed penalty of prision correccional maximum to prision mayor minimum is
not prision mayor minimum as apparently assumed by the RTC. To compute the
maximum period of the prescribed penalty, prision correccional maximum
to prision mayor minimum should be divided into three equal portions of time each of
which portion shall be deemed to form one period in accordance with Article 65 of the
RPC. Following this procedure, the maximum period of prisioncorreccional maximum
to prision mayor minimum is from 6 years, 8 months and 21 days to 8 years. The
incremental penalty, when proper, shall thus be added to anywhere from 6 years, 8
months and 21 days to 8 years, at the discretion of the court.
 
In computing the incremental penalty, the amount defrauded shall be subtracted
by P22,000.00, and the difference shall be divided by P10,000.00. Any fraction of a year
shall be discarded as was done starting with the case of People v. Pabalan in consonance
with the settled rule that penal laws shall be construed liberally in favor of the accused. x
x x.
 
 
WHEREFORE, the petitions for review on certiorari are DENIED. The
Decision of the Court of Appeals in CA-G.R. CR No. 27414 which affirmed with
modification the Decision of the Regional Trial Court, Branch 52, in Criminal Case No.
99-173688 convicting petitioners Lyzah Sy Franco and Steve Besario of the crime of
estafa is AFFIRMED with further modification that the indeterminate prison term
imposed on each of the petitioners is four (4) years and two (2) months of prision
correccional as minimum to thirteen (13) years of reclusion temporal as maximum.
 
SO ORDERED.
 
 
MARIANO C. DEL CASTILLO
Associate Justice
WE CONCUR:
 
 

RENATO C. CORONA
Chief Justice
Chairperson
 

PRESBITERO J. VELASCO, JR. TERESITA J. LEONARDO-DE CASTRO

Associate Justice Associate Justice
 
JOSE PORTUGAL PEREZ
Associate Justice
 
 
 
 
 
 
 
CERTIFICATION
 
Pursuant to Section 13, Article VIII of the Constitution, it is hereby certified that the
conclusions in the above Decision had been reached in consultation before the case was
assigned to the writer of the opinion of the Courts Division.
 

 
RENATO C. CORONA
Chief Justice
 
[1]
 CA rollo, pp. 185-199; penned by Associate Justice Arcangelita M. Romilla-Lontok and concurred in by
Associate Justices Rodrigo V. Cosico and Danilo B. Pine. .
[2]
 Records, pp. 360-373; penned by Judge Edgardo F. Sundiam.
[3]
 Id. at 1-2.
[4]
 Id. at 373.
[5]
 CA rollo, p. 199.
[6]
 Rollo of G.R. No. 171328, p. 10.
[7]
 Rollo of G.R. No. 171335, p. 17.
[8]
 Id. at 197.
[9]
 People v. Petralba, 482 Phil. 362, 374 (2004).
[10]
 Erquiaga v. Court of Appeals, 419 Phil. 641, 647 (2001).
[11]
 REVISED PENAL CODE, Article 8.
[12]
 Preferred Home Specialties, Inc. v. Court of Appeals, G.R. No. 163593, December 16, 2005, 478 SCRA 387,
414-415.
[13]
 RCL Feeders PTE., Ltd. v. Hon. Perez, 487 Phil. 211, 220-221 (2004).
[14]
 People v. Macaliag, 392 Phil. 284, 299 (2000).
[15]
 REVISED PENAL CODE, Article 315.
[16]
 G.R. No. 173473, December 17, 2008, 574 SCRA 258, 283-284.
 
 
SECOND DIVISION
 
BETTY GABIONZA and G.R. No. 161057
ISABELITA TAN,
Petitioners,
Present:
 
QUISUMBING, J.
Chairperson,
- versus - CARPIO MORALES,
TINGA,
VELASCO, JR., and
COURT OF APPEALS, LUKE BRION, JJ.
ROXAS and EVELYN NOLASCO,
Respondents. Promulgated:
 
September 12, 2008
 
x ---------------------------------------------------------------------------------x
 
 
DECISION
 
TINGA, J.:
On 21 August 2000, petitioners Betty Go Gabionza (Gabionza) and Isabelita Tan
(Tan) filed their respective Complaints-affidavit[1] charging private respondents
Luke Roxas (Roxas) and Evelyn Nolasco (Nolasco) with several criminal acts.
Roxas was the president of ASB Holdings, Inc. (ASBHI) while Nolasco was the
senior vice president and treasurer of the same corporation.
 
According to petitioners, ASBHI was incorporated in 1996 with its declared
primary purpose to invest in any and all real and personal properties of every kind
or otherwise acquire the stocks, bonds, and other securities or evidence of
indebtedness of any other corporation, and to hold or own, use, sell, deal in,
dispose of, and turn to account any such stocks.[2] ASBHI was organized with an
authorized capital stock of P500,000.00, a fact reflected in the corporations articles
of incorporation, copies of which were appended as annexes to the complaint.[3]
 
Both petitioners had previously placed monetary investment with the Bank of
Southeast Asia (BSA). They alleged that between 1996 and 1997, they were
convinced by the officers of ASBHI to lend or deposit money with the corporation.
They and other investors were urged to lend, invest or deposit money with ASBHI,
and in return they would receive checks from ASBHI for the amount so lent,
invested or deposited. At first, they were issued receipts reflecting the name ASB
Realty Development which they were told was the same entity as BSA or was
connected therewith, but beginning in March 1998, the receipts were issued in the
name of ASBHI. They claimed that they were told that ASBHI was exactly the
same institution that they had previously dealt with.[4]
 
ASBHI would issue two (2) postdated checks to its lenders, one representing the
principal amount and the other covering the interest thereon. The checks were
drawn against DBS Bank and would mature in 30 to 45 days. On the maturity of
the checks, the individual lenders would renew the loans, either collecting only the
interest earnings or rolling over the same with the principal amounts.[5]
 
In the first quarter of 2000, DBS Bank started to refuse to pay for the checks
purportedly by virtue of stop payment orders from ASBHI. In May of 2000,
ASBHI filed a petition for rehabilitation and receivership with the Securities and
Exchange Commission (SEC), and it was able to obtain an order enjoining it from
paying its outstanding liabilities.[6]This series of events led to the filing of the
complaints by petitioners, together with Christine Chua, Elizabeth Chan, Ando Sy
and Antonio Villareal, against ASBHI.[7] The complaints were for estafa under
Article 315(2)(a) and (2)(d) of the Revised Penal Code, estafa under
Presidential Decree No. 1689, violation of the Revised Securities Act and violation
of the General Banking Act.
 
A special task force, the Task Force on Financial Fraud (Task Force), was created
by the Department of Justice (DOJ) to investigate the several complaints that were
lodged in relation to ASBHI.[8] The Task Force, dismissed the complaint on 19
October 2000, and the dismissal was concurred in by the assistant chief state
prosecutor and approved by the chief state prosecutor.[9] Petitioners filed a motion
for reconsideration but this was denied in February 2001.[10] With respect to the
charges of estafa under Article 315(2) of the Revised Penal Code and of violation
of the Revised Securities Act (which form the crux of the issues before this Court),
the Task Force concluded that the subject transactions were loans which gave rise
only to civil liability; that petitioners were satisfied with the arrangement from
1996 to 2000; that petitioners never directly dealt with Nolasco and Roxas; and
that a check was not a security as contemplated by the Revised Securities Act.
 
 Petitioners then filed a joint petition for review with the Secretary of Justice.
On 15 October 2001, then Secretary Hernando Perez issued a resolution which
partially reversed the Task Force and instead directed the filing of five (5)
Informations for estafa under Article 315(2)(a) of the Revised Penal Code on the
complaints of Chan and petitioners Gabionza and Tan, and an Information for
violation of Section 4 in relation to Section 56 of the Revised Securities Act.
[11]
 Motions for reconsideration to this Resolution were denied by the Department
of Justice in a Resolution dated 3 July 2002.[12]
 
Even as the Informations were filed before
the Regional Trial Court of Makati City, private respondents assailed the DOJ
Resolution by way of a certiorari petition with the Court of Appeals. In its assailed
Decision[13] dated 18 July 2003, the Court of Appeals reversed the DOJ and ordered
the dismissal of the criminal cases. The dismissal was sustained by the appellate
court when it denied petitioners motion for reconsideration in a Resolution
dated 28 November 2003.[14] Hence this petition filed by Gabionza and Tan.
 
The Court of Appeals deviated from the general rule that accords respect to
the discretion of the DOJ in the determination of probable cause. This Court
consistently adheres to its policy of non-interference in the conduct of preliminary
investigations, and to leave to the investigating prosecutor sufficient latitude of
discretion in the determination of what constitutes sufficient evidence to establish
probable cause for the filing of an information against a supposed offender.[15]
 
At the outset, it is critical to set forth the key factual findings of the DOJ which led
to the conclusion that probable cause existed against the respondents. The DOJ
Resolution states, to wit:
 
The transactions in question appear to be mere renewals of the loans the
complainant-petitioners earlier granted to BSA. However, just after they agreed to
renew the loans, the ASB agents who dealt with them issued to them receipts
indicating that the borrower was ASB Realty, with the representation that it was
the same entity as BSA or connected therewith. On the strength of this
representation, along with other claims relating to the status of ASB and its
supposed financial capacity to meet obligations, the complainant-petitioners
acceded to lend the funds to ASB Realty instead. As it turned out, however, ASB
had in fact no financial capacity to repay the loans as it had an authorized capital
stock of only P500,000.00 and paid up capital of only P125,000.00. Clearly, the
representations regarding its supposed financial capacity to meet its obligations to
the complainant-petitioners were simply false. Had they known that ASB had in
fact no such financial capacity, they would not have invested millions of pesos.
Indeed, no person in his proper frame of mind would venture to lend millions of
pesos to a business entity having such a meager capitalization. The fact that the
complainant-petitioners might have benefited from its earlier dealings with ASB,
through interest earnings on their previous loans, is of no moment, it appearing
that they were not aware of the fraud at those times they renewed the loans.
 
The false representations made by the ASB agents who dealt with the
complainant-petitioners and who inveigled them into investing their funds in ASB
are properly imputable to respondents Roxas and Nolasco, because they, as ASBs
president and senior vice president/treasurer, respectively, in charge of its
operations, directed its agents to make the false representations to the public,
including the complainant-petitioners, in order to convince them to invest their
moneys in ASB. It is difficult to make a different conclusion, judging from the
fact that respondents Roxas and Nolasco authorized and accepted for ASB the
fraud-induced loans. This makes them liable for estafa under Article 315
(paragraph 2 [a]) of the Revised Penal Code. They cannot escape criminal liability
on the ground that they did not personally deal with the complainant-petitioners in
regard to the transactions in question. Suffice it to state that to commit a crime,
inducement is as sufficient and effective as direct participation.[16]
 
 
Notably, neither the Court of Appeals decision nor the dissent raises any serious
disputation as to the occurrence of the facts as narrated in the above passage. They
take issue instead with the proposition that such facts should result in a prima
facie case against either Roxas or Nolasco, especially given that neither of them
engaged in any face-to-face dealings with petitioners. Leaving aside for the
moment whether this assumed remoteness of private respondents sufficiently
insulates them from criminal liability, let us first discern whether the above-stated
findings do establish a prima facie case that petitioners were indeed the victims of
the crimes of estafa under Article 315(2)(a) of the Revised Penal Code and of
violation of the Revised Securities Act.
 
Article 315(2)(a) of the Revised Penal Code states:
 
ART. 315. Swindling (estafa). Any person who shall defraud another by
any of the means mentioned herein below shall be punished by:
xxx xxx xxx
 
(2) By means of any of the following false pretenses or fraudulent acts
executed prior to or simultaneous with the commission of the fraud:
 
(a) By using a fictitious name, or falsely pretending to possess
power, influence, qualifications, property, credit, agency, business or
imaginary transactions, or by means of other similar deceits;
 
xxx xxx xxx
 
 
 
The elements of estafa by means of deceit as defined under Article 315(2)(a)
of the Revised Penal Code are as follows: (1) that there must be a false pretense,
fraudulent act or fraudulent means; (2) that such false pretense, fraudulent act or
fraudulent means must be made or executed prior to or simultaneously with the
commission of the fraud; (3) that the offended party must have relied on the false
pretense, fraudulent act or fraudulent means, that is, he was induced to part with
his money or property because of the false pretense, fraudulent act or fraudulent
means; and (4) that as a result thereof, the offended party suffered damage.[17]
 
Do the findings embodied in the DOJ Resolution align with the
foregoing elements of estafa by means of deceit?
 
 First. The DOJ Resolution explicitly identified the false pretense, fraudulent
act or fraudulent means perpetrated upon the petitioners. It narrated that petitioners
were made to believe that ASBHI had the financial capacity to repay the loans it
enticed petitioners to extend, despite the fact that it had an authorized capital stock
of only P500,000.00 and paid up capital of only P125,000.00.[18] The deficient
capitalization of ASBHI is evinced by its articles of incorporation, the treasurers
affidavit executed by Nolasco, the audited financial statements of the corporation
for 1998 and the general information sheets for 1998 and 1999, all of which
petitioners attached to their respective affidavits.[19]
 
The Court of Appeals conceded the fact of insufficient capitalization, yet
discounted its impact by noting that ASBHI was able to make good its loans or
borrowings from 1998 until the first quarter of 2000.[20] The short-lived ability of
ASBHI, to repay its loans does not negate the fraudulent misrepresentation or
inducement it has undertaken to obtain the loans in the first place. The material
question is not whether ASBHI inspired exculpatory confidence in its investors by
making good on its loans for a while, but whether such investors would have
extended the loans in the first place had they known its true financial setup. The
DOJ reasonably noted that no person in his proper frame of mind would venture to
lend millions of pesos to a business entity having such a meager capitalization. In
estafa under Article 315(2)(a), it is essential that such false statement or false
representation constitute the very cause or the only motive which induces the
complainant to part with the thing.[21]
 
Private respondents argue before this Court that the true capitalization of
ASBHI has always been a matter of public record, reflected as it is in several
documents which could be obtained by the petitioners from the SEC. [22] We are not
convinced. The material misrepresentations have been made by the agents or
employees of ASBHI to petitioners, to the effect that the corporation was
structurally sound and financially able to undertake the series of loan transactions
that it induced petitioners to enter into. Even if ASBHIs lack of financial and
structural integrity is verifiable from the articles of incorporation or other publicly
available SEC records, it does not follow that the crime of estafa through deceit
would be beyond commission when precisely there are bending representations
that the company would be able to meet its obligations. Moreover, respondents
argument assumes that there is legal obligation on the part of petitioners to
undertake an investigation of ASBHI before agreeing to provide the loans. There is
no such obligation.It is unfair to expect a person to procure every available public
record concerning an applicant for credit to satisfy himself of the latters financial
standing. At least, that is not the way an average person takes care of his concerns.
 
Second. The DOJ Resolution also made it clear that the false representations
have been made to petitioners prior to or simultaneously with the commission of
the fraud. The assurance given to them by ASBHI that it is a worthy credit partner
occurred before they parted with their money. Relevantly, ASBHI is not the entity
with whom petitioners initially transacted with, and they averred that they had to
be convinced with such representations that Roxas and the same group behind
BSA were also involved with ASBHI.
 
 
 
Third. As earlier stated, there was an explicit and reasonable conclusion
drawn by the DOJ that it was the representation of ASBHI to petitioners that it was
creditworthy and financially capable to pay that induced petitioners to extend the
loans. Petitioners, in their respective complaint-affidavits, alleged that they were
enticed to extend the loans upon the following representations: that ASBHI was
into the very same activities of ASB Realty Corp., ASB Development Corp. and
ASB Land, Inc., or otherwise held controlling interest therein; that ASB could
legitimately solicit funds from the public for investment/borrowing purposes; that
ASB, by itself, or through the corporations aforestated, owned real and personal
properties which would support and justify its borrowing program; that ASB was
connected with and firmly backed by DBS Bank in which Roxas held a substantial
stake; and ASB would, upon maturity of the checks it issued to its lenders, pay the
same and that it had the necessary resources to do so.[23]
 
Fourth. The DOJ Resolution established that petitioners sustained damage as
a result of the acts perpetrated against them. The damage is
considerable as to petitioners.Gabionza lost P12,160,583.32 whereas Tan lost
16,411,238.57.[24] In addition, the DOJ Resolution noted that neither Roxas nor
Nolasco disputed that ASBHI had borrowed funds from about 700 individual
investors amounting to close to P4B.[25]
 
 
To the benefit of private respondents, the Court of Appeals ruled,
citing Sesbreno v. Court of Appeals,[26] that the subject transactions are akin to
money market placements which partake the nature of a loan, the non-payment of
which does not give rise to criminal liability for estafa. The citation is woefully
misplaced. Sesbreno affirmed that a money market transaction partakes the nature
of a loan and therefore nonpayment thereof would not give rise to criminal liability
for estafa through misappropriation or conversion.[27] Estafa through
misappropriation or conversion is punishable under Article 315(1)(b), while
the case at bar involves Article 315 (2)(a), a mode of estafa by means of
deceit. Indeed, Sesbreno explains: In money market placement, the investor is a
lender who loans his money to a borrower through a middleman or dealer.
Petitioner here loaned his money to a borrower through Philfinance. When the
latter failed to deliver back petitioner's placement with the corresponding interest
earned at the maturity date, the liability incurred by Philfinance was a civil one.
[28]
 That rationale is wholly irrelevant to the complaint at bar, which centers not on
the inability of ASBHI to repay petitioners but on the fraud and misrepresentation
committed by ASBHI to induce petitioners to part with their money.
 
To be clear, it is possible to hold the borrower in a money market placement
liable for estafa if the creditor was induced to extend a loan upon the false or
fraudulent misrepresentations of the borrower. Such estafa is one by means of
deceit. The borrower would not be generally liable for estafa through
misappropriation if he or she fails to repay the loan, since the liability in such
instance is ordinarily civil in nature.
 
We can thus conclude that the DOJ Resolution clearly supports a prima
facie finding that the crime of estafa under Article 315 (2)(a) has been committed
against petitioners. Does it also establish a prima facie finding that there has been a
violation of the then-Revised Securities Act, specifically Section 4 in relation to
Section 56 thereof?
Section 4 of Batas Pambansa Blg. 176, or the Revised Securities Act,
generally requires the registration of securities and prohibits the sale or distribution
of unregistered securities.[29] The DOJ extensively concluded that private
respondents are liable for violating such prohibition against the sale of unregistered
securities:
 
 Respondents Roxas and Nolasco do not dispute that in 1998, ASB
borrowed funds about 700 individual investors amounting to close to P4 billion, on
recurring, short-term basis, usually 30 or 45 days, promising high interest yields,
issuing therefore mere postdate checks. Under the circumstances, the checks
assumed the character of evidences of indebtedness, which are among the
securities mentioned under the Revised Securities Act. The term securities
embodies a flexible rather than static principle, one that is capable of adaptation to
meet the countless and variable schemes devised by those who seek to use the
money of others on the promise of profits (69 Am Jur 2d, p. 604). Thus, it has been
held that checks of a debtor received and held by the lender also are evidences of
indebtedness and therefore securities under the Act, where the debtor agreed to pay
interest on a monthly basis so long as the principal checks remained uncashed, it
being said that such principal extent as would have promissory notes payable on
demand (Id., p. 606, citing Untied States v. Attaway (DC La) 211 F Supp 682). In
the instant case, the checks were issued by ASB in lieu of the securities
enumerated under the Revised Securities Act in a clever attempt, or so they
thought, to take the case out of the purview of the law, which requires prior license
to sell or deal in securities and registration thereof. The scheme was to designed to
circumvent the law. Checks constitute mere substitutes for cash if so issued in
payment of obligations in the ordinary course of business transactions. But when
they are issued in exchange for a big number of individual non-personalized loans
solicited from the public, numbering about 700 in this case, the checks cease to be
such. In such a circumstance, the checks assume the character of evidences of
indebtedness. This is especially so where the individual loans were not evidenced
by appropriate debt instruments, such as promissory notes, loan agreements, etc.,
as in this case. Purportedly, the postdated checks themselves serve as the evidences
of the indebtedness. A different rule would open the floodgates for a similar
scheme, whereby companies without prior license or authority from the SEC. This
cannot be countenanced. The subsequent repeal of the Revised Securities Act does
not spare respondents Roxas and Nolasco from prosecution thereunder, since the
repealing law, Republic Act No. 8799 known as the Securities Regulation Code,
continues to punish the same offense (see Section 8 in relation to Section 73, R.A.
No. 8799).[30]
 
 
The Court of Appeals however ruled that the postdated checks issued by
ASBHI did not constitute a security under the Revised Securities Act. To support
this conclusion, it cited the general definition of a check as a bill of exchange
drawn on a bank and payable on demand, and took cognizance of the fact that the
issuance of checks for the purpose of securing a loan to finance the activities of the
corporation is well within the ambit of a valid corporate act to note that a
corporation does not need prior registration with the SEC in order to be able to
issue a check, which is a corporate prerogative.
 
This analysis is highly myopic and ignorant of the bigger picture. It is one
thing for a corporation to issue checks to satisfy isolated individual obligations,
and another for a corporation to execute an elaborate scheme where it would
comport itself to the public as a pseudo-investment house and issue postdated
checks instead of stocks or traditional securities to evidence the investments of its
patrons. The Revised Securities Act was geared towards maintaining the stability
of the national investment market against activities such as those apparently
engaged in by ASBHI. As the DOJ Resolution noted, ASBHI adopted this scheme
in an attempt to circumvent the Revised Securities Act, which requires a prior
license to sell or deal in securities. After all, if ASBHIs activities were actually
regulated by the SEC, it is hardly likely that the design it chose to employ would
have been permitted at all.
 
 
But was ASBHI able to successfully evade the requirements under the
Revised Securities Act? As found by the DOJ, there is ultimately a prima
facie case that can at the very least sustain prosecution of private respondents
under that law. The DOJ Resolution is persuasive in citing American authorities
which countenance a flexible definition of securities. Moreover, it bears pointing
out that the definition of securities set forth in Section 2 of the Revised Securities
Act includes commercial papers evidencing indebtedness of any person, financial
or non-financial entity, irrespective of maturity, issued, endorsed, sold, transferred
or in any manner conveyed to another.[31] A check is a commercial paper
evidencing indebtedness of any person, financial or non-financial entity. Since the
checks in this case were generally rolled over to augment the creditors existing
investment with ASBHI, they most definitely take on the attributes of traditional
stocks.
 
 
We should be clear that the question of whether the subject checks fall
within the classification of securities under the Revised Securities Act may still be
the subject of debate, but at the very least, the DOJ Resolution has established
a prima facie case for prosecuting private respondents for such offense. The
thorough determination of such issue is best left to a full-blown trial of the merits,
where private respondents are free to dispute the theories set forth in the DOJ
Resolution. It is clear error on the part of the Court of Appeals to dismiss such
finding so perfunctorily and on such flimsy grounds that do not consider the grave
consequences. After all, as the DOJ Resolution correctly pointed out: [T]he
postdated checks themselves serve as the evidences of the indebtedness. A
different rule would open the floodgates for a similar scheme, whereby companies
without prior license or authority from the SEC. This cannot be countenanced.[32]
 
 
This conclusion quells the stance of the Court of Appeals that the
unfortunate events befalling petitioners were ultimately benign, not malevolent, a
consequence of the economic crisis that beset the Philippines during that era.
[33]
 That conclusion would be agreeable only if it were undisputed that the activities
of ASBHI are legal in the first place, but the DOJ puts forth a legitimate theory that
the entire modus operandi of ASBHI is illegal under the Revised Securities Act
and if that were so, the impact of the Asian economic crisis would not obviate the
criminal liability of private respondents.
 
 Private respondents cannot make capital of the fact that when the DOJ
Resolution was issued, the Revised Securities Act had already been repealed by the
Securities Regulation Code of 2000.[34] As noted by the DOJ, the new Code does
punish the same offense alleged of petitioners, particularly Section 8 in relation to
Section 73 thereof. The complained acts occurred during the effectivity of the
Revised Securities Act. Certainly, the enactment of the new Code in lieu of the
Revised Securities Act could not have extinguished all criminal acts committed
under the old law.
 
In 1909-1910, the Philippine and United States Supreme Courts affirmed the
principle that when the repealing act reenacts substantially the former law, and
does not increase the punishment of the accused, the right still exists to punish the
accused for an offense of which they were
convicted and sentenced before the passage of the later act.[35] This doctrine was
reaffirmed as recently as 2001, where the Court, through Justice Quisumbing, held
in Benedicto v. Court of Appeals[36] that an exception to the rule that the absolute
repeal of a penal law deprives the court of authority to punish a person charged
with violating the old law prior to its repeal is where the repealing act reenacts the
former statute and punishes the act previously penalized under the old law.[37] It is
worth noting that both the Revised Securities Act and the Securities Regulation
Code of 2000 provide for exactly the same penalty: a fine of not less than five
thousand (P5,000.00) pesos nor more than five hundred thousand (P500,000.00)
pesos or imprisonment of not less than seven (7) years nor more than twenty one
(21) years, or both, in the discretion of the court.[38]
 
It is ineluctable that the DOJ Resolution established a prima facie case for
violation of Article 315 (2)(a) of the Revised Penal Code and Sections 4 in relation
to 56 of the Revised Securities Act. We now turn to the critical question of whether
the same charges can be pinned against Roxas and Nolasco likewise.
 
The DOJ Resolution did not consider it exculpatory that Roxas and Nolasco
had not themselves dealt directly with petitioners, observing that to commit a
crime, inducement is as sufficient and effective as direct participation.[39] This
conclusion finds textual support in Article 17[40] of the Revised Penal Code. The
Court of Appeals was unable to point to any definitive evidence that Roxas or
Nolasco did not instruct or induce the agents of ASBHI to make the false or
misleading representations to the investors, including petitioners. Instead, it sought
to acquit Roxas and Nolasco of any liability on the ground that the traders or
employees of ASBHI who directly made the dubious representations to petitioners
were never identified or impleaded as respondents.
 
It appears that the Court of Appeals was, without saying so, applying the
rule in civil cases that all indispensable parties must be impleaded in a civil action.
[41]
 There is no equivalent rule in criminal procedure, and certainly the Court of
Appeals decision failed to cite any statute, procedural rule or jurisprudence to
support its position that the failure to implead the traders who directly dealt with
petitioners is indeed fatal to the complaint.[42]
 
Assuming that the traders could be tagged as principals by direct
participation in tandem with Roxas and Nolasco the principals by inducement does
it make sense to compel that they be jointly charged in the same complaint to the
extent that the exclusion of one leads to the dismissal of the complaint? It does not.
Unlike in civil cases, where indispensable parties are required to be impleaded in
order to allow for complete relief once the case is adjudicated, the determination of
criminal liability is individual to each of the defendants. Even if the criminal court
fails to acquire jurisdiction over one or some participants to a crime, it still is able
to try those accused over whom it acquired jurisdiction. The criminal court will
still be able to ascertain the individual liability of those accused whom it could try,
and hand down penalties based on the degree of their participation in the crime.
The absence of one or some of the accused may bear impact on the available
evidence for the prosecution or defense, but it does not deprive the trial court to
accordingly try the case based on the evidence that is actually available.
 
At bar, if it is established after trial that Roxas and Nolasco instructed all the
employees, agents and traders of ASBHI to represent the corporation as financially
able to engage in the challenged transactions and repay its investors, despite their
knowledge that ASBHI was not established to be in a position to do so, and that
representatives of ASBHI accordingly made such representations to petitioners,
then private respondents could be held liable for estafa. The failure to implead or
try the employees, agents or traders will not negate such potential criminal liability
of Roxas and Nolasco. It is possible that the non-participation of such traders or
agents in the trial will affect the ability of both petitioners and private respondents
to adduce evidence during the trial, but it cannot quell the existence of the crime
even before trial is had. At the very least, the non-identification or non-impleading
of such traders or agents cannot negatively impact the finding of probable cause.
 
The assailed ruling unfortunately creates a wide loophole, especially in this
age of call centers, that would create a nearly fool-proof scheme whereby well-
organized criminally-minded enterprises can evade prosecution for criminal fraud.
Behind the veil of the anonymous call center agent, such enterprises could induce
the investing public to invest in fictional or incapacitated corporations with
fraudulent impossible promises of definite returns on investment. The rule, as set
forth by the Court of Appeals ruling, will allow the masterminds and profiteers
from the scheme to take the money and run without fear of the law simply because
the defrauded investor would be hard-pressed to identify the anonymous call center
agents who, reading aloud the script prepared for them in mellifluous tones,
directly enticed the investor to part with his or her money.
 
Is there sufficient basis then to establish probable cause against Roxas and
Nolasco? Taking into account the relative remoteness of private respondents to
petitioners, the DOJ still concluded that there was. To repeat:
 
The false representations made by the ASB agents who dealt with the
complainant-petitioners and who inveigled them into investing their funds in ASB
are properly imputable to respondents Roxas and Nolasco, because they, as ASBs
president and senior vice president/treasurer, respectively, respectively, in charge
of its operations, directed its agents to make the false representations to the
public, including the complainant-petitioners, in order to convince them to invest
their moneys in ASB. It is difficult to make a different conclusion, judging from
the fact that respondents Roxas and Nolasco authorized and accepted for ASB the
fraud-induced loans.[43]
 
 
Indeed, the facts as thus established cannot lead to a definite, exculpatory
conclusion that Roxas and Nolasco did not instruct, much less forbid, their agents
from making the misrepresentations to petitioners. They could of course pose that
defense, but such claim can only be established following a trial on the merits
considering that nothing in the record proves without doubt such law-abiding
prudence on their part. There is also the fact that ABSHI, their corporation,
actually received the alleged amounts of money from petitioners. It is especially
curious that according to the ASBHI balance sheets dated 31 December 1999,
which petitioners attached to their affidavit-complaints,[44] over five billion pesos
were booked as advances to stockholder when, according to the general
information sheet for 1999, Roxas owned 124,996 of the 125,000 subscribed
shares of ASBHI.[45] Considering that ASBHI had an authorized capital stock
of only P500,000 and a subscribed capital of P125,000, it can be reasonably
deduced that such large amounts booked as advances to stockholder could
have only come from the loans extended by over 700 investors to ASBHI.
 
It is true that there are exceptions that may warrant departure from the
general rule of non-interference with the determination of probable cause by the
DOJ, yet such exceptions do not lie in this case, and the justifications actually cited
in the Court of Appeals decision are exceptionally weak and ultimately erroneous.
Worse, it too hastily condoned the apparent evasion of liability by persons who
seemingly profited at the expense of investors who lost millions of pesos. The
Courts conclusion is that the DOJS decision to prosecute private respondents is
founded on sufficient probable cause, and the ultimate determination of guilt or
acquittal is best made through a full trial on the merits. Indeed, many of the points
raised by private respondents before this Court, related as they are to the factual
context surrounding the subject transactions, deserve the full assessment and
verification only a trial on the merits can accord.
 
 
 
WHEREFORE, the petition is GRANTED. The assailed Decision and
Resolution of the Court of Appeals dated 18 July 2003 and 28 November 2003 are
REVERSED and SET ASIDE. The Resolutions of the Department of Justice in I.S.
Nos. 2000-1418 to 1422 dated 15 October 2001 and 3 July 2002 are
REINSTATED. Costs against private respondents.
  
 
DANTE O. TINGA
Associate Justice
 
 
WE CONCUR:
 
 
 
 
LEONARDO A. QUISUMBING
Associate Justice
Chairperson
 
 
 
 
 
CONCHITA CARPIO MORALES PRESBITERO J. VELASCO, JR.
Associate Justice Associate Justice
 
 
 
 
ARTURO D. BRION
Associate Justice
 
 
 
 
 
 
ATTESTATION
 
 
I attest that the conclusions in the above Decision had been reached in
consultation before the case was assigned to the writer of the opinion of the
Courts Division.
 
 
 
LEONARDO A. QUISUMBING
Associate Justice
Chairperson, Second Division
 
 
 
 
CERTIFICATION
 
 
Pursuant to Section 13, Article VIII of the Constitution, and the Division
Chairpersons Attestation, it is hereby certified that the conclusions in the
above Decision had been reached in consultation before the case was
assigned to the writer of the opinion of the Courts Division.
 
 
 
 
REYNATO S. PUNO
Chief Justice
 
 

 
[1]
See rollo, pp. 466-558.
 
[2]
Id. at 466, 515.
 
[3]
Id.
 
[4]
Id. at 467-468, 516-517.
 
[5]
Id. at 83.
 
[6]
Id. See also MBTC v. ASB Holdings, Inc., et.al, G.R. No. 166197, 27 Feburary 2007.
 
[7]
Id.
 
[8]
Id. at 22.
 
[9]
Through a Joint-Resolution dated 19 October 2000. See rollo, pp. 96-106.
 
[10]
Rollo, pp. 108-110.
 
[11]
Id. at 81-88.
 
[12]
Id. at 89-92. In said Resolution, the DOJ also directed that two additional informations for estafa under
Article 315(2)(a) be filed corresponding to the complaints filed by Ando Sy and Antonio Villareal, whose names
were inadvertently omitted in the dispositive portion of [the DOJ] resolution of October 15, 2001. Id., at 91.
 
[13]
Id. at 52-62. Penned by Associate Justice R. De Guia-Salvador, concurred in by Associate Justice Marina
L. Buzon and Jose C. Mendoza of the Court of Appeals Special Fifteenth Division.
 
[14]
Id. at 76-77.
 
[15]
Andres v. Cuevas, G.R. No. 150869, 9 June 2005, 460 SCRA 38, 52.
 
[16]
Rollo, pp. 85-86.
 
[17]
Aricheta v. People, G.R. No. 172500, 21 September 2007; citing Cosme Jr. v. People, G.R. No. 149753,
27 November 2006, 508 SCRA 190, 203-204.
 
[18]
Rollo, p. 85.
 
[19]
See e.g., id. at 480-501.
 
[20]
Id. at 60-61.
 
[21]
L. REYES, II The Revised Criminal Code (2001 ed.) at 767; citing People v. Gines, et al. C.A., 61 O.G.
1365.
 
[22]
Rollo, pp. 332-333.
 
[23]
See id. at 467, 516.
 
[24]
Id. at 84.
 
[25]
Id. at 86.
 
[26]
310 Phil. 671 (1995).
 
[27]
Id. at 681.
 
[28]
Id. at 682.
 
[29]
The provision reads in full:
 
 SECTION 4.    Requirement of registration of securities. (a) No securities, except of a
class exempt under any of the provisions of Section five hereof or unless sold in any transaction
exempt under any of the provisions of Section six hereof, shall be sold or offered for sale or
distribution to the public within the Philippine unless such securities shall have been registered
and permitted to be sold as hereinafter provided.

(b)    Notwithstanding the provisions of paragraph (a) of this Section and the succeeding Sections
regarding exemptions, no commercial paper as defined in Section two hereof shall be issued,
endorsed, sold, transferred or in any other manner conveyed to the public, unless registered in
accordance with the rules and regulations that shall be promulgated in the public interest and for
the protection of investors by the Commission. The Commission, however, with due regard to the
public interest and the protection of investors, may, by rules and regulations, exempt from
registration any commercial paper that may otherwise be covered by this paragraph. In either case,
the rules and regulations promulgated by the Commission shall be subject to the approval of the
Monetary Board of the Central Bank of the Philippines. The Monetary Board shall, however, have
the power to promulgate its own rules on the monetary and credit aspects of commercial paper
issues, which may include the imposition of ceilings on issues by any single borrower, and the
authority to supervise the enforcement of such rules and to require issues of commercial papers to
submit their financial statements and such periodic reports as may be necessary for such
enforcement. As far as practicable, such financial statements and periodic reports, when required
by both the Commission and the Monetary Board, shall be uniform.

(c)    A record of the registration of securities shall be kept in a Register of Securities in which
shall be recorded orders entered by the Commission with respect to such securities. Such register
and all documents or information with respect to the securities registered therein shall be open to
the public inspection at reasonable hours on business days.
 
[30]
Rollo, pp. 86-87.
 
[31]
See Section 2, Revised Securities Act.
 
[32]
Rollo, p. 87.
 
[33]
Id. at 61.
 
[34]
Dissenting Opinion, infra.
 
[35]
Ong Chang Wing v. U.S., 40 Phil. 1046, 1050 (1910).
 
[36]
416 Phil. 722 (2001).
 
[37]
Id. at 744.
 
[38]
See Section 56, Revised Securities Act and Section 73, Securities Regulation Code.
 
[39]
Rollo, p. 86.
 
[40]
Principals. The following are considered principals:
 
1.        those who take a direct part in the execution of the act;
2.        Those who directly force or induce others to commit it;
3.        Those who cooperate in the commission of the offense by another act without which it would not have
been accomplished.
 
[41]
See 1997 RULES OF CIVIL PROCEDURE, Rule 3, Sec. 7.
 
 [42]
See rollo, p. 60.
 
[43]
Id. at 86.
 
[44]
Id. at 479, 525.
 
[45]
See id. at 496, 540.
 THIRD DIVISION

ROSITA SY, G.R. No. 183879

 
Petitioner,
Present:
 
 
 
CORONA, J.,
 
Chairperson,
 
VELASCO, JR.,
- versus -
NACHURA,
 
PERALTA, and
 
MENDOZA, JJ.
 
 
 
Promulgated:
 
 
PEOPLE OF THE PHILIPPINES,
April 14, 2010
Respondent.
 
 
x------------------------------------------------------------------------------------x

 
 

RESOLUTION

NACHURA, J.:

Before the Court is a petition for review on certiorari under Rule 45 of the Rules of
Court, assailing the Decision[1] dated July 22, 2008 of the Court of Appeals (CA) in
CA-G.R. CR No. 30628.

Rosita Sy (Sy) was charged with one count of illegal recruitment in Criminal Case
No. 02-0537 and one count of estafa in Criminal Case No. 02-0536. In a joint
decision of the Regional Trial Court (RTC), Sy was exonerated of the illegal
recruitment charge. However, she was convicted of the crime of estafa. Thus, the
instant appeal involves only Criminal Case No. 02-0536 for the crime of estafa.

The Information[2] for estafa reads:

 
That sometime in the month of March 1997, in the City of Las Pias, Philippines, and
within the jurisdiction of this Honorable Court, the above-named accused, did, then and
there willfully, unlawfully and feloniously defraud Felicidad Mendoza-Navarro y
Landicho in the following manner, to wit: the said accused by means of false pretenses
 and fraudulent representation which she made to the said complainant that she can
deploy her for employment in Taiwan, and complainant convinced by said
representations, gave the amount of P120,000.00 to the said accused for processing of
her papers, the latter well knowing that all her representations and manifestations were
false and were only made for the purpose of obtaining the said amount, but once in her
possession[,] she misappropriated, misapplied and converted the same to her own
personal use and benefit, to the damage and prejudice of Felicidad Mendoza-Navarro y
Landicho in the aforementioned amount of P120,000.00.

CONTRARY TO LAW.[3]

On May 27, 2007, Sy was arraigned and pleaded not guilty to the crimes charged.
Joint trial ensued thereafter.

As summarized by the CA, the facts of the case are as follows:

 
Version of the Prosecution

Sometime in March 1997, appellant, accompanied by Corazon Miranda (or Corazon),

went to the house of Corazons sister, Felicidad Navarro (or Felicidad), in Talisay,
Batangas to convince her (Felicidad) to work abroad. Appellant assured Felicidad of a
good salary and entitlement to a yearly vacation if she decides to take a job
in Taiwan. On top of these perks, she shall receive compensation in the amount of
Php120,000.00. Appellant promised Felicidad that she will take care of the processing of
the necessary documents, including her passport and visa. Felicidad told appellant that
she will think about the job offer.

Two days later, Felicidad succumbed to appellants overseas job solicitation. With

Corazon in tow, the sisters proceeded to appellants residence in Better Homes,
Moonwalk, Las Pias City.Thereat, Felicidad handed to appellant the amount of
Php60,000.00. In the third week of March 1997, Felicidad returned to appellants abode
and paid to the latter another Php60,000.00. The latter told her to come back the
following day. In both instances, no receipt was issued by appellant to acknowledge
receipt of the total amount of Php120,000.00 paid by Felicidad.

On Felicidads third trip to appellants house, the latter brought her to Uniwide in Sta.
Cruz, Manila, where a male person showed to them the birth certificate that Felicidad
would use in applying for a Taiwanese passport. The birth certificate was that of a
certain Armida Lim, born to Margarita Galvez and Lim Leng on 02 June 1952. Felicidad
was instructed on how to write Armida Lims Chinese name.

Subsequently, appellant contacted Felicidad and thereafter met her at the Bureau of
Immigration office. Thereat, Felicidad, posing and affixing her signature as Armida G.
Lim, filled out the application forms for the issuance of Alien Certificate of Registration
(ACR) and Immigrant Certificate of Registration (ICR). She attached to the application
forms her own photo. Felicidad agreed to use the name of Armida Lim as her own
because she already paid to appellant the amount of Php120,000.00.

In December 1999, appellant sent to Felicidad the birth certificate of Armida Lim, the
Marriage Contract of Armida Lims parents, ACR No. E128390, and ICR No. 317614. These
documents were submitted to and eventually rejected by the Taiwanese authorities,
triggering the filing of illegal recruitment and estafa cases against appellant.

Version of the Defense

Appellant denied offering a job to Felicidad or receiving any money from her. She
asserted that when she first spoke to Felicidad at the latters house, she mentioned that
her husband and children freely entered Taiwan because she was a holder of a Chinese
passport. Felicidad commented that many Filipino workers in Taiwan were holding
Chinese passports.

Three weeks later, Felicidad and Corazon came to her house in Las Pias and asked her if
she knew somebody who could help Felicidad get a Chinese ACR and ICR for a fee.

 
 Appellant introduced a certain Amelia Lim, who, in consideration of the amount of
Php120,000.00, offered to Felicidad the use of the name of her mentally deficient sister,
Armida Lim.Felicidad agreed. On their second meeting at appellants house, Felicidad
paid Php60,000.00 to Amelia Lim and they agreed to see each other at Uniwide the
following day. That was the last time appellant saw Felicidad and Amelia Lim.[4]

On January 8, 2007, the RTC rendered a decision,[5] the dispositive portion

of which reads:

 
WHEREFORE, premises considered the court finds the accused Rosita Sy NOT GUILTY of
the crime of Illegal Recruitment and she is hereby ACQUITTED of the said offense. As
regards the charge of Estafa, the court finds the accused GUILTY thereof and hereby
sentences her to an indeterminate penalty of four (4) years of prision correctional as
minimum to 11 years of prision mayor, as maximum. The accused is ordered to
reimburse the amount of sixty-thousand (Php60,000.00) to the private complainant.

SO ORDERED.[6]

Aggrieved, Sy filed an appeal for her conviction of estafa. On July 22, 2008,
the CA rendered a Decision,[7] affirming with modification the conviction of
Sy, viz.:

 
WHEREFORE, with the MODIFICATION sentencing accused-appellant to suffer the
indeterminate penalty of four (4) years and two (2) months of prision correccional, as
minimum, to seventeen (17) years of reclusion temporal, as maximum, the appealed
decision is AFFIRMED in all other respects.

SO ORDERED.[8]

 
  

Hence, this petition.

The sole issue for resolution is whether Sy should be held liable for estafa,
penalized under Article 315, paragraph 2(a) of the Revised Penal Code (RPC).[9]

Swindling or estafa is punishable under Article 315 of the RPC. There are
three ways of committing estafa, viz.: (1) with unfaithfulness or abuse of
confidence; (2) by means of false pretenses or fraudulent acts; or (3) through
fraudulent means. The three ways of committing estafa may be reduced to
two, i.e., (1) by means of abuse of confidence; or (2) by means of deceit.

The elements of estafa in general are the following: (a) that an accused
defrauded another by abuse of confidence, or by means of deceit; and (b) that
damage and prejudice capable of pecuniary estimation is caused the offended
party or third person.

The act complained of in the instant case is penalized under Article 315,
paragraph 2(a) of the RPC, wherein estafa is committed by any person who shall
defraud another by false pretenses or fraudulent acts executed prior to or
simultaneously with the commission of the fraud. It is committed by using
fictitious name, or by pretending to possess power, influence, qualifications,
property, credit, agency, business or imaginary transactions, or by means of other
similar deceits.

The elements of estafa by means of deceit are the following, viz.: (a) that
there must be a false pretense or fraudulent representation as to his power,
influence, qualifications, property, credit, agency, business or imaginary
transactions; (b) that such false pretense or fraudulent representation was made
or executed prior to or simultaneously with the commission of the fraud; (c) that
the offended party relied on the false pretense, fraudulent act, or fraudulent
means and was induced to part with his money or property; and (d) that, as a
result thereof, the offended party suffered damage.[10]

In the instant case, all the foregoing elements are present. It was proven beyond
reasonable doubt, as found by the RTC and affirmed by the CA, that Sy
misrepresented and falsely pretended that she had the capacity to deploy
Felicidad Navarro (Felicidad) for employment in Taiwan. The misrepresentation
was made prior to Felicidads payment to Sy of One Hundred Twenty Thousand
Pesos (P120,000.00). It was Sys misrepresentation and false pretenses that
induced Felicidad to part with her money. As a result of Sys false pretenses and
misrepresentations, Felicidad suffered damages as the promised employment
abroad never materialized and the money she paid was never recovered.

The fact that Felicidad actively participated in the processing of the illegal travel
documents will not exculpate Sy from liability. Felicidad was a hapless victim of
circumstances and of fraud committed by Sy. She was forced to take part in the
processing of the falsified travel documents because she had already
paid P120,000.00. Sy committed deceit by representing that she could secure
Felicidad with employment in Taiwan, the primary consideration that induced the
latter to part with her money. Felicidad was led to believe by Sy that she
possessed the power and qualifications to provide Felicidad with employment
abroad, when, in fact, she was not licensed or authorized to do so. Deceived,
Felicidad parted with her money and delivered the same to petitioner. Plainly, Sy
is guilty of estafa.

 
Illegal recruitment and estafa cases may be filed simultaneously or separately.
The filing of charges for illegal recruitment does not bar the filing of estafa, and
vice versa. Sys acquittal in the illegal recruitment case does not prove that she is
not guilty of estafa. Illegal recruitment and estafa are entirely different offenses
and neither one necessarily includes or is necessarily included in the other. A
person who is convicted of illegal recruitment may, in addition, be convicted
of estafa under Article 315, paragraph 2(a) of the RPC.[11] In the same manner, a
person acquitted of illegal recruitment may be held liable for estafa. Double
jeopardy will not set in because illegal recruitment is malum prohibitum, in which
there is no necessity to prove criminal intent, whereas estafa is malum in se, in
the prosecution of which, proof of criminal intent is necessary.[12]

The penalty prescribed for estafa under Article 315 of the RPC is prision

correccional in its maximum period to prision mayor in its minimum period, if the
amount defrauded is over Twelve Thousand Pesos (P12,000.00) but does not
exceed Twenty-two Thousand Pesos (P22,000.00), and if such amount exceeds
the latter sum, the penalty shall be imposed in its maximum period, adding one
year for each additional Ten Thousand Pesos (P10,000.00); but the total penalty
that may be imposed shall not exceed twenty years. In such cases, and in
connection with the accessory penalties that may be imposed under the
provisions of this Code, the penalty shall be termed prision mayor or reclusion
temporal, as the case may be.

The addition of one year imprisonment for each additional P10,000.00, in excess

of P22,000.00, is the incremental penalty. The incremental penalty rule is a
mathematical formula for computing the penalty to be actually imposed using the
prescribed penalty as the starting point. This special rule is applicable
in estafa and in theft.[13]

In estafa, the incremental penalty is added to the maximum period of the penalty
prescribed, at the discretion of the court, in order to arrive at the penalty to be
actually imposed, which is the maximum term within the context of the
Indeterminate Sentence Law (ISL).[14] Under the ISL, attending circumstances in a
case are applied in conjunction with certain rules of the Code in order to
determine the penalty to be actually imposed based on the penalty prescribed by
the Code for the offense. The circumstance is that the amount defrauded
exceeds P22,000.00, and the incremental penalty rule is utilized to fix the penalty
actually imposed.[15]

To compute the incremental penalty, the amount defrauded shall be subtracted

by P22,000.00, and the difference shall be divided by P10,000.00, and any fraction
of P10,000.00 shall be discarded.[16]
 

In the instant case, prision correccional in its maximum period to prision mayor in

its minimum period is the imposable penalty. The duration of prision
correccional in its maximum period is from four (4) years, two (2) months and one
(1) day to six (6) years; while prision mayor in its minimum period is from six (6)
years and one (1) day to eight (8) years. The incremental penalty for the amount
defrauded would be an additional nine years imprisonment, to be added to the
maximum imposable penalty of eight years. Thus, the CA committed no reversible
error in sentencing Sy to an indeterminate penalty of four (4) years and two (2)
months of prision correccional, as minimum, to seventeen (17) years of reclusion
temporal, as maximum.

As to the amount that should be returned or restituted by Sy, the sum that
Felicidad gave to Sy, i.e., P120,000.00, should be returned in full. The fact that
Felicidad was not able to produce receipts is not fatal to the case of the
prosecution since she was able to prove by her positive testimony that Sy was the
one who received the money ostensibly in consideration of an overseas
employment in Taiwan.[17]

 
 WHEREFORE, in view of the foregoing, the Decision of the Court of Appeals
dated July 22, 2008 in CA-G.R. CR No. 30628, sentencing petitioner Rosita Sy to an
indeterminate penalty of four (4) years and two (2) months of prision
correccional, as minimum, to seventeen (17) years of reclusion temporal, as
maximum, is hereby AFFIRMED. We, however, MODIFY the CA Decision as to the
amount of civil indemnity, in that Sy is ordered to reimburse the amount of One
Hundred Twenty Thousand Pesos (P120,000.00) to private complainant Felicidad
Navarro.

SO ORDERED.

 
 
ANTONIO EDUARDO B. NACHURA
Associate Justice
 
 
WE CONCUR:
 
 
 
RENATO C. CORONA
Associate Justice
Chairperson
 
 
 
  
 
PRESBITERO J. VELASCO, JR. DIOSDADO M. PERALTA
Associate Justice Associate Justice
 
 
 
JOSE CATRAL MENDOZA
Associate Justice
 

ATTESTATION
 

I attest that the conclusions in the above Resolution had been reached in
consultation before the case was assigned to the writer of the opinion of the
Courts Division.

RENATO C. CORONA
Associate Justice
Chairperson, Third Division
 
 
 CERTIFICATION
 

Pursuant to Section 13, Article VIII of the Constitution and the Division
Chairperson's Attestation, I certify that the conclusions in the above Resolution
had been reached in consultation before the case was assigned to the writer of
the opinion of the Courts Division.

REYNATO S. PUNO
Chief Justice

[1]
 Penned by Associate Justice Rebecca de Guia-Salvador, with Associate Justices Vicente S.E. Veloso and Ricardo
R. Rosario, concurring; rollo, pp. 21-37.
[2]
 Rollo, p. 48.
[3]
 Id.
[4]
 Id. at 22-25.
[5]
 Penned by Judge Erlinda Nicolas-Alvaro, RTC, Branch 198, Las Pias City; id. at 39-44.
[6]
 Id. at 44.
[7]
 Supra note 1.
[8]
 Id. at 36.
[9]
 Petitioner assigned the following errors in the CA Decision:
I
THE COURT OF APPEALS COMMITTED REVERSIBLE ERROR IN HOLDING THAT PETITIONER
OFFERED OVERSEAS JOB TO PRIVATE RESPONDENT.
 
II
THE COURT OF APPEALS COMMITTED REVERSIBLE ERROR IN HOLDING THAT PETITIONER
MISREPRESENTED AND FALSELY PRETENDED TO RESPONDENT THAT SHE HAD THE POWER AND
CAPACITY TO DEPLOY HER FOR A WORK IN TAIWAN.
III
THE COURT OF APPEALS COMMITTED REVERSIBLE ERROR IN HOLDING THAT PETITIONERS
MISREPRESENTATION AND FALSE PRETENSES WAS WHAT INDUCED RESPONDENT TO PART WITH
HER MONEY. (Rollo, p. 13).
[10]
 R.R. Paredes v. Calilung, G.R. No. 156055, March 5, 2007, 517 SCRA 369; Cosme, Jr. v. People, G.R. No.
149753, November 27, 2006, 508 SCRA 190; Jan-Dec Construction Corporation v. CA, G.R. No. 146818, February
6, 2006, 481 SCRA 556.
[11]
 People v. Billaber, 465 Phil. 726 (2004).
[12]
 Id.
[13]
 People v. Temporada, G.R. No. 173473, December 17, 2008, 574 SCRA 258.
[14]
 Under the ISL, in imposing a prison sentence for an offense punished by the Revised Penal Code, or its
amendments, the court shall sentence an accused to an indeterminate sentence the maximum term of which shall
be that which, in view of the attending circumstances, could be properly imposed under the rules of the said Code,
and the minimum which shall be within the range of the penalty next lower to that prescribed by the Code for the
offense; and if the offense is punished by any other law, the court shall sentence the accused to an indeterminate
sentence, the maximum term of which shall not exceed the maximum fixed by said law and the minimum shall not
be less than the minimum term prescribed by the same. 
[15]
 People v. Temporada, supra note 13, at 263-264.
[16]
 Id. at 260.
[17]
 People v. Gonzales-Flores, 408 Phil. 855 (2001); People v. Mercado, 364 Phil. 148 (1999).
 
  

SECOND DIVISION

 
RAFAEL H. GALVEZ and G.R. No. 187919
KATHERINE L. GUY,
 
Petitioners,
 
 
 
 
 
 
 
 
 
-versus-
 
 
 
 
 
 
 
 
 
HON. COURT OF APPEALS and
 
ASIA UNITED BANK,
 
Respondents.
 
 
 
x------------------------x
 
   

ASIA UNITED BANK, G.R. No. 187979

Petitioner,  

   

   

   

   

-versus-  

   

   

   

   

GILBERT G. GUY, PHILIP LEUNG,  

KATHERINE L. GUY, RAFAEL H. GALVEZ
 
and EUGENIO H. GALVEZ, JR.,
 
Respondents.
 
 
 
x--------------------------x
 
 
 
 
 
GILBERT G. GUY, PHILIP LEUNG and
EUGENIO H. GALVEZ, JR.,  
Petitioners, G.R. No. 188030

   

  Present:

   

  CARPIO, J.,

-versus- Chairperson,

  BRION,

  PEREZ,

  SERENO, and

ASIA UNITED BANK, REYES, JJ.

Respondent.  

Promulgated:

April 25, 2012

x ----------------------------------------------------------------------------------------x

DECISION

PEREZ, J.:

THE FACTS
 In 1999, Radio Marine Network (Smartnet) Inc. (RMSI) claiming to do
business under the name Smartnet Philippines[1] and/or Smartnet Philippines, Inc.
(SPI),[2] applied for an Omnibus Credit Line for various credit facilities with Asia
United Bank (AUB). To induce AUB to extend the Omnibus Credit Line, RMSI,
through its directors and officers, presented its Articles of Incorporation with its
400-peso million capitalization and its congressional telecom franchise. RMSI was
represented by the following officers and directors occupying the following
positions:

 
 

Gilbert Guy - Exec. V-Pres./Director

Philip Leung - Managing Director

Katherine Guy - Treasurer

Rafael Galvez - Executive Officer

Eugenio Galvez, Jr. - Chief Financial Officer/Comptroller

Satisfied with the credit worthiness of RMSI, AUB granted it a P250 million
Omnibus Credit Line, under the name of Smartnet Philippines, RMSIs Division. On
1 February 2000, the credit line was increased to P452 million pesos after a third-
party real estate mortgage by Goodland Company, Inc.,[3] an affiliate of Guy Group
of Companies, in favor of Smartnet Philippines,[4] was offered to the
bank. Simultaneous to the increase of the Omibus Credit Line, RMSI submitted a
proof of authority to open the Omnibus Credit Line and peso and dollar accounts
in the name of Smartnet Philippines, Inc., which Gilbert Guy, et al. represented as
a division of RMSI,[5] as evidenced by the letterhead used in its formal
correspondences with the bank and the financial audit made by SGV & Co., an
independent accounting firm. Attached to this authority was the Amended
Articles of Incorporation of RMSI, doing business under the name of Smartnet
Philippines, and the Secretarys Certificate of SPI authorizing its directors, Gilbert
Guy and Philip Leung to transact with AUB.[6] Prior to this major transaction,
however, and, unknown to AUB, while RMSI was doing business under the name
of Smartnet Philippines, and that there was a division under the name Smartnet
Philippines, Gilbert Guy, et al. formed a subsidiary corporation, the SPI with a
paid-up capital of only P62,500.00.

Believing that SPI is the same as Smartnet Philippines - the division of RMSI
- AUB granted to it, among others, Irrevocable Letter of Credit No. 990361 in the
total sum of $29,300.00 in favor of Rohde & Schwarz Support Centre Asia Ptd.
Ltd., which is the subject of these consolidated petitions. To cover the liability of
this Irrevocable Letter of Credit, Gilbert Guy executed Promissory Note No.
010445 in behalf of SPI in favor of AUB. This promissory note was renewed twice,
once, in the name of SPI (Promissory Note No. 011686), and last, in the name of
Smartnet Philippines under Promissory Note No. 136131, bolstering AUBs belief
that RMSIs directors and officers consistently treated this letter of credit, among
others, as obligations of RMSI.

When RMSIs obligations remained unpaid, AUB sent letters demanding

payments. RMSI denied liability contending that the transaction was incurred
solely by SPI, a corporation which belongs to the Guy Group of Companies, but
which has a separate and distinct personality from RMSI. RMSI further claimed
that while Smartnet Philippines is an RMSI division, SPI, is a subsidiary of RMSI,
and hence, is a separate entity.

Aggrieved, AUB filed a case of syndicated estafa under Article 315 (2) (a) of

the Revised Penal Code in relation to Section 1 of Presidential Decree (PD) No.
1689 against the interlocking directors of RMSI and SPI, namely, Gilbert G. Guy,
Rafael H. Galvez, Philip Leung, Katherine L. Guy, and Eugenio H. Galvez, Jr., before
the Office of the City Prosecutor of Pasig City.
 

AUB alleged that the directors of RMSI deceived it into believing that SPI
was a division of RMSI, only to insist on its separate juridical personality later on
to escape from its liabilities with AUB. AUB contended that had it not been for the
fraudulent scheme employed by Gilbert Guy, et al., AUB would not have parted
with its money, which, including the controversy subject of this petition,
amounted to hundreds of millions of pesos.

In a Resolution dated 3 April 2006,[7] the Prosecutor found probable cause

to indict Gilbert G. Guy, et al. for estafa but dismissed the charge of violation of
PD No. 1689 against the same for insufficiency of evidence, thus:

 
WHEREFORE, it is recommended that respondents be charged for ESTAFA under
Article 315, par. 2(a) of the Revised Penal Code, and the attached information be filed
with the Regional Trial Court in Pasig City, with a recommended bail of P40,000.00 for
each respondent.

It is further recommended that the charge of violation of P.D. 1689 against the
said respondents be dismissed for insufficiency of evidence.[8]

Accordingly, an Information dated 3 April 2006[9] was filed against Gilbert

Guy, et al. with the Regional Trial Court of Pasig City.

Both parties, i.e., the AUB and Gilbert Guy, et al., filed their respective

Petitions for Review with the Department of Justice (DOJ) assailing the 3 April
2006 Resolution of the Office of the City Prosecutor of Pasig City.

In a Resolution dated 15 August 2006,[10] the DOJ reversed the City

Prosecutors Resolution and ordered the dismissal of the estafa charges against
Gilbert Guy, et al. for insufficiency of evidence.
  

The AUBs Motion for Reconsideration was denied, constraining it to assail

the DOJ Resolution before the Court of Appeals (CA).

The CA partially granted AUBs petition in a Decision dated 27 June 2008,

thus:

 
WHEREFORE, the instant petition is GRANTED, finding probable cause against
private respondents for the crime of ESTAFA under Article 315, par 2 (a) of the Revised
Penal Code. The assailed Resolution dated August 15, 2006 of the Department of Justice
is REVERSED AND SET ASIDE, subject to our ruling that the private respondents are not
liable under P.D. 1689. The April 3, 2006 Resolution of Assistant City Prosecutor Paudac
is hereby REINSTATED.[11]

Aggrieved, Gilbert Guy, Philip Leung and Eugenio H. Galvez Jr. (in G.R. No.
188030) and separately, Rafael Galvez and Katherine Guy (in G.R. No. 187919)
filed the present petitions before this Court assailing the CA Decision which
reinstated the City Prosecutors Resolution indicting them of the crime of
estafa. The AUB also filed its own petition before us, docketed as G.R. No. 187979,
assailing the Court of Appeals Decision for dismissing the charge in relation to
Section 1 of PD No. 1689.

Hence, these consolidated petitions.

Gilbert Guy, et al. argue that this case is but a case for collection of sum of
money, and, hence, civil in nature and that no fraud or deceit was present at the
onset of the transaction which gave rise to this controversy, an element
indispensable for estafa to prosper.[12]
  

AUB, on the other, insists that this controversy is within the scope of PD No.
1689, otherwise known as syndicated estafa. It contends that Guy, et al., induced
AUB to grant SPIs letter of credit to AUBs damage and prejudice by misleading
AUB into believing that SPI is one and the same entity as Smartnet Philippines
which AUB granted an Omnibus Credit Transaction. After receiving and profiting
from the proceeds of the aforesaid letter of credit, Gilbert Guy, et al. denied and
avoided liability therefrom by declaring that the obligation should have been
booked under SPI as RMSI never contracted, nor authorized the same. It is on this
premise that AUB accuses Gilbert Guy, et al. to have committed the crime
of estafa under Article 315 (2) (a) of the Revised Penal Code in relation to PD No.
1689.

At issue, therefore, is whether or not there is probable cause to prosecute

Gilbert Guy, et al. for the crime of syndicated estafa on the basis of fraudulent
acts or fraudulent means employed to deceive AUB into releasing the proceeds of
Irrevocable Letter of Credit No. 990361 in favor of SPI.

Our Ruling

This controversy could have been just a simple case for collection of sum of
money had it not been for the sophisticated fraudulent scheme which Gilbert
Guy, et al.employed in inducing AUB to  part with its money.

Records show that on 17 February 1995, Radio Marine Network, Inc. (Radio
Marine) amended its corporate name to what it stands today Radio Marine
Network (Smartnet), Inc. This was a month after organizing its subsidiary
corporation the Smartnet Philippines, Inc. with a capital of only P62,500.00.[13] A
year earlier, Gilbert Guy, et al., established Smartnet Philippines as a division of
Radio Marine under which RMSI operated its business.

It was, however, only on 26 March 1998, when the Securities and Exchange
Commission approved the amended corporate name, and only in October 1999
did RMSI register Smartnet Philippines as its business name with the Department
of Trade and Industry.[14]

It is in this milieu that RMSI transacted business with AUB under the name
Smartnet Philippines and/or SPI.

Article 315 (2) (a) of the Revised Penal Code provides:

 
Art. 315. Swindling (estafa) any person who shall defraud another by any of the
means mentioned herein below x x x :

xxxx

2. By means of any of the following false pretenses or fraudulent acts executed

prior to or simultaneous with the commission of the fraud:

(a)  By using a fictitious name, or falsely pretending to possess power, influence,

qualifications, property, credit, agency, business or imaginary transactions; or by
means of other similar deceits. x x x.

 
The elements of estafa by means of deceit are the following:

 
a.       That there must be a false pretense, fraudulent act or fraudulent means;

b.      That such false pretense, fraudulent act or fraudulent means must be made or
executed prior to or simultaneously with the commission of the fraud;

c.       That the offended party must have relied on the false pretense, fraudulent act, or
fraudulent means, that is, he was induced to part with his money or property
because of the false pretense, fraudulent act, or fraudulent means;

d.      That as a result thereof, the offended party suffered damage.[15]

First, Gilbert Guy, Philip Leung, Katherine Guy, Rafael Galvez and Eugene
Galvez, Jr., interlocking directors of RMSI and SPI, represented to AUB in their
transactions that Smartnet Philippines and SPI were one and the same entity.
While Eugene Galvez, Jr. was not a director of SPI, he actively dealt with AUB in
his capacity as RMSIs Chief Financial Officer/Comptroller by falsely representing
that SPI and RMSI were the same entity. Gilbert Guy, Philip Leung, Katherine Guy,
Rafael Galvez, and Eugene Galvez, Jr. used the business names Smartnet
Philippines, RMSI, and SPI interchangeably and without any distinction. They
successfully did this by using the confusing similarity of RMSIs business name, i.e.,
Smartnet Philippines its division, and, Smartnet Philippines, Inc. the subsidiary
corporation. Further, they were able to hide the identity of SPI, by having almost
the same directors as that of RMSI. In order to let it appear that SPI is the same as
that of Smartnet Philippines, they submitted in their application documents of
RMSI, including its Amended Articles of Incorporation,[16] third-party real estate
mortgage of Goodland Company[17] in favor of Smartnet Philippines, and audited
annual financial statement of SGV & Co.[18] Gilbert Guy, et al. also used RMSI
letterhead in their official communications with the bank and the contents of
these official communications[19]conclusively pointed to RMSI as the one which
transacted with the bank.

These circumstances are all indicia of deceit. Deceit is the false

representation of a matter of fact whether by words or conduct, by false or
misleading allegations, or by concealment of that which should have been
disclosed which deceives or is intended to deceive another so that he shall act
upon it to his legal injury.[20]

Second, the intent to deceive AUB was manifest from the start. Gilbert

Guy et al. laid down first all the necessary materials they need for this deception
before defrauding the bank by first establishing Smartnet Philippines as a division
of Radio Marine under which Radio Marine Network Inc. operated its business.
[21]
 Then it organized a subsidiary corporation, the SPI, with a capital of
only P62,000.00.[22] Later, it changed the corporate name of Radio Marine
Network Inc. into RMSI.[23]

Undoubtedly, deceit here was conceived in relation to Gilbert Guy, et

al.s transaction with AUB. There was a plan, documented in corporations papers,
that led to the defraudation of the bank. The circumstances of the directors and
officers acts in inserting in Radio Marine the name of Smartnet; the creation of its
division Smartnet Philippines; and its registration as business name as Smartnet
Philippines with the Department of Trade and Industry, together with the
incorporation of its subsidiary, the SPI, are indicia of a pre-conceived scheme to
create this elaborate fraud, victimizing a banking institution, which perhaps, is the
first of a kind in Philippine business.

We emphasize that fraud in its general sense, is deemed to comprise

anything calculated to deceive, including all acts, omissions, and concealment
involving a breach of legal duty or equitable duty, trust, or confidence justly
reposed, resulting in damage to another, or by which an undue and
unconscientious advantage is taken of another.[24] It is a generic term embracing
all multifarious means which human ingenuity can device and which are resorted
to by one individual to secure an advantage over another by false suggestions or
by suppression of truth and includes all surprise, trick, cunning, dissembling and
any unfair way by which another is cheated.[25]

As early as 1903, in U.S. v. Mendezona,[26] we held that an accused may be

convicted for estafa if the deceit of false pretense is committed prior to or
simultaneous with fraud and is the efficient cause or primary consideration which
induced the offended party to part with his money or property.

Third, AUB would not have granted the Irrevocable Letter of Credit No.
990361, among others, had it known that SPI which had only P62,500.00 paid-up
capital and no assets, is a separate entity and not the division or business name of
RMSI. Gilbert Guy, et al. however, contends that the transaction subject in this
controversy is a letter of credit and not a loan, hence, SPIs capital does not
matter.[27] This was also the contention of the DOJ in reversing the Resolution of
the City Prosecutors Office of Pasig. The DOJ contended that:

 
It is also noted that the subject transaction, one of the several series of transactions
between complainant AUB and SPI, is not a loan transaction. It is a letter of credit
transaction intended to facilitate the importation of goods by SPI. The allegation as to
the lack of capitalization of SPI is therefore immaterial and irrelevant since it is a letter
of credit transaction. The seller gets paid only if it delivers the documents of title over
the goods to the bank which issued the letter of credit, while the buyer/importer
acquires title to the goods once it reimburses the issuing bank. The transaction secures
the obligation of the buyer/importer to the issuing bank. [28]
It is true that ordinarily, in a letter of credit transaction, the bank merely
substitutes its own promise to pay for the promise to pay of one of its customers,
who in turn promises to pay the bank the amount of funds mentioned in the
letters of credit plus credit or commitments fees mutually agreed upon. Once the
issuing bank shall have paid the beneficiary after the latters compliance with the
terms of the letter of credit, the issuing bank is entitled to reimbursement for the
amount it paid under the letter of credit.[29]

In the present case, however, no reimbursement was made outright,

precisely because the letter of credit was secured by a promissory note executed
by SPI. The bank would have not agreed to this transaction had it not been
deceived by Gilbert Guy, et al. into believing the RMSI and SPI were one and the
same entity. Guy and his cohorts acts in (1) securing the letter of credit
guaranteed by a promissory note in behalf of SPI; and, (2) their act of
representing SPI as RMSIs Division, were indicia of fraudulent acts because they
fully well know, even before transacting with the bank, that: (a) SPI was a
separate entity from Smartnet Philippines, the RMSIs Division, which has the
Omnibus Credit Line; and (b) despite this knowledge, they misrepresented to the
bank that SPI is RMSIs division. Had it not for this false representation, AUB would
have not granted SPIs letter of credit to be secured with a promissory note
because SPI as a corporation has no credit line with AUB and SPI by its own, has
no credit standing.

Fourth, it is not in dispute that the bank suffered damage, which, including
this controversy, amounted to hundreds of millions of pesos.

It is worth emphasizing that under Section 1, Rule 112 of the Revised Rules
on Criminal Procedure, the function of a preliminary investigation is to determine
whether there is a sufficient ground to engender a well-grounded belief that a
crime x x x has been committed and that the respondent is probably guilty thereof
and should be held for trial.[30]

A finding of probable cause needs only to rest on evidence showing that

more likely than not, the accused committed the crime.[31]  Preliminary
investigation is not the occasion for the full and exhaustive display of the parties'
evidence.[32]  It is for the presentation of such evidence only as may engender a
well-founded belief that an offense has been committed and that the accused is
probably guilty thereof.[33]  The validity and merits of a party's accusation or
defense, as well as admissibility of testimonies and evidence, are better ventilated
during the trial proper.[34]

We, therefore, sustain the findings of the CA and the City Prosecutors
Resolution finding that probable cause exists against Gilbert Guy, et al. for the
crime of estafa under Article 315 (2)(a) of the Revised Penal Code and that Gilbert
Guy, et al. are probably guilty thereof and should be held for trial. AUBs
voluminous documents submitted to this Court overcome this difficulty and
established that there is sufficient ground to engender a well-grounded belief that
a crime has been committed and that the respondents are probably guilty thereof
and should be held for trial.

Lest it be misunderstood, we reiterate that this Courts finding of probable

cause is grounded on fraud committed through deceit which surrounded Gilbert
Guy, et al.transaction with AUB, thus, violating Article 315 (2) (a) of the Revised
Penal Code; it is neither their act of borrowing money and not paying them, nor
their denial thereof, but their very act of deceiving AUB in order for the latter to
part with its money. As early as the Penal Code of Spain, which was enforced in
the Philippines as early as 1887 until it was replaced by the Revised Penal Code in
1932, the act of fraud through false pretenses or similar deceit was already being
punished. Article 335 of the Penal Code of Spain punished a person who
defrauded another by falsely pretending to possess any power, influence,
qualification, property, credit, agency or business, or by means of similar deceit.[35]

Anent the issue as to whether or not Gilbert Guy, et al. should be charged

for syndicated estafa in relation to Section 1 of PD No. 1689, which states that:

 
SEC 1. Any person or persons who shall commit estafa or other forms of
swindling as defined in Article 315 and 316 of the Revised Penal Code, as amended, shall
be punished by life imprisonment to death if the swindling (estafa) is committed by a
syndicate consisting of five or more persons formed with the intention of carrying out
the unlawful or illegal act, transaction, enterprise or scheme, and the defraudation
results in the misappropriation of moneys contributed by stockholders, or members of
rural banks, cooperatives, samahang nayon(s), or farmers associations, or of funds
solicited by corporations/ associations from the general public.

We hold that the afore-quoted law applies to the case at bar, for the
following reasons:

Under Section 1 of PD No. 1689, the elements of syndicated estafa are:

(a) estafa or other forms of swindling as defined in Artilce 315 and 316 of the
Revised Penal Code is committed; (b) the estafa or swindling is committed by a
syndicate of five or more persons; and (c) defraudation results in the
misappropriation of moneys contributed by stockholders, or members of rural
banks, cooperatives, samahang nayon[s], or farmers associations or of funds
solicited by corporations/associations from the general public.[36]

First, as defined under Section 1 of PD No. 1689, a syndicate consists of five

or more persons formed with the intention of carrying out the unlawful or illegal
act, transaction, enterprise or scheme. Five (5) accused, namely, Gilbert G. Guy,
Rafael H. Galvez, Philip Leung, Katherine L. Guy, and Eugenio H. Galvez, Jr. were,
(a) all involved in the formation of the entities used to defraud AUB; and (b) they
were the officers and directors, both of RMSI and SPI, whose conformities paved
the way for AUB to grant the letter of credit subject of this case, in AUBs honest
belief that SPI, as Gilbert Guy, et al. represented, was a mere division of RMSI. As
already discussed, although Eugenio Galvez, Jr. was not a director of SPI, he,
together with Gilbert Guy and Philip Leung, actively participated in the scheme
through their signed correspondences with the bank and their attendance in the
meetings with executives of AUB.[37] Rafael Galvez and Katherine Guy, on the
other hand, were the directors of RMSI and SPI who caused and authorized
Gilbert Guy and Philip Leung to transact with AUB.[38]

Second, while these corporations were established presumably in

accordance with law, it cannot be denied that Gilbert G. Guy, Rafael H. Galvez,
Philip Leung, Katherine L. Guy, and Eugenio H. Galvez, Jr. used these corporations
to carry out the illegal and unlawful act of misrepresenting SPI as a mere division
of RMSI, and, despite knowing SPIs separate juridical personality, applied for a
letter of credit secured by SPIs promissory note, knowing fully that SPI has no
credit line with AUB. The circumstances of the creation of these entities and their
dealings with the bank reveal this criminal intent to defraud and to deceive AUB.

Third, the fact that the defraudation of AUB resulted to misappropriation of

the money which it solicited from the general public in the form of deposits was
substantially established.[39] Section 3.1 of the General Banking Law defines banks
as entities engaged in the lending of funds obtained in the form of deposits. The
Old General Banking Act (R.A. No. 337) gave a fuller picture of the basic banking
function of obtaining funds from the public by way of deposits and the lending of
these funds as follows:

 
Sec 2. Only entities duly authorized by the Monetary Board of the Central Bank may
engage in the lending of funds obtained from the public through the receipt of deposits
of any kind, and all entities regularly conducting such operations shall be considered as
banking institutions, xxxx.
 Gilbert Guy et al. want this Court to believe that AUB, being a commercial
bank, is beyond the coverage of PD No. 1689. We hold, however, that a bank is a
corporation whose fund comes from the general public. P.D. No. 1689 does not
distinguish the nature of the corporation. It requires, rather, that the funds of
such corporation should come from the general public. This is bolstered by the
third whereas clause of the quoted law which states that the same also applies to
other corporations/associations operating on funds solicited from the general
public. This is precisely the very same scheme that PD No. 1689 contemplates that
this species of estafa be checked or at least be minimized by imposing capital
punishment involving funds solicited by corporations/associations from the
general public because this erodes the confidence of the public in the banking and
cooperative system, contravenes public interest and constitutes economic
sabotage that threatens the stability of the nation.[40]

Hence, for the stated reasons, we applied the law in People v. Balasa,[41] a
non-stock/non-profit corporation the Panata Foundation of the Philippines,
Inc. We held that PD No. 1689 also applies to other corporations/associations
operating on funds solicited from the general public.

In People v. Romero,[42] we also applied the law to a stock corporation

engaged in marketing, the Surigao San Andres Industrial Development
Corporation. Likewise, in People v. Menil,[43] we applied the law to another
marketing firm known as ABM Appliance and Upholstery.

In these cited cases, the accused used the legitimacy of their entities to
perpetrate their unlawful and illegal acts. We see no reason not to apply this law
to a banking institution, a corporation imbued with public interest, when a clear
reading of the PD 1689 reveals that it is within its coverage.

 
 WHEREFORE, the Decision of the Court of Appeals dated 27 June 2008 in
CA-G.R. SP No. 97160 is hereby AFFIRMED with MODIFICATION that Gilbert G.
Guy, Rafael H. Galvez, Philip Leung, Katherine L. Guy and Eugenio H. Galvez, Jr. be
charged for SYNDICATED ESTAFA under Article 315 (2) (a) of the Revised Penal
Code in relation to Section 1 of Presidential Decree No. 1689.

SO ORDERED.
 

  JOSE PORTUGAL PEREZ

Associate Justice

WE CONCUR:
 

ANTONIO T. CARPIO
Associate Justice
Chairperson
 

 
 

ARTURO D. BRION MARIA LOURDES P. A. SERENO Associate

Justice Associate Justice

 
 
 
 
 

BIENVENIDO L. REYES
Associate Justice

ATTESTATION

I attest that the conclusions in the above Decision had been reached in
consultation before the case was assigned to the writer of the opinion of the
Courts Division.

 
ANTONIO T. CARPIO

Associate Justice

Chairperson

 
 
 
CERTIFICATION
 

Pursuant to Section 13, Article VIII of the Constitution, it is hereby certified

that the conclusions in the above Decision were reached in consultation before
the case was assigned to the writer of the opinion of the Court.

 
 
 

RENATO C. CORONA
Chief Justice

[1]
 Rollo in G.R. No. 188030, p. 111.
[2]
 In Civil Case No. 68366, RMSI filed a complaint, claiming that it was doing business under the name Smartnet
Philippines and Smartnet Philippines, Inc. Id. at 486.
[3]
 Goodland Co., Inc. v Asia United Bank, G.R. Nos. 195546 and 195561, 14 March 2012.
[4]
 Rollo in G.R. No. 188030, p. 471.
[5]
 Id. at 472.
[6]
 Id.
[7]
 Rollo in G.R. No. 187919, pp. 137-148.
[8]
 Id. at 148.
[9]
 Filed before the Regional Trial Court of Pasig City, entitled People of the Philippines v. Gilbert Guy et al., Branch
57, docketed as Criminal Case No. 133010-PSG. Id. at 53
[10]
 Rollo in G.R. No. 188030, p. 398.
[11]
 Penned by Associate Justice Vicente Veloso, with Associate Justices Rebecca de Guia-Salvador and Apolinario
D. Bruselas, Jr., concurring. Rollo in G.R. No. 187919, pp. 8-41.
[12]
 Rollo in G.R. No. 188030, p. 16.
[13]
 Incorporated on 24 January 1995. Rollo in G.R. No. 187919, p. 294.
[14]
 Rollo in G.R. No. 188030, p. 111.
[15]
 Montano v. People, 423 Phil. 141, 147-148 (2001).
[16]
 Rollo in G.R. No. 188030, pp. 458-467.
[17]
 Id. at 114.
[18]
 Id. at 494-502.
[19]
 Id. at. 481, 492-493, 502, 505, 507-512.
[20]
 People v. Balasa, 356 Phil. 362. 382-383 (1998).
[21]
 Rollo in G.R. No. 188030, p. 381.
[22]
 Id. at 89-100.
[23]
 Id. at 101.
[24]
 Id. at 382.
[25]
 Id. citing Alleje v. Court of Appeals, G.R. No. 107152, 25 January 1995, 240 SCRA 495, 500 citing further
Blacks Law Dictionary., 4th Edition., p. 788 (1951).
[26]
 2 Phil. 353 (1903).
[27]
 Rollo in G.R. No. 188030, p. 22.
[28]
 Resolution of the Department of Justice. Rollo in G.R. No. 188030, p. 201.
[29]
 Prudential Bank v. IAC, 216 SCRA 257 (1992).
[30]
 Webb v. Hon. De Leon, 317 Phil. 758. 777 (1995).
[31]
 Presidential Ad Hoc Fact-Finding Committee on Behest Loans v. Hon. Desierto, 375 Phil. 697 (1999).
[32]
 Id.
[33]
 Id.
[34]
 Id.
[35]
 Lozano v. Martinez, G.R. No. 63419, 18 December 1986, 146 SCRA 323, 332.
[36]
 People v. Balasa,supra note 20 at 395-396.
[37]
 Rollo in G.R. No. 188030, pp. 149-160.
[38]
 Id. at 115.
[39]
 Section 95. Definition of Deposit Substitutes. The term deposit substitutes is defined as an alternative form of
obtaining funds from the public, other than deposits, xxx.
[40]
 Preamble of PD No 1689:
WHEREAS, there is an upsurge in the commission of swindling and other forms of frauds in rural
banks, cooperatives, "samahang nayon (s)", and farmers' associations or corporations/associations operating
on funds solicited from the general public; WHEREAS, such defraudation or misappropriation of funds
contributed by stockholders or members of such rural banks, cooperatives, "samahang nayon(s)", or
farmers' associations, or of funds solicited by corporations/associations from the general public, erodes the
confidence of the public in the banking and cooperative system, contravenes the public interest, and
constitutes economic sabotage that threatens the stability of the nation;
WHEREAS, it is imperative that the resurgence of said crimes be checked, or at least minimized,
by imposing capital punishment on certain forms of swindling and other frauds involving rural banks,
cooperatives, "samahang nayon(s)", farmers' associations or corporations/associations operating on funds
solicited from the general public;
[41]
 Supra note 20.
[42]
 365 Phil. 531 (1999).
[43]
 G.R. Nos. 11504-66, 12 September 2000, 340 SCRA 125.
 Republic of the Philippines
Supreme Court
Manila

SECOND DIVISION
 
HECTOR TREAS, G. R. No. 195002
Petitioner,  
  Present:
   
  CARPIO, J.,
  Chairperson,
- versus - PEREZ,
  SERENO,
  REYES, and
  PERLAS-BERNABE,* JJ.
   
  Promulgated:
PEOPLE OF THE PHILIPPINES,  
Respondent. January 25, 2012

x--------------------------------------------------x
 
DECISION
 
SERENO, J.:
 
Where life or liberty is affected by its proceedings, courts must keep strictly
within the limits of the law authorizing them to take jurisdiction and to try the case
and render judgment thereon.[1]

This is a Petition for Review on Certiorari under Rule 45 of the 1997 Revised
Rules of Civil Procedure, seeking to annul and set aside the Court of Appeals (CA)
Decision dated 9 July 2010[2] and Resolution dated 4 January 2011.
 
 
Statement of the Facts and of the Case
 
The pertinent facts, as found by the CA, are as follows:
Sometime in December 1999, Margarita Alocilja (Margarita) wanted to buy a
house-and-lot in Iloilo City covered by TCT No. 109266. It was then mortgaged
with Maybank. The bank manager Joselito Palma recommended the appellant
Hector Treas (Hector) to private complainant Elizabeth, who was an employee
and niece of Margarita, for advice regarding the transfer of the title in the latters
name. Hector informed Elizabeth that for the titling of the property in the name of
her aunt Margarita, the following expenses would be incurred:
 
P20,000.00- Attorneys fees,
P90,000.00- Capital Gains Tax,
P24,000.00- Documentary Stamp,
P10,000.00- Miscellaneous Expenses.
 
Thereafter, Elizabeth gave P150,000.00 to Hector who issued a corresponding
receipt dated December 22, 1999 and prepared [a] Deed of Sale with Assumption
of Mortgage. Subsequently, Hector gave Elizabeth Revenue Official Receipt Nos.
00084370 for P96,000.00 and 00084369 for P24,000.00. However, when she
consulted with the BIR, she was informed that the receipts were fake. When
confronted, Hector admitted to her that the receipts were fake and that he used the
P120,000.00 for his other transactions. Elizabeth demanded the return of the
money.
 
To settle his accounts, appellant Hector issued in favor of Elizabeth a Bank of
Commerce check No. 0042856 dated November 10, 2000 in the amount of
P120,000.00, deducting from P150,000.00 the P30,000.00 as attorneys fees.
When the check was deposited with the PCIBank, Makati Branch, the same was
dishonored for the reason that the account was closed. Notwithstanding repeated
formal and verbal demands, appellant failed to pay. Thus, the instant case of
Estafa was filed against him.[3]
 
On 29 October 2001, an Information was filed by the Office of the City Prosecutor
before the Regional Trial Court (RTC), both of Makati City. The Information reads
as follows:
That on or about the 23rd day of December, 1999, in the City of Makati, Metro
Manila, Philippines and within the jurisdiction of this Honorable Court, the
above-named accused, received in trust from ELIZABETH LUCIAJA the amount
of P150,000.00 which money was given to her by her aunt Margarita Alocilja,
 with the express obligation on the part of the accused to use the said amount for
expenses and fees in connection with the purchase of a parcel of land covered by
TCT No. T-109266, but the said accused, once in possession of the said amount,
with the intent to gain and abuse of confidence, did then and there willfully,
unlawfully and feloniously misappropriate, misapply and convert to his own
personal use and benefit the amount of P130,000.00 less attorneys fees and the
said accused failed and refused and still fails and refuses to do so, to the damage
and prejudice of complainant Elizabeth Luciaja and Margarita Alocilja in the
aforementioned amount of P130,000.00.
 
CONTRARY TO LAW.[4]
 
During arraignment on 26 April 2002, petitioner, acting as his own counsel,
entered a plea of Not Guilty. Allegedly due to old age and poor health, and the fact
that he lives in Iloilo City, petitioner was unable to attend the pre-trial and trial of
the case.
 
On 8 January 2007, the RTC rendered a Decision[5] finding petitioner guilty of the
crime of Estafa under section 1, paragraph (b), of Article 315 of the Revised Penal
Code (RPC), with the dispositive portion as follows:
WHEREFORE, in view of the foregoing, judgment is rendered finding accused
Hector Trenas guilty of the crime of Estafa with abuse of confidence as penalized
under Article 315 of the Revised Penal Code, and which offense was committed
in the manner described in the aforementioned information. As a consequence of
this judgment, accused Hector Trenas is sentenced to suffer a penalty of Ten (10)
Years and One (1) Day of Prision Mayor to Seventeen (17) Years and Four (4)
Months of Reclusion Temporal. Moreover, he is ordered to indemnify private
complainant Elizabeth Luciaja the amount of P130,000.00 with interest at the
legal rate of 12% per annum, reckoned from the date this case was filed until the
amount is fully paid.
 
SO ORDERED.[6]
We note at this point that petitioner has been variably called Treas and
Trenas in the pleadings and court issuances, but for consistency, we use the name
Treas, under which he was accused in the Information.

On 24 August 2007, petitioner filed a Motion for Reconsideration,[7] which

was denied by the RTC in a Resolution dated 2 July 2008.[8]

 
 On 25 September 2008, petitioner filed a Notice of Appeal before the RTC.
[9]
 The appeal was docketed as CA-G.R. CR No. 32177. On 9 July 2010, the CA
rendered a Decision[10] affirming that of the RTC. On 4 August 2010, petitioner
filed a Motion for Reconsideration, which was denied by the CA in a Resolution
dated 4 January 2011.[11]

On 25 January 2011, petitioner filed a Motion for Extension of Time to File

Petition for Review on Certiorari[12] before this Court. He asked for a period of 15
days within which to file a petition for review, and the Court granted his motion in
a Resolution dated 9 February 2011.

On 3 February 2011, petitioner filed his Petition for Review on Certiorari before
this Court, with the following assignment of errors:
1.                  THE COURT OF APPEALS ERRED IN RULING THAT AN
ACCUSED HAS TO PRESENT EVIDENCE IN SUPPORT OF THE DEFENSE
OF LACK OF JURISDICTION EVEN IF SUCH LACK OF JURISDICTION
APPEARS IN THE EVIDENCE OF THE PROSECUTION;
 
2.                  THE COURT OF APPEALS ERRED IN RULING THAT
DEMAND MADE BY A PERSON OTHER THAN THE AGGRIEVED PARTY
SATISFIES THE REQUIREMENT OF DEMAND TO CONSTITUTE THE
OFFENSE OF ESTAFA;[13]
 
On the first issue, petitioner asserts that nowhere in the evidence presented
by the prosecution does it show that ₱150,000 was given to and received by
petitioner in Makati City. Instead, the evidence shows that the Receipt issued by
petitioner for the money was dated 22 December 1999, without any indication of
the place where it was issued. Meanwhile, the Deed of Sale with Assumption of
Mortgage prepared by petitioner was signed and notarized in Iloilo City, also on 22
December 1999. Petitioner claims that the only logical conclusion is that the
money was actually delivered to him in Iloilo City, especially since his residence
and office were situated there as well. Absent any direct proof as to the place of
delivery, one must rely on the disputable presumption that things happened
according to the ordinary course of nature and the ordinary habits of life. The only
time Makati City was mentioned was with respect to the time when the check
provided by petitioner was dishonored by Equitable-PCI Bank in its De la Rosa-
Rada Branch in Makati. Petitioner asserts that the prosecution witness failed to
allege that any of the acts material to the crime of estafa had occurred in Makati
City. Thus, the trial court failed to acquire jurisdiction over the case.

Petitioner thus argues that an accused is not required to present evidence to prove
lack of jurisdiction, when such lack is already indicated in the prosecution
evidence.

As to the second issue, petitioner claims that the amount of P150,000 actually
belongs to Margarita. Assuming there was misappropriation, it was actually she not
Elizabeth who was the offended party. Thus, the latters demand does not satisfy the
requirement of prior demand by the offended party in the offense of estafa. Even
assuming that the demand could have been properly made by Elizabeth, the
demand referred to the amount of P120,000, instead of P150,000. Finally, there is
no showing that the demand was actually received by petitioner. The signature on
the Registry Return Receipt was not proven to be that of petitioners.

On 30 May 2011, this Court issued a Resolution directing the Office of the
Solicitor General (OSG) to file the latters Comment on the Petition. On 27 July
2011, the OSG filed a Motion for Extension, praying for an additional period of 60
days within which to submit its Comment. This motion was granted in a
Resolution dated 12 September 2011. On 23 September 2011, the OSG filed a
Motion for Special Extension, requesting an additional period of five days. On 29
September 2011, it filed its Comment on the Petition.

In its Comment, the OSG asserts that the RTC did not err in convicting petitioner
as charged. The OSG notes that petitioner does not dispute the factual findings of
the trial court with respect to the delivery of P150,000 to him, and that there was a
relationship of trust and confidence between him and Elizabeth. With respect to his
claim that the Complaint should have been filed in Iloilo City, his claim was not
supported by any piece of evidence, as he did not present any. Further, petitioner
is, in effect, asking the Court to weigh the credibility of the prosecution witness,
Elizabeth. However, the trial courts assessment of the credibility of a witness is
entitled to great weight, unless tainted with arbitrariness or oversight of some fact
or circumstance, which is not the case here.
With respect to the second issue, the OSG stresses that the defense of no valid
demand was not raised in the lower court. Nevertheless, the demand letter sent to
Elizabeth suffices, as she is also one of the complainants alleged in the
Information, as an agent of Margarita. Moreover, no proof was adduced as to the
genuineness of petitioners signature in the Registry Return Receipt of the demand
letter.

The OSG, however, submits that the Court may recommend petitioner for
executive clemency, in view of his advanced age and failing health.
 
The Courts Ruling
 
The Petition is impressed with merit.
 
Review of Factual Findings
 
While the Petition raises questions of law, the resolution of the Petition
requires a review of the factual findings of the lower courts and the evidence upon
which they are based.

As a rule, only questions of law may be raised in a petition for review under
Rule 45 of the Rules of Court. In many instances, however, this Court has laid
down exceptions to this general rule, as follows:
 
(1) When the factual findings of the Court of Appeals and the trial court are
contradictory;
(2) When the conclusion is a finding grounded entirely on speculation, surmises
or conjectures;
(3) When the inference made by the Court of Appeals from its findings of fact is
manifestly mistaken, absurd or impossible;
(4) When there is grave abuse of discretion in the appreciation of facts;
(5) When the appellate court, in making its findings, went beyond the issues of the
case, and such findings are contrary to the admissions of both appellant
and appellee;
(6) When the judgment of the Court of Appeals is premised on misapprehension
of facts;
(7) When the Court of Appeals failed to notice certain relevant facts which, if
properly considered, would justify a different conclusion;
(8) When the findings of fact are themselves conflicting;
 (9) When the findings of fact are conclusions without citation of the specific
evidence on which they are based; and
(10) When the findings of fact of the Court of Appeals are premised on the
absence of evidence but such findings are contradicted by the evidence on
record.[14]

In this case, the findings of fact of the trial court and the CA on the issue of the
place of commission of the offense are conclusions without any citation of the
specific evidence on which they are based; they are grounded on conclusions and
conjectures.

The trial court, in its Decision, ruled on the commission of the offense without any
finding as to where it was committed:
 
Based on the evidence presented by the prosecution through private complainant
Elizabeth Luciaja, the Court is convinced that accused Trenas had committed the
offense of Estafa by taking advantage of her trust so that he could misappropriate
for his own personal benefit the amount entrusted to him for payment of the
capital gains tax and documentary stamp tax.
 
As clearly narrated by private complainant Luciaja, after accused Trenas had
obtained the amount of P150,000.00 from her, he gave her two receipts
purportedly issued by the Bureau of Internal Revenue, for the fraudulent purpose
of fooling her and making her believe that he had complied with his duty to pay
the aforementioned taxes. Eventually, private complainant Luciaja discovered that
said receipts were fabricated documents.[15]
 
In his Motion for Reconsideration before the RTC, petitioner raised the argument
that it had no jurisdiction over the offense charged. The trial court denied the
motion, without citing any specific evidence upon which its findings were based,
and by relying on conjecture, thus:
That the said amount was given to [Treas] in Makati City was incontrovertibly
established by the prosecution. Accused Treas, on the other hand, never appeared
in Court to present countervailing evidence. It is only now that he is suggesting
another possible scenario, not based on the evidence, but on mere what ifs. x x x
 
Besides, if this Court were to seriously assay his assertions, the same would still
not warrant a reversal of the assailed judgment. Even if the Deed of Sale with
Assumption of Mortgage was executed on 22 December 999 in Iloilo City, it
cannot preclude the fact that the P150,000.00 was delivered to him by private
complainant Luciaja in Makati City the following day. His reasoning the money
 must have been delivered to him in Iloilo City because it was to be used for
paying the taxes with the BIR office in that city does not inspire concurrence. The
records show that he did not even pay the taxes because the BIR receipts he gave
to private complainant were fake documents. Thus, his argumentation in this
regard is too specious to consider favorably.[16]

For its part, the CA ruled on the issue of the trial courts jurisdiction in this wise:
It is a settled jurisprudence that the court will not entertain evidence unless
it is offered in evidence. It bears emphasis that Hector did not comment on the
formal offer of prosecutions evidence nor present any evidence on his behalf. He
failed to substantiate his allegations that he had received the amount of
P150,000.00 in Iloilo City. Hence, Hectors allegations cannot be given
evidentiary weight.
 
Absent any showing of a fact or circumstance of weight and influence
which would appear to have been overlooked and, if considered, could affect the
outcome of the case, the factual findings and assessment on the credibility of a
witness made by the trial court remain binding on appellate tribunal. They are
entitled to great weight and respect and will not be disturbed on review.[17]
 
The instant case is thus an exception allowing a review of the factual findings of
the lower courts.

Jurisdiction of the Trial Court

 
The overarching consideration in this case is the principle that, in criminal cases,
venue is jurisdictional. A court cannot exercise jurisdiction over a person charged
with an offense committed outside its limited territory. In Isip v. People,[18] this
Court explained:
 
The place where the crime was committed determines not only the
venue of the action but is an essential element of jurisdiction. It is a
fundamental rule that for jurisdiction to be acquired by courts in criminal cases,
the offense should have been committed or any one of its essential ingredients
should have taken place within the territorial jurisdiction of the court. Territorial
jurisdiction in criminal cases is the territory where the court has jurisdiction to
take cognizance or to try the offense allegedly committed therein by the accused.
Thus, it cannot take jurisdiction over a person charged with an offense allegedly
committed outside of that limited territory. Furthermore, the jurisdiction of a
court over the criminal case is determined by the allegations in the complaint
or information. And once it is so shown, the court may validly take cognizance
of the case. However, if the evidence adduced during the trial shows that the
 offense was committed somewhere else, the court should dismiss the action
for want of jurisdiction. (Emphasis supplied.)
 
In a criminal case, the prosecution must not only prove that the offense was
committed, it must also prove the identity of the accused and the fact that the
offense was committed within the jurisdiction of the court.

In Fukuzume v. People,[19] this Court dismissed a Complaint for estafa,

wherein the prosecution failed to prove that the essential elements of the offense
took place within the trial courts jurisdiction. The Court ruled:
More importantly, we find nothing in the direct or cross-examination of
Yu to establish that he gave any money to Fukuzume or transacted business with
him with respect to the subject aluminum scrap wires inside or within the
premises of the Intercontinental Hotel in Makati, or anywhere in Makati for that
matter. Venue in criminal cases is an essential element of jurisdiction. x x x
 
In the present case, the criminal information against Fukuzume was filed
with and tried by the RTC of Makati. He was charged with estafa as defined under
Article 315, paragraph 2(a) of the Revised Penal Code, the elements of which are
as follows: x x x
 
The crime was alleged in the Information as having been committed
in Makati. However, aside from the sworn statement executed by Yu on April
19, 1994, the prosecution presented no other evidence, testimonial or
documentary, to corroborate Yu's sworn statement or to prove that any of
the above-enumerated elements of the offense charged was committed in
Makati. Indeed, the prosecution failed to establish that any of the subsequent
payments made by Yu in the amounts of P50,000.00 on July 12, 1991, P20,000.00
on July 22, 1991, P50,000.00 on October 14, 1991 and P170,000.00 on October
18, 1991 was given in Makati. Neither was there proof to show that the
certifications purporting to prove that NAPOCOR has in its custody the subject
aluminum scrap wires and that Fukuzume is authorized by Furukawa to sell the
same were given by Fukuzume to Yu in Makati. On the contrary, the testimony of
Yu established that all the elements of the offense charged had been committed in
Paraaque, to wit: that on July 12, 1991, Yu went to the house of Fukuzume in
Paraaque; that with the intention of selling the subject aluminum scrap wires, the
latter pretended that he is a representative of Furukawa who is authorized to sell
the said scrap wires; that based on the false pretense of Fukuzume, Yu agreed to
buy the subject aluminum scrap wires; that Yu paid Fukuzume the initial amount
of P50,000.00; that as a result, Yu suffered damage. Stated differently, the crime
of estafa, as defined and penalized under Article 315, paragraph 2(a) of the
Revised Penal Code, was consummated when Yu and Fukuzume met at the
 latter's house in Paraaque and, by falsely pretending to sell aluminum scrap wires,
Fukuzume was able to induce Yu to part with his money.
 
xxx
 
From the foregoing, it is evident that the prosecution failed to prove that
Fukuzume committed the crime of estafa in Makati or that any of the
essential ingredients of the offense took place in the said city. Hence, the
judgment of the trial court convicting Fukuzume of the crime of estafa
should be set aside for want of jurisdiction, without prejudice, however, to the
filing of appropriate charges with the court of competent jurisdiction. (Emphasis
supplied)

In this case, the prosecution failed to show that the offense of estafa under
Section 1, paragraph (b) of Article 315 of the RPC was committed within the
jurisdiction of the RTC of Makati City.

That the offense was committed in Makati City was alleged in the
information as follows:
That on or about the 23rd day of December, 1999, in the City of Makati,
Metro Manila, Philippines and within the jurisdiction of this Honorable Court,
the above-named accused, received in trust from ELIZABETH LUCIAJA the
amount of P150,000.00 x x x. (Emphasis supplied.)[20]
 

Ordinarily, this statement would have been sufficient to vest jurisdiction in

the RTC of Makati. However, the Affidavit of Complaint executed by Elizabeth
does not contain any allegation as to where the offense was committed. It provides
in part:
4. THAT on 23 December 1999, [Elizabeth] personally entrusted to ATTY.
HECTOR TREAS the sum of P150,000.00 to be expended as agreed and
ATTY. HECTOR TREAS issued to me a receipt, a photo copy of which is
hereto attached as Annex B,
 
 
5. THAT despite my several follow-ups with ATTY. HECTOR TREAS, the latter
failed to transfer the title of aforesaid property to MRS. MARGARITA
ALOCILJA. He also failed to pay the capital gains tax, documentary stamps
and BIR-related expenses. What ATTY. HECTOR TREAS accomplished was
only the preparation of the Deed of Sale covering aforesaid property. A copy
of said Deed of Sale is hereto attached as Annex C,
 
 6. THAT in view of my persistent follow-ups, ATTY. HECTOR TREAS  issued to
me a check for refund of the sum given to him less the attorneys fee of
P20,000.00 and the sum of P10,000.00 allegedly paid to BIR or in the net sum
of P120,000.00. x x x
 
7. THAT when said check was deposited at EQUITABLE PCI BANK dela Rosa-
Rada Branch at Makati City, the same was dishonored by the drawee bank for
the reason: ACCOUNT CLOSED. x x x[21]

Aside from the lone allegation in the Information, no other evidence was
presented by the prosecution to prove that the offense or any of its elements was
committed in Makati City.

Under Article 315, par. 1 (b) of the RPC, the elements of estafa are as
follows: (1) that money, goods or other personal property is received by the
offender in trust or on commission, or for administration, or under any other
obligation involving the duty to make delivery of or to return the same; (2) that
there be misappropriation or conversion of such money or property by the
offender, or denial on his part of such receipt; (3) that such misappropriation or
conversion or denial is to the prejudice of another; and (4) there is demand by the
offended party to the offender.[22]

There is nothing in the documentary evidence offered by the

prosecution[23] that points to where the offense, or any of its elements, was
committed. A review of the testimony of Elizabeth also shows that there was no
mention of the place where the offense was allegedly committed:
Q After the manager of Maybank referred Atty. Treas to you, what happened
next?
A We have met and he explained to the expenses and what we will have to and
she will work for the Deed of Sale.
Q And did he quote any amount when you got to the expenses?
A Yes. I gave him ONE HUNDRED FIFTY THOUSAND.

Q What was the amount quoted to you?

A ONE HUNDRED FIFTY THOUSAND.
Q Did he give a breakdown of this ONE HUNDRED FIFTY THOUSAND?
A Yes, sir.
Q And what is the breakdown of this ONE HUNDRED FIFTY THOUSAND?
A TWENTY THOUSAND is for his Attorneys fee, NINETY THOUSAND is for
the capital gain tax TWENTY FOUR THOUSAND is intended for
 documentary sum (sic) and TEN THOUSAND PESOS is for other
expenses for BIR.
Q And did you give him this ONE HUNDRED FIFTY THOUSAND?
A Yes, sir.
Q Did he issue a receipt?
A Yes, sir.
Q If shown to you a receipt issued by Atty. Treas for this ONE HUNDRED
FIFTY THOUSAND, will you be able to identify it?
A Yes, sir.
Q I am showing to you a document, madam witness, already identified during the
pre-trial as exhibit B. This appears to be a receipt dated December 22,
1999. Will you please go over this document and inform this court what
relation has this to the receipt which you said Atty. Treas issued to you?
A This is the receipt issued by Atty. Hector Treas.
Q Now, after the amount of ONE HUNDRED FIFTY THOUSAND was given to
Atty. Treas by you, what happened next?
A We made several follow-ups but he failed to do his job.[24]
 
Although the prosecution alleged that the check issued by petitioner was
dishonored in a bank in Makati, such dishonor is not an element of the offense
of estafa under Article 315, par. 1 (b) of the RPC.

Indeed, other than the lone allegation in the information, there is nothing in
the prosecution evidence which even mentions that any of the elements of the
offense were committed in Makati. The rule is settled that an objection may be
raised based on the ground that the court lacks jurisdiction over the offense
charged, or it may be considered motu proprio by the court at any stage of the
proceedings or on appeal.[25] Moreover, jurisdiction over the subject matter in a
criminal case cannot be conferred upon the court by the accused, by express waiver
or otherwise. That jurisdiction is conferred by the sovereign authority that
organized the court and is given only by law in the manner and form prescribed by
law.[26]

It has been consistently held by this Court that it is unfair to require a

defendant or accused to undergo the ordeal and expense of a trial if the court has
no jurisdiction over the subject matter or offense or it is not the court of proper
venue.[27] Section 15 (a) of Rule 110 of the Revised Rules on Criminal Procedure
of 2000 provides that [s]ubject to existing laws, the criminal action shall be
instituted and tried in the court of the municipality or territory where the offense
was committed or where any of its essential ingredients occurred. This
fundamental principle is to ensure that the defendant is not compelled to move to,
and appear in, a different court from that of the province where the crime was
committed as it would cause him great inconvenience in looking for his witnesses
and other evidence in another place.[28] This principle echoes more strongly in this
case, where, due to distance constraints, coupled with his advanced age and failing
health, petitioner was unable to present his defense in the charges against him.

There being no showing that the offense was committed within Makati, the
RTC of that city has no jurisdiction over the case.[29]

As such, there is no more need to discuss the other issue raised by petitioner.

At this juncture, this Court sees it fit to note that the Code of Professional
Responsibility strongly militates against the petitioners conduct in handling the
funds of his client. Rules 16.01 and 16.02 of the Code provides:
 
Rule 16.01 A lawyer shall account for all money or property collected or
received for or from the client.
 
Rule 16.02 A lawyer shall keep the funds of each client separate and apart
from his own and those others kept by him.

When a lawyer collects or receives money from his client for a particular
purpose (such as for filing fees, registration fees, transportation and office
expenses), he should promptly account to the client how the money was spent. [30] If
he does not use the money for its intended purpose, he must immediately return it
to the client. His failure either to render an accounting or to return the money (if
the intended purpose of the money does not materialize) constitutes a blatant
disregard of Rule 16.01 of the Code of Professional Responsibility.[31]

Moreover, a lawyer has the duty to deliver his client's funds or properties as
they fall due or upon demand.[32] His failure to return the client's money upon
demand gives rise to the presumption that he has misappropriated it for his own
use to the prejudice of and in violation of the trust reposed in him by the client.
[33]
 It is a gross violation of general morality as well as of professional ethics; it
impairs public confidence in the legal profession and deserves punishment.[34]
 In Cuizon v. Macalino,[35] this Court ruled that the issuance of checks which
were later dishonored for having been drawn against a closed account indicates a
lawyer's unfitness for the trust and confidence reposed on him, shows lack of
personal honesty and good moral character as to render him unworthy of public
confidence, and constitutes a ground for disciplinary action.

This case is thus referred to the Integrated Bar of the Philippines (IBP) for
the initiation of disciplinary proceedings against petitioner. In any case, should
there be a finding that petitioner has failed to account for the funds received by him
in trust, the recommendation should include an order to immediately return the
amount of ₱130,000 to his client, with the appropriate rate of interest from the time
of demand until full payment.

WHEREFORE, the Petition is GRANTED. The Decision dated 9 July

2010 and the Resolution dated 4 January 2011 issued by the Court of Appeals in
CA-G.R. CR No. 32177 are SET ASIDE on the ground of lack of jurisdiction on
the part of the Regional Trial Court, Branch 137, Makati City. Criminal Case No.
01-2409 is DISMISSEDwithout prejudice. This case  is REFERRED to the IBP
Board of Governors for investigation and recommendation pursuant to Section 1 of
Rule 139-B of the Rules of Court.

SO ORDERED.
 

 
MARIA LOURDES P. A. SERENO
Associate Justice
 
 
 
 
WE CONCUR:
 
 
 
ANTONIO T. CARPIO
Associate Justice
 Chairperson
 
 
 
JOSE PORTUGAL PEREZ BIENVENIDO L. REYES
Associate Justice Associate Justice
 
 
ESTELA M. PERLAS-BERNABE
Associate Justice
 
 
 
 
 
 
ATTESTATION

I attest that the conclusions in the above Decision had been reached in
consultation before the case was assigned to the writer of the Opinion of the Courts
Division.
 
ANTONIO T. CARPIO
Associate Justice
Chairperson, Second Division
 
 
 
 
CERTIFICATION
 
Pursuant to Section 13, Article VIII of the Constitution, and the Division
Chairpersons Attestation, I certify that the conclusions in the above decision had
been reached in consultation before the case was assigned to the writer of the
opinion of the Courts Division.
 
 
  
RENATO C. CORONA
Chief Justice
 

*
 Designated as Acting Member of the Second Division vice Associate Justice Arturo D. Brion per Special Order
No. 1174 dated January 9, 2012.
[1]
 Fukuzume v. People, G.R. No. 143647, 11 November 2005, 474 SCRA 570, citing Pangilinan v. Court of
Appeals, 321 SCRA 51 (1999).
[2]
 Penned by Associate Justice Samuel H. Gaerlan and concurred in by Associate Justices Hakim S. Abdulwahid and
Ricardo R. Rosario.
[3]
 Rollo, p. 33; original citations omitted.
[4]
 Id. at 40.
[5]
 Id. at 52-58.
[6]
 Id. at 58.
[7]
 Id. at 59-66.
[8]
 Id. at 67-72.
[9]
 Id. at 73-74.
[10]
 Id. at 31-38.
[11]
 Id. at 39-40.
[12]
 Id. at 3-6.
[13]
 Id. at 14.
[14]
 Salcedo v. People, G.R. No. 137143, 8 December 2000, 347 SCRA 499.
[15]
 Rollo, pp. 55-56.
[16]
 Id. at 71.
[17]
 Id. at 36-37.
[18]
 G.R. No. 170298, 26 June 2007, 525 SCRA 735.
[19]
 Supre note 1.
[20]
 Rollo, p. 40.
[21]
 Id. at 41-42.
[22]
 Salazar v. People of the Philippines, 480 Phil. 444 (2004).
[23]
 Records, pp. 260-262.
[24]
 Records, pp. 352-353.
[25]
 Supra; see also RULES OF COURT, Rule 118, Sec. 9 in relation to Sec. 3(b).
[26]
 Id.
[27]
 Buaya v. Polo, 251 Phil. 422 (1989); Javier v. Sandiganbayan, G.R. Nos. 147026-27, 11 September 2009, 599
SCRA 324.
[28]
 Campanano v. Datuin, G.R. No. 172142, 17 October 2007, 536 SCRA 471.
[29]
 See Uy v. Court of Appeals, G.R. No. 119000, 28 July 1997, 276 SCRA 367.
[30]
 Belleza v. Macasa, A.C. No. 7815, 23 July 2009, 593 SCRA 549.
[31]
 Id.
[32]
 Code of Professional Responsibility, Rule 16.03; Barnachea v. Quiocho, A.C. No. 5925, 11March 2003, 399
SCRA 1.
[33]
 Pentecostes v. Ibaez, 363 Phil. 624 (1999).
[34]
 Supra note 30.
[35]
 A.C. No. 4334, 7 July 2004, 433 SCRA 484.
 Republic of the Philippines
Supreme Court
Manila
 

FIRST DIVISION
 

REGINO SY CATIIS, G.R. NO. 153979

Petitioner,

Present:

PANGANIBAN, C.J.,

(Chairperson)

- versus - YNARES-SANTIAGO,

AUSTRIA-MARTINEZ,

CALLEJO, SR., and

CHICO-NAZARIO, JJ.

COURT OF APPEALS (17th

Division), REYNALDO A.

PATACSIL, ENRICO D. LOPEZ,

LUZVIMINDA A. PORTUGUEZ

and THE BUREAU OF JAIL

MANAGEMENT AND PENOLOGY,

NATIONAL CAPITAL REGION,

MAKATI CITY JAIL, THROUGH

ITS OFFICER-IN-CHARGE WARDEN,

CHIEF INSP. ISAGANI M. GAMINO, Promulgated:

Respondents. February 6, 2006

x - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - x

DECISION

AUSTRIA-MARTINEZ, J.:

Before us is a petition for review on certiorari filed

[1]
by Regino Sy Catiis (petitioner) seeking to nullify the Decision  dated June 14,
2002 of the Court of Appeals (CA) which sustained the Order dated December 18,
2001 of the Regional Trial Court, Branch 96, Quezon City,[2] allowing private
respondents to post bail and the Order dated December 21, 2001 of the Executive
Judge of the same court[3] approving the surety bond posted by respondents and
their release.

 
 Petitioner filed a letter-complaint dated May 28, 2001 against private
respondents Reynaldo A. Patacsil, Enrico D. Lopez, Luzviminda A. Portuguez and a
certain Margielyn Tafalla before the Office of the City Prosecutor of Quezon City,
for violation of Art. 315, No. 2(a) of the Revised Penal Code in relation to
Presidential Decree No. 1689 (syndicated estafa) and other related offenses. The
complaint was docketed as I.S. No. 01-10686. Private respondents, except
for Tafalla, filed their joint counter-affidavits denying the charges against them.

On October 10, 2001, Assistant City Prosecutor Alessandro D. Jurado issued

a Resolution[4] finding the existence of a probable cause for
syndicated Estafa against private respondents and Tafalla with no bail
recommended. The Resolution was approved by City Prosecutor Claro A. Arellano.

An Information was filed on the same day by Prosecutor Jurado against

private respondents and Tafalla before the Regional Trial Court of Quezon City
and raffled off to Branch 96, which reads:

The undersigned accuses REYNALDO A. PATACSIL, ENRICO D. LOPEZ,

LUZVIMINDA A. PORTUGUEZ and MARGIELYN TAFALLA, of the crime of Estafa under
Article 315, paragraph 2(a) of the Revise Penal Code in relation to P.D. 1689, committed
as follows:

That on or about the 3rd week of January 2000 or subsequent

thereto in Quezon City and within the jurisdiction of this Honorable
Court, the above-named accused, conspiring and confederating
together and all of them mutually helping and aiding one another in a
syndicated manner consisting of five (5) or more persons through
corporations registered with the Securities and Exchange Commission
(SEC) and/or unregistered foreign entities with intention of carrying out
the unlawful or illegal act, transaction, enterprise or scheme, with intent
to gain and by means of fraud and deceit, did then and there willfully,
 unlawfully and feloniously defraud REGINO SY CATIIS and several other
persons in the following manner, to wit: by falsely or fraudulently
pretending or representing, in a transaction or series of transactions,
which they made with the Complainant and the public in general to the
effect that they were in a legitimate business of foreign exchange
trading successively or simultaneously operating under the following
name and style of Asia Profits Philippines,
Incorporation, Winggold Management Philippines
Incorporated, Belkin Management Consultancy, Inc. and/or BelkinProfits
Limited or other unregistered foreign entities induced and succeeded in 
inducing complainant and several other persons to give and deliver and
in fact, the latter and said persons gave and delivered to said accused
the amount of at least US$ 123,461.14 or its equivalent in Philippine
Pesos on the strength of said manifestations and representations, the
accused knowing fully well that the above-named corporations
registered with the SEC and/or those unregistered foreign entities are
not licensed nor authorized to engage in foreign exchange trading
corporations and that such manifestations and representations to
transact in foreign exchange were false and fraudulent that resulted to
the damage and prejudice of the complainant and other persons and
that the defraudation pertains to funds solicited from the public in
general by such corporations/associations.[5]

On November 7, 2001, Judge Lucas P. Bersamin issued an Order finding

probable cause against all the accused and approved the recommendation of the
City Prosecutor that the charge be non-bailable. The corresponding warrants of
arrest were issued.[6]

A return[7] on the warrant of arrest was made by PO3 Joselito M. Coronel,

PNP Criminal Investigation and Detection Group, Camp Crame, Quezon City, with
the information that except for Margielyn Tafalla, who remained at large, all other
accused were already detained at the Makati City Jail.

 
 On November 12, 2001, a notice of hearing was issued by
Judge Bersamin setting the case for arraignment on November 20, 2001. Private
respondents on the same day filed an urgent motion to fix bail.

On November 20, 2001, private respondents, when arraigned, entered

pleas of not guilty. The Prosecution was required to file their
comment/opposition on private respondents motion to fix bail which they did
through the Private Prosecutor with the conformity of Assistant City Prosecutor
Arthur O. Malabaguio.[8]

On December 18, 2001, Judge Bersamin issued an Order reconsidering his earlier

Order of November 7, 2001 by declaring that the offense charged is bailable. In
finding that the accused are entitled to bail, Judge Bersamin made the following
disquisitions:
 

x x x

In order to impose the penalty of life imprisonment to death under Sec. 1, P.D.
No. 1689, the estafa or swindling must be committed by a syndicate. The law plainly
states that a syndicate consists of five or more persons formed with the intention of
carrying out the unlawful or illegal act, transaction, enterprise, or scheme, and
the defraudation results in the misappropriation of money or of funds solicited by
corporations/associations from the general public.

Herein, only four persons are actually charged. Consequently,

the estafa charged has no relation to the crime punished with life imprisonment to
death under Sec. 1, Presidential Decree No. 1689.

The allegation of the information that the accused conspired with each other in
a syndicated manner consisting of five (5) or more persons through corporations
registered with the Securities and Exchange Commission (SEC) and/or unregistered
foreign entities with intention of carrying out the unlawful or illegal act, transaction,
enterprise or scheme cannot change the juridical nature of the offense charged. If the
Government has chosen to indict only four persons, without more, the obvious reason
is that only the persons actually charged were involved in the commission of the
offense. As such, there was no syndicate.

In all likelihood, the allegation of in a syndicated manner consisting of five (5)
or more persons is made herein solely for having bail denied. Whether that is true or
not is beside the point, but the Court cannot now lend itself to such a likelihood which,
according to the foregoing disquisition, lacks legal basis. For that matter, the Court must
recant its approval of the recommendation to deny bail.

The Prosecution represents that the Supreme Court has affirmed in People vs.
Romero a conviction under Presidential Decree No.1689 even if the accused charged is
only less than five (5) accused.

Such representation is grossly misleading. Far to the contrary, in People v.

Romero, where two accused were actually charged but only one was ultimately
penalized due to the death of the other accused during the pendency of the case, the
Supreme Court did not impose the higher penalty of life imprisonment to death because
the Prosecution failed to clearly establish that the corporation was a syndicate, as
defined under the law, holding, instead, that, since the crime was not committed by a
syndicate, the proper penalty is that provided in the second paragraph of Sec.1, P.D. No.
1689, to wit:

When not committed by a syndicate as above defined, the

penalty imposable shall be reclusion temporal to reclusion perpetua if
the amount of the fraud exceeds 100,000.00 pesos.

Yet, one should ask: Where, as here, the amount alleged in the information

clearly exceeds 100,000.00 pesos such that the second paragraph of Sec. 1, P.D. No.
1689, is applicable, is the offense still bailable considering that the range of the
imposable penalty is from reclusion temporal to reclusion perpetua?
  

The answer is in the affirmative.

Under Rule 110, 2000 Rules of Criminal Procedure, the Information should aver,
among others, the qualifying and aggravating circumstances of the offense in ordinary
and concise language and not necessarily in the language used in the statute but in
terms sufficient to enable a person of common understanding to know what offense is
being charged as well as its qualifying and aggravating circumstance and for the court to
pronounce judgment.

A perusal of the information discloses that no aggravating circumstance has

been alleged in the information. The omission consequently precludes the State from
proving any aggravating circumstance which will raise the penalty to its maximum
period of reclusion perpetua. The Court itself is also prohibited from
imposing reclusion perpetua, since the requirement of complete allegations of the
particulars in the indictment is based on the right of the accused to be fully informed of
the nature of the charges against him so that he may adequately prepare for his defense
pursuant to the due process clause of the Constitution.

As stated in People v. Romero, supra, the penalty under the second paragraph of
Sec.1, P.D. No. 1689, when there is neither mitigating or aggravating circumstance
attendant, is the medium period of reclusion temporal, that is from sixteen (16) years
and one (1) day to twenty (20) years.

Hence, the offense charged is unquestionably bailable.[9]

On December 26, 2001, petitioner filed with the CA a petition

for certiorari with prayer for temporary restraining order and/or writ of
preliminary injunction[10] assailing the Order of Judge Bersamin allowing private
respondents to post bail.

 
 On the same day, then Associate Justice Romeo J. Callejo Sr.,[11] Justice on
Duty Per Office Memorandum of Presiding Justice, issued a Resolution[12] granting
petitioners prayer for the issuance of a temporary restraining order, thus, private
respondents and all those acting for and in their behalf were temporarily
restrained from enforcing and implementing the Order of Judge Bersamin and
from further proceeding in Criminal Case No. 01-105430.

However, unknown to petitioner, private respondents had already filed or

posted their surety bonds on December 21, 2001 with the Office of Executive
Judge Monina A. Zenarosa[13] who approved the same on the same day and
ordered the immediate release of private respondents unless held for other
lawful cause.[14] Petitioner filed a supplemental petition with the CA on January
14, 2002 assailing the jurisdiction of Judge Zenarosa in issuing the Order
dated December 21, 2001.

On June 14, 2002, the CA issued its assailed decision denying due course to the
petition and dismissed the same after it found no grave abuse of discretion
committed by Judge Bersamin and Judge Zenarosa in issuing the assailed orders.

Hence, the instant petition filed by petitioner raising the following issues, to wit:
 

Whether or not the issuance of the questioned Decision promulgated June 14,

2002 by the 17th Division of the Court of Appeals sustaining the validity of the 1st assailed
Order dated December 18, 2001 of Hon. Presiding Judge Lucas P. Bersamin of Branch 96
of the Regional Trial Court of Quezon City ruling that there should be at least five (5)
persons that must be charged under Section 1, Presidential Decree No. 1689 is not in
accordance with law or with applicable decisions of this Honorable Supreme Court.

 
 B

Whether or not the questioned Decision sanctioning the grant of bail in the
st
1  assailed Order dated December 18, 2001 of Hon. Presiding Judge Lucas
P. Bersamin of Branch 96 of the Regional Trial Court of Quezon City violated Section 7,
Rule 114 of the Revised Rules of Criminal Procedure and actually departed from the
accepted and usual course in the determination of bailability of criminal offenses.

Whether or not the questioned Decision sustaining the order of release in the
nd
2  assailed Order dated December 21 of Hon. Executive Judge Monina A. Zenarosa of
the Regional Trial Court of Quezon City violated Section 17, Rule 114 of the Revised
Rules of Criminal Procedure[15]

Anent the first issue, petitioner contends that under Section 1 of P.D. No. 1689,
the term any person must be understood and read in its singular meaning so that
even only one person can be indicted for committing estafa or other forms of
swindling in relation to P.D. No. 1689 citing the case of People v. Romero; that
Judge Bersamin erred when he already computed the possible penalty in case of
private respondents conviction; that the capital nature of an offense for the
purpose of bailability is determined by the penalty prescribed by law, not by
penalty which may actually be imposed since the latter requires a consideration
of the evidence on trial; that since no evidence had yet been presented by both
prosecution and defense, Judge Bersamin has again shown bias by already
computing the imposable penalty just to stretch the application of the law and
questionably grant bail in favor of private respondents.

We are not persuaded.

 
 The CA found that the assailed order of Judge Bersamin cannot be
characterized as one issued with grave abuse of discretion for he correctly
determined that the Information did not charge a syndicated Estafa; that with
only four charged in the information, it could not be considered as committed by
a syndicate which must consist of five or more persons and he cannot be faulted
for that.

Section 1 of P.D. No. 1689, increasing the penalty for certain forms of
swindling or estafa, provides:
 

SECTION 1. Any person or persons who shall commit estafa or other forms of

swindling as defined in Articles 315 and 316 of the Revised Penal Code, as amended,
shall be punished by life imprisonment to death if the swindling (estafa) is committed by
a syndicate consisting of five or more persons formed with the intention of carrying out
the unlawful or illegal act, transaction, enterprise or scheme, and
the defraudation results in the misappropriation of moneys contributed by stockholders,
or members of rural banks cooperatives, "samahang nayon(s)," or farmers associations,
or of funds solicited by corporations/associations from the general public.

When not committed by a syndicate as above defined, the penalty

imposable shall be reclusion temporal to reclusion perpetua if the amount of the
fraud exceeds 100,000 pesos.
 
 
Clearly, P.D. No. 1689 penalizes offenders with life imprisonment to
death regardless of the amount involved, provided that a syndicate committed
the crime. A syndicate is defined in the same law as consisting of five or more
persons formed with the intention of carrying out the unlawful or illegal act,
transaction, enterprise or scheme. Under the second paragraph, it is provided
that if the offenders are not members of a syndicate, they shall nevertheless
be held liable for the acts prohibited by the law but they shall be penalized
 by reclusion temporal to reclusion perpetua if the amount of the fraud is more
than P100,000.00.
 
Petitioners interpretation that the term any person in the first paragraph of
section 1 could mean that even one person can be indicted for
syndicated estafa is contrary to the provision of the law. It bears stressing that the
law must be considered as a whole, just as it is necessary to consider a sentence
in its entirety in order to grasp its true meaning.[16] It is a dangerous practice to
base construction upon only a part of a section since one portion may be qualified
by the other portion.[17] In fact, there is no need for any construction or
interpretation of P. D. No. 1689 since the law is clear and free from any doubt or
ambiguity. Section 1 of P.D. No. 1689 has defined what constitutes a syndicate
and such definition is controlling. Where a requirement is made in explicit and
unambiguous terms, no discretion is left to the judiciary. It must see to it that its
mandate is obeyed.[18]

In this case, the Information specifically charged only four persons without
specifying any other person who had participated in the commission of the crime
charged, thus, based on the definition of syndicate under the law, the crime
charged was not committed by a syndicate. We find no reversible error
committed by the CA when it upheld the ruling of Judge Bersamin that with only
four persons actually charged, the estafa charged has no relation to the crime
punished with life imprisonment to death under section 1 of P. D. No. 1689.

The wordings in the information that the accused conspired with each

other in a syndicated manner consisting of five (5) or more persons through
corporations registered with the Securities and Exchange Commission (SEC)
and/or unregistered foreign entities with intention of carrying out the unlawful or
illegal act, transaction, enterprise or scheme is not sufficient compliance with the
requirements of the law on what constitute a syndicate. It bears stressing that the
first paragraph of the accusatory portion of the Information charges only four
persons. To repeat, P.D. No. 1689 has provided for the definition of a syndicate
and it is controlling. As correctly found by the trial court, if the government has
chosen to indict only four persons, without more, the obvious reason is that only
the persons actually charged were involved in the commission of the offense,
thus, there was no syndicate.

Petitioners reliance in People v. Romero to support his argument is

misleading. First, the issue of whether only one person can be indicted for
syndicated estafa was not an issue in the Romero case. Secondly, the Court did
not impose the penalty of life imprisonment to death on the accused since the
prosecution failed to clearly establish that the corporation was a syndicate as
defined under the law. There is no other way of establishing a syndicate under
P.D. No. 1689 than by the adherence to the definition provided by law.

Since the crime charged was not committed by a syndicate as defined

under the law, the penalty of life imprisonment to death cannot be imposed on
private respondents. Judge Bersamin is correct when he ruled that private
respondents could only be punished with reclusion
temporal to reclusion perpetua in case of conviction since the amount of the fraud
exceeds P100,000.00. The next question is, whether Judge Bersamin is correct in
finding that the crime charged is bailable despite that the imposable penalty
ranges from reclusion temporal to reclusion perpetua?

The Court answers in the affirmative.

 
 Sections 8 and 9 of Rule 110 of the Revised Rules of Criminal Procedure,
which took effect on December 1, 2000, provide:
 
Sec. 8. Designation of the offense. The complaint or information shall
state the designation of the offense given by the statute, aver the acts or omissions
constituting the offense, and specify its qualifying and aggravating
circumstances. If there is no designation of the offense, reference shall be made to
the section or subsection of the statute punishing it.
 
Sec. 9. Cause of the accusations. The acts or omissions complained of as
constituting the offense and the qualifying and aggravating circumstances must be
stated in ordinary and concise language and not necessarily in the language used
in the statute but in terms sufficient to enable a person of common understanding
to know what offense is being charged as well as its qualifying and aggravating
circumstances and for the court to pronounce judgment.
 

Clearly, it is now a requirement that the aggravating as well as the

qualifying circumstances be expressly and specifically alleged in the complaint or
information. Otherwise, they cannot be considered by the trial court in their
judgment, even, if they are subsequently proved during trial.[19] A reading of the
Information shows that there was no allegation of any aggravating circumstance,
thus Judge Bersamin is correct when he found that the lesser penalty,
i.e., reclusion temporal, is imposable in case of conviction.

Section 13, Article III of the Constitution provides that all persons, except
those charged with offenses punishable by reclusion perpetua when evidence of
guilt is strong, shall before conviction, be bailable by sufficient sureties or be
released on recognizance as may be provided by law. In pursuance thereof,
Section 4 of Rule 114, as amended, now provides that all persons in custody shall,
before conviction by a regional trial court of an offense not punishable by
death, reclusion perpetua or life imprisonment, be admitted to bail as a matter of
right. Since the imposable penalty on private respondents, in case of conviction,
is reclusion temporal, they are entitled to bail as a matter of right. Notably,
Judge Bersamin issued his Order finding the crime charge bailable and fixed the
amount of P150,000.00 each for the provisional liberty of private respondents
only after petitioner had submitted their comment/opposition to petitioners
motion to fix bail.
 

Petitioner claims that the Order of Judge Bersamin allowing private

respondents to post bail already prejudged the case; that he summarily decided
the eventual and imminent dismissal of the criminal case without even the
reception of evidence; that such prejudgment came from a ruling on a mere issue
of bail.

Such argument is baseless. The Order was issued on the basis that the
allegations in the Information do not establish that the crime charged was
committed by a syndicate as defined under the law where the penalty of life
imprisonment to death could be imposed. Nowhere in the Order did
Judge Bersamin state that the act complained of is not punishable at all.

Petitioner next contends that private respondents filing of bail with

Executive Judge Monina Zenarosa, other than Branch 96 where the case is
pending, is questionable and not in accordance with Section 17, Rule 114 [20] of the
Revised Rules on Criminal Procedure; that the records show that when private
respondents filed their bail with Judge Zenarosa, Branch 96 was open and
available as private respondents through their representative were able to pay for
the issuance of the certifications on the Information and the Order dated
December 18, 2001; that petitioners counsel and the Assistant City Prosecutor
Arthur Malabaguio had personally received their respective copies of the Order
dated December 18, 2001 inside the staff room of Branch 96 and they even
attested that Judge Bersamin was physically present on December 21, 2002, the
day private respondents filed their bail bond with Judge Zenarosa; that despite
these circumstances, Judge Zenarosa still exercised jurisdiction over the bail filed
by private respondents and issued the Order dated December 21, 2001 approving
the surety bonds and ordering the release of private respondents; that the CAs
justification that Judge Zenarosa accepted the bail bond due to the fact that
Judge Bersamin was momentarily out of his office or premises at the time of
posting of the bond was not borne by the records.
 

We are not persuaded.

Section 17, Rule 114 of the Revised Rules on Criminal Procedure provides
that bail in the amount fixed may be filed with the court where the case is
pending, or, in the absence or unavailability of the judge thereof, with another
branch of the same court within the province or city. While Branch 96 is open and
available on the day private respondents posted their bail with Judge Zenarosa, it
does not necessarily follow that Judge Bersamin was available at that precise
moment. Although it is alleged in the supplemental petition prepared by
petitioners counsel, Atty. Rodeo Nuez, with the conformity of
Prosecutor Malabaguio filed before the CA that both of them saw
Judge Bersamin discharging his function on that day, it is not under
oath. Moreover, it is not specifically stated in the supplemental petition that at
the exact time Judge Zenarosa approved the bail, Judge Bersamin was available.
Thus, petitioner failed to rebut the presumption that official duty had been
regularly performed[21] by Judge Zenarosa under the rules.

WHEREFORE, the petition for review on certiorari is DENIED. The assailed

decision of the Court of Appeals dated June 14, 2002 is AFFIRMED. Costs against
petitioner.
 
 SO ORDERED.
 

MA. ALICIA AUSTRIA-MARTINEZ

Associate Justice
 
WE CONCUR:
 
 
 
ARTEMIO V. PANGANIBAN
Chief Justice
Chairperson
 
 
(No part)
CONSUELO YNARES-SANTIAGO ROMEO J. CALLEJO, SR.
Associate Justice Associate Justice
 
 
MINITA V. CHICO-NAZARIO
Associate Justice
 
 
 
CERTIFICATION
 
Pursuant to Section 13, Article VIII of the Constitution, it is hereby certified that
the conclusions in the above Decision were reached in consultation before the case
was assigned to the writer of the opinion of the Courts Division.
 
 
 
ARTEMIO V. PANGANIBAN
Chief Justice
 
  
 
 
 
 
 

[1]
 Penned by Justice Roberto A. Barrios, concurred in by Justices Bienvenido L.Reyes and Edgardo F. Sundiam.
[2]
 Penned by Judge Lucas P.Bersamin (now Associate Justice of the Court of Appeals); Docketed as Criminal Case
No. Q-01-105430.
[3]
 Per Judge Monina A. Zenarosa.
[4]
 Rollo, pp. 89-94.
[5]
 Id., at p. 87.
[6]
 Id., at p. 98.
[7]
 Id., at p. 100.
[8]
 Id., at pp. 110-118.
[9]
 Id., at pp. 54-57
[10]
 Docketed as CA G.R. SP No. 68287.
[11]
 Now a Member of this Court.
[12]
 Rollo, p. 166.
[13]
 Now Associate Justice of the Court of Appeals.
[14]
 Rollo, p. 58.
 
[15]
 Id., at. p. 19.
[16]
 Judge Noli C. Diaz, Statutory Construction, 2001 edition, p. 35.
[17]
 Id.
[18]
 Luzon Surety Co., Inc. v. De Garcia, 140 Phil. 509, 514 (1969).
[19]
 People v. Casitas, Jr., 445 Phil. 407, 427 (2003); People v. Bragat, 416 Phil. 829, 844 (2001).
[20]
 SECTION 17. Bail, where filed. (a) Bail in the amount fixed may be filed with the court where the case is
pending, or, in the absence or unavailability of the judge thereof, with another branch of the
same court within the province or city. If the accused is arrested in a province, city or
municipality other than where the case is pending, bail may be filed also with any regional trial
court of said place, or, if no judge thereof is available, with any metropolitan trial judge,
municipal trial judge or municipal circuit trial judge therein.
[21]
 Rules of Court, Rule 131, Section 3(m).
 FIRST DIVISION

[G.R. No. 144785. September 11, 2003]

YOLANDA GARCIA, petitioner, vs. PEOPLE OF THE

PHILIPPINES respondent.

DECISION
YNARES-SANTIAGO, J.:

This is an appeal from the decision  dated August 30, 2000 of the Court of Appeals
[1]

in CA-G.R. CR No. 22771 affirming in toto the decision of the Regional Trial Court,
Branch 43 of Manila which found petitioner Yolanda Garcia guilty beyond reasonable
doubt of the crime of estafa, and sentenced her to suffer the penalty of imprisonment
ranging from six (6) years and one (1) day to ten (10) years and one (1) day of prision
mayor, to indemnify the complainant in the amount of P87,000.00, and to pay the costs.
Petitioner Yolanda Garcia was charged with estafa in an information which reads:

That on or about and during the period comprised between June 20, 1995, and August
15, 1995, inclusive, in the City of Manila, Philippines, the said accused did then and
there willfully, unlawfully and feloniously defraud one DOLORES S. APOLONIO in
the following manner, to wit: the said accused by means of false manifestations and
fraudulent representations which she made to said DOLORES S. APOLONIO to the
effect that accused has three (3) checks which according to her have sufficient funds
and if encashed, the same will not be dishonored; and by means of other deceits of
similar import, induced and succeeded in inducing the said DOLORES S.
APOLONIO to accept the following checks:

Name of Bank Check No. Amount Date Payable to

Phil Natl Bank 046884 P28,000.00 6-20-95 Cash

-do- 047416 34,000.00 8-15-95 -do-
Pilipinas Bank 60042087 25,000.00 7-25-95 Garcia
Vegetable Dealer

as payments of assorted vegetables which accused purchased and received from said
DOLORES S. APOLONIO in the total amount of P87,000.00, said accused knowing
fully well that the said manifestations and representations were all false and untrue as
said checks when presented to the bank for payment were all dishonored for the
reason Drawn Against Insufficient Funds, and were made solely for the purpose of
obtaining, as in fact she did obtain assorted vegetables in the amount of P87,000.00;
which once in her possession and with intent to defraud, she willfully, unlawfully and
feloniously misappropriated, misapplied and converted the said assorted vegetables or
the value thereof to her own personal use and benefit, to the damage and prejudice of
the said owner in the aforesaid amount of P87,000.00, Philippine Currency.

CONTRARY TO LAW. [2]

Petitioner pleaded not guilty when arraigned. Trial on the merits then ensued.
For more than a year, petitioner had been buying assorted vegetables from Dolores
Apolonio in Divisoria, Manila. Petitioner always paid in cash. However, in May 1995,
petitioner thrice bought vegetables from Apolonio using three checks: one postdated
June 20, 1995 for P28,000.00, drawn by her husband, Manuel Garcia; the second
postdated July 25, 1995 for P34,000.00, drawn by her daughter Gigi Garcia; and the
third postdated August 15, 1995 for P25,000.00, drawn by her nephew Jose Nadongga
Jr. When the three checks were presented for payment, they were all dishonored for
insufficiency of funds.
Hence, Apolonio instituted the aforesaid criminal case against petitioner.
In her defense, petitioner claimed that the amounts of the checks were already paid
and that the same did not belong to her as they were only paid to her by her
customers. She also maintained she did not have any transaction with the complainant
in May 1995.
On December 29, 1998, the trial court rendered a decision, the dispositive portion of
which reads:

WHEREFORE, in view of all the foregoing considerations, the Court finds the
accused guilty beyond reasonable doubt of the crime of Estafa under Art. 315, Sec.
2(2) (sic) of the Revised Penal Code, as amended and there being no mitigating or
aggravating circumstances and taking into account the provisions of the Indeterminate
Sentence Law, the Court hereby sentences the accused Yolanda Garcia to suffer the
indeterminate penalty of SIX (6) YEARS and ONE (1) DAY to TEN YEARS and
ONE (1) DAY of prision mayor as maximum.

She should also indemnify the complainant in the amount of P87,000.00 without
subsidiary imprisonment in case of insolvency and to pay the costs. [3]

Petitioner appealed her conviction to the Court of Appeals, which, on August 30,
2000, rendered the assailed decision affirming the judgment of conviction rendered by
the trial court.
In this petition for review, petitioner alleges that the Court of Appeals erred:
 1. In affirming the trial courts decision finding her guilty of the crime of estafa
under Article 315, Section 2[d] of the Revised Penal Code as amended
for issuing postdated checks, when she was charged in the information
for the crime of estafa through false pretenses punishable under Art. 315,
Section 2[a] of the Revised Penal Code.

2. In convicting her of estafa under Article 315, Section 2[d] of the Revised
Penal Code which penalizes those who issue postdated checks when
petitioner did not issue or draw the postdated checks.

3. In convicting her of estafa under Article 315, Section 2[d] of the Revised
Penal Code when there is no evidence that she had knowledge that the
postdated checks she allegedly delivered to complainant were without
sufficient funds.

4. In not considering that she delivered said checks to complainant in payment
of a pre-existing obligation so that her liability if at all is civil in nature.

5. In not reversing and setting aside the trial courts decision and in not
acquitting her instead. [4]

Petitioner basically claims that her constitutional right to be informed of the nature
and cause of the accusation against her was violated because, although she was
charged with estafa under Article 315, Section 2[a], as amended, which penalizes false
manifestations or fraudulent representations in defraudation of another, she was instead
convicted of estafa under Article 315, Section 2[d] which penalizes the issuance of
postdated checks that were not funded or were insufficiently funded.
Petitioner further claims she was not the issuer or the drawer of said checks, and
had no knowledge that they were unfunded or underfunded. In any case, assuming that
she indeed issued or drew the checks, they were in payment of a pre-existing
obligation. Consequently, she could not be held liable for estafa and her liability is only
civil in nature.
Section 14(2) of Article III of the 1987 Constitution provides that an accused has the
right to be informed of the nature and cause of the accusation against him. Indeed,
Section 6, Rule 110 of the Revised Rules of Criminal Procedure requires that the acts
and omissions complained of as constituting the offense must be alleged in the
Information. Section 8 thereof provides that the Information shall state the designation
of the offense given by the statute and aver the acts or omissions constituting the
offense. The real nature of the crime charged is determined by the facts alleged in the
Information and not by the title or designation of the offense contained in the caption of
the Information. It is fundamental that every element of which the offense is comprised
must be alleged in the Information. What facts and circumstances are necessary to be
alleged in the Information must be determined by reference to the definition and
essential elements of the specific crimes. [5]

Article 315, paragraph 2(a) of the Revised Penal Code provides that swindling or
estafa by false pretenses or fraudulent acts executed prior to or simultaneously with the
commission of the fraud is committed by using fictitious name, or falsely pretending to
possess power, influence, qualifications, property, credit, agency, business or imaginary
transactions, or by other similar deceits. The elements of estafa under this penal
provision are: (1) the accused defrauded another by means of deceit; and (2) damage
or prejudice capable of pecuniary estimation is caused to the offended party or third
party.
[6]

A careful reading of the Information clearly shows that petitioner was charged with
estafa under Article 315, paragraph 2 (a) of the Revised Penal Code. The Information
alleged that petitioner by means of false manifestations and fraudulent representations
x x x to the effect that accused has three checks which according to her have sufficient
funds and if encashed the same will not be dishonored; x x x induced x x x Dolores S.
Apolonio to accept the following checks x x x as payment of assorted vegetables x x x in
the total amount of P87,000.00. [7]

There is, however, no basis for petitioner to conclude that she was convicted for
estafa under Article 315, paragraph 2(d) of the Revised Penal Code which penalizes
any person who shall defraud another by postdating or issuing a check or issuing a
check in payment of an obligation when the offender has no funds in the bank or his
funds deposited therein are not sufficient to cover the amount of check. The elements of
this form of estafa are: (1) postdating or issuing a check in payment of an obligation
contracted at the time the check was issued; (2) lack or insufficiency of funds to cover
the check; and (3) damage to the payee thereof. [8]

While the typographical error in the dispositive portion of the trial courts decision did
not help in clearing this matter by saying that, x x x the Court finds the accused guilty
beyond reasonable doubt of the crime of Estafa under Art. 315, Sec. 2(2) of the Revised
Penal Code, x x x,  the body of the trial courts decision clearly discusses the elements
[9]

of estafa under Article 315, paragraph 2(a), thus:

The elements of estafa are (1) that the accused defrauded another by abuse of
confidence or by means of deceit; and (2) that the damage or prejudice capable of
pecuniary estimation is caused to the offended party.

In the instant case when accused convinced the complainant assuring her that the
postdated checks she was giving as payment of the vegetables of the same amount that
she got, are funded as they belong to her relatives, when actually they are bad checks,
she employed deceit. In so doing, the complainant is damaged to the tune of
P87,000.00 which is the value of the vegetables.

Another element to be proven in estafa is knowledge that at the time she negotiated
the checks, the drawer has no sufficient funds in the bank. The fact that the checks
were postdated at some future date is evidence enough to show that at the time of
negotiation the drawer did not have sufficient funds in the bank or his funds deposited
therein were not sufficient to cover the amount of the checks. [10]

Even supposing that the trial court apparently discussed estafa under Article 315,
paragraph 2(d), it was only pointing out the absurdity of petitioners argument, thus:

When accused testified that she does not use the checks of other persons, what did she
mean during the pre-trial that the checks subject of this case belong to her customers
and given to her in payment? Is she not in effect saying that she gave to the
complainant the three checks of her customers to pay her own purchases? This again
is an admission that she really used the checks of other persons to pay her obligation.

Maybe she has in mind that since she is not the maker of the checks she cannot be
guilty of estafa. But she is wrong. In the case of People v. Isleta, et.al., 61 Phil. 332
and reiterated in the case of Zalgado v. CA, 178 SCRA 146, it was held that the
appellant who only negotiated directly and personally the check drawn by another is
guilty of estafa because he had guilty knowledge that at the time he negotiated the
check, the drawer has no sufficient funds. [11]

In other words, whether petitioner was charged under either paragraph 2(a) or 2(d)
of Article 315 of the Revised Penal Code, she would still be guilty of estafa because
damage and deceit, which are essential elements of the offense, have been established
with satisfactory proof. The fraudulent act was committed prior to or simultaneous with
the issuance of the bad check. The guarantee and the simultaneous delivery of the
checks by petitioner were the enticement and the efficient cause of the defraudation
committed against Apolonio who suffered damage amounting to P87,000.00 as a result
of the fraud committed by petitioner in paying him underfunded checks drawn by three
different persons.
Fraud, in its general sense, is deemed to comprise anything calculated to deceive,
including all acts, omissions, and concealment involving a breach of legal or equitable
duty, trust, or confidences justly reposed, resulting in damage to another, or by which an
undue and unconscientious advantage is taken of another. It is a generic term
embracing all multifarious means which human ingenuity can device, and which are
resorted to by one individual to secure an advantage over another by false suggestions
or by suppression of truth and includes all surprise, trick, cunning, dissembling and any
unfair way by which another is cheated. Deceit is a specie of fraud. [12]

In fact, the Court of Appeals saw through petitioners deceit when it observed, thus:

Appellants scheme is obvious. She wanted to get vegetables from Apolonio for

free. In order to escape from any criminal liability, she asked her husband, daughter
and nephew to issue the bouncing checks.And certainly, the scheme was
deceitful. The appellant could not have been unaware of the insufficient funds of her
relatives to support the checks they issued but she tendered the checks to Apolonio
with the assurance that they were funded. Appellant could have exerted efforts to
settle her account upon notice of the dishonored checks if she were in good faith. [13]

In view of the foregoing, we see no need to discuss the other assigned errors.
Petitioner was charged with estafa under Article 315, paragraph 2[a] of the Revised
Penal Code. The proper imposable penalty is prision correccional in its maximum period
to prision mayor in its minimum period, if the amount of fraud is over P12,000.00 but
does not exceed P22,000.00; and if such amount exceeds the latter sum, the penalty
provided in this paragraph shall be imposed in its maximum period, adding one year for
each additional P10,000.00; but the total penalty which may be imposed shall not
exceed twenty years. In such cases, the penalty shall be termed prision
mayor or reclusion temporal, as the case may be. [14]

Under the Indeterminate Sentence Law, if the offense is punished by the Revised
Penal Code, such as estafa, the court shall sentence the accused to an indeterminate
penalty, the maximum term of which shall be that which, in view of the attending
circumstances, could be properly imposed under the rules of the Revised Penal Code,
and the minimum term of which shall be within the range of the penalty next lower to
that prescribed by the Code for the offense. The penalty next lower should be based on
the penalty prescribed by the Code for the offense, without first considering any
modifying circumstance attendant to the commission of the crime. The determination of
the minimum penalty is left by law to the sound discretion of the court and it can be
anywhere within the range of the penalty next lower without any reference to the periods
into which it might be subdivided. The modifying circumstances are considered only in
the imposition of the maximum term of the indeterminate sentence. [15]

In this case, petitioner defrauded Apolonio in the amount of P87,000.00. The fact

that the amount exceeds P22,000.00 should not be considered in the initial
determination of the indeterminate penalty; instead the matter should be so taken as
analogous to modifying circumstances in the imposition of the maximum term of the full
indeterminate sentence. This accords with the rule that penal laws are construed in
favor of the accused.
[16]

Hence, the maximum penalty to be imposed on petitioner should be taken from the
maximum period of the basic penalty, i.e., prision mayor in its minimum period, which
ranges from four (4) years, two (2) months and one (1) day to eight (8) years.
The minimum penalty, applying the Indeterminate Sentence Law, shall be taken
from the penalty next lower in degree than the basic penalty which is prision
correccional in its minimum and medium period, in any of its periods, the range of which
is from six (6) months and one (1) day to four (4) years and two (2) months.
Thus, the trial court erred in imposing the penalty which ranges from six (6) years
and one (1) day to ten (10) years and one (1) day. The proper penalty should be four (4)
years and two (2) months of prision correccional, as minimum, to fourteen (14) years
of reclusion temporal, as maximum.
 WHEREFORE, in light of the foregoing, the Court hereby AFFIRMS with
MODIFICATION the decision of the trial court finding Yolanda Garcia guilty of estafa
under Article 315, paragraph 2[a] of the Revised Penal Code, and sentencing her to
suffer the indeterminate penalty of four (4) years and two (2) months of prision
correccional, as minimum, to fourteen (14) years of reclusion temporal, as maximum,
and to indemnify the complainant in the amount of P87,000.00. With costs.
SO ORDERED.
Davide, Jr., C.J., (Chairman), Vitug, and Carpio, JJ., concur.
Azcuna, J., on official leave.

[1]
 Penned by Associate Justice Salome A. Montoya and concurred in by Associate Justices Romeo J.
Callejo Sr. (now Associate Justice of the Supreme Court) and Martin S. Villarama Jr.
[2]
 CA Records, p. 13.
[3]
 Penned by Judge Manuela F. Lorenzo of the Regional Trial Court of Manila, Branch 43.
[4]
 Appellants Brief, Rollo, pp. 14-15.
[5]
 Naya v. Spouses Abing, G.R. No. 146770, 27 February 2003.
[6]
 People v. Balasa, 356 Phil. 362, 382 (1998).
[7]
 Information, Records, p. 13.
[8]
 People v. Tan, G.R. No. 120672, 17 August 2000, 338 SCRA 330, 336-337.
[9]
 Decision, Records, pp. 53, 56; underscoring ours.
[10]
 Id., pp. 53, 55.
[11]
 Id.
[12]
 People v. Hernando, 375 Phil. 1078, 1091 (1999).
[13]
 Court of Appeals Decision, Rollo, pp. 29, 33.
[14]
 Article 315 of the Revised Penal Code.
[15]
 People v. Hernando, 375 Phil. 1078, 1094 (1999).
[16]
 People v. Hernando, supra.
  
FIRST DIVISION
 
 
LIBERATA AMBITO, G.R. No. 127327
BASILIO AMBITO, and  
CRISANTO AMBITO,
Petitioner,  

  Present:
 
 
PUNO, C.J., Chairperson,
 
CARPIO,
- versus -
CORONA,
 
AZCUNA, and
 
LEONARDO-DE CASTRO, JJ.
 
 
PEOPLE OF
THE PHILIPPINESand COURT  
OF APPEALS,
Respondents. Promulgated:

February 13, 2009

 
x------------------------------------------------------------------------------------------x

 
DECISION
 
LEONARDO-DE CASTRO, J.:
 
 
Before this Court is a Petition for Review on Certiorari under Rule 45 of the Rules
of Civil Procedure of the Decision[1] of respondent Court of Appeals (CA), dated
March 29, 1996, in CA-G.R. CR No. 12727, entitled People of the Philippines v.
Liberata Ambito, et al., filed by petitioners Liberata Ambito, Basilio Ambito and
Crisanto Ambito. The assailed CA decision affirmed the judgment of conviction of
multiple charges of violation of Batas Pambansa Blg. 22 (B.P. Blg. 22) meted upon
co-petitioner Basilio Ambito; multiple charges of the complex offense of Estafa
through Falsification of Commercial Documents, defined and penalized in Articles
48, 171, 172 and 315 of the Revised Penal Code (RPC), meted upon co-petitioners
Liberata and Basilio Ambito; and two charges of Falsification of Commercial
Document, as defined and penalized under Articles 171 and 172 of the RPC,
meted upon co-petitioner Crisanto Ambito in the Decision[2] rendered by the
Regional Trial Court (RTC) of Iloilo City, Branch 26, dated November 29, 1990, in
the consolidated Criminal Case Nos. 14556 to 14587.
 
The facts of this case, as summarized in the assailed CA decision, are as
follows:
 
Basilio Ambito and Liberata Ambito were the principal owners of two rural banks in the province of Iloilo namely, the
Community Rural Bank of Leon, Inc., in the municipality of Leon, and the Rural Bank of Banate, Inc. in the municipality of
Banate. In addition, the spouses Ambito were the owners of Casette [Kajzette] Enterprises, a commercial establishment
in Jaro, Iloilo Cityengaged in procuring farm implements intended for the use of the agricultural loan borrowers of the
said banks. The spouses Ambito obtained their supply of farm implements and spare parts from the Iloilo City branch of
Pacific Star Inc. which was then engaged in selling Yanmar machineries and spare parts.
 
On several occasions in 1979, the spouses Basilio Ambito and Liberata Ambito transacted business with
Pacific Star, Inc. whereby they purchased Yanmar machineries and spare parts from the said company allegedly for the
use of the loan borrowers of their banks. In these transactions, the spouses Ambito made down payments in their
purchases either in case, in checks or in certificates of time deposit issued by the Rural Bank of Banate, Inc. and the
Community Rural Bank of Leon, Inc.
 
However, when the Manila Banking Corporation (Manila Bank) checks issued by Basilio Ambito
as down payment of their purchases were presented for payment by the drawee bank, the same were dishonored for
insufficiency of funds. These are Check No. 79173946 dated June 20, 1979 in the amount of P39,168.75 (Exh. A, CC No.
14556); Check No. 79173948 dated June 15, 1979 in the amount of P75,595.00 (Exh. A, CC 14557); Check No. 79173947
dated June 30, 1979 in the amount of P45,957.00 (Exh. A, CC No. 14558); Check No. 79182639 dated October 18, 1979
in the amount of P4,501.36 (Exh. A, CC No. 14559); Check No. 79182638 dated September 27, 1979 in the amount
of P1,957.60 (Exh. A, CC No. 14560); Check No. 79182637 dated September 18, 1979 in the amount of P 2,425.50 (Exh.
A, CC No. 14561) and Check No. 79175930 dated August 9, 1979 in the amount of P2,875.25 (Exh. A, CC No. 14562).
 
At the time the spouses Basilio Ambito and Liberata Ambito made purchases of farm implements from the
Pacific Star, Inc. in 1979, the general manager of the Rural Bank of Banate, Inc. was Liberata Ambito herself and the
cashier, Marilyn Traje, while the general manager of the Community Rural Bank of Leon, Inc. was Crisanto Ambito,
brother of Basilio Ambito, and the cashier, Reynaldo Baron.
 
On three separate occasions, Liberata Ambito forced the cashier of the Rural Bank of Banate, Marilyn Traje,
to sign several blank certificates of time deposit and to give the same to her alleging that she needed the said
certificates in connection with some transactions involving the bank. Marilyn Traje at first refused to give Liberata
Ambito the said certificates but the latter scolded her, at the same time assuring her that she would be responsible to
anybody for the issuance of said certificates including personnel and investigators of the Central Bank tasked with the
examination of the accounts of the bank. Afraid that she would lose her job if she would not follow Liberata
Ambito. Marilyn Traje signed and gave the blank certificates of time deposit to her without receiving any consideration
therefore.
 
The same thing happened to Reynaldo Baron, the cashier of the Community Rural Bank of Leon, Inc. who was
asked by the spouses Ambito as well as the manager of the bank, Crisanto Ambito, to sign and give blank certificates of
time deposit to them. Reynaldo Baron was at first hesitant to accommodate the request of the Ambitos but due to their
persistence and considering that they were his superiors and owners of the bank, Baron signed the certificates of time
deposit in blank and gave the same to the Ambitos. When Baron asked for the duplicate copies of the certificates, he
was told that they were still negotiating with Pacific Star, Inc. Later, the Ambitos told Baron that the transaction was
cancelled and that he should just cause the printing of similar blank certificates by the Apostol Printing Press
in Iloilo City. Baron got scared and objected to the idea vouched to him by the Ambitos until finally he resigned from his
job because he could no longer withstand the pressure exerted on him involving transactions he believed were
anomalous. Baron worked as cashier of the Community Rural Bank of Leon, Inc. from August to December 1979. When
the Central Bank investigators came and conducted examination of the records and transactions of the bank, Baron
reported the anomalies to them.
 
The blank certificates of time deposit of the Rural Bank of Banate, Inc. obtained by the spouses Basilio and
Liberata Ambito from Marilyn Traje were filled up with the amounts of deposit and the name of the Pacific Star, Inc. as
depositor and used by the spouses as down payments of the purchase price of the machineries and spare parts
purchased from the Pacific Star, Inc. These certificates of time deposit are as follows:

1.     Certificate of Time Deposit No. 079, due date May 7, 1979, in the amount of P7,276.50 (Exh.
A, Crim. Case No. 14563) as down payment of the articles covered by Sales Invoice No. 3002
dated November 9, 1978 of Pacific Star, Inc. (Exh. A-1, Crim. Case No. 14563);

2.     Certificate of Time Deposit Nos. 083 and 085 both with due date May 14, 1979 in the amounts
of P17,283.00 and P3,132.00, respectively (Exhs. A and A-1, Crim. Case No. 14564) as down
payment. Sales Invoice Nos. 3003, 3004 and 3005 (Exhs. A-1, A-2 and A-3, Crim. Case No.
14564);

3.     Certificate of Time Deposit No. 086, due date May 21, 1979, in the amount of P11,896.50
(Exh. A, Crim. Case No. 14565) as down payment, Sales Invoice No. 3006 (Exh. A-1, Crim. Case
No. 14565);

4.     Certificate of Time Deposit No. 087, due date May 27, 1979 (Exh. A, Crim. Case No. 14566) in
the amount of P7,945.00 as down payment, Sales Invoice No. 3007 dated November 27,
1978 and Sales Invoice No. 3008 dated November 28, 1978 in the total amount of P7,945.00
(Exhs. A-1 and A-2, Crim. Case No. 14566);
5.     Certificate of Time Deposit No. 089, due date May 29, 1979, in the amount of P17,090.50
(Exh. A, Crim. Case No. 14567) as down payment, Sales Invoices Nos. 3009 and 3010 both
date December 1, 1978 (Exhs. A-1 and A-2, Crim. Case No. 14567);

6.     Certificate of Time Deposit No. 095, due date June 20, 1979 in the amount of P24,062.50 (Exh.
A, Crim. Case No. 14568) as down payment in Sales Invoice Nos. 3031 dated December 11,
1978 (Exh. A-1, Crim. Case No. 14568);

7.     Certificate of Time Deposit No. 089, due date May 29, 1979, in the amount of P17,090.50
(Exh. A, Crim. Case No. 14567) as down payment in Sales Invoice No. 3035 (Exh. A-1, Crim.
Case No. 14567);

8.     Certificate of Time Deposit No. 097, due date June 13, 1979, in the amount of P5,827.50 (Exh.
A, Crim. Case No. 14570) as down payment in Sales Invoice Nos. 3066 and 3067 both dated
January 3, 1979 (Exhs. A-1 and A-2, Crim. Case No. 14570);

9.     Certificate of Time Deposit No. 098, due date June 16, 1979, in the amount of P8,365.00 (Exh.
A, Crim. Case No. 14571) as down payment in Sales Invoice Nos. 3081 dated January 10, 1979
and Sales Invoice No. 3091 dated January 16, 1979 (Exhs. A-1 and A-2, Crim. Case No. 14571);

10. Certificate of Time Deposit No. 099, due date July 22, 1979, in the amount of P27,226.50 (Exh.
A, Crim. Case No. 14572 as down payment in Sales Invoice No. 3097 dated January 23, 1979
(Exh. A-1, Crim. Case No. 14572);

11. Certificate of Time Deposit No. 100, due date July 25, 1979, in the amount of P9,380.00 (Exh.
A, Crim. Case No. 14573) as down payment in Sales Invoice No. 3099 dated January 25, 1979
(Exh. A-1, Crim. Case No. 14573);

12. Certificate of Time Deposit No. 101, due date July 28, 1979 in the amount of P3,132.50 (Exh. A;
Crim. Case No. 14574) as down payment in Sales Invoice No. 3106 (Exh. A-1, Crim. Case No.
14574);

13. Certificate of Time Deposit No. 102, due date August 15, 1979 in the amount of P21,420.00
(Exh. A, Crim. Case No. 14575) in payment of Sales Invoice No. 3120 dated February 8, 1979,
Sales Invoice No, 3121 dated February 8, 1979 and Sales Invoice No. 3126 dated February 12,
1979, (Exhs. A-1, A-2 and A-3, Crim Case No. 14575);

14. Certificate of Time Deposit No. 105, due date August 14, 1979, in the amount of P25,375.00
(Exh. A, Crim. Case No. 14576) as down payment of Sales Invoice No. 3129 dated February
15, 1979 (Exh. A-1, Crim. Case No. 14576);

15. Certificate of Time Deposit No. 106, due date August 16, 1979, in the amount of P58,712.50
(Exh. A, Crim. Case No. 14577) as down payment of Sales Invoice No. 3134 dated February
17, 1977 (Exh. A-1, Crim. Case No. 14577);

16. Certificate of Time Deposit No. 107, due date August 21, 1979, in the amount of P16,205.00
(Exh. A, Crim. Case No. 14578) and Certificate of Time Deposit No. 104, due date September
18, 1979, in the amount of P2,730.00 (Exh. A-1, Crim. Case No. 14578) as down payment in
Sales Invoice No. 3137 dated February 22, 1979 and Sales Invoice No. 3178 dated March 22,
1979;

17. Certificate of Time Deposit No. 108, due date October 15, 1979, in the amount of P78,277.50
(Exh. A, Crim. Case No. 14579) as down payment in Sales Invoice Nos. 3215, 3216 and 3217
all dated April 18, 1979, (Exhs. A-1, A-2 and A-3, Crim. Case No. 14579);
 18. Certificate of Time Deposit No. 109, due date October 16, 1979, in the amount of P8,557.50
(Exh. A, Crim. Case No. 14580) as down payment in Sales Invoice No. 3221 dated April 19,
1979 (Exh. A-1, Crim. Case No. 14580);

19. Certificate of Time Deposit No. 110, due date October 22, 1979, in the amount of P38,529.75
(Exh. A, Crim. Case No. 14581) as down payment in Sales Invoice No. 3240 and 3241 both
dated April 25, 1979 (Exhs. A-1 and A-2, Crim. Case No. 145810);

20. Certificate of Time Deposit No. 111, due date October 29, 1979, in the amount of P7,218.75
(Exh. A, Crim. Case No. 14582) as down payment in Sales Invoice No. 3409 dated May 2, 1979
(Exh. A-1, Crim. Case No. 14582);

21. Certificates of Time Deposit Nos. 112, 113, 114, 115, 116, 117 and 118 all dated November 1,
1979 in the amounts
of P57,750.00, P93,933.00, P21,393.75, P12,285.00,P13,860.00, P20,002.50 and P156,555.00
respectively (Exhs. A, A-1, A-2, A-3, A-4, A-5, A-6, Crim. Case No. 14583) as down payment in
Sales Invoice Nos. 3423 to 3429, inclusive (Exhs. A-7 to A-13, inclusive, Crim. Case No.
14583);

22. Certificate of Time Deposit No. 119, due date December 18, 1979, in the amount of P5,892.25
(Exh. A, Crim. Case No. 14584) as down payment in Sales Invoice No. 3505 dated June 21,
1979 (Exh. A-1, Crim. Case No. 14584);

23. Certificate of Time Deposit No. 134, due date January 23, 1980, in the amount of P3,984.00
(Exh. A, Crim. Case No. 14585) as down payment in Sales Invoice No. 3272 dated July 27,
1979 (Exh. A-1, Crim. Case No. 14585);

The certificates of time deposit of the Community Rural Bank of Leon found to have been falsified are (1)
Certificate of Time Deposit No. 039 , due date February 4, 1980 in the amount of P32,555.25 (Exh. A, Crim. Case No.
14586) and (2) Certificate of Time Deposit No. 040, due date February 14, 1980 in the amount of P9,103.19 (Exh. A,
Crim. Case No. 14587).

The said certificates of time deposit supposedly issued by the Rural Bank of the Banate, Inc. and the
Community Rural Bank of Leon, Inc. were unfunded and not covered by any deposit so that when presented for
redemption by the (sic) Pacific Star, Inc., the same were not honored. As a consequence, Pacific Star, Inc. suffered actual
damages in the amounts representing the total value of the machineries and spare parts sold and delivered by the
complainant to the Ambitos and the latter failed and refused to pay the same despite demands on them.

In view of the anomalous transactions entered into by the Ambitos, both the Rural Bank of Banate, Inc. and
the Community Rural Bank of Leon, Inc. became insolvent and so sometime in May 7, 1980, the Central Bank of
the Philippines placed both banks under receivership and liquidation. Maria Luz Preires, bank examiner of the Central
Bank, was appointed deputy receiver and later deputy liquidator of the Community Rural Bank of Leon. The Central Bank
took over the affairs and records of the banks including their deposits, assets and liabilities. Records showed no
certificate of time deposit in the name of Pacific Star, Inc. properly funded and covered by any deposit. Anomalous
issuances of certificates of time deposit were uncovered as, for instance, Community Rural Bank of Leon, Inc. Certificates
of Time Deposit Nos. 039 (Exh. A, Crim. Case No. 14586 and 040 (Exh. A, Crim. Case No. 14587) which were supposed to
be in the name of Pacific Star, Inc. were actually issued in the name of Paciencia Cantara on October 17, 1979 and
Francisco Alinsao on November 19, 1979 and only in the amounts of P1,000.00 and P3,000.00, respectively (Exh. B, Crim.
Cases Nos. 14586 and 14587).

Subsequently, on complaint of Pacific Star, Inc., the Ambitos were charged of violations of B.P. Blg. 22,
Falsification and Estafa through Falsification of Commercial Document under the Informations filed in the aforecited
cases.

After due proceedings, the Court a quo, promulgated a Decision, dated November 29, 1990, the decretal
portion of which reads as follows:
 WHEREFORE, in Criminal Cases Nos. 14556, 14557, 14558, 14559, 14560, 14561 and
14562, the Court hereby finds the accused, Basilio Ambito, guilty beyond reasonable doubt of the
offense of violation of the provisions of Section 1 of Batas Pambansa Blg. 22 and hereby sentences
the said accused to suffer in each of the seven cases, the penalty of imprisonment of SIX (6)
MONTHS and ONE (1) DAY and to indemnify the offended party, Pacific Star, Inc. the total sum
of P173,480.55, with interest thereon at the legal rate of 12% per annum from the date of filing of
the Informations on May 10, 1982, until paid, without subsidiary imprisonment in case of
insolvency, and to pay the costs.

In Criminal Cases Nos. 14574 and 14585, the Court hereby finds the accused, Basilio
Ambito and Liberata Ambito, guilty beyond reasonable doubt of the complex offense of Estafa
thru Falsification of Commercial Document, defined and penalized in Articles 48, 171, 172 and 315
of the Revised Penal Code and hereby sentences the said accused to suffer in each case, an
indeterminate sentence ranging from TWO (2) YEARS, FOUR (4) MONTHS and ONE (1) DAY of
prision correccional as minimum to FOUR (4) YEARS, NINE (9) MONTHS and ELEVEN (11) DAYS of
prision correccional as maximum, and pay a fine of P3,000.00 and to indemnify the offended
party, Pacific Star, Inc. the total sum of P18,287.00 with interests thereon at the legal rate of 12%
per annum from the date of the filing of the Informations on May 10, 1982 until paid, without
subsidiary imprisonment in case of insolvency, together with the accessory penalties provided for
by law, and to pay the costs.

In Criminal Cases Nos. 14563, 14570, 14580, 14582 and 14584, the Court hereby finds
the accused, Basilio Ambito and Liberata Ambito, guilty beyond reasonable doubt of the complex
crime of Estafa thru Falsification of Commercial Document, defined and penalized in Articles 48,
171, 172 and 315 of the Revised Penal Code and hereby sentences the said accused to suffer, in
each of these cases, an indeterminate prison sentence ranging from TWO (2) YEARS, ELEVEN (11)
MONTHS and ELEVEN (11) DAYS of prision correccional as minimum, to SIX (6) YEARS, EIGHT (8)
MONTHS and TWENTY ONE (21) DAYS of prision mayor as maximum, and to indemnify the
offended party, Pacific Star, Inc., the total sum of P83,095.00, with interests thereon at the legal
rate of 12% per annum from the date of the filing of the Informations on May 10, 1982 until paid,
without subsidiary imprisonment in case of insolvency, together with the accessory penalties
provided for by law, and to pay the costs.

In Criminal Cases Nos. 14566, 14569, 14571 and 14573, the Court hereby finds the
accused, Basilio Ambito and Liberata Ambito, guilty beyond reasonable doubt of the complex
offense of Estafa thru Falsification of Commercial Document, defined and penalized in Articles 48,
171, 172 and 315 of the Revised Penal Code and hereby sentences the said accused to suffer, in
each of these cases, an indeterminate prison sentence ranging from FOUR (4) YEARS, TWO (2)
MONTHS of prision correccional as minimum, to EIGHT (8) YEARS of prision mayor as maximum,
and to indemnify the offended party, Pacific Star, Inc., the total sum of P103,900.00 with interests
thereon at the legal rate of 12% per annum from the date of the filing of the Informations on May
10, 1982 until paid, without subsidiary imprisonment in case of insolvency, together with the
accessory penalties provided for by law and to pay costs.

In Criminal Cases Nos. 14564 and 14578, the Court hereby finds the accused, Basilio
Ambito and Liberata Ambito, guilty beyond reasonable doubt of the complex offense of Estafa
thru Falsification of Commercial Document, defined and penalized in Articles 48, 171, 172 and 315
of the Revised Penal Code and hereby sentences the said accused to suffer, in each of these cases,
an indeterminate prison sentence ranging from FOUR (4) YEARS, TWO (2) MONTHS and ONE (1)
DAY of prision correccional as minimum, to ELEVEN (11) YEARS of prision mayor as maximum, and
to indemnify the offended party, Pacific Star, Inc., the total sum of P116,530.00 with interests
thereon at the legal rate of 12% per annum from the date of the filing of the Informations on May
10, 1982 until paid, without subsidiary imprisonment in case of insolvency, together with the
accessory penalties provided for by law and to pay costs.

In Criminal Cases Nos. 14565, the Court hereby finds the accused, Basilio Ambito and
Liberata Ambito, guilty beyond reasonable doubt of the complex offense of Estafa thru
Falsification of Commercial Document, defined and penalized in Articles 48, 171, 172 and 315 of
the Revised Penal Code and hereby sentences the said accused to suffer, in each of these cases, an
indeterminate prison sentence ranging from FOUR (4) YEARS and TWO (2) MONTHS of prision
correccional as minimum, to NINE (9) YEARS of prision mayor as maximum, and to indemnify the
offended party, Pacific Star, Inc., the sum of P35,190.00 with interests thereon at the legal rate of
12% per annum from the date of the filing of the Informations on May 10, 1982 until paid, without
subsidiary imprisonment in case of insolvency, together with the accessory penalties provided for
by law and to pay costs.

In Criminal Cases Nos. 14567, the Court hereby finds the accused, Basilio Ambito and
Liberata Ambito, guilty beyond reasonable doubt of the offense of Estafa thru Falsification of
Commercial Document, defined and penalized in Articles 48, 171, 172 and 315 of the Revised
Penal Code and hereby sentences the said accused each, to suffer an indeterminate prison
sentence ranging from FOUR (4) YEARS and TWO (2) MONTHS of prision correccional as minimum,
to TEN (10) YEARS of prision mayor as maximum, and to indemnify the offended party, Pacific
Star, Inc., the sum of P50,555.00 with interests thereon at the legal rate of 12% per annum from
the date of the filing of the Informations on May 10, 1982 until paid, without subsidiary
imprisonment in case of insolvency, together with the accessory penalties provided for by law and
to pay costs.

In Criminal Cases Nos. 14568 and 14575, the Court hereby finds the accused, Basilio
Ambito and Liberata Ambito, guilty beyond reasonable doubt of the offense of Estafa thru
Falsification of Commercial Document, defined and penalized in Articles 48, 171, 172 and 315 of
the Revised Penal Code and hereby sentences the said accused to suffer, in each of these cases, an
indeterminate prison sentence ranging from FOUR (4) YEARS, TWO (2) MONTHS and ONE (1) DAY
of prision correccional as minimum, to TWELVE (12) YEARS of prision mayor as maximum, and to
indemnify the offended party, Pacific Star, Inc., the sum of P134,375.00 with interests thereon at
the legal rate of 12% per annum from the date of the filing of the Informations on May 10, 1982
until paid, without subsidiary imprisonment in case of insolvency, together with the accessory
penalties provided for by law and to pay costs.

In Criminal Cases Nos. 14572, 14576 and 14581, the Court hereby finds the accused,
Basilio Ambito and Liberata Ambito, guilty beyond reasonable doubt of the offense of Estafa thru
Falsification of Commercial Document, defined and penalized in Articles 48, 171, 172 and 315 of
the Revised Penal Code and hereby sentences the said accused to suffer, in each of these cases, an
indeterminate prison sentence ranging from SIX (6) YEARS and ONE (1) DAY of prision mayor as
minimum, to THIRTEEN (13) YEARS of reclusion temporal as maximum, and to indemnify the
offended party, Pacific Star, Inc., the total sum of P235,170.00 with interests thereon at the legal
rate of 12% per annum from the date of the filing of the Informations on May 10, 1982 until paid,
without subsidiary imprisonment in case of insolvency, together with the accessory penalties
provided for by law and to pay costs.

In Criminal Cases Nos. 14577, 14579 and 14583, the Court hereby finds the accused,
Basilio Ambito and Liberata Ambito, guilty beyond reasonable doubt of the complex offense of
Estafa thru Falsification of Commercial Document, defined and penalized in Articles 48, 171, 172
and 315 of the Revised Penal Code and hereby sentences the said accused to suffer, in each of
these cases, an indeterminate prison sentence ranging from TEN (10) YEARS and ONE (1) DAY of
prision mayor as minimum, to TWENTY (20) YEARS of reclusion temporal as maximum, and to
indemnify the offended party, Pacific Star, Inc., the total sum of P1,110,500.00 with interests
thereon at the legal rate of 12% per annum from the date of the filing of the Informations on May
10, 1982 until paid, without subsidiary imprisonment in case of insolvency, together with the
accessory penalties provided for by law and to pay costs.

The foregoing penalties imposed upon the accused are, however, subject to the
threefold rule as provided for in Article 70 of the Revised Penal Code so that the maximum
duration of the accused imprisonment shall not be more than three times the most severe of the
penalties the total period of which not to exceed Forty (40) years.
 In Criminal Cases Nos. 14586 and 14587, the Court hereby finds the accused, Crisanto
Ambito, guilty beyond reasonable doubt of the offense of Falsification of Commercial Document,
defined and penalized under Articles 171 and 172 of the Revised Penal Code and hereby
sentences the said accused to suffer, in each of these two cases, an indeterminate prison sentence
ranging from ONE (1) YEAR and ONE (1) DAY of prision correccional as minimum, to FOUR (4)
YEARS, TWO (2) MONTHS of prision correccional as maximum, and pay a fine of P2,000.00,
together with the accessory penalties provided for by law, and to pay the costs. For insufficiency
of evidence, Basilio Ambito and Liberata Ambito are hereby ACQUITTED of the offenses charged in
these Criminal Cases Nos. 14586 and 14587.

On reasonable doubt, the accused Marilyn Traje and Reynaldo Baron, are hereby
ACQUITTED of the offense charged in all the criminal cases against them and the bail bonds
posted for their provisional liberty are hereby ordered cancelled.[3]

After they were convicted by the RTC, petitioners appealed their case to
respondent CA which, in turn, denied their appeal via the assailed CA Decision,
the dispositive portion of which reads as follows:

 
IN THE LIGHT OF ALL THE FOREGOING, the assailed Decision is hereby AFFIRMED in toto. With costs against the
Appellants.
 
SO ORDERED.[4]

Petitioners promptly interposed a Motion for Reconsideration of the adverse CA

Decision but this was succinctly rejected by the CA in its Resolution[5] dated
November 8, 1996, hence, petitioners recourse to this Court for review on
certiorari.
This Court initially denied said Petition for Review on Certiorari[6] through a
Resolution[7] dated January 29, 1997 on the ground that the said petition raised
factual issues. Undaunted, petitioners filed a Motion for Reconsideration[8] dated
February 25, 1997 seeking to persuade this Court to give due course to their
petition which this Court granted in a Resolution[9] dated April 28, 1997, thereby
reinstating the petition. Respondents were required to file comment on the
petition as ordered in the same Resolution. Respondents filed their
Comment[10] on September 9, 1997, while petitioners filed a delayed Reply[11] on
September 4, 1998. In turn, respondents filed a Rejoinder[12] on January 18, 1999.

 
 On January 17, 2005, this Court issued a Resolution[13] directing both parties
to submit their respective memoranda within thirty (30) days from
notice. Respondents submitted their Memorandum[14] on March 18, 2005 but
petitioners failed to submit theirs despite the fact that this Court had already
granted numerous extensions of time to file as requested by petitioners
counsel. This Court even resorted to imposing a fine on petitioners counsel for his
repeated non-compliance as stated by our Resolution[15] dated March 8, 2006 but
to no avail. Thus, in a Resolution[16] dated June 20, 2007, this Court resolved to
dispense with the filing of petitioners memorandum.
 
In their Petition,[17] petitioners raised the following grounds:
A.               THE RESONDENT COURT OF APPEALS COMMITTED A
REVERSIBLE ERROR IN FINDING THE PETITIONERS GUILTY OF THE
OFFENSES IMPUTED TO THEM, THERE BEING UNCONTROVERTED
EVIDENCE SHOWING THAT FROM THE NATURE OF THE
TRANSACTIONS AND DEALINGS BETWEEN THE PETITIONERS AND
PSI FOR A LONG PERIOD OF 14 YEARS, THE LIABILITY OF THE
PETITIONERS, IF ANY, IS ONLY CIVIL IN NATURE, AND NO CRIMINAL
LIABILITY ATTACHES TO THEM.
 
B.               THE RESPONDENT COURT OF APPEALS COMMITTED A
REVERSIBLE ERROR IN FINDING THE PETITIONERS GUILTY BEYOND
REASONABLE DOUBT OF ALL THE OFFENSES IMPUTED TO THEM,
THE FACTS OF THE CASE SHOWING THAT THE VALUE OF THE
SUBJECT CHECKS AND CCTDS [CREDIT CERTIFICATES OF TIME
DEPOSIT] HAVE ALREADY BEEN FULLY PAID PRIOR TO THE
INSTITUTION OF THE CRIMINAL CASES BELOW.
 
C.               ANENT CRIMINAL CASE NOS. 14556 TO 14562, THE
RESPONDENT COURT OF APPEALS COMMITTED A REVERSIBLE
ERROR IN FINDING THE PETITIONER BASILIO AMBITO GUILTY
 BEYOND REASONABLE DOUBT OF THE OFFENSE OF VIOLATION OF
BP22 DESPITE THE LACK OF ESSENTIAL ELEMENTS OF PRIOR NOTICE
OF DISHONOR AND DEMAND FOR PAYMENT OF THE ALLEGED
DISHONORED CHECKS GIVEN BY PSI TO PETITIONERS.
 
D.               ANENT CRIMINAL CASE NOS. 14556, 14557 AND 14558, THE
RESPONDENT COURT COMMITTED A REVERSIBLE ERROR IN
FINDING PETITIONER BASILIO AMBITO GUILTY OF VIOLATION OF
BP22 DESPITE THAT THE SUBJECT CHECKS WERE NOT PRESENTED
FOR PAYMENT WITHIN 90 DAYS FROM DATE OF CHECK.
 
E.               ANENT CRIMINAL CASE NOS. 14556 AND 14557, THE
RESPONDENT COURT OF APPEALS COMMITTED A REVERSIBLE
ERROR IN FINDING PETITIONER BASILIO AMBITO GUILTY OF THE
OFFENSE OF VIOLATION OF BP22 DESPITE THAT THERE WAS IN
EACH CASE NO PROPER EVIDENCE OFFERED TO PROVE THE CRIME
CHARGED.
 
F.                ANENT CRIMINAL CASE NOS. 14563 TO 14585, THE
RESPONDENT COURT OF APPEALS COMMITTED A REVERSIBLE
ERROR IN FINDING THE PETITIONERS GUILTY BEYOND REASONABLE
DOUBT OF THE OFFENSE OF ESTAFA BY FALSE PRETENSES
COMPLEXED WITH FALSIFICATION OF A COMMERCIAL DOCUMENT,
THERE BEING PROSECUTION EVIDENCE TENDING TO SHOW THE
LACK OF THE ELEMENT OF DECEIT.
 
G.              ANENT CRIMINAL CASE NOS. 14563 TO 14585, THE
RESPONDENT COURT OF APPEALS COMMITTED A REVERSIBLE
ERROR IN FINDING THE PETITIONERS GUILTY BEYOND REASONABLE
DOUBT OF ESTAFA BY FALSE PRETENSES COMPLEXED WITH
FALSIFICATION OF A COMMERCIAL DOCUMENT, IT BEING CLEAR
FROM THE FACE OF THE SUBJECT CCTDS THEMSELVES THAT THERE
THEREIN EXISTS NO FALSE NARRATION OF FACTS.
 
H.               THE RESPONDENT COURT OF APPEALS COMMITTED A
REVERSIBLE ERROR IN REFUSING TO RESOLVE THE ASSIGNED
ERROR OF DOUBLE PAYMENT OF IMDEMNITY OR CIVIL LIABILITY
ON THE MERITS THEREOF, IT BEING IN A POSITION TO DO SO, AND
DESPITE TIMELY NOTICE OF THE PRIOR INSTITUTION OF THE CIVIL
CASE INVOLVING THE SAME TRANSACTIONS AS IN THE CASES AT
BAR.[18]
 
In essence, petitioners recourse to this Court is hinged on their belief that
their conviction in the lower court was not based on proof beyond reasonable
doubt and that the respondent CA failed to perform its duty to fully ascertain
whether the prosecutions evidence was sufficient enough to warrant a finding
that would support their conviction for violation of B.P. Blg. 22 and for Estafa
through Falsification of Commercial Documents.
 
We hold the petition to be meritorious in part.
 
Anent the issue of whether or not co-petitioner Basilio Ambitos conviction
in Criminal Case Nos. 14556 to 14562 for the seven (7) counts of violation of B.P.
Blg. 22 was in accordance with law, petitioners argue that he cannot be convicted
of the same since the prosecution allegedly failed to prove the dispensable
elements of prior notice of dishonor and demand for payment of the checks at
issue.[19] Furthermore, they insist that there is no violation of B.P. Blg. 22,
particularly in Criminal Case Nos. 14556, 14557 and 14558 as the subject checks
therein were presented for payment more than ninety (90) days from date.[20]
 
In response, the Office of the Solicitor General (OSG) asserts that
petitioners claim of necessary and indispensable elements of notice of dishonor
and demand to pay cannot be found in the statute defining the essential elements
of violation of B.P. Blg. 22. The OSG further insists that, from among the said
essential elements, there is no particular manner prescribed in which the person
who made and issued the dishonored checks should be notified of the fact of
dishonor.
 
Be that as it may, the OSG avers that as far as the checks subject of the
charges of violation of B.P. Blg. 22 in these criminal cases are concerned, co-
petitioner Basilio Ambito had been more than sufficiently notified of the fact of
dishonor because on December 28, 1979, Pacific Star, Inc. (PSI) filed with Branch 2
of the RTC of Manila a civil complaint for collection against petitioners, or more
than three (3) years before the thirty-two (32) Informations for violations of B.P.
Blg. 22 and for Estafa through Falsification of Commercial Documents were filed
against petitioners on May 10, 1982. Within that three-year span of time, the OSG
points out, co-petitioner Basilio Ambito failed to pay the value of the checks
despite having been notified of their dishonor. [21]
 
As to petitioners contention that the prosecution was not able to prove the
indispensable element that the drawer had knowledge that the checks were not
backed up by sufficient funds since the checks subject of Criminal Case Nos.
14556, 14557 and 14558 were presented for payment more than ninety (90) days
from date, the OSG claims that the said element had been clearly established by
the petitioners testimony in the lower court where petitioners contend that the
subject checks were issued only as mere guarantee and, as such, were not
supposed to be deposited as previously agreed by PSI and petitioners. [22] In any
case, the OSG argues that under Section 2 of B.P. Blg. 22, the makers knowledge
of the insufficiency of funds is legally presumed from the dishonor of the check
for insufficiency of funds.[23]
 
After carefully reviewing the records and the submissions of the parties, we
find that the prosecutions evidence was inadequate to prove co-petitioner Basilio
Ambitos guilt beyond reasonable doubt for seven (7) counts of violation of B.P.
Blg. 22.
 
The elements of violation of B.P. Blg. 22 are: (1) making, drawing, and
issuance of any check to apply on account or for value; (2) knowledge of the
maker, drawer, or issuer that at the time of issue he does not have sufficient
funds in or credit with the drawee bank for the payment of the check in full upon
its presentment; and (3) subsequent dishonor of the check by the drawee bank
for insufficiency of funds or credit, or dishonor for the same reason had not the
drawer, without any valid cause, ordered the bank to stop payment.[24]
 
The gravamen of the offense punished by B.P. Blg. 22 is the act of making or
issuing a worthless check or a check that is dishonored upon its presentation for
payment. It is not the nonpayment of an obligation which the law punishes. The
law is not intended or designed to coerce a debtor to pay his debt. The thrust of
the law is to prohibit, under pain of penal sanctions, the making of worthless
checks and putting them in circulation. Because of its deleterious effects on the
public interest, the practice is proscribed by the law.The law punishes the act not
as an offense against property, but an offense against public order.[25] Thus, the
mere act of issuing a worthless check whether as a deposit, as a guarantee or
even as evidence of pre-existing debt is malum prohibitum.[26]
 
 In light of the foregoing, petitioners contention in the lower court that the
subject checks were only issued as mere guarantee and were not intended for
deposit as per agreement with PSI is not tenable. Co-petitioner Basilio Ambito
would be liable under B.P. Blg. 22 by the mere fact that he issued the subject
checks, provided that the other elements of the crime are properly proved.
 
With regard to the second element, we note that the law provides for
a prima facie rule of evidence. A disputable presumption of knowledge of
insufficiency of funds in or credit with the bank is assumed from the act of
making, drawing, and issuing a check, payment of which is refused by the drawee
bank for insufficiency of funds when presented within 90 days from the date of
issue. However, such presumption does not arise when the maker or drawer pays
or makes arrangements for the payment of the check within five banking days
after receiving notice that such check had been dishonored. In order for the
maker or drawer to pay the value thereof or make arrangements for its payment
within the period prescribed by law, it is therefore necessary and indispensable
for the maker or drawer to be notified of the dishonor of the check.
 
Under B.P. Blg. 22, the prosecution must prove not only that the accused
issued a check that was subsequently dishonored. It must also establish that the
accused was actually notified that the check was dishonored, and that he or she
failed, within five (5) banking days from receipt of the notice, to pay the holder of
the check the amount due thereon or to make arrangement for its
payment. Absent proof that the accused received such notice, a prosecution for
violation of the Bouncing Checks Law cannot prosper.[27]
 
 The absence of a notice of dishonor necessarily deprives an accused an
opportunity to preclude a criminal prosecution. Accordingly, procedural due
process clearly enjoins that a notice of dishonor be actually sent to and received
by the accused. The accused has a right to demand and the basic postulates of
fairness require that the notice of dishonor be actually sent to and received by
the same to afford him/her the opportunity to avert prosecution under B.P. Blg.
22.[28]
 
In the case at bar, there is nothing in the records that would indicate that
co-petitioner Basilio Ambito was given any notice of dishonor by PSI or by Manila
Bank, the drawee bank, when the subject checks were dishonored for
insufficiency of funds upon presentment for payment. In fact, all that the OSG can
aver regarding this matter is that co-petitioner Basilio Ambito had been notified of
the fact of dishonor since PSI filed a collection case against petitioners more than
three (3) years before the same filed the criminal cases before this Court.[29]
 
Likewise, respondent CA merely cited, in its assailed Decision, co-petitioner
Basilio Ambitos July 17, 1989 trial court testimony as basis for concluding that he
was properly informed of the dishonor of the subject checks, viz:
 
Appellant Basilios claim that he was never notified of the dishonor of the checks he issued in partial payments of the
purchases Kazette Enterprises made from PSI is belied by his own admission made when he testified in the Court a quo
thus:
 
xxx
Q Inspite of you agreement they deposited and when presented they bounce?
A That was in the receipts.
Q So you admit you have presented these checks already marked as Exhibit A for the
prosecution for criminal cases Nos. 14556 to 14562, inclusive, were all returned for insufficiency of
funds by the depository bank?
A Yes, sir. (t.s.n., Ambito, page 35, July 17, 1989)
 
Nothwithstanding his notice of the dishonor of the checks, Appellant failed to replace the same with cash or make
arrangements with PSI, for the payments of the amounts of the checks.[30]

 
 Verily, the aforementioned circumstances are not in accord with the
manner or form by which a notice of dishonor should be made under the law and
existing jurisprudence.
 
The notice of dishonor of a check may be sent to the drawer or maker by
the drawee bank, the holder of the check, or the offended party either by
personal delivery or by registered mail. The notice of dishonor to the maker of a
check must be in writing.[31]
 
While, indeed, Section 2 of B.P. Blg. 22 does not state that the notice of
dishonor be in writing, taken in conjunction, however with Section 3 of the
law, i.e., that where there are no sufficient funds in or credit with such drawee
bank, such fact shall always be explicitly stated in the notice of dishonor or
refusal, a mere oral notice or demand to pay would appear to be insufficient for
conviction under the law. The Court has previously held that both the spirit and
letter of the Bouncing Checks Law would require for the act to be punished
thereunder not only that the accused issued a check that is dishonored, but that
likewise the accused has actually been notified in writing of the fact of
dishonor. The consistent rule is that penal statutes have to be construed strictly
against the State and liberally in favor of the accused.[32]
 
There being no proof that co-petitioner Basilio Ambito was given any
written notice either by PSI or by Manila Bank informing him of the fact that his
checks were dishonored and giving him five (5) banking days within which to
make arrangements for payment of the said checks, the rebuttable presumption
that he had knowledge of the insufficiency of his funds has no application in the
present case.
  
Due to the failure of prosecution in this case to prove that co-petitioner
Basilio Ambito was given the requisite notice of dishonor and the opportunity to
make arrangements for payment as provided for under the law, We cannot with
moral certainty convict him of violation of B.P. Blg. 22.

However, Basilio Ambitos acquittal for his violations of B.P. Blg. 22 for
failure of the prosecution to prove all elements of the offense beyond reasonable
doubt did not entail the extinguishment of his civil liability for the dishonored
checks. In a number of similar cases,[33] we have held that an acquittal based on
reasonable doubt does not preclude the award of civil damages. The judgment of
acquittal extinguishes the liability of the accused for damages only when it
includes a declaration that the facts from which the civil liability might arise did
not exist. Thus, in the case at bar, the trial courts directive for Basilio Ambito to
indemnify PSI the total sum of P173,480.55, with interest thereon at the legal rate
of 12% per annum from the date of filing of the Informations on May 10, 1982,
until paid, and to pay the costs is affirmed.
Anent the question of whether or not petitioner spouses Liberata and
Basilio Ambitos conviction for the offense of Estafa through Falsification of
Commercial Document was proven beyond reasonable doubt, the petitioners
interposed the defense that they cannot be properly convicted of the same as
there was no finding of false narration of facts and of deceit.
 
Petitioners assert that PSI was not deceived by the issuance of the subject
credit certificates of time deposit (CCTDs), which did not contain a false narration
of facts, for the reasons that: (i) said CCTDs, which were undated as to their
respective dates of issuance, did not state that funds had already been deposited
by PSI; (ii) during the course of their alleged fourteen-year long business
relationship, PSI, which had been accepting said CCTDs, knew that they were
unfunded as said certificates of time deposit were issued to serve as promissory
notes to guarantee payment for the balance of the invoice price of the
machineries;[34] (iii) petitioners did not represent to PSI that the money was
already deposited because the subject CCTDs were even postdated;[35] (iv) the
amounts stated in the CCTDs were not downpayments but CREDIT extended to
petitioner Basilio Ambito payable six months after the sales/purchases were
made;[36] (v) petitioners obligation is civil in nature because current and savings
deposits constitute loans to a bank and, thus, a CCTD is an evidence of a simple
loan;[37] (vi) the essential element of fraud was absent because PSI knew that the
CCTDs issued to it by petitioners were not covered by funds because it knew that
the deposits were yet to be made when the farmers, to whom Basilio Ambito
resold on credit the machineries, shall have deposited in the rural banks their
payments for those machineries;[38] (vii) the subject certificates of time deposit
issued to PSI were not ordinary certificates of time deposit but CREDIT certificates
of Time Deposit because the term credit indicates a deferred or delayed nature of
the payment, thus, signifying a promise to pay at a future date;[39] (viii) PSI was not
defrauded as it gave discounts in its sales invoices if petitioners paid in full the
value of the certificates on or before 180 days from delivery. By giving discounts
for early payment, it was thus aware of the possibility that said certificates might
not be funded when they fell due;[40] (ix) the sales invoices issued by PSI gave it
the right to institute civil actions only and not criminal actions; [41] and (x)
petitioners had already performed their obligations to PSI by way of the payment
of the amount of P300,000.00 and the return of one unit Kubota machinery
valued at P 28,000.00.[42]
 
 We are not persuaded. We find no reason to disturb the identical findings
of the CA and the RTC regarding the particular circumstances surrounding the
petitioners conviction of Estafa through Falsification of Commercial Documents
because the same are adequately supported by the evidence on record.
 
It is not the function of this Court to analyze or weigh evidence all over
again, unless there is a showing that the findings of the lower court are totally
devoid of support or are glaringly erroneous as to constitute palpable error or
grave abuse of discretion.[43]
 
The elements of Estafa by means of deceit, whether committed by false
pretenses or concealment, are the following (a) that there must be a false
pretense, fraudulent act or fraudulent means. (b) That such false pretense,
fraudulent act or fraudulent means must be made or executed prior to or
simultaneous with the commission of the fraud. (c) That the offended party must
have relied on the false pretense, fraudulent act or fraudulent means, that is, he
was induced to part with his money or property because of the false pretense,
fraudulent act or fraudulent means. (d) That as a result thereof, the offended
party suffered damage.[44]
 
In the prosecution for Estafa under Article 315, paragraph 2(a) of the RPC,
[45]
 it is indispensable that the element of deceit, consisting in the false statement
or fraudulent representation of the accused, be made prior to, or at least
simultaneously with, the delivery of the thing by the complainant.
 
The false pretense or fraudulent act must be committed prior to or
simultaneously with the commission of the fraud, it being essential that such false
statement or representation constitutes the very cause or the only motive which
induces the offended party to part with his money. In the absence of such
requisite, any subsequent act of the accused, however fraudulent and suspicious
it might appear, cannot serve as basis for prosecution for estafa under the said
provision.[46]
 
In the case at bar, the records would show that PSI was given assurance by
petitioners that they will pay the unpaid balance of their purchases from PSI when
the CCTDs with petitioners banks, the Rural Bank of Banate, Inc. (RBBI) and/or the
Rural Bank of Leon, Inc. (RBLI), and issued under the name of PSI, would be
presented for payment to RBBI and RBLI which, in turn, will pay the amount of
deposit stated thereon. The amounts stated in the CCTDs correspond to the
purchase cost of the machineries and equipment that co-petitioner Basilio Ambito
bought from PSI as evidenced by the Sales Invoices presented during the trial. It is
uncontroverted that PSI did not apply for and secure loans from RBBI and RBLI. In
fine, PSI and co-petitioner Basilio Ambito were engaged in a vendor-purchaser
business relationship while PSI and RBBI/RBLI were connected as depositor-
depository. It is likewise established that petitioners employed deceit when they
were able to persuade PSI to allow them to pay the aforementioned machineries
and equipment through down payments paid either in cash or in the form of
checks or through the CCTDs with RBBI and RBLI issued in PSIs name with interest
thereon. It was later found out that petitioners never made any deposits in the
said Banks under the name of PSI. In fact, the issuance of CCTDs to PSI was not
recorded in the books of RBBI and RBLI and the Deputy Liquidator appointed by
the Central Bank of the Philippines even corroborated this finding of anomalous
bank transactions in her testimony during the trial. [47]
 As borne by the records and the pleadings, it is indubitable that petitioners
representations were outright distortions of the truth perpetrated by them for
the sole purpose of inducing PSI to sell and deliver to co-petitioner Basilio Ambito
machineries and equipments. Petitioners knew that no deposits were ever made
with RBBI and RBLI under the name of PSI, as represented by the subject CCTDs,
since they did not intend to deposit any amount to pay for the machineries. PSI
was an innocent victim of deceit, machinations and chicanery committed by
petitioners which resulted in its pecuniary damage and, thus, confirming the
lower courts finding that petitioners are guilty of the complex crime of Estafa
through Falsification of Commercial Documents.
 
The pronouncement by the appeals court that a complex crime had been
committed by petitioners is proper because, whenever a person carries out on a
public, official or commercial document any of the acts of falsification
enumerated in Article 171 of the RPC[48] as a necessary means to perpetrate
another crime, like Estafa, Theft, or Malversation, a complex crime is formed by
the two crimes.
Under Article 48 of the RPC,[49] a complex crime refers to (1) the
commission of at least two grave or less grave felonies that must both (or all) be
the result of a single act, or (2) one offense must be a necessary means for
committing the other (or others). Negatively put, there is no complex crime when
(1) two or more crimes are committed, but not by a single act; or (2) committing
one crime is not a necessary means for committing the other (or others).[50]
 

The falsification of a public, official, or commercial document may be a

means of committing Estafa, because before the falsified document is actually
utilized to defraud another, the crime of Falsification has already been
consummated, damage or intent to cause damage not being an element of the
crime of falsification of public, official or commercial document. In other words,
the crime of falsification has already existed. Actually utilizing that falsified public,
official or commercial document to defraud another is estafa. But the damage is
caused by the commission of Estafa, not by the falsification of the
document. Therefore, the falsification of the public, official or commercial
document is only a necessary means to commit the estafa.[51]
 

In the case before us, the issuance by petitioners of CCTDs which reflected
amounts that were never deposited as such in either RBBI or RBLI is Falsification
under Articles 171[52] and 172[53] of the RPC. The particular criminal undertaking
consisted of petitioners, taking advantage of their position as owners of RBBI and
RBLI, making untruthful statements/representations with regard to the existence
of time deposits in favor of PSI by issuing the subject CCTDs without putting up
the corresponding deposits in said banks.
 
Under Article 171, paragraph 4 of the RPC,[54] the elements of falsification of
public documents through an untruthful narration of facts are: (1) the offender
makes in a document untruthful statements in a narration of facts; (2) the
offender has a legal obligation to disclose the truth of the facts narrated; (3) the
facts narrated by the offender are absolutely false; and (4) the perversion of truth
in the narration of facts was made with the wrongful intent to injure a third
person.[55]
 
As earlier discussed, the issuance of the falsified CCTDs for the sole purpose
of obtaining or purchasing various machinery and equipment from PSI amounts to
the criminal offense of Estafa under Article 315 (2) (a) of the RPC.[56] The
petitioners falsified the subject CCTDs, which are commercial documents, to
defraud PSI. Since the falsification of the CCTDs was the necessary means for the
commission of Estafa, the assailed judgment of the appeals court convicting
petitioners of the complex crime of Estafa through Falsification of Commercial
Documents is correct.
 
Quite apart from the prosecutions successful discharge of its burden of
proof, we find that the accused failed to discharge their burden to prove their
defense. To begin with, there appears to be no proof on record of the alleged 14-
year financial arrangement between accused and PSI or the purported
consignment only agreement between them other than the uncorroborated and
self-serving testimony of the accused. Moreover, we uphold the findings of the CA
and the court a quo as to the proper characterization of the CCTDs and the lack of
credible, independent evidence of the alleged payment of the accuseds
obligations to PSI.
Finally, with respect to co-petitioner Crisanto Ambito, we find no reason to
disturb the trial courts ruling that he is liable for only the crime of Falsification of
Commercial Documents in connection with CCTD Nos. 039 and 040 of RBLI, there
being no showing that the said CCTDs were used to purchase farm implements
from PSI.[57]
 
WHEREFORE, the Petition is PARTLY GRANTED. The assailed Decision dated
March 29, 1996 of the Court of Appeals affirming that of the Regional Trial Court
is AFFIRMED with respect to petitioner spouses Basilio and Liberata Ambitos
conviction for Estafa through Falsification of Commercial Documents (in Criminal
Case Nos. 14563 to 14585) and with respect to co-petitioner Crisanto Ambitos
conviction for Falsification of Commercial Documents (in Criminal Case Nos.
14586 and 14587). However, the aforesaid Decision is REVERSED with respect to
co-petitioner Basilio Ambitos conviction for violation of B.P. Blg. 22 (in Criminal
Case Nos. 14556 to 14562), who is hereby ACQUITTED on the ground that his guilt
has not been established beyond reasonable doubt. However, the portion of the
said Decision insofar as it directs Basilio Ambito to indemnify Pacific Star, Inc. the
total sum of P173,480.55, with interest thereon at the legal rate of 12% per
annum from the date of filing of the Informations on May 10, 1982, until paid, and
to pay the costs (also in Criminal Case Nos. 14556 to 14562) is AFFIRMED.
 
 

SO ORDERED.

TERESITA J. LEONARDO-DE CASTRO

Associate Justice

WE CONCUR:

 
 

REYNATO S. PUNO
Chief Justice
Chairperson

   
 ANTONIO T. CARPIO RENATO C. CORONA

Associate Justice Associate Justice

ADOLFO S. AZCUNA

Associate Justice

 
 

CERTIFICATION
 

Pursuant to Section 13, Article VIII of the Constitution, it is hereby certified

that the conclusions in the above Decision were reached in consultation before the
case was assigned to the writer of the opinion of the Courts Division.
 

REYNATO S. PUNO
Chief Justice
[1]
 Penned by then Court of Appeals (CA) and later Supreme Court (SC) Associate Justice Romeo J. Callejo, Sr.
(ret.), with then CA and later SC Associate Justice Antonio M. Martinez (ret.) and CA Associate Justice Delilah
Vidallon-Magtolis (ret.), concurring; rollo, pp. 162-188.
[2]
 Id., at pp. 145-161.
[3]
 Id., at pp. 162-176.
[4]
 Id., at pp. 187-188.
[5]
 Id., at p. 189.
[6]
 Id., at pp. 14-189.
[7]
 Id., at p. 190.
[8]
 Id., at pp. 191-250.
[9]
 Id., at p. 252.
[10]
 Id., at pp. 280-317.
[11]
 Id., at pp. 409-466.
[12]
 Id., at pp. 477-491.
[13]
 Id., at pp. 497-498.
[14]
 Id., at pp. 499-547.
[15]
 Id., at p. 601.
[16]
 Id., at p. 652.
[17]
 Supra note 6.
[18]
 Id., at pp. 37-38.
[19]
 Id., at pp. 56-61.
[20]
 Id., at pp. 61-63.
[21]
 Id., at p. 529.
[22]
 Id., at p. 528. (citing TSN, July 17, 1989, pp.35-36)
[23]
 Id., at pp. 530-531.
[24]
 Tan v. People, G.R. No. 145006, August 30, 2006, 500 SCRA 172, 182.
[25]
 Lozano v. Martinez, No. L-63419, December 18, 1986, 146 SCRA 323, 338.
[26]
 Ricaforte v. Jurado, G.R. No. 154438, September 5, 2007, 532 SCRA 317, 330.
[27]
 Bax v. People, G.R. No. 149858, September 5, 2007, 532 SCRA 284, 291, citing King v. People, G.R. 131540,
December 2, 1999, 319 SCRA 654.
[28]
 Lao v. Court of Appeals, G.R. No. 119178, June 20, 1997, 274 SCRA 572, 594.
[29]
 Rollo, p. 529.
[30]
 Id., at p. 179.
[31]
 Rigor v. People, G.R. No. 144887, November 17, 2004, 442 SCRA 450, 462.
[32]
 Domangsang v. Court of Appeals, G.R. No. 139292, December 5, 2000, 347 SCRA 75, 83.

 Domangsang v. Court of Appeals, Id. at 84-85, Rico v. People, G. R. No. 137191, November 18, 2002, 392
[33]

SCRA 61, 74; Bax v. People, G.R. No. 149858, September 5, 2007, 532 SCRA 284, 292-293.
 
[34]
 Rollo, pp. 64-72.
[35]
 Id., at pp. 434-435.
[36]
 Id., at pp. 435-436.
[37]
 Id., at p. 437.
[38]
 Id., at p. 438.
[39]
 Id., at p. 439.
[40]
 Id., at pp. 439-440.
[41]
 Id., at p. 441.
[42]
 Id., at pp. 441-442.
[43]
 De Jesus v. Court of Appeals, G.R. No. 127857, June 20, 2006, 491 SCRA 325, 333.
[44]
 R.R. Paredes v. Calilung, G.R. No. 156055, March 5, 2007, 517 SCRA 369, 393.
[45]
 Art. 315. Swindling (estafa). Any person who shall defraud another by any of the means mentioned
herein below . . .
xxx
2. By means of any of the following false pretenses or fraudulent acts executed prior to or
simultaneously with the commission of the fraud:
(a) By using fictitious name, or falsely pretending to possess power, influence,
qualifications, property, credit, agency, business or imaginary transactions, or by means
of other similar deceits.
[46]
 Aricheta v. People, G.R. No. 172500, September 21, 2007, 533 SCRA 695, 704.
[47]
 Rollo, pp. 184-187.
[48]
 Art. 171. Falsification by public officer; employee or notary or ecclesiastical minister. The penalty of prision
mayor and a fine not to exceed 5,000 pesos shall be imposed upon any public officer, employee, or notary who,
taking advantage of his official position, shall falsify a document by committing any of the following acts:
1.        Counterfeiting or imitating any handwriting, signature, or rubric;
2.        Causing it to appear that persons have participated in any act or proceeding when they did not in fact
so participate;
3.        Attributing to persons who have participated in an act or proceeding statements other than those in
fact made by them;
4.        Making untruthful statements in a narration of facts;
5.        Altering true dates;
6.        Making any alteration or intercalation in a genuine document which changes its meaning;
7.        Issuing in an authenticated form a document purporting to be a copy of an original document when no
such original exists, or including in such copy a statement contrary to, or different from, that of the
genuine original; or
8.        Intercalating any instrument or note relative to the issuance thereof in a protocol, registry, or official
book.
The same penalty shall be imposed upon any ecclesiastical minister who shall commit any of the offenses
enumerated in the preceding paragraphs of this article, with respect to any record or document of such character that
its falsification may affect the civil status of persons.
[49]
 Art. 48. Penalty for complex crimes. When a single act constitutes two or more grave or less grave felonies, or
when an offense is a necessary means for committing the other, the penalty for the most serious crime shall be
imposed, the same to be applied in its maximum period.
[50]
 Monteverde v. People, G.R. No. 139610, August 12, 2002, 387 SCRA 196, 208.
[51]
 Cf. Reyes, The Revised Penal Code, Book II, 2001 ed., p. 226.
[52]
 Supra note 47.
[53]
 Art. 172. Falsification by private individuals and use of falsified documents. The penalty of prision
correccional in its medium and maximum periods and a fine of not more than 5,000 pesos shall be imposed upon:
1.        Any private individual who shall commit any of the falsifications enumerated in the next preceding
article in any public or official document or letter of exchange or any other kind of commercial
document; and
2.        Any person who, to the damage of a third party, or with the intent to cause such damage, shall in any
private document commit any of the acts of falsification enumerated in the next preceding article.
Any person who shall knowingly introduce in evidence in any judicial proceeding or to the damage of
another or who, with the intent to cause such damage, shall use any of the false documents embraced in the next
preceding article or in any of the foregoing subdivisions of this article, shall be punished by the penalty next lower
in degree.
[54]
 Art. 171. Falsification by public officer; employee or notary or ecclesiastical minister. The penalty of prision
mayor and a fine not to exceed 5,000 pesos shall be imposed upon any public officer, employee, or notary who,
taking advantage of his official position, shall falsify a document by committing any of the following acts:
xxx
(4) Making untruthful statements in a narration of facts;
[55]
 Enemecio v. Office of the Ombudsman (Visayas), G.R. No. 146731, January 13, 2004, 419 SCRA 82, 91.
[56]
 Supra note 44.
[57]
 Rollo at 156.
 
 
 
 
 
 
SECOND DIVISION
 

JAIME GUINHAWA, G.R. No. 162822

Petitioner,
Present:
PUNO, J., Chairman,
AUSTRIA-MARTINEZ,
- versus - CALLEJO, SR.,
TINGA, and
CHICO-NAZARIO, JJ.
Promulgated:
PEOPLE OF THE PHILIPPINES,
Respondent. August 25, 2005
x--------------------------------------------------x
DECISION
 
 
CALLEJO, SR., J.:
 

Jaime Guinhawa was engaged in the business of selling brand new motor
vehicles, including Mitsubishi vans, under the business name of Guinrox Motor
Sales. His office and display room for cars were located along Panganiban Avenue,
Naga City. He employed Gil Azotea as his sales manager.
 
 On March 17, 1995, Guinhawa purchased a brand new Mitsubishi L-300
Versa Van with Motor No. 4D56A-C8929 and Serial No. L069WQZJL-07970 from
the Union Motors Corporation (UMC) in Paco, Manila. The van bore Plate No. DLK
406. Guinhawas driver, Leopoldo Olayan, drove the van from Manila to Naga City.
However, while the van was traveling along the highway in Labo, Daet, Camarines
Norte, Olayan suffered a heart attack. The van went out of control, traversed the
highway onto the opposite lane, and was ditched into the canal parallel to the
highway.[1] The van was damaged, and the left front tire had to be replaced.
 

The incident was reported to the local police authorities and was recorded
in the police blotter.[2] The van was repaired and later offered for sale in
Guinhawas showroom.[3]
 

Sometime in October 1995, the spouses Ralph and Josephine Silo wanted to
buy a new van for their garment business; they purchased items in Manila and
sold them in Naga City.[4] They went to Guinhawas office, and were shown the L-
300 Versa Van which was on display. The couple inspected its interior portion and
found it beautiful. They no longer inspected the under chassis since they
presumed that the vehicle was brand new.[5] Unaware that the van had been
damaged and repaired on account of the accident in Daet, the couple decided to
purchase the van for P591,000.00. Azotea suggested that the couple make a
downpayment of P118,200.00, and pay the balance of the purchase price by
installments via a loan from the United Coconut Planters Bank (UCPB), Naga
Branch, with the L-300 Versa Van as collateral. Azotea offered to make the
necessary arrangements with the UCPB for the consummation of the loan
transaction. The couple agreed. On November 10, 1995, the spouses executed a
Promissory Note[6] for the amount of P692,676.00 as payment of the balance on
the purchase price, and as evidence of the chattel mortgage over the van in favor
of UCPB.
 

On October 11, 1995, the couple arrived in Guinhawas office to take

delivery of the van. Guinhawa executed the deed of sale, and the couple paid
the P161,470.00 downpayment, for which they were issued Receipt No. 0309.
[7]
 They were furnished a Service Manual[8] which contained the warranty terms
and conditions. Azotea instructed the couple on how to start the van and to
operate its radio. Ralph Silo no longer conducted a test drive; he and his wife
assumed that there were no defects in the van as it was brand new.[9]
 

On October 12, 1995, Josephine Silo, accompanied by Glenda Pingol, went

to Manila on board the L-300 Versa Van, with Glendas husband, Bayani Pingol III,
as the driver. Their trip to Manila was uneventful. However, on the return trip to
Naga from Manila on October 15 or 16, 1995, Bayani Pingol heard a squeaking
sound which seemed to be coming from underneath the van. They were in
Calauag, Quezon, where there were no humps along the road.[10] Pingol stopped
the van in Daet, Camarines Norte, and examined the van underneath, but found
no abnormalities or defects.[11] But as he drove the van to Naga City, the
squeaking sound persisted. 
Believing that the van merely needed grease, Pingol stopped at a Shell gasoline
station where it was examined. The mechanic discovered that some parts
underneath the van had been welded. When Pingol complained to Guinhawa, the
latter told him that the defects were mere factory defects. As the defects
persisted, the spouses Silo requested that Guinhawa change the van with two
Charade-Daihatsu vehicles within a week or two, with the additional costs to be
taken from their downpayment. Meanwhile, the couple stopped paying the
monthly amortization on their loan, pending the replacement of the van.
Guinhawa initially agreed to the couples proposal, but later changed his mind and
told them that he had to sell the van first. The spouses then brought the vehicle
to the Rx Auto Clinic in Naga City for examination. Jesus Rex Raquitico, Jr., the
mechanic, examined the van and discovered that it was the left front stabilizer
that was producing the annoying sound, and that it had been repaired.
[12]
 Raquitico prepared a Job Order containing the following notations and
recommendations:
 
1. CHECK UP SUSPENSION (FRONT)

2. REPLACE THE ROD END

3. REPLACE BUSHING

NOTE: FRONT STEP BOARD HAS BEEN ALREADY DAMAGED AND REPAIRED.

 
 NOTE: FRONT LEFT SUSPENSION MOUNTING IS NOT ON SPECIFIED
ALIGNMENT/MEASUREMENT[13]

Josephine Silo filed a complaint for the rescission of the sale and the refund
of their money before the Department of Trade and Industry (DTI). During the
confrontation between her and Guinhawa, Josephine learned that Guinhawa had
bought the van from UMC before it was sold to them, and after it was damaged in
Daet. Subsequently, the spouses Silo withdrew their complaint from the DTI.
 

On February 14, 1996, Josephine Silo filed a criminal complaint for violation
of paragraph 1, Article 318 of the Revised Penal Code against Guinhawa in the
Office of the City Prosecutor of Naga City. After the requisite investigation, an
Information was filed against Guinhawa in the Municipal Trial Court (MTC) of
Naga City. The inculpatory portion reads:
 
The undersigned Assistant Prosecutor of Naga City accuses Jaime Guinhawa of
the crime of OTHER DECEITS defined and penalized under Art. 318, par. 1 of the Revised
Penal Code, committed as follows:

That on or about October 11, 1995, in the City of Naga,

Philippines, and within the jurisdiction of this Honorable Court, the said
accused, being a motor vehicle dealer using the trade name of
Guinhawa Motor Sales at Panganiban Avenue, Naga City, and a dealer of
brand new cars, by means of false pretenses and fraudulent acts, did
then and there willfully, unlawfully and feloniously defraud private
complainant, JOSEPHINE P. SILO, as follows: said accused by means of
false manifestations and fraudulent representations, sold to said private
complainant, as brand new, an automobile with trade name L-300 Versa
 Van colored beige and the latter paid for the same in the amount
of P591,000.00, when, in truth and in fact, the same was not brand new
because it was discovered less than a month after it was sold to said
Josephine P. Silo that said L-300 Versa Van had defects in the
underchassis and stepboard and repairs had already been done thereat
even before said sale, as was found upon check-up by an auto
mechanic; that private complainant returned said L-300 Versa Van to
the accused and demanded its replacement with a new one or the
return of its purchase price from said accused but despite follow-up
demands no replacement was made nor was the purchase price
returned to private complainant up to the present to her damage and
prejudice in the amount of P591,000.00, Philippine Currency, plus other
damages that may be proven in court.[14]

Guinhawa testified that he was a dealer of brand new Toyota, Mazda,

Honda and Mitsubishi cars, under the business name Guinrox Motor Sales. He
purchased Toyota cars from Toyota Philippines, and Mitsubishi cars from UMC in
Paco, Manila.[15] He bought the van from the UMC in March 1995, but did not use
it; he merely had it displayed in his showroom in Naga City. [16] He insisted that the
van was a brand new unit when he sold it to the couple.[17] The spouses Silo
bought the van and took delivery only after inspecting and taking it for a road
tests.[18] His sales manager, Azotea, informed him sometime in November 1995
that the spouses Silo had complained about the defects under the left front
portion of the van. By then, the van had a kilometer reading of 4,000 kilometers.
[19]
 He insisted that he did not make any false statement or fraudulent
misrepresentation to the couple about the van, either before or simultaneous
with its purchase. He posited that the defects noticed by the couple were not
major ones, and could be repaired. However, the couple refused to have the van
repaired and insisted on a refund of their payment for the van which he could not
allow. He then had the defects repaired by the UMC.[20] He claimed that the van
was never involved in any accident, and denied that his driver, Olayan, met an
accident and sustained physical injuries when he drove the van from Manila to
Naga City.[21] He even denied meeting Bayani Pingol.
 

The accused claimed that the couple filed a Complaint[22] against him with
the DTI on January 25, 1996, only to withdraw it later.[23] The couple then failed to
pay the amortizations for the van, which caused the UCPB to file a petition for the
foreclosure of the chattel mortgage and the sale of the van at public auction.[24]
 

Azotea testified that he had been a car salesman for 16 years and that he
sold brand new vans.[25] Before the couple took delivery of the vehicle, Pingol
inspected its exterior, interior, and underside, and even drove it for the couple.
[26]
 He was present when the van was brought to the Rx Auto Clinic, where he
noticed the dent on its front side.[27] He claimed that the van never figured in any
vehicular accident in Labo, Daet, Camarines Norte on March 17, 1995.[28] In fact,
he declared, he found no police record of a vehicular accident involving the van
on the said date.[29] He admitted that Olayan was their driver, and was in charge of
taking delivery of cars purchased from the manufacturer in Manila.[30]
 
 On November 6, 2001, the trial court rendered judgment convicting
Guinhawa. The fallo of the decision reads:
 
WHEREFORE, premises considered, judgment is hereby rendered declaring the
accused, JAIME GUINHAWA, guilty of the crime of Other Deceits defined and penalized
under Art. 318(1) of the Revised Penal Code, the prosecution having proven the guilt of
the accused beyond reasonable doubt and hereby imposes upon him the penalty of
imprisonment from 2 months and 1 day to 4 months of Arresto Mayor and a fine of One
Hundred Eighty Thousand Seven Hundred and Eleven Pesos (P180,711.00) the total
amount of the actual damages caused to private complainant.

As to the civil aspect of this case which have been deemed instituted with this
criminal case, Articles 2201 and 2202 of the Civil Code provides:

Art. 2201. In contracts and quasi-contracts, the damages for

which the obligor who acted in good faith is liable shall be those that
are the natural and probable consequences of the breach of the
obligation, and which the parties have foreseen or could have
reasonably foreseen at the time the obligation was constituted.

In case of fraud, malice or wanton attitude, the obligor shall be

responsible for all damages which may be reasonably attributed to the
non-performance of the obligation.

Art. 2202. In crimes and quasi-delicts, the defendant shall be

liable for all damages which are the natural and probable consequences
of the act or omission complained of. It is not necessary that such
damages have been foreseen or could have reasonably been foreseen
by the defendant.

 
Thus, accused is condemned to pay actual damages in the amount of One
Hundred Eighty Thousand Seven Hundred and Eleven Pesos (Php180,711.00), which
 represents the 20% downpayment and other miscellaneous expenses paid by the
complainant plus the amount of Nineteen Thousand Two Hundred Forty-One
(Php19,241.00) Pesos, representing the 1st installment payment made by the private
complainant to the bank. Accused is, likewise, ordered to pay moral damages in the
amount of One Hundred Thousand Pesos (Php100,000.00) in view of the moral pain
suffered by the complainant; for exemplary damages in the amount of Two Hundred
Thousand Pesos (Php200,000.00) to serve as deterrent for those businessmen similarly
inclined to take undue advantage over the publics innocence. As for attorneys fees, the
reasonable amount of One Hundred Thousand Pesos (Php100,000.00) is hereby
awarded.

SO ORDERED.[31]

The trial court declared that the accused made false pretenses or
misrepresentations that the van was a brand new one when, in fact, it had figured
in an accident in Labo, Daet, Camarines Norte, and sustained serious damages
before it was sold to the private complainant.
 

Guinhawa appealed the decision to the Regional Trial Court (RTC) of Naga
City, Branch 19, in which he alleged that:
 
1. The lower court erred in its finding that the repair works on the left front
portion and underchassis of the van was the result of the accident in Labo, Camarines
Norte, where its driver suffered an attack of hypertension.

2. The lower court erred in its four (4) findings of fact that accused-appellant
made misrepresentation or false pretenses that the van was a brand new car, which
constituted deceit as defined in Article 318, paragraph 1 of the Revised Penal Code.
  

3. The lower court erred in finding accused-appellant civilly liable to

complainant Josephine Silo. But, even if there be such liability, the action therefor has
already prescribed and the amount awarded was exhorbitant, excessive and
unconscionable.[32]

Guinhawa insisted that he never talked to the couple about the sale of the
van; hence, could not have made any false pretense or misrepresentation.
 

On August 1, 2002, the RTC affirmed the appealed judgment.[33]

 

Guinhawa filed a petition for review with the Court of Appeals (CA), where
he averred that:
 
I

THE COURT A QUO ERRED IN CONVICTING PETITIONER OF THE CRIME OF OTHER

DECEITS AND SENTENCING HIM TO SUFFER IMPRISONMENT OF TWO MONTHS AND
ONE DAY TO FOUR MONTHS OF ARRESTO MAYOR AND TO PAY FINE IN THE AMOUNT
OF P180,711.00.

II

THE COURT A QUO ERRED IN ORDERING PETITIONER TO PAY PRIVATE

COMPLAINANT P180,711.00 AS DOWNPAYMENT, P19,241.00 AS FIRST INSTALLMENT
WITH UCPB NAGA, P100,000.00 AS MORAL DAMAGES, P200,000.00 AS EXEMPLARY
DAMAGES AND P100,000.00 AS ATTORNEYS FEES.[34]
 

On January 5, 2004, the CA rendered judgment affirming with modification

the decision of the RTC. The fallo of the decision reads:
 
WHEREFORE, premises considered, the instant petition is hereby partially
granted insofar as the following are concerned: a) the award of moral damages is
hereby REDUCED to P10,000.00 and b) the award of attorneys fees and exemplary
damages are hereby DELETED for lack of factual basis. In all other respects, We affirm
the decision under review.

Costs against petitioner.

SO ORDERED.[35]

The CA ruled that the private complainant had the right to assume that the van
was brand new because Guinhawa held himself out as a dealer of brand new
vans. According to the appellate court, the act of displaying the van in the
showroom without notice to any would-be buyer that it was not a brand new unit
was tantamount to deceit. Thus, in concealing the vans true condition from the
buyer, Guinhawa committed deceit.
 
 The appellate court denied Guinhawas motion for reconsideration,
prompting him to file the present petition for review on certiorari, where he
contends:
 
I

THE COURT A QUO ERRED IN NOT HOLDING THAT THE INFORMATION CHARGED

AGAINST PETITIONER DID NOT INFORM HIM OF A CHARGE OF OTHER DECEITS.

II

THE COURT A QUO ERRED IN HOLDING THAT PETITIONER EMPLOYED FRAUD OR DECEIT

AS DEFINED UNDER ARTICLE 318, REVISED PENAL CODE.

III

THE COURT A QUO ERRED IN NOT CONSIDERING THE CIRCUMSTANCES POINTING TO

THE INNOCENCE OF THE PETITIONER.[36]

The issues for resolution are (1) whether, under the Information, the
petitioner was charged of other deceits under paragraph 1, Article 318 of the
Revised Penal Code; and (2) whether the respondent adduced proof beyond
reasonable doubt of the petitioners guilt for the crime charged.
 
 The petitioner asserts that based on the allegations in the Information, he
was charged with estafa through false pretenses under paragraph 2, Article 315
of the Revised Penal Code. Considering the allegation that the private
complainant was defrauded of P591,000.00, it is the RTC, not the MTC, which has
exclusive jurisdiction over the case. The petitioner maintains that he is not
estopped from assailing this matter because the trial courts lack of jurisdiction can
be assailed at any time, even on appeal, which defect cannot even be cured by
the evidence adduced during the trial. The petitioner further avers that he was
convicted of other deceits under paragraph 1, Article 318 of the Revised Penal
Code, a crime for which he was not charged; hence, he was deprived of his
constitutional right to be informed of the nature of the charge against him. And in
any case, even if he had been charged of other deceits under paragraph 1 of
Article 318, the CA erred in finding him guilty. He insists that the private
complainant merely assumed that the van was brand new, and that he did not
make any misrepresentation to that effect. He avers that deceit cannot be
committed by concealment, the absence of any notice to the public that the van
was not brand new does not amount to deceit. He posits that based on the
principle of caveat emptor, if the private complainant purchased the van without
first inspecting it, she must suffer the consequences. Moreover, he did not attend
to the private complainant when they examined the van; thus, he could not have
deceived them.
 
 The petitioner maintains that, absent evidence of conspiracy, he is not
criminally liable for any representation Azotea may have made to the private
complainant, that the van was brand new. He insists that the respondent was
estopped from adducing evidence that the vehicle was involved in an accident in
Daet, Camarines Norte on March 17, 1995, because such fact was not alleged in
the Information.
 

In its comment on the petition, the Office of the Solicitor General avers
that, as gleaned from the material averments of the Information, the petitioner
was charged with other deceits under paragraph 1, Article 318 of the Revised
Penal Code, a felony within the exclusive jurisdiction of the MTC. The petitioner
was correctly charged and convicted, since he falsely claimed that the vehicle was
brand new when he sold the same to the private complainant. The petitioners
concealment of the fact that the van sustained serious damages as an aftermath
of the accident in Daet, Camarines Norte constituted deceit within the meaning of
paragraph 1 of Article 318.
 

The Information filed against the petitioner reads:

 
That on or about October 11, 1995, in the City of Naga, Philippines, and within
the jurisdiction of this Honorable Court, the said accused, being a motor vehicle dealer
using the trade name of Guinhawa Motor Sales at Panganiban Avenue, Naga City, and
 dealer of brand new cars, by means of false pretenses and fraudulent acts, did then and
there, willfully, unlawfully and feloniously defraud private complainant, JOSEPHINE P.
SILO, as follows: said accused by means of false manifestations and fraudulent
representations, sold to said private complainant, as brand new, an automobile with
trade name L-300 Versa Van colored beige and the latter paid for the same in the
amount of P591,000.00, when, in truth and in fact, the same was not brand new
because it was discovered less than a month after it was sold to said Josephine P. Silo
that said L-300 Versa Van had defects in the underchassis and stepboard and repairs
have already been done thereat even before said sale, as was found upon check-up by
an auto mechanic; that private complainant returned said L-300 Versa Van to the
accused and demanded its replacement with a new one or the return of its purchase
price from said accused but despite follow-up demands no replacement was made nor
was the purchase price returned to private complainant up to the present to her
damage and prejudice in the amount of P591,000.00, Philippine Currency, plus other
damages that may be proven in court.

CONTRARY TO LAW.[37]

Section 6, Rule 110 of the Rules of Criminal Procedure requires that the
Information must allege the acts or omissions complained of as constituting the
offense:
 
SEC. 6. Sufficiency of complaint or information. A complaint or information is
sufficient if it states the name of the accused; the designation of the offense given by
the statute; the acts or omissions complained of as constituting the offense; the name of
the offended party; the approximate date of the commission of the offense; and the
place where the offense was committed.

When an offense is committed by more than one person, all of them shall be
included in the complaint or information.
 

The real nature of the offense charged is to be ascertained by the facts

alleged in the body of the Information and the punishment provided by law, not
by the designation or title or caption given by the Prosecutor in the Information.
[38]
 The Information must allege clearly and accurately the elements of the crime
charged.[39]
 

As can be gleaned from its averments, the Information alleged the essential
elements of the crime under paragraph 1, Article 318 of the Revised Penal Code.
 

The false or fraudulent representation by a seller that what he offers for

sale is brand new (when, in fact, it is not) is one of those deceitful acts envisaged
in paragraph 1, Article 318 of the Revised Penal Code. The provision reads:
 
Art. 318. Other deceits. The penalty of arresto mayor and a fine of not less than
the amount of the damage caused and not more than twice such amount shall be
imposed upon any person who shall defraud or damage another by any other deceit not
mentioned in the preceding articles of this chapter.

This provision was taken from Article 554 of the Spanish Penal Code which
provides:
 
 El que defraudare o perjudicare a otro, usando de cualquier engao que no se halle
expresado en los artculos anteriores de esta seccin, ser castigado con una multa del
tanto al duplo del perjuicio que irrogare; y en caso de reincidencia, con la del duplo y
arresto mayor en su grado medio al mximo.

For one to be liable for other deceits under the law, it is required that the
prosecution must prove the following essential elements: (a) false pretense,
fraudulent act or pretense other than those in the preceding articles; 
(b) such false pretense, fraudulent act or pretense must be made or executed
prior to or simultaneously with the commission of the fraud; and (c) as a result,
the offended party suffered damage or prejudice.[40] It is essential that such false
statement or fraudulent representation constitutes the very cause or the only
motive for the private complainant to part with her property.
 

The provision includes any kind of conceivable deceit other than those
enumerated in Articles 315 to 317 of the Revised Penal Code.[41] It is intended as
the catchall provision for that purpose with its broad scope and intendment.[42]
 

Thus, the petitioners reliance on paragraph 2(a), Article 315 of the Revised
Penal Code is misplaced. The said provision reads:
 
2. By means of any of the following false pretenses or fraudulent acts executed prior to
or simultaneously with the commission of the fraud:
  

(a) By using fictitious name, or falsely pretending to possess power, influence,

qualifications, property, credit, agency, business or imaginary
transactions; or by means of other similar deceits.

The fraudulent representation of the seller, in this case, that the van to be
sold is brand new, is not the deceit contemplated in the law. Under the principle
of ejusdem generis, where a statement ascribes things of a particular class or kind
accompanied by words of a generic character, the generic words will usually be
limited to things of a similar nature with those particularly enumerated unless
there be something in the context to the contrary.[43]
 

Jurisdiction is conferred by the Constitution or by law. It cannot be

conferred by the will of the parties, nor diminished or waived by them. The
jurisdiction of the court is determined by the averments of the complaint or
Information, in relation to the law prevailing at the time of the filing of the
criminal complaint or Information, and the penalty provided by law for the crime
charged at the time of its commission.
 

Section 32 of Batas Pambansa Blg. 129, as amended by Republic Act No.

7691, provides that the MTC has exclusive jurisdiction over offenses punishable
with imprisonment not exceeding six years, irrespective of the amount of the fine:
 
Sec. 32. Jurisdiction of Metropolitan Trial Courts, Municipal Trial Courts and
Municipal Circuit Trial Courts in Criminal Cases. Except in cases falling within the
exclusive original jurisdiction of Regional Trial Courts and of the Sandiganbayan, the
Metropolitan Trial Courts, Municipal Trial Courts, and Municipal Circuit Trial Courts shall
exercise:

(1) Exclusive original jurisdiction over all violations of city or

municipal ordinances committed within their respective territorial
jurisdiction; and

(2) Exclusive original jurisdiction over all offenses punishable

with imprisonment not exceeding six (6) years irrespective of the
amount of fine, and regardless of other imposable accessory or other
penalties, including the civil liability arising from such offenses or
predicated thereon, irrespective of kind, nature, value or amount
thereof: Provided, however, That in offenses involving damage to
property through criminal negligence, they shall have exclusive original
jurisdiction thereof.

Since the felony of other deceits is punishable by arresto mayor, the MTC
had exclusive jurisdiction over the offense lodged against the petitioner.
 

On the merits of the petition, the Court agrees with the petitioners
contention that there is no evidence on record that he made direct and positive
representations or assertions to the private complainant that the van was brand
new. The record shows that the private complainant and her husband Ralph Silo
were, in fact, attended to by Azotea. However, it bears stressing that the
representation may be in the form of words, or conduct resorted to by an
individual to serve as an advantage over another. Indeed, as declared by the CA
based on the evidence on record:
 
Petitioner cannot barefacedly claim that he made no personal representation
that the herein subject van was brand new for the simple reason that nowhere in the
records did he ever refute the allegation in the complaint, which held him out as a
dealer of brand new cars. It has thus become admitted that the petitioner was dealing
with brand new vehicles a fact which, up to now, petitioner has not categorically denied.
Therefore, when private complainant went to petitioners showroom, the former had
every right to assume that she was being sold brand new vehicles there being nothing to
indicate otherwise. But as it turned out, not only did private complainant get a defective
and used van, the vehicle had also earlier figured in a road accident when driven by no
less than petitioners own driver.[44]

Indeed, the petitioner and Azotea obdurately insisted in the trial court that
the van was brand new, and that it had never figured in vehicular accident. This
representation was accentuated by the fact that the petitioner gave the Service
Manual to the private complainant, which manual 
contained the warranty terms and conditions, signifying that the van was brand
new. Believing this good faith, the private complainant decided to purchase the
van for her buy-and-sell and garment business, and even made a downpayment
of the purchase price.
 
 As supported by the evidence on record, the van was defective when the
petitioner sold it to the private complainant. It had ditched onto the shoulder of
the highway in Daet, Camarines Norte on its way from Manila to Naga City. The
van was damaged and had to be repaired; the rod end and bushing had to be
replaced, while the left front stabilizer which gave out a persistent annoying
sound was repaired. Some parts underneath the van were even welded together.
Azotea and the petitioner deliberately concealed these facts from the private
complainant when she bought the van, obviously so as not to derail the sale and
the profit from the transaction.
 

The CA is correct in ruling that fraud or deceit may be committed by

omission. As the Court held in People v. Balasa:[45]
 
Fraud, in its general sense, is deemed to comprise anything calculated to
deceive, including all acts, omissions, and concealment involving a breach of legal or
equitable duty, trust, or confidence justly reposed, resulting in damage to another, or by
which an undue and unconscientious advantage is taken of another. It is a generic term
embracing all multifarious means which human ingenuity can device, and which are
resorted to by one individual to secure an advantage over another by false suggestions
or by suppression of truth and includes all surprise, trick, cunning, dissembling and any
unfair way by which another is cheated. On the other hand, deceit is the false
representation of a matter of fact whether by words or conduct, by false or misleading
allegations, or by concealment of that which should have been disclosed which deceives
or is intended to deceive another so that he shall act upon it to his legal injury.[46]

 
 It is true that mere silence is not in itself concealment. Concealment which
the law denounces as fraudulent implies a purpose or design to hide facts which
the other party sought to know.[47] Failure to reveal a fact which the seller is, in
good faith, bound to disclose may generally be classified as a deceptive act due to
its inherent capacity to deceive.[48] Suppression of a material fact which a party is
bound in good faith to disclose is equivalent to a false representation.
[49]
 Moreover, a representation is not confined to words or positive assertions; it
may consist as well of deeds, acts or artifacts of a nature calculated to mislead
another and thus allow the fraud-feasor to obtain an undue advantage.[50]
 

Fraudulent nondisclosure and fraudulent concealment are of the same

genre. Fraudulent concealment presupposes a duty to disclose the truth and that
disclosure was not made when opportunity to speak and inform was presented,
and that the party to whom the duty of disclosure, as to a material fact was due,
was induced thereby to act to his injury.[51]
 

Article 1389 of the New Civil Code provides that failure to disclose facts
when there is a duty to reveal them constitutes fraud. In a contract of sale, a
buyer and seller do not deal from equal bargaining positions when the latter has
knowledge, a material fact which, if communicated to the buyer, would render
the grounds unacceptable or, at least, substantially less desirable.[52] If, in a
contract of sale, the vendor knowingly allowed the vendee to be deceived as to
the thing sold in a material matter by failing to disclose an intrinsic circumstance
that is vital to the contract, knowing that the vendee is acting upon the
presumption that no such fact exists, deceit is accomplished by the suppression of
the truth.[53]
 

In the present case, the petitioner and Azotea knew that the van had figured in an
accident, was damaged and had to be repaired. Nevertheless, the van was placed
in the showroom, thus making it appear to the public that it was a brand new
unit. The petitioner was mandated to reveal the foregoing facts to the private
complainant. But the petitioner and Azotea even obdurately declared when they
testified in the court a quo that the vehicle did not figure in an accident, nor had it
been repaired; they maintained that the van was brand new, knowing that the
private complainant was going to use it for her garment business. Thus, the
private complainant bought the van, believing it was brand new.
 

Significantly, even when the petitioner was apprised that the private
complainant had discovered the vans defects, the petitioner agreed to replace the
van, but changed his mind and insisted that it must be first sold.
 

The petitioner is not relieved of his criminal liability for deceitful concealment of
material facts, even if the private complainant made a visual inspection of the
vans interior and exterior before she agreed to buy it and 
failed to inspect its under chassis. Case law has it that where the vendee made
only a partial investigation and relies, in part, upon the representation of the
vendee, and is deceived by such representation to his injury, he may maintain an
action for such deceit.[54] The seller cannot be heard to say that the vendee should
not have relied upon the fraudulent concealment; that negligence, on the part of
the vendee, should not be a defense in order to prevent the vendor from
unjustifiably escaping with the fruits of the fraud.
 

In one case,[55] the defendant who repainted an automobile, worked it over to

resemble a new one and delivered it to the plaintiff was found to have warranted
and represented that the automobile being sold was new. This was found to be a
false representation of an existing fact; and, if it was material and induced the
plaintiff to accept something entirely different from that which he had contracted
for, it clearly was a fraud which, upon its discovery and a tender of the property
back to the seller, [it] entitled the plaintiff to rescind the trade and recover the
purchase money.[56]
 

On the petitioners insistence that the private complainant was proscribed from
charging him with estafa based on the principle of caveat emptor, case law has it
that this rule only requires the purchaser to exercise such care and attention as is
usually exercised by ordinarily prudent men in like business affairs, and only
applies to defects which are open and patent to the service of one exercising such
care.[57] In an avuncular case, it was held that:
 
 The rule of caveat emptor, like the rule of sweet charity, has often been invoked to
cover a multitude of sins; but we think its protecting mantle has never been stretched to
this extent. It can only be applied where it is shown or conceded that the parties to the
contract stand on equal footing and have equal knowledge or equal means of
knowledge and there is no relation of trust or confidence between them. But, where
one party undertakes to sell to another property situated at a distance and of which he
has or claims to have personal knowledge and of which the buyer knows nothing except
as he is informed by the seller, the buyer may rightfully rely on the truth of the sellers
representations as to its kind, quality, and value made in the course of negotiation for
the purpose of inducing the purchase. If, in such case, the representations prove to be
false, neither law nor equity will permit the seller to escape responsibility by the plea
that the buyer ought not to have believed him or ought to have applied to other sources
to ascertain the facts. [58]

It bears stressing that Azotea and the petitioner had every opportunity to reveal
to the private complainant that the van was defective. They resolved to maintain
their silence, to the prejudice of the private complainant, who was a garment
merchant and who had no special knowledge of parts of motor vehicles. Based on
the surrounding circumstances, she relied on her belief that the van was brand
new. In fine, she was the innocent victim of the petitioners fraudulent
nondisclosure or concealment.
 

The petitioner cannot pin criminal liability for his fraudulent omission on his
general manager, Azotea. The two are equally liable for their collective fraudulent
silence. Case law has it that wherever the doing of a 
certain act or the transaction of a given affair, or the performance of certain
business is confided to an agent, the authority to so act will, in accordance with a
general rule often referred to, carry with it by implication the authority to do all of
the collateral acts which are the natural and ordinary incidents of the main act or
business authorized.[59]
 

The MTC sentenced the petitioner to suffer imprisonment of from two months
and one day, as minimum, to four months of arresto mayor, as maximum. The CA
affirmed the penalty imposed by the trial court. This is erroneous. Section 2 of Act
4103, as amended, otherwise known as the Indeterminate Sentence Law,
provides that the law will not apply if the maximum term of imprisonment does
not exceed one year:
 
SEC. 2. This Act shall not apply to persons convicted of offenses punished with death
penalty or life-imprisonment; to those convicted of treason, conspiracy or proposal to
commit treason; to those convicted of misprision of treason, rebellion, sedition or
espionage; to those convicted of piracy; to those who are habitual delinquents; to those
who shall have escaped from confinement or evaded sentence; to those who having
been granted conditional pardon by the Chief Executive shall have violated the terms
thereof; to those whose maximum term of imprisonment does not exceed one year, not
to those already sentenced by final judgment at the time of approval of this Act, except
as provided in Section 5 hereof. (As amended by Act No. 4225.)

In this case, the maximum term of imprisonment imposed on the petitioner was
four months and one day of arresto mayor. Hence, the MTC was proscribed from
imposing an indeterminate penalty on the petitioner. An indeterminate penalty
may be imposed if the minimum of the penalty is 
one year or less, and the maximum exceeds one year. For example, the trial court
may impose an indeterminate penalty of six months of arresto mayor, as
minimum, to two years and four months of prision correccional, as maximum,
since the maximum term of imprisonment it imposed exceeds one year. If the trial
court opts to impose a penalty of imprisonment of one year or less, it should not
impose an indeterminate penalty, but a straight penalty of one year or less
instead. Thus, the petitioner may be sentenced to a straight penalty of one year,
or a straight penalty of less than one year, i.e., ten months or eleven months. We
believe that considering the attendant circumstances, a straight penalty of
imprisonment of six months is reasonable.
 

Conformably with Article 39 in relation to paragraph 3, Article 38 of the

Revised Penal Code, the petitioner shall suffer subsidiary imprisonment if he has
no property with which to pay the penalty of fine.
 

IN LIGHT OF ALL THE FOREGOING, the petition is DENIED. The assailed Decision
and Resolution are AFFIRMED WITH MODIFICATION. Considering the surrounding
circumstances of the case, the petitioner is hereby sentenced to suffer a straight
penalty of six (6) months imprisonment. The petitioner shall suffer subsidiary
imprisonment in case of insolvency.
 

Costs against the petitioner.

 

SO ORDERED.
 
 
ROMEO J. CALLEJO, SR.
Associate Justice
 
 
 
 
WE CONCUR:
 
 
 
 
REYNATO S. PUNO
Associate Justice
Chairman
 

 
MA. ALICIA AUSTRIA-MARTINEZ DANTE O. TINGA
Associate Justice Associate Justice
 
 
 
 
MINITA V. CHICO-NAZARIO
Associate Justice
 

 
 

ATTESTATION
 

I attest that the conclusions in the above Decision were reached in consultation
before the case was assigned to the writer of the opinion of the Courts Division.

REYNATO S. PUNO

Associate Justice

Chairman, Second Division

CERTIFICATION
 

Pursuant to Section 13, Article VIII of the Constitution, and the Division
Chairmans Attestation, it is hereby certified that the conclusions in the above
decision were reached in consultation before the case was assigned to the writer
of the opinion of the Courts Division.

 
 

HILARIO G. DAVIDE, JR.

Chief Justice

[1]
 Exhibit B.
[2]
 Exhibit D.
[3]
 TSN, 1 June 2000, pp. 16-17.
[4]
 TSN, 3 August 2000, p. 5.
[5]
 TSN, 6 October 1999, p. 18.
[6]
 Exhibit DD-1.
[7]
 Exhibit FF.
[8]
 Exhibit J.
[9]
 TSN, 6 October 1999, p. 18.
[10]
 TSN, 29 January 1998, pp. 5-7.
[11]
 Exhibit F.
[12]
 Exhibits K to K-1.
[13]
 Exhibit AA.
[14]
 Records, p. 1.
[15]
 TSN, 1 June 2000, p. 6.
[16]
 Exhibit 4-A.
[17]
 TSN, 1 June 2000, p. 19.
[18]
 Id. at 7.
[19]
 Exhibit 4-A.
[20]
 TSN, 1 June 2000, p. 19; Exhibits 4 to 4-C.
[21]
 Exhibit 4.
[22]
 Exhibit 8.
[23]
 Exhibit 11.
[24]
 Exhibits DD and EE.
[25]
 TSN, 23 November 2000, p. 11.
[26]
 TSN, 3 August 2000, pp. 6-7.
[27]
 Id. at 10.
[28]
 Id. at 14.
[29]
 Id. at 13.
[30]
 Id. at 13-14.
[31]
 Records, pp. 641-642.
[32]
 Records, p. 575.
[33]
 Id. at 588-592.
[34]
 Id. at 606.
[35]
 Penned by Associate Justice Andres B. Reyes, Jr., with Associate Justices Buenaventura J. Guerrero and
Regalado E. Maambong, concurring; CA Rollo, p. 100.
[36]
 Rollo, p. 9.
[37]
 Records, p. 1.
[38]
 Buhat v. Court of Appeals, G.R. No. 119601, 17 December 1996, 265 SCRA 701; People v. Escosio, G.R. No.
101742, 25 March 1993, 220 SCRA 475; Buaya v. Polo, G.R. No. 75079, 26 January 1989, 169 SCRA 471.
[39]
 Serapio v. Sandiganbayan, G.R. No. 148769, 28 January 2003, 396 SCRA 443.
[40]
 1. que exista realmente una defraudacion, un perjuicio ejectivo; (2) que este se haya causado mediante engao,
esto es, con el empleo de medios fraudulentos puestos en juego por el estafador para conseguir su mal proposito.
(Viada, CODIGO PENAL, 6th ed., Vol. 6, p. 570)
[41]
 Reyes, The Revised Penal Code, 2001 ed., Vol. II, p. 815.
[42]
 Regalado, CRIMINAL LAW CONSPECTUS, 1st ed., p. 592.
[43]
 Philippine Bank of Communications v. Court of Appeals, G.R. No. 118552, 5 February 1996, 253 SCRA 241.
[44]
 Rollo, p. 34.
[45]
 G.R. No. 106357, 3 September 1998, 295 SCRA 49. (Emphasis supplied)
[46]
 Id. at 71-72.
[47]
 Phillips Petroleum Co. v. Daniel Motors Co., 149 S.W.2d 979 (1941).
[48]
 Testo v. Russ Dunmire Oldsmobile, Inc., 83 A.L.R., 3rd ed., p. 680 (1976); 554 P.2d 349.
[49]
 Tyler v. Savage, 143 U.S. 79, 12 S.Ct. 340, 36 L.Ed. 82.
[50]
 Lindberg Cadillac Company v. Leonard Aron, 371 S.W.2d 651 (1963).
[51]
 Lovell v. Smith, 169 So. 280 (1936).
[52]
 Supra, at note 47.
[53]
 Lindbergh Cadillac Company v. Aron, 371 S.W.2d 651 (1963).
[54]
 Burnett v. Boyer, 285 S.W. 670; Madton v. Norton, 238 N.W. 686.
[55]
 Kraus v. National Bank of Commerce of Mankato, 167 N.W. 353.
[56]
 Snellgrove v. Dingelhoef, 103 S.E. 418 (1920).
[57]
 Judd v. Walker, 89 S.W. 558.
[58]
 Nolan v. Fitzpatrick, et al., 173 N.W. 255 (1919).
[59]
 Park v. Moorman Manufacturing Company, 40 A.L.R. 2d 273 (1952).

SECOND DIVISION
  

ELVIRA LATEO y ELEAZAR, FRANCISCO G.R. No. 161651

ELCA y ARCAS, and BARTOLOME  
BALDEMOR y MADRIGAL, Present:
Petitioners,  

  CARPIO, J.,
  Chairperson,
  NACHURA,
- versus - BERSAMIN,*
  ABAD, and
  DEL CASTILLO,* JJ.
   
PEOPLE OF THE PHILIPPINES, Promulgated:
Respondent.  
  June 8, 2011

x------------------------------------------------------------------------------------x

 
 

DECISION

NACHURA, J.:

 
  

On appeal is the August 7, 2003 Decision[1] of the Court of Appeals (CA) in

CA-G.R. CR No. 23240, which affirmed with modification the March 17, 1998
decision[2] of the Regional Trial Court (RTC) of Pasay City, Branch 109, convicting
Elvira Lateo (Lateo), Francisco Elca (Elca), and Bartolome Baldemor (Baldemor) of
attempted estafa.

On April 28, 1995, Lateo, Elca, and Baldemor (petitioners), along with
Orlando Lalota (Lalota) and Nolasco de Guzman (De Guzman), were charged
with estafa in an information, which reads:

 
That on or about April 27, 1995, in Pasay City, Metro Manila and within the jurisdiction
of this Honorable Court, accused ELVIRA LATEO y ELEAZAR, conspiring and
confederating with FRANCISCO ELCA y ARCAS, BARTOLOME BALDEMOR y MADRIGAL,
ORLANDO LALOTA and NOLASCO DE GUZMAN, and mutually helping one another,
acting in common accord, by means of deceit, that is, by falsely representing themselves
to be the true and [lawful] owner of a piece of land located in the province of Cavite,
and possessing power, influence, qualification, property, credit, agency, business, or
imaginary transactions and by means of other similar deceits, did then and there,
willfully, unlawfully and feloniously induce ELEONOR LUCERO to part with her money in
the amount of TWO MILLION (P2,000,000.00) PESOS, Philippine Currency, as indeed she
parted only with the amount of Two Hundred Thousand (P200,000.00) PESOS, Philippine
Currency, which said accused actually received in marked Philippine Currency, to the
damage and prejudice of said ELEONOR LUCERO in the aforestated amount of Two
Hundred Thousand Pesos (P200,000.00) PESOS Philippine Currency.

CONTRARY TO LAW.[3]

When arraigned on May 31, 1995, petitioners, with the assistance of their
counsel, entered their respective pleas of not guilty. Accused Lalota and De
Guzman remained at large.
  

Trial on the merits then ensued. The prosecutions version of the facts is

summarized by the CA in this wise:

 
Sometime in 1994, [petitioners] Lateo and Elca proposed that [Lucero] finance
the titling of the 122 hectares of land located in Muntinlupa allegedly owned by
[petitioner] Elca as the sole heir of Gregorio Elca. Title to the property had not been
transferred to [petitioner] Elcas name because of a certain discrepancy between the
Deed of Sale and TCT No. 77730. [Petitioner] Elca offered to assign to [Lucero] 70
hectares of said land. She was then introduced to [petitioner] Baldemor, Orlando Lalota
and Nolasco de Guzman.

[Lucero] released to [petitioners] about P4.7 million in staggered amounts. [Petitioner]

Elca told [Lucero] that certain portions of the property will first be put in the name of
[petitioner] Lateo and would later be assigned to her. [Lucero] was given a Deed of Sale
dated March 27, 1987. [Petitioner] Elca likewise executed an irrevocable Special Power
of Attorney in favor of [Lucero].Later, she was presented certified true copies of three
(3) titles, TCT Nos. 195550, 195551 and 195552 issued by the Register of Deeds of
Makati City in the name of [petitioner] Lateo covering approximately twenty-seven (27)
hectares of Plan A-7 of the Mutinlupa Estate, situated in Barrio Magdaong, Poblacion,
Muntinlupa. However, [in] December 1994, when [Lucero] verified with the Registry of
Deeds of Makati, she discovered that the aforesaid titles of the property were actually
registered in the names of Marc Oliver R. Singson, Mary Jeanne S. Go and Feliza C.
Torrigoza.

[Lucero] confronted [petitioners] and demanded from them [the] return of the
money. She was told that they did not have any money to return. They instead offered a
five (5) hectare property identified as Lot 10140 of Plan Sgs 04213-000441 located at
Bacoor, Cavite allegedly owned by [petitioner] Elca. [Petitioner] Elca, however,
demanded an additional P2 million for the transfer of title.

When [Lucero] verified with the Land Management Bureau (LMB), she discovered that
[petitioner] Elca only had a pending application for the sales patent over a four (4)[-
hectare] area of the subject land. These misrepresentations prompted her to file a
complaint with the Task Force Kamagong, PACC, Manila.
  

On April 26, 1995, the task force conducted an entrapment at Furosato

Restaurant. [Petitioners] were apprehended in possession of marked 100-peso bills
amounting to P100,000.00, supposedly in exchange for the Deed of Assignment
prepared by [Lucero] for their transaction.[4]

Petitioners version, on the other hand, is summed up as follows:

 
Sometime in 1994, [Lucero], [petitioner] Lateo, Oscar Lalota met with [petitioner] Elca in
Muntinlupa to discuss the proposal of [Lucero] to finance the titling of [petitioner] Elcas
land.

On June 28, 1994, in a meeting called by [Lucero], she laid down the terms and
conditions regarding her plans to finance the titling of [petitioner] Elcas land. She
proposed that 22 out of the 122 hectares of the land would be given to the old tenants
of the property, the 30 hectares would be titled in the name of [petitioner] Elca as his
retained share and the other 70 hectares would be her profit as financier of the
transaction. [Lucero] would also pay P10.00 for every square meter of the 70 hectares
or a total amount of P7 million. All the expenses for the titling and management of the
land would be deducted from P7 million. The remaining balance would then be given to
[petitioners].

[Lucero] assigned Oscar Lalota to work for the titling of the land and to prepare all
documents necessary thereto. [Petitioner] Baldemor would act as overseer of the
transaction as [Luceros] attorney-in-fact. [Petitioner] Lateo would serve as secretary and
assistant of [Lucero]. [Petitioner] Elca would guard the property to keep off
squatters. He and his wife were instructed to sign all documents prepared by Oscar
Lalota.

In December 1994, [Lucero] told [petitioner] Elca that upon verification from the
Registry of Deeds of Makati City, she found out that all the documents submitted by
Oscar Lalota pertaining to their transaction were falsified. Oscar Lalota disappeared
after getting the money.
  

In order to recover her losses from the anomalous transaction, [Lucero] offered to
purchase [petitioner] Elcas property in Cavite. [Petitioner] Elca agreed to sell 2 hectares
of his property at a price of P100.00 per square meter. [Petitioner] Elca informed
[Lucero] that the land was not yet titled although the documents had already been
completed. [Lucero] agreed to pay in advance the amount of P200,000.00 for the
immediate titling of the land.

On December 21, 1994, however, [Lucero] gave no advance payment. [Petitioner] Elca

was made to return [in] January 1995. On that date still [Lucero] made no payment.

On [April] 25, 1995, [Lucero] promised to give the P200,000.00 advance payment at

Furosato Restaurant [on] Roxas Boulevard, Pasay City. Having failed to contact his
lawyer, on [April] 26, 1995, [petitioner] Elca went alone to Furosato Restaurant. Because
of the absence of [petitioner] Lateo, [Lucero] postponed their meeting to [April] 27,
1995.

When [petitioner] Elca arrived at Furosato Restaurant on [April] 27, 1995, [Lucero] and
her lawyer Atty. Velasquez, [petitioners] Lateo and Baldemor and Atty. Ambrosio were
already there.Atty. Velasquez, upon the order of [Lucero], produced a document
entitled Contract to Sell outlining their agreement over the 2 hectares of land in
Bacoor, Cavite. Atty. Ambrosio examined the contract to find out if it contains the terms
and conditions agreed upon. Attys. Velasquez and Ambrosio made their own
handwritten corrections in the contract including the change of the title from Contract
to Sell to Deed of Assignment, after which, both of them signed the
document. [Petitioner] Elca and [Lucero] signed the document as parties while
[petitioners] Lateo and Baldemor signed as witnesses.

After the signing of the Deed of Assignment, [Lucero] brought out the P200,000.00 as
the promised payment for the land. While [petitioner] Baldemor was counting the
money, Atty. Velasquez and [Lucero] went to the comfort room. Thereafter, several
agents of the PACC approached them. They were arrested and brought to the NBI
Headquarters.[5]

 
After trial, the RTC rendered a decision[6] dated March 17, 1998, viz.:

 
It should be noted that the transaction over the Cavite property was a continuation of
and is somehow related to their first transaction. The same was offered to [Lucero] in
lieu of the Muntinlupa property with Francisco Elca telling [Lucero] just to add another
two million (P2,000,000.00) pesos plus expenses for titling and the property can be
transferred to her.

The second transaction which covers the Bacoor property was again an attempt to
defraud [Lucero] when Francisco Elca again represented himself as the owner of the said
property when in truth and in fact his right was merely derived from his application to
purchase Friar Lands dated June 25, 1992 which at the time of the transaction was still
being protested as shown by the Investigation Report of Rogelio N. Bruno, Special
Investigator II, DENR, Land Management Bureau (Exhibit LLLL) hence accused has no
right and/or authority to deliver or transfer the ownership over said parcel of land to
[Lucero].

In the case of Celino vs. CA 163 SCRA 97, it was held that Estafa under Art. 315 (2) (a) of
the Revised Penal Code is committed by means of using fictitious name or falsely
pretending to possess power, influence, qualifications, property, credit, agency,
business or imaginary transaction or by means of other similar deceits. Further, in the
case of Villaflor vs. CA 192 SCRA 680, the Supreme Court held: what is material is the
fact that appellant was guilty of fraudulent misrepresentation when knowing that the
car was then owned by the Northern Motors, Inc., still he told the private complainant
that the car was actually owned by him for purposes of and at the time he obtained the
loan from the latter. Indubitably, the accused was in bad faith in obtaining the loan
under such circumstance.

The attempt to defraud the complainant did not materialize due to the timely
intervention of the Task Force Kamagong operatives.

Art. 6, par. 3 of the Revised Penal Code provides that there is an attempt when the
offender convinces (sic) the commission of a felony directly by overt acts and does not
perform all the acts of execution which should produce the felony by reason of some
 cause or accident other than his own spontaneous desistance. The entrapment thus
prevented the consummation of the transaction over the Cavite property.

x x x [I]n the case of Koh Tieck Heng vs. People 192 SCRA 533, the Court held
[that] although one of the essential elements of Estafa is damage or prejudice to the
offended party, in the absence of proof thereof, the offender would x x x be guilty of
attempted estafa. Appellant commenced the commission of the crime of estafa but he
failed to perform all the acts of execution which would produce the crime not by reason
of [their] spontaneous desistance but because of his apprehension of the authorities
before they could obtain the amount. Since only the intent to cause damage and not the
damage itself has been shown respondent court correctly convicted appellant of
attempted estafa.

The culpability of x x x the accused is strengthened by the transfer of his rights

over the same subject land in Cavite in favor of Leticia Ramirez (Exhibit NNNN) thus
clearly influencing his intention to defraud herein complainant as the same shows his
lack of intent to transfer his rights and/or ownership to complainant.

The representations made by Francisco Elca that he owns the property in

Bacoor, Cavite, his having offered the same again to the complainant in lieu of the
aborted deal in the Muntinlupa property their constant follow-up of complainants
decision over the matter convincing the complainant to accept the offer and their
persona[l] presence at the place of entrapment and their receipt of the P100,000.00
marked money which they even counted one after the other, thus making all of them
positive of the presence of fluorescent powder. Those among others indicate strongly
that all three accused Francisco Elca, Elvira Lateo and Bartolome Baldemor attempted to
deceive and defraud complainant Eleanor Lucero.[7]

The RTC decreed that:

 
IN VIEW OF ALL THE FOREGOING, the Court finds all accused Francisco Elca,
Elvira Lateo and Bartolome Baldemor guilty beyond reasonable doubt of attempted
 Estafa and is hereby sentenced to imprisonment of Ten (10) years and One (1) Day to
Twelve (12) Years.

SO ORDERED.[8]

Petitioners filed a motion for reconsideration,[9] but the RTC denied it on

December 28, 1998.[10]

Petitioners appealed to the CA, assigning in their brief the following errors
allegedly committed by the trial court:
 

I. That with due respect to the Honorable Court, it is respectfully submitted that it erred
in finding that THEY ARE GUILTY OF THE CRIME OF ATTEMPTED ESTAFA UNDER
ARTICLE 315 PAR. 2(a) OF THE REVISED PENAL CODE.

II. That the basis of the findings of the Honorable Court that they (three accused) are
guilty of attempted estafa is not in accordance with the evidence on record.

III. That the Honorable Court erred in the imposition of the appropriate penalty based
on its findings assuming without admitting that they (three accused) are guilty
of attempted estafa.[11]

The CA was not at all persuaded by petitioners arguments and sustained

petitioners conviction, although with modification as to the penalty imposed. The
decretal portion of the CA Decision reads:

 
WHEREFORE, premises considered, the assailed decision is
hereby AFFIRMED with MODIFICATION as to the penalty imposed. [Petitioners] Elvira E.
 Lateo, Francisco A. Elca and Bartolome M. Baldemor are hereby sentenced to suffer an
indeterminate penalty of six (6) months of arresto mayor as minimum, to four (4) years
and two (2) months of prision correccional, as maximum.

Cost against [petitioners].

SO ORDERED.[12]

Petitioners filed a motion for reconsideration,[13] but their motion also

suffered the same fate, as the CA denied it on January 12, 2004.[14]

Before us, petitioners insist that their conviction lacked factual and legal
basis. They assail the RTC finding, which was sustained by the CA, that the
transaction involving the Bacoor property was again an attempt to defraud
Eleonor Lucero (Lucero). Petitioners deny that they deceived Lucero. They claim
that Lucero was aware that the Bacoor property is not yet titled in the name of
Elca; and that they went to Furosato restaurant upon Luceros invitation and on
Luceros representation that she would hand to them the P200,000.00 needed to
facilitate the issuance of title in Elcas name. Petitioners, therefore, plead for an
acquittal. Finally, petitioners assail the penalty imposed by the CA for being
erroneous.

The Office of the Solicitor General (OSG), on the other hand, asserts that
the CA correctly sustained petitioners conviction for attempted estafa. However,
it recommends for further modification of the penalty to six (6) months of arresto
mayor.

 
 Inarguably, the resolution of the issues raised by petitioners requires us to
inquire into the sufficiency of the evidence presented, including the credibility of
the witnesses, a course of action which this Court will not do, consistent with our
repeated holding that this Court is not a trier of facts. Basic is the rule that factual
findings of trial courts, including their assessment of the witnesses credibility, are
entitled to great weight and respect by this Court, particularly when the CA
affirms the findings.[15]

It is true that the rule admits of several exceptions,[16] but none of the

recognized exceptions is present in the case at bar.

Article 315(2)(a) of the Revised Penal Code lists the ways by

which estafa may be committed, which includes:

Art. 315. Swindling (estafa). x x x.

xxxx

2. By means of any of the following false pretenses or fraudulent acts executed
prior to or simultaneously with the commission of the fraud:

(a) By using fictitious name, or falsely pretending to possess power, influence,

qualifications, property, credit, agency, business or imaginary transactions; or by
means of other similar deceits.

 
The elements of the felony are as follows:
 
1.      That there must be a false pretense, fraudulent act or fraudulent means.
 2.      That such false pretense, fraudulent act or fraudulent means must be made or
executed prior to or simultaneously with the commission of the fraud.

3.      That the offended party must have relied on the false pretense, fraudulent act, or
fraudulent means, that is, he was induced to part with his money or property
because of the false pretense, fraudulent act, or fraudulent means.

4.      That as a result thereof, the offended party suffered damage.[17]

We agree with the finding of the trial court that the transaction involving
the Bacoor property was a continuation of the transaction involving parcels of
land in Muntinlupa, Metro Manila. When Lucero discovered that Elcas certificates
of title over the Muntinlupa property were fake, Elca offered, as substitute, the 5-
hectare portion of his purported 14-hectare lot in Bacoor, Cavite, but asked for an
additional P2,000,000.00, in this wise:

 
Dear Ms. Lucero:

This is with reference to the advances we had obtained from you in the total amount
of P4.7 million, more or less. It was agreed that the said advances shall be due and
demandable upon the release of titles over my parcels of land situated in Muntinlupa,
Metro Manila of which we are presently working out with appropriate government
agencies. Your current demand fro[m] us to pay the aforesaid amount plus your
unilaterally imposed interests is therefore premature and baseless.

However, with regards to your alternative demand that you be given a total of 5
hectares (2 has. upon signing of an agreement assigning my rights and additional 3 has.
upon complete release of the remaining 14 hectares) please be informed that I am now
amenable, provided that an additional P2.0 million will be paid to me to take care of my
other personal commitments. These 5 hectares are situated in Malipay,
Bacoor, Cavite with a portion of Lot 10140 of Plan Sgs-04213-000441-D. I am expecting
the title of said property early next year. The current market [valuation] of real estate
properties in that area is P450.00 per square meter and hence, the property will be
more [than] sufficient to cover our obligates (sic).
  

Please be guided accordingly.

Very truly yours,

(Signed)

Francisco N. Elca

Bo. Katihan, Poblacion

[18]
Muntinlupa, Metro Manila

As it turned out, Elca did not own 14 hectares in Bacoor, Cavite. He merely

had an inchoate right over the Bacoor property, derived from his Application to
Purchase Friar Lands, which covered only 7 hectares.[19] Elcas application was later
amended to cover only 4 hectares, in view of the protest by Alfredo Salenga
(Salenga).[20] Clearly, Elca was in no position to transfer ownership of the 5-
hectare Bacoor property at the time petitioners offered it to Lucero.

In Alcantara v. Court of Appeals,[21] this Court, citing People v. Balasa,

[22]
 explained the meaning of fraud and deceit, viz.:

 
[F]raud in its general sense is deemed to comprise anything calculated to deceive,
including all acts, omissions, and concealment involving a breach of legal or equitable
duty, trust, or confidence justly reposed, resulting in damage to another, or by which an
undue and unconscientious advantage is taken of another. It is a generic term
embracing all multifarious means which human ingenuity can device, and which are
resorted to by one individual to secure an advantage over another by false suggestions
or by suppression of truth and includes all surprise, trick, cunning, dissembling and any
 unfair way by which another is cheated. And deceit is the false representation of a
matter of fact whether by words or conduct, by false or misleading allegations, or by
concealment of that which should have been disclosed which deceives or is intended to
deceive another so that he shall act upon it to his legal injury.

Indubitably, petitioners parody that Elca owned 14 hectares in Bacoor,

Cavite, and was offering a 5-hectare portion of it, in substitution of the
Muntinlupa property, and demanding an additional P2,000,000.00 from Lucero,
constituted fraud and deceit.

To reiterate, it is an oft-repeated principle that the factual findings of the

trial courts, including their assessment of the witness credibility, are entitled to
great weight and respect by this Court, particularly when the CA affirms the
findings.[23] Considering that there is nothing in the records that shows that the
factual findings of the trial court and the appellate court were erroneous, we
affirm their conclusion that petitioners attempted to defraud Lucero again.

Undoubtedly, petitioners commenced the commission of the crime

of estafa but they failed to perform all the acts of execution which would produce
the crime, not by reason of their own spontaneous desistance but because of
their apprehension by the authorities before they could obtain the amount. Since
only the intent to cause damage and not the damage itself had been shown,
[24]
 the RTC and the CA correctly convicted petitioners of attempted estafa.

On the penalty. The RTC sentenced petitioners to an imprisonment term of

ten (10) years and one (1) day to twelve years. The CA modified it to six (6)
months of arresto mayor, as minimum, to four (4) years and two (2) months
of prision correccional, as maximum.
  

Petitioners and the OSG both argue that the penalty imposed by the CA was
wrong, and plead for its modification.

The penalty for estafa depends on the amount defrauded. Thus, if the
crime of estafa had been consummated, Lucero would have been defrauded in
the amount ofP100,000.00.[25] Hence, the applicable penalty under Article 315 of
the Revised Penal Code (RPC) would have been prision correccional in its
maximum period to prision mayor in its minimum period, with an additional one
(1) year for every P10,000.00 in excess of the first P22,000.00; provided, that the
total penalty should not exceed twenty years.

Since what was established was only attempted estafa, then the applicable
penalty would be that which is two degrees lower than that prescribed by law for
the consummated felony pursuant to Article 51,[26] in relation to Article 61(5),[27] of
the RPC. Accordingly, the imposable penalty would be arresto mayor in its
medium period to arresto mayor in its maximum period,[28] or an imprisonment
term ranging from two (2) months and one (1) day to six (6) months. And because
the amount involved exceeded P22,000.00, one (1) year imprisonment for
every P10,000.00 should be added, bringing the total to seven (7) years.

However, we agree with the OSG that it would be inequitable to impose the
additional incremental penalty of 7 years to the maximum period of penalty,
considering that petitioners were charged and convicted merely of attempted and
not consummated estafa. We, therefore, modify the penalty and sentence
petitioners to imprisonment of four (4) months of arresto mayor.

 
WHEREFORE, the petition is DENIED. The assailed Decision and Resolution of the
Court of Appeals in CA-G.R. CR No. 23240 are AFFIRMED. Petitioners Elvira Lateo,
Francisco Elca, and Bartolome Baldemor are found guilty beyond reasonable
doubt of attempted estafa, and are hereby sentenced to suffer the penalty of four
(4) months of arresto mayor.

 
 

SO ORDERED.

ANTONIO EDUARDO B. NACHURA

Associate Justice

WE CONCUR:

ANTONIO T. CARPIO

Associate Justice

Chairperson

 
  

LUCAS P. BERSAMIN ROBERTO A. ABAD

Associate Justice Associate Justice

MARIANO C. DEL CASTILLO

Associate Justice

 
 

ATTESTATION

I attest that the conclusions in the above Decision had been reached in
consultation before the case was assigned to the writer of the opinion of the
Courts Division.

ANTONIO T. CARPIO

Associate Justice

Chairperson, Second Division

 

CERTIFICATION

Pursuant to Section 13, Article VIII of the Constitution and the Division
Chairpersons Attestation, I certify that the conclusions in the above Decision had
been reached in consultation before the case was assigned to the writer of the
opinion of the Courts Division.

RENATO C. CORONA

Chief Justice

 
 
 
 
 
 
 
 
*
 Additional member in lieu of Associate Justice Diosdado M. Peralta, per raffle dated April 5, 2011.
* 
   Additional member in lieu of Associate Justice Jose Catral Mendoza, per raffle dated April 5, 2011.
[1]
 Penned by Associate Justice Juan Q. Enriquez, Jr., with Associate Justices Perlita J. Tria Tirona and Jose Catral
Mendoza (now a member of this Court), concurring; CA rollo, pp. 135-143.
[2]
 Records, Vol. IV, pp. 182-198.
[3]
 Records, Vol. I, pp. 4-5.
[4]
 Supra note 1, at 136-137.
[5]
 Id. at 137-139.
[6]
 Supra note 2.
[7]
 Id. at 196-198.
[8]
 Records, Vol. IV, p. 198.
[9]
 Id. at 209-227.
[10]
 Id. at 255-256.
 
[11]
 CA rollo, pp. 69-79.
[12]
 Supra note 1, at 143.
[13]
 CA rollo, pp. 144-150.
[14]
 Id. at 173.
 
[15]
 Pucay v. People, G.R. No. 167084, October 31, 2006, 506 SCRA 411, 420.
[16]
 (1) When the findings are grounded entirely on speculation, surmises or conjectures; (2) when the inference made
is manifestly mistaken, absurd or impossible; (3) when there is grave abuse of discretion; (4) when the judgment is
based on a misapprehension of facts; (5) when the findings of facts are conflicting; (6) when in making its findings
the Court of Appeals went beyond the issues of the case, or its findings are contrary to the admissions of both the
appellant and the appellee; (7) when the findings are contrary to the trial court; (8) when the findings are conclusions
without citation of specific evidence on which they are based; (9) when the facts set forth in the petition as well as in
the petitioner's main and reply briefs are not disputed by the respondent; (10) when the findings of fact are premised
on the supposed absence of evidence and contradicted by the evidence on record; and (11) when the Court of
Appeals manifestly overlooked certain relevant facts not disputed by the parties, which, if properly considered,
would justify a different conclusion. (Id.)
[17]
 Alcantara v. Court of Appeals, 462 Phil. 72, 88-89 (2003).
[18]
 Exhibit Q; records, Vol. II, p. 176.
[19]
 Exhibit 18; records, Vol. IV, p. 25.
[20]
 See Exhibit LLLL; id. at 343-346.
[21]
 Supra note 17, at 89.
[22]
 G.R. Nos. 106357 & 108601-02, September 3, 1998, 295 SCRA 49.
[23]
 Pucay v. People, supra note 15, at 423.
[24]
 See Koh Tieck Heng v. People, G.R. Nos. 48535-36, December 21, 1990, 192 SCRA 533, 545.
[25]
 See Exhibits VVV-2 to VVV-581; records, Vol. II, pp. 205-322.
[26]
 Art. 51. Penalty to be imposed upon principals of attempted crime. The penalty lower by two degrees than that
prescribed by law for the consummated felony shall be imposed upon the principals in an attempt to commit a
felony.
[27]
 Art. 61. - Rules for graduating penalties.For the purpose of graduating the penalties which, according to the
provisions of Articles 50 to 57, inclusive, of this Code, are to be imposed upon persons guilty as principals of any
frustrated or attempted felony, or as accomplices or accessories, the following rules shall be observed:
xxxx
(5) When the law prescribes a penalty for a crime in some manner not specifically provided for in the four preceding
rules, the courts, proceeding by analogy, shall impose corresponding penalties upon those guilty as principals of the
frustrated felony, or of attempt to commit the same, and upon accomplices and accessories.
[28]
 See Pecho v. Sandiganbayan, G.R. No. 111399, November 14, 1994, 238 SCRA 116, 139.
 

 
 
THIRD DIVISION
 
 
CARMEN RITUALO y RAMOS,   G. R. No. 178337
Petitioner,  
  Present:
   
  YNARES-SANTIAGO, J.,
  CHICO-NAZARIO,
- versus - VELASCO, JR.,
  PERALTA, and
  BERSAMIN,* JJ.
   
   
PEOPLE OF Promulgated:
THE PHILIPPINES,  
Respondent. June 25, 2009
x--------------------------------------------------x
 
 
DECISION
 
 
CHICO-NAZARIO, J.:
 
 
For review is the Decision[1] of the Court of Appeals promulgated on 23
April 2007 in CA-G.R. CR. No. 29393 entitled, People of the Philippines v.
Carmen Ritualo y Ramos, affirming with modification, the Decision[2] dated 1
December 2004 of the Regional Trial Court (RTC), Branch 199, Las Pias City, in
Criminal Cases No. 01-0076 and No. 01-0077.
 
In this Petition for Review on Certiorari under Rule 45 of the Revised Rules
of Court, petitioner Carmen Ritualo y Ramos (petitioner Ritualo) prays for the
reversal of the appellate courts decision affirming with modification the decision of
the trial court finding her guilty beyond reasonable doubt of [committing] the
crimes of x x x Simple Illegal Recruitment [defined and punished] under Section 7
of Republic Act No. 8042, otherwise known as the Migrant Workers Act of 1995,
[3]
 and Estafa.[4]
 This case originated from two Informations, both dated 2 January 2001,
which charged Ritualo with the crimes of Illegal Recruitment defined and
penalized by Republic Act No. 8042; and Estafa under Art. 315, par. 2(a) of the
Revised Penal Code, respectively. The accusatory portion of the first Information
reads as follows:
 
That on or about the 1st day of May, 2000, in the City of Las Pias, Philippines, and
within the jurisdiction of this Honorable Court, the above named accused, falsely
representing herself to have the capacity and power to contract, enlist and recruit
workers for employment abroad, did then and there willfully, unlawfully, and
feloniously collect for a fee, recruit and promise employment/job placement
abroad to Felix Biacora without first securing the required license or authority
from the Department of Labor and Employment.[5]
 
 
The one for Estafa states, viz:
 
That during the periods (sic) from May 1, 2000 to June 1, 2000, in the City
of Las Pias, Philippines, and within the jurisdiction of this Honorable Court, the
above named accused, with intent of gain, by means of false pretenses or
fraudulent acts executed prior to or simultaneously with the commission of the
fraud, did then and there willfully, unlawfully and feloniously defraud
the Complainant Felix Biacora amounting to P80,000.00 committed in the
following manner to wit: that the Accused represented to the Complainant that
she was authorized or licensed by the Department of Labor and Employment to
recruit workers for overseas employment and that she could send Complainant to
work abroad (Australia) as farm worker as soon as possible, knowing very well
that such representation is false and was intended only to get money from the
Complainant and the Complainant after relying from the said representations
made by the accused, handed to the accused the said amount and the accused,
once in possession of the money, misappropriated, misapplied and converted the
same for her personal use and benefit, and not withstanding repeated demands
failed and refused to pay the said amount of P80,000.00 to the damage and
prejudice of the Complainant in the aforementioned amount of P80,000.00.[6]
 
 
The foregoing were docketed as Criminal Cases No. 01-0076 and No. 0077 and
raffled to Branch 275 of the Regional Trial Court (RTC) of Las Pias City.
 
 Upon arraignment on 24 May 2001, petitioner Ritualo, duly assisted by
counsel de oficio, pleaded Not Guilty to the crimes charged.[7]
On 26 May 2003, during the joint trial of the cases, petitioner Ritualo orally
manifested in open court that earnest efforts were being undertaken to settle the
civil aspect thereof. Thus, with the conformity of the accused, herein petitioner
Ritualo, coupled with the latters express waiver apropos the attachment of double
jeopardy, the RTC ordered[8] the provisional dismissal of the two cases.
 
On 13 October 2003, however, the RTC ordered[9] the revival of the cases
upon the motion of the prosecution, on the ground that Ritualo reneged on her
undertaking as embodied in a handwritten note entitled, Kasunduan viz:
 
 
May 26, 2003
 
Kasunduan
Ako si Carmen Ritualo, ay sa araw na ito May 26,
2003, nagbabayad kay Felix Biacora ng halagang Sampunglibong
Piso (P10,000.00) at ang natirang Twenty One Thousand Pesos ay babayaran ko
sa loob ng Tatlong Buwan magmula ngayon.
 
(Sgd.)
Carmen Ritualo
Akusado
Sumang-ayon:
(Sgd.)
Felix Biacora
Complainant[10]
 
 
In the ensuing trial, the prosecution presented two witnesses, namely, Felix
Biacora, the victim;[11] and Belen Blones, employee of the Licensing Branch of the
Philippines Overseas Employment Agency (POEA). Taken altogether, the
evidence of the prosecution established the following facts:
  
In 1993, Felix Biacora went to Saudi Arabia for overseas employment that
was facilitated by one Cynthia Libutan (Libutan) who worked for a recruitment
agency.[12]Several years after his return to the country, Biacora accidentally met
Libutan in Baclaran Church sometime in 2000. After they exchanged pleasantries,
the former signified to the latter his desire to seek another overseas
employment. Libutan then gave Biacora the name, address and contact number of
her friend, one Carmen Ritualo, the petitioner herein, who was able to help
Libutans sister find work in Australia. Biacora thereafter called petitioner Ritualo
to set up a meeting.
 
On 1 May 2000, accompanied by his wife, Biacora went to the house of
petitioner Ritualo and inquired from her whether she could help him secure
overseas employment in Australia. Petitioner Ritualo answered in the affirmative,
and to be convincing, brought out travel documents of several people she was able
to help, who were then supposedly scheduled to leave for abroad pretty soon.
[13]
 Biacora was then assured that:
 
[He could] leave for Australia [in a months time] if [he] will give [petitioner
Ritualo] a total amount of P160,000.00, and [his] salary would be US$700.00 per
month as a farm worker.[14]
 
 
On the above-quoted representation on the same date, Biacora paid
petitioner Ritualo the amount of P40,000.00 as downpayment, with the balance to
be completed before he left for Australia. Upon receipt of the money, petitioner
Ritualo issued Biacora a Cash Voucher[15] as evidence of said payment. To
complete their transaction, Biacora left her a copy of his Bio-data.[16]
 
 On 4 May 2000, Biacora again gave petitioner Ritualo P20,000.00 as
additional payment, making the total amount received by the latter P60,000.00.
Again, petitioner Ritualo issued a Cash Voucher.[17]
 
Subsequently, Biacora was informed by petitioner Ritualo that all he needed
in securing an employment in Australia was his Passport and an endorsement from
the Representative of his district. Accompanied by petitioner Ritualo and one Anita
Seraspe, the assistant[18] of the former, Biacora went to the Batasan Pambansa to
secure the necessary endorsement. Thereafter, all three went to the Australian
Embassy to apply for Biacoras working visa.
 
On 1 June 2000, Biacora went to see petitioner Ritualo to follow up the date
of his departure. Petitioner Ritualo asked from Biacora another P20,000.00 and
told the latter to be patient. As with the other amounts given, proof of
payment[19] was similarly issued to acknowledge receipt thereof.
 
Several dates were set for Biacoras departure, but none pushed through. To
top it all, his Australian Visa application was denied by the Australian
Embassy. Consequently, on 9 September 2000, Biacora demanded from petitioner
Ritualo the return of the P80,000.00. The latter promised to pay back the money
on the 13th of September 2000. None came.
 
Thereafter, Biacora filed the subject criminal complaints against petitioner
Ritualo.
 
In two Certifications dated 23 October 2000[20] and 5 November 2003,
[21]
 respectively, both identified by Belen Blones of the Licensing Division of the
POEA, it was confirmed that per available records of [its] Office, CARMEN
RITUALO, in her personal capacity is not licensed by this Administration to
recruit workers for overseas employment[22]; and that [a]ny recruitment activity
undertaken by [her] is deemed illegal.[23]
 
To rebut the foregoing evidence presented by the prosecution, the defense
presented a diametrically opposed version of the facts of the present case through
the sole testimony of Ritualo.
 
In her testimony, Ritualo narrated that it was Libutan and Biacora who asked
her to introduce them to a certain Anita Seraspe, the person responsible for sending
petitioner Ritualos own sister to Australia;[24] that she had no agreement with
Biacora respecting the latters employment in Australia; that any talk of money was
made among Libutan, Biacora and Seraspe only; that she received a total
of P80,000.00 from Biacora, but that the same was merely entrusted to her because
Libutan and Biacora had just met Seraspe,[25] and that she turned over all the
payments to Seraspe who acknowledged receipt of the same by writing on pieces
of paper said acceptance; that she accompanied Biacora to Batasan Pambansa at
his request; that she did not earn any money out of her referral and introduction of
Libutan and Biacora to Seraspe; that even if she did not earn any money out of the
subject transaction, she returned P10,000.00 and P31,000.00, or a total
of P41,000.00, to Biacora out of fear that the latter would file charges against her;
that she tried to find Seraspe, but the latter could not be found at her last known
address; and that she gave Biacora an additional P6,000.000 to obviate any more
scandal befalling her family.[26]
 
 On 1 December 2004, after trial, the RTC found the evidence presented by
the prosecution to be more credible and logical than that presented by the defense
and thus, convicted Ritualo for the crimes of Simple Illegal Recruitment and
Estafa, defined and penalized under the Migrant Workers and Overseas Filipino
Act of 1995 and the Revised Penal Code, respectively. The dispositive portion of
the trial courts judgment stated:
 
WHEREFORE, in view of the foregoing, the Court finds accused
CARMEN RITUALO y RAMOS, GUILTY beyond reasonable doubt of the
crimes of:
 
1. Simple Illegal Recruitment (Criminal Case Number 01-0076) under
Section 7 of Republic Act No. 8042 otherwise known as the
Migrant Workers Act of 1995, and sentences her to suffer an
Indeterminate penalty of imprisonment of Six (6) years and ONE
(1) day, as minimum, to EIGHT (8) years, as maximum, and to pay
a fine of P200,000.00.
 
2. In Criminal Case Number 01-0077 for Estafa, herein accused is hereby
sentenced to suffer an indeterminate penalty of prison term of six
(6) months and One (1) day of Prission (sic) Correctional (sic), as
minimum, to seven (7) years, eleven (11) months and eleven (11)
days of Prision Mayor, as maximum and is ORDERED to
indemnify Felix Biacora actual damages in the amount
of P66,000.00 which is minus the amount of P14,000.00 which the
private complainant admitted to have been refunded to him.
 
Cost de oficio.[27]
 
 
Ritualos Motion for Reconsideration of the trial courts decision was
subsequently denied in an Order[28] dated 21 January 2005.
 
In an Order[29] dated 1 March 2005, the RTC granted and approved the
Notice of Appeal[30] filed by Ritualo.
 
The Court of Appeals, in its Decision promulgated on 23 April 2007,
affirmed the judgment of the RTC insofar as the conviction of Ritualo was
concerned. As reasoned by the Court of Appeals, [a]s against the positive and
categorical testimony of the [Biacora], [Ritualos] denials cannot prevail.
[31]
 Particularly, the appellate court held that Ritualos acts of promising and
assuring employment overseas to [Biacora] [fell] squarely within the ambit of
recruitment and placement as defined by [The Migrant Workers Act or Republic
Act No. 8042].[32] With respect to the charge of Estafa under the Revised Penal
Code, the appellate court likewise found that all the elements of said crime existed
in the case at bar, i.e., [Ritualo] misrepresented herself to the [Biacora] as the
person who could send him to Australia for employment, and by reason of
misrepresentations, false assurances and deceit, [Biacora] was induced to part with
his money in payment of placement fees, thereby causing him damage and
prejudice.[33]
 
The penalties imposed on Ritualo by the trial court, however, were modified
by the Court of Appeals on the ground that the latter erred in imposing in the
Illegal Recruitment case, an indeterminate sentence ranging from six (6) years and
one (1) day, as minimum, to eight (8) years, as maximum, and to pay a fine
of P200,000.00,[34] in view of the penalty prescribed under Sec. 7 of Republic Act
No. 8042; and, in the Estafa case, another indeterminate sentence ranging from six
(6) months and one (1) day of prision correcional, as minimum, to seven (7) years,
eleven (11) months and eleven (11) days of prision mayor, as maximum, contrary
to the wordings of Art. 315 of the Revised Penal Code.
 
The fallo of the Court of Appeals decision is restated:
 
UPON THE VIEW WE TAKE OF THESE CASES, THUS, the appealed
decision finding the accused-appellant Carmen Ritualo y Ramos guilty beyond
reasonable doubt of Simple Illegal Recruitment and Estafa is AFFIRMED, with
the following MODIFICATIONS
1. In Criminal Case No. 01-0076 (Simple Illegal Recruitment), the
accused-appellant is sentenced to suffer the penalty of
imprisonment of twelve (12) years and to pay a fine
of P500,000.00.
 
2. In Criminal Case No. 01-0077 (Estafa), the accused-appellant is
sentenced to an indeterminate prison term of four (4) years and two
(2) months of prision correctional (sic), as minimum, to twelve
(12) years of prision mayor, as maximum, and to indemnify the
private complainant Felix Biacora the sum of P66,000.00 with the
interest thereon at the legal rate from September 21, 2000 until the
same is fully paid.
 
Costs shall also be taxed against the accused-appellant.[35]
 
  
Hence, Ritualo filed the instant petition for review.
 
In this petition, Ritualo prayed for the reversal of the decision of the RTC, as
affirmed with modification by the Court of Appeals, on the basis of the following
assignment of errors:
 
I.
 
WHETHER THE HONORABLE COURT OF APPEALS ERRED IN
AFFIRMING WITH MODIFICATION THE DECISION OF THE REGIONAL
TRIAL COURT DESPITE THE FACT THAT THE EVIDENCE ON RECORD
COULD NOT SUPPORT A CONVICTION; and
 
II.
 
ASSUMING ARGUENDO THAT THE PETITIONER IS CULPABLE, THE
HONORABLE COURT OF APPEALS ERRED IN MODIFYING THE
DECISION OF THE REGIONAL TRIAL COURT AS REGARDS THE TERM
OF SENTENCE IN THE ILLEGAL RECRUITMENT CASE.[36]
 
 
Essentially, she argues that there was no proof beyond reasonable doubt that
x x x [she] gave Biacora a distinct impression that she had the power or ability to
send him abroad for work such that the latter was convinced to part with his
money.[37] Petitioner Ritualo maintains that Biacora transacted with Seraspe and
not with her. Assuming for the sake of argument that she and Biacora had any
agreement with each other, petitioner Ritualo insisted that it was merely to
facilitate the latters application for an Australian Visa. Particularly, she pointed out
that the prosecution failed to present other witnesses who could have corroborated
the claim of Biacora that she (Ritualo) promised him employment abroad. Anent
the penalty imposed by the courts, petitioner disputed the appellate courts
reasoning and claimed that the same was improper in view of the ruling of this
Court in People v. Gallardo,[38] in which therein respondent was also convicted of
Simple Illegal Recruitment.
The Office of the Solicitor General, for the People of the Philippines, on the
other hand, asserted that the findings of the Court of Appeals were supported by
the records of the case, i.e., Biacora was consistent in his testimony that it was
petitioner who illegally recruited him for work as a farmhand in Australia. Thus,
[a]s against the positive and categorical testimony of the private complainant
(Biacora), petitioners denial cannot prevail.
 
We find no merit in the petition.
 
Having weighed the evidence for the contending parties, there is no cogent
reason to reverse the findings and conclusion of the RTC as affirmed by the Court
of Appeals.
 
The crime of Simple Illegal Recruitment is defined and penalized under Sec.
6 of Republic Act. No. 8042, which reads:
SEC. 6. Definition. - For purposes of this Act, illegal recruitment shall
mean any act of canvassing, enlisting, contracting, transporting, utilizing, hiring,
or procuring workers and includes referring, contract services, promising or
advertising for employment abroad, whether for profit or not, when undertaken by
a non-licensee or non-holder of authority contemplated under Article 13(f)
of Presidential Decree No. 442, as amended, otherwise known as the Labor Code
of the Philippines: Provided, That any such non-licensee or non-holder who, in
any manner, offers or promises for a fee employment abroad to two or more
persons shall be deemed so engaged. It shall likewise include the following acts,
whether committed by any person, whether a non-licensee, non-holder, licensee
or holder of authority:
 
(a) To charge or accept directly or indirectly any amount greater than that
specified in the schedule of allowable fees prescribed by the Secretary of Labor
and Employment, or to make a worker pay any amount greater than that actually
received by him as a loan or advance;
 
(b) To furnish or publish any false notice or information or document in
relation to recruitment or employment;
 
(c) To give any false notice, testimony, information or document or
commit any act of misrepresentation for the purpose of securing a license or
authority under the Labor Code;
 
(d) To induce or attempt to induce a worker already employed to quit his
employment in order to offer him another unless the transfer is designed to
liberate a worker from oppressive terms and conditions of employment;
 
(e) To influence or attempt to influence any person or entity not to employ any
worker who has not applied for employment through his agency;
 
(f) To engage in the recruitment or placement of workers in jobs harmful to public
health or morality or to the dignity of the Republic of the Philippines;
 
(g) To obstruct or attempt to obstruct inspection by the Secretary of Labor and
Employment or by his duly authorized representative;

(h) To fail to submit reports on the status of employment, placement vacancies,

remittance of foreign exchange earnings, separation from jobs, departures and
such other matters or information as may be required by the Secretary of Labor
and Employment;
(i) To substitute or alter to the prejudice of the worker, employment contracts
approved and verified by the Department of Labor and Employment from the time
of actual signing thereof by the parties up to and including the period of the
expiration of the same without the approval of the Department of Labor and
Employment;
 
(j) For an officer or agent of a recruitment or placement agency to become an
officer or member of the Board of any corporation engaged in travel agency or to
be engaged directly or indirectly in the management of a travel agency;
 
(k) To withhold or deny travel documents from applicant workers before
departure for monetary or financial considerations other than those authorized
under the Labor Code and its implementing rules and regulations;
 
(l) Failure to actually deploy without valid reason as determined by the
Department of Labor and Employment ; and
 
(m) Failure to reimburse expenses incurred by the worker in connection with his
documentation and processing for purposes of deployment, in cases where the
deployment does not actually take place without the worker's fault. Illegal
recruitment when committed by a syndicate or in large scale shall be considered
an offense involving economic sabotage.
 
Illegal recruitment is deemed committed by a syndicate if carried out by a
group of three (3) or more persons conspiring or confederating with one another.
It is deemed committed in large scale if committed against three (3) or more
persons individually or as a group.
 
The persons criminally liable for the above offenses are the principals,
accomplices and accessories. In case of juridical persons, the officers having
control, management or direction of their business shall be liable.
 
Art. 315, par. 2(a) of the Revised Penal Code, on the other hand, enumerates one of
the modes of committing estafa, thus:
 
xxxx
 
2. By means of any of the following false pretenses or fraudulent acts
executed prior to or simultaneously with the commission of the fraud:

  (a) By using fictitious name, or falsely pretending to possess power, influence,

qualifications, property, credit, agency, business or imaginary transactions, or by
means of other similar deceits.
 
Illegal recruitment is committed when two essential elements concur:
 
(1) that the offender has no valid license or authority required by law to
enable him to lawfully engage in the recruitment and placement of workers, and
 
(2) that the offender undertakes any activity within the meaning of
recruitment and placement defined under Article 13(b), or any prohibited
practices enumerated under Article 34 of the Labor Code.[39]
 
 
Article 13(b) of the Labor Code defines recruitment and placement as:
 
Any act of canvassing, enlisting, contracting, transporting, utilizing,
hiring, or procuring workers, and includes referrals, contract
services, promising or advertising for employment, locally or abroad, whether for
profit or not: Provided, that any person or entity which, in any manner, offers or
promises for a fee employment to two or more persons shall be deemed engaged
in recruitment and placement. (Emphasis supplied.)
 
 
In this case, the first element is, indeed, present. The prosecution
established, through Belen Blones of the Licensing Branch of the POEA, who
identified and confirmed the two Certifications issued by the POEA Licensing
Branch, that per available records of [its] Office, CARMEN RITUALO, in her
personal capacity is not licensed by this Administration to recruit workers for
overseas employment.[40]
 
 As to the second element, it must be shown that the accused gave the private
complainant the distinct impression that he/she had the power or ability to send the
private complainant abroad for work, such that the latter was convinced to part
with his/her money in order to be employed.[41] Thus, to be engaged in illegal
recruitment, it is plain that there must at least be a promise or an offer of
employment from the person posing as a recruiter whether locally or abroad.[42] In
the case at bar, the second element is similarly present. As testified to by Biacora,
petitioner Ritualo professed to have the ability to send him overseas to be
employed as a farm worker in Australia with a monthly salary of US$700.00. [43] To
further wet Biacoras appetite, petitioner Ritualo even showed him purported travel
documents of other people about to depart, whose overseas employment she
supposedly facilitated. That petitioner Ritualo personally assisted Biacora in the
completion of the alleged requirements, i.e., securing a Letter of Request and
Guarantee from the Representative of his Congressional District in Batangas to
ensure the approval of Biacoras application for an Australian Visa, even
accompanying Biacora to the Australian Embassy, all clearly point to her efforts to
convince Biacora that she (petitioner Ritualo) had, indeed, the ability and influence
to make Biacoras dream of overseas employment come true.
 
The claim of petitioner Ritualo that it was Anita Seraspe who was really the
recruiter and the one who profited from the subject illegal transaction holds no
water. Petitioner Ritualos act of receiving payment from Biacora and issuing
personal receipts therefor; of personally assisting Biacora to complete the
necessary documents; of failing to present evidence to corroborate her testimony
despite several opportunities given her by the trial court; of petitioner Ritualo
having been positively identified as the person who transacted with Biacora and
promised the latter an overseas employment and who personally received money
from Biacora, all unhesitatingly point to petitioner Ritualo as the culprit.
 
The following oral and documentary evidence are worth reproducing:
 
COURT:
 
 Q: How many times did you receive money from private complainant?
 
WITNESS:
 
Three (3) times, Your Honor.
 
Q: The first time?
 
A: My first time is Php40,000.00, Your Honor.
 
Q: The second time?
 
A: Php20,000.00, Your Honor.
 
Q: Third time?
 
A: Php20,000.00, Your Honor.
 
Q: When you received these amounts of money, who issued the private
complainant a receipt?
 
A: I was the one, Your Honor.[44]
 
 
The first Cash Voucher issued by petitioner Ritualo declares:
 
CASH VOUCHER
 
5-1-2000
 
Payment for document Australia fourty (sic) thousand (sic) pesos (sic)
only (P40,000.00)
 
 
RECEIVED from Felix Evangelista Biacora the amount
of PESOS fourty thousand pesos (P40,000.00) in full
payment of amount described above.
 
By: (Sgd.) Carmen Ritualo[45]
 
 
The second, on 4 May 2000, states:
 
CASH VOUCHER
 
 5-4-2000
 
Payment for document Australia twenty (sic) thousand (sic) pesos (sic)
only (P20,000.00)
 
 
RECEIVED from Felix Biacora the amount
of PESOS twenty thousand (P20,000.00) in full payment of
amount described above.
 
By: (Sgd.) Carmen Ritualo[46]
 
 
And the third receipt reads:
 
RECEIPT
 
No. _____________ Date: 6-1-2000
 
RECEIVED from Felix Biacora the sum of Pesos Twenty
thousand (P20,000.00) as payment for for Visa.
 
Partial _______ Cash _____√_____
Balance ______ Check No. _______
(Sgd.) Carmen Ritualo
Authorized Signature[47]
 
 
Petitioner Ritualo next tried to impress upon this Court that she received
nary a centavo from the subject illegal transaction; therefore, she should not be
held liable.
 
We reject this outright. In the first place, it has been abundantly shown that
she really received the monies from Biacora. Secondly, even without consideration
for her services, she still engaged in recruitment activities, since it was
satisfactorily shown that she promised overseas employment to Biacora. And,
more importantly, Sec. 6 of Republic Act No. 8042 does not require that the illegal
recruitment be done for profit.
 
 Petitioner Ritualo boldly but vainly tried to inject reasonable doubt by
complaining that the RTC and the Court of Appeals affirmed her conviction
despite failure of the prosecution to present other vital witness, i.e., Biacoras wife,
who accompanied her husband to the house of petitioner Ritualo and, hence,
witnessed what happened on the first meeting between the latter and Biacora. Non-
presentation of said witness, according to petitioner Ritualo, raises the presumption
that her testimony, if presented, would be adverse to the prosecution.
 
The prosecution is entitled to conduct its own case and to decide what witnesses to
call to support its charges.[48] The defense posture that the non-presentation of the
wife of Biacora constitutes suppression of evidence favorable to petitioner Ritualo
is fallacious. In fact, the same line of reasoning can be used against petitioner
Ritualo. If the defense felt that the testimony of Biacoras wife would support her
defense, what she could and should have done was to call her (Biacoras wife) to
the stand as her own witness. One of the constitutional rights of the accused is "to
have compulsory process to secure the attendance of witnesses and the production
of evidence in his behalf." And, in the same vein, since petitioner Ritualo is setting
the cloak of liability on Seraspes shoulder, she (petitioner Ritualo) could and
should have had the former subpoenaed as well.
 
As held by this Court, the adverse presumption of suppression of evidence
does not, moreover, apply where the evidence suppressed is merely corroborative
or cumulative in nature.[49] If presented, Biacoras wife would merely corroborate
Biacoras account which, by itself, already detailed what occurred on the day of the
parties first meeting at the house of petitioner Ritualo. Hence, the prosecution
committed no fatal error in dispensing with the testimony of Biacoras wife.
Finally, Biacora, the private complainant in this case, did not harbor any ill
motive to testify falsely against petitioner Ritualo. The latter failed to show any
animosity or ill feeling on the part of Biacora that could have motivated him to
falsely accuse her of the crimes charged. It would be against human nature and
experience for strangers to conspire and accuse another stranger of a most serious
crime just to mollify their hurt feelings.[50]
  
The totality of the evidence in the case at bar, when scrutinized and taken
together, leads to no other conclusion than that petitioner Ritualo engaged in
recruiting and promising overseas employment to Felix Biacora under the above-
quoted Sec. 6 of Republic Act No. 8042 vis--vis Article 13(b) of the Labor
Code. Hence, she cannot now feign ignorance of the consequences of her unlawful
acts.
 
As to the sentence imposed upon petitioner Ritualo for the crime of simple
illegal recruitment, this Court clarifies that the penalty imposed by the Court of
Appeals a sentence of 12 years imprisonment and a fine of P500,000.00 - is partly
incorrect, as petitioner Ritualo is a non-licensee.[51] Under Sec. 7(a) of Republic
Act No. 8042, simple illegal recruitment is punishable by imprisonment of not less
than six (6) years and one (1) day but not more than twelve (12) years and a fine of
not less than Two Hundred Thousand Pesos (P200,000.00) nor more than Five
Hundred Thousand Pesos (P500,000.00). Applying the provisions of Section 1 of
the Indeterminate Sentence law, however, the correct penalty that should have been
imposed upon petitioner Ritualo is imprisonment for the period of eight (8) years
and one (1) day, as minimum, to twelve (12) years, as maximum.[52] The imposition
of a fine of P500,000.00 is also in order.
 
With respect to the criminal charge of estafa, this Court likewise affirms the
conviction of petitioner Ritualo for said crime. The same evidence proving
petitioner Ritualos criminal liability for illegal recruitment also established her
liability for estafa. It is settled that a person may be charged and convicted
separately of illegal recruitment under Republic Act No. 8042 in relation to the
Labor Code, and estafa under Art. 315, paragraph 2(a) of the Revised Penal
Code. As this Court held in People v. Yabut[53]:
 
In this jurisdiction, it is settled that a person who commits illegal
recruitment may be charged and convicted separately of illegal recruitment under
the Labor Code and estafa under par. 2(a) of Art. 315 of the Revised Penal Code.
The offense of illegal recruitment is malum prohibitum where the criminal intent
of the accused is not necessary for conviction, while estafa is malum in se where
 the criminal intent of the accused is crucial for conviction. Conviction for
offenses under the Labor Code does not bar conviction for offenses punishable by
other laws. Conversely, conviction for estafa under par. 2(a) of Art. 315 of the
Revised Penal Code does not bar a conviction for illegal recruitment under the
Labor Code. It follows that ones acquittal of the crime of estafa will not
necessarily result in his acquittal of the crime of illegal recruitment in large scale,
and vice versa.
 
 
The prosecution has proven beyond reasonable doubt that petitioner Ritualo
was similarly guilty of estafa under Art. 315 (2)(a) of the Revised Penal Code
committed --
 
By means of any of the following false pretenses or fraudulent acts
executed prior to or simultaneously with the commission of the fraud:
 
(a) By using fictitious name, or falsely pretending to possess power,
influence, qualifications, property, credit, agency, business or imaginary
transactions, or by means of other similar deceits.
 
 
Both elements of the crime were established in this case, namely, (a)
petitioner Ritualo defrauded complainant by abuse of confidence or by means of
deceit; and (b) complainant Biacora suffered damage or prejudice capable of
pecuniary estimation as a result.[54] Biacora parted with his money upon the
prodding and enticement of petitioner Ritualo on the false pretense that she had the
capacity to deploy him for employment in Australia. In the end, Biacora was
neither able to leave for work overseas nor did he get his money back, thus causing
him damage and prejudice. Hence, the conviction of petitioner Ritualo of the crime
of estafa should be upheld.
 
While this Court affirms the conviction of the petitioner Ritualo for estafa,
we find, however, that both the trial court and the appellate court erroneously
computed the penalty of the crime. The amount of which the private complainant,
Biacora, was defrauded was Eighty Thousand Pesos (P80,000.00) and not merely
Sixty Six Thousand Pesos (P66,000.00).
 
 Under the Revised Penal Code, an accused found guilty of estafa shall be
sentenced to:
 
Art. 315. Swindling (estafa). Any person who shall defraud another by any
of the means mentioned herein below shall be punished by:
 
1st. The penalty of prision correccional in its maximum period to prision
mayor in its minimum period, if the amount of the fraud is over 12,000 pesos but
does not exceed 22,000 pesos, and if such amount exceeds the latter sum, the
penalty provided in this paragraph shall be imposed in its maximum period,
adding one year for each additional 10,000 pesos; but the total penalty which may
be imposed shall not exceed twenty years. In such cases, and in connection with
the accessory penalties which may be imposed under the provisions of this Code,
the penalty shall be termed prision mayor or reclusion temporal, as the case may
be.
 
2nd. The penalty of prision correccional in its minimum and medium
periods, if the amount of the fraud is over 6,000 pesos but does not exceed 12,000
pesos;
 
3rd. The penalty of arresto mayor in its maximum period to prision
correccional in its minimum period if such amount is over 200 pesos but does not
exceed 6,000 pesos; and
 
4th. By arresto mayor in its maximum period, if such amount does not
exceed 200 pesos, x x x.
 
 
Computing the penalty for the crime of Estafa based on the above-quoted
provision, the proper penalty to be imposed upon petitioner Ritualo is the
maximum term of prision correccional maximum to prision mayor minimum as
mandated by Article 315 of the Revised Penal Code. But considering that the
amount defrauded exceeded Twenty-Two Thousand Pesos (P22,000.00), per the
same provision, the prescribed penalty is not only imposed in its maximum period,
but there is imposed an incremental penalty of one (1) year imprisonment for every
Ten Thousand Pesos (P10,000.00) in excess of the cap of Twenty-Two Thousand
Pesos (P22,000.00).[55] As this Court held in People v. Gabres,[56] [t]he fact that the
amounts involved in the instant case exceed P22,000.00 should not be considered
in the initial determination of the indeterminate penalty; instead, the matter should
be so taken as analogous to modifying circumstances in the imposition of the
maximum term of the full indeterminate sentence.[57] And with respect to the
computation of the minimum term of the indeterminate sentence, in this case,
given that the penalty prescribed by law for the estafa charge against petitioner
Ritualo is prision correccional maximum to prision mayor minimum, the penalty
next lower would then be prision correccional minimum to medium per Art. 64 in
relation to Art. 65, both of the Revised Penal Code.
 
Preceding from the above discussion, thus, the prison term to be imposed
upon petitioner Ritualo vis--vis the crime of Estafa is as follows: the minimum
term should be anywhere within six (6) months and one (1) day to four (4) years
and two (2) months of prision correccional; while the maximum term of the
indeterminate sentence should be within the range of six (6) years, eight (8)
months and twenty-one (21) days to eight (8) years of prision mayor considering
that the amount involved exceeds P22,000.00, plus an added five (5) years, as there
are five (5) increments of P10,000.00 over the cap of P22,000.00.[58]
 
Lastly, regarding the award of indemnity due from petitioner Ritualo, both
the RTC and Court of Appeals ordered her to pay Biacora the amount of Sixty-Six
Thousand Pesos (P66,000.00), instead of the original amount defrauded, which is
Eighty Thousand Pesos (P80,000.00), in view of petitioner Ritualos payment of
Fourteen Thousand Pesos (P14,000.00). A thorough scrutiny of the record of the
case, however, yields the finding that as of the date of revival of the case before the
RTC, or on 13 October 2003, only the amount of Twenty-One Thousand Pesos
(P21,000.00) remains unpaid. The Motion to Revive Case dated 2 October
2003 filed by the prosecution attached the letter-request of private complainant
Biacora, elucidating thus:
 
I, MR. FELIX BIACORA, complainant against MRS. CARMEN
RITUALO with Case No. 01-0076-77. This case is temporary (sic) dismissed
on May 26, 2003 in Branch 1999 (sic).
 
On May 26, 2003 MRS. CARMEN RITUALO made written promise that
she will pay the balance amounting P21,000.00 Twenty Thousand Pesos after 3
months but she failed.
 
 Due that (sic) her promise did not materialized (sic), I personally request
the Hon. Court to REVIVE this case.
 
 
Respectfully yours,
 
(Sgd.) MR. FELIX BIACORA
 
 
With the foregoing submission of Biacora, out of the amount of Eighty
Thousand Pesos (P80,000.00), only Twenty-One Thousand Pesos (P21,000.00)
remains unpaid. Accordingly, the civil liability of petitioner Ritualo is now merely
Twenty-One Thousand Pesos (P21,000.00).
 
WHEREFORE, in view of the foregoing, the Decision of the Court of
Appeals in CA-G.R. CR No. 29393 promulgated on 23 April
2007 is AFFIRMED with the following MODIFICATIONS:
 
(1) In Criminal Case No. 01-0076, petitioner Carmen Ritualo is
found GUILTY beyond reasonable doubt of the crime of Simple Illegal
Recruitment, and is sentenced to suffer an indeterminate prison term of eight (8)
years and one (1) day as minimum, to twelve (12) years, as maximum, and to pay a
fine of P500,000.00; and
 
(2) In Criminal Case No. 01-0077, petitioner Carmen Ritualo is also
found GUILTY beyond reasonable doubt of the crime of Estafa and sentenced to
suffer an indeterminate prison term of four (4) years and two (2) months of prision
correccional, as minimum, to eleven (11) years and eight (8) months and twenty-
one (21) days of prision mayor, as maximum.
 
Petitioner Carmen R. Ritualo is similarly ORDERED to indemnify Felix E.
Biacora the amount of P21,000.00. Costs de oficio.
 
 
SO ORDERED.
  
 
 
 
  MINITA V. CHICO-NAZARIO
Associate Justice
 
 
 
WE CONCUR:
 
 
 
CONSUELO YNARES-SANTIAGO
Associate Justice
Chairperson
 
 
 
PRESBITERO J. VELASCO, JR. DIOSDADO M. PERALTA
Associate Justice Associate Justice
   
   
   
 
LUCAS P. BERSAMIN
Associate Justice
 
 
 
ATTESTATION
 
I attest that the conclusions in the above Decision were reached in consultation
before the case was assigned to the writer of the opinion of the Courts Division.
 
 
 
CONSUELO YNARES-SANTIAGO
Associate Justice
Chairperson, Third Division
  
 
 
CERTIFICATION
 
Pursuant to Section 13, Article VIII of the Constitution, and the Division
Chairpersons Attestation, it is hereby certified that the conclusions in the above
Decision were reached in consultation before the case was assigned to the writer of
the opinion of the Courts Division.
 
 
 
REYNATO S. PUNO
Chief Justice
 
 
 
 

*
 Associate Justice Lucas P. Bersamin was designated to sit as additional member replacing Associate Justice
Antonio Eduardo B. Nachura per Raffle dated 22 June 2009.
[1]
 Penned by Court of Appeals Associate Justice Renato C. Dacudao with Associate Justices Noel G. Tijam and
Sesinando E. Villon, concurring; rollo, pp. 95-115.
[2]
 Penned by Hon. Joselito J. Vibandor, Presiding Judge, RTC Branch 199, Las Pias City; id. at 58-70.
[3]
 Records, p. 269.
[4]
 Id.
[5]
 Id. at 1.
[6]
 Id. at 3.
[7]
 Id. at 83.
[8]
 Id. at 130.
[9]
 Id. at 134.
[10]
 Id. at 170.
[11]
 TSN, 10 March 2003; TSN, 5 May 2003.
[12]
 Id. at 4-5.
[13]
 Records, p. 8.
[14]
 Id.
[15]
 Id. at 164.
[16]
 TSN, 10 March 2003; TSN, 5 May 2003.
[17]
 Records, p. 164.
[18]
 TSN, 5 May 2003, p. 20.
[19]
 Denominated as Receipt; records, p. 165.
[20]
 Certification issued by Hermogenes C. Mateo, Director II, Licensing Branch, POEA; Exhibit E; records, p. 168.
[21]
 Felicitas Q. Bay, Director II, Licensing Branch, POEA; Exhibit F-1; records, p. 169.
[22]
 Id. at 168.
[23]
 Id. at 169.
[24]
 TSN, 16 February 2004, pp. 55-56.
[25]
 Id. at 56.
[26]
 TSN, 14 April 2004, pp. 85-86.
[27]
 Rollo, p. 70.
[28]
 Records, p. 289.
[29]
 Id. at 304.
[30]
 Id. at 300-301.
[31]
 Rollo, p. 111.
[32]
 Id. at 112.
[33]
 Id. at 113.
[34]
 Id. at 112.
[35]
 Id. at 114.
[36]
 Id. at 24-25.
[37]
 Id. at 27.
[38]
 436 Phil. 698 (2002).
[39]
 People v. Navarra, Sr., 404 Phil. 693, 701 (2001).
[40]
 Records, pp. 168-169.
[41]
 People v. Angeles, 430 Phil. 333, 346 (2002).
[42]
 Id.
[43]
 Complaint-affidavit which was admitted in evidence and its contents confirmed on the witness stand by Biacora.
[44]
 TSN, 16 February 2004, pp. 18-19.
[45]
 Exhibit "B-1; records, p. 164.
[46]
 Exhibit B-3; id. at 164.
[47]
 Exhibit C; id. at 165.
[48]
 People v. Armentano, G. R. No. 90803, 3 July 1992, 211 SCRA 82, 87.
[49]
 Tarapen v. People, G.R. No. 173824, 28 August 2008, 563 SCRA 577, 593, citing People v. De Jesus, G.R. No.
93852, January 24, 1992, 205 SCRA 383, 391.
[50]
 People v. Reichl, 428 Phil. 643, 664 (2002).
[51]
 Sec. 7, Republic Act. No. 8042.
SEC. 7. Penalties.
(a) Any persons found guilty of illegal recruitment shall suffer the penalty of imprisonment of not less than six (6)
years and one (1) day but not more than twelve (12) years and a fine or not less that Two hundred thousand
pesos (P200,000.00) nor more than Five hundred thousand pesos (P500,000.00);
(b) The penalty of life imprisonment and a fine of not less than Five hundred thousand pesos (P500,000.00) nor
more than One million pesos (P1,000,000.00) shall be imposed if illegal recruitment constitutes economic
sabotage as defined herein.
[52]
 People v. Hu, G.R. No. 182232, 6 October 2008, 567 SCRA 696, 713-714.
[53]
 374 Phil. 575, 586 (1999).
[54]
 People v. Temporada, G.R. No. 173473, 17 December 2008.
[55]
 Provided that the total penalty that may be imposed shall not exceed 20 years.
[56]
 335 Phil. 242 (1997).
[57]
 Id. at 257.
[58]
 The additional five (5) years is in view of the five (5) increments of Ten Thousand Pesos (P10,000.00)
representing the difference of the amount defrauded by petitioner Ritualo, which is Eighty Thousand Pesos
(P80,000.00), or Fifty Eight Thousand Pesos (P58,000.00) more than the cap of Twenty-Two Thousand
Pesos (P22,000.00) provided by law.
Republic of the Philippines
Supreme Court
Manila
 
FIRST DIVISION
 
  
PEOPLE OF THE PHILIPPINES,   G.R. No. 173198

Plaintiff-Appellee,  
Present:
 
 
  CORONA, C.J.,

  Chairperson,

  VELASCO, JR.,

  LEONARDO-DE CASTRO,

- versus - PERALTA,* and

  PEREZ, JJ.

   

   

  Promulgated:

   

DOLORES OCDEN, June 1, 2011

Accused-Appellant.
x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x
 
 
DECISION
 

LEONARDO-DE CASTRO, J.:
 
  

For Our consideration is an appeal from the Decision[1] dated April 21, 2006 of the
Court of Appeals in CA-G.R. CR.-H.C. No. 00044, which affirmed with modification
the Decision[2] dated July 2, 2001 of the Regional Trial Court (RTC), Baguio City,
Branch 60, in Criminal Case No. 16315-R. The RTC found accused-appellant
Dolores Ocden (Ocden) guilty of illegal recruitment in large scale, as defined and
penalized under Article 13(b), in relation to Articles 38(b), 34, and 39 of
Presidential Decree No. 442, otherwise known as the New Labor Code of the
Philippines, as amended, in Criminal Case No. 16315-R; and of the crime of estafa
under paragraph 2(a), Article 315 of the Revised Penal Code, in Criminal Case Nos.
16316-R, 16318-R, and 16964-R.[3] The Court of Appeals affirmed Ocdens
conviction in all four cases, but modified the penalties imposed in Criminal Case
Nos. 16316-R, 16318-R, and 16964-R,
 
The Amended Information[4] for illegal recruitment in large scale in Criminal Case
No. 16315-R reads:
 
That during the period from May to December, 1998, in the City of Baguio, Philippines, and within the jurisdiction of this
Honorable Court, the above-named accused, did then and there willfully, unlawfully and feloniously for a fee, recruit and
promise employment as factory workers in Italy to more than three (3) persons including, but not limited to the
following: JEFFRIES C. GOLIDAN, HOWARD C. GOLIDAN, KAREN M. SIMEON, JEAN S. MAXIMO, NORMA PEDRO, MARYLYN
MANA-A, RIZALINA FERRER, and MILAN DARING without said accused having first secured the necessary license or
authority from the Department of Labor and Employment.
 
 

Ocden was originally charged with six counts of estafa in Criminal Case Nos.
16316-R, 16318-R, 16350-R, 16369-R, 16964-R, and 16966-R.
 
The Information in Criminal Case No. 16316-R states:
 
That sometime during the period from October to December, 1998 in the City of Baguio, Philippines and
within the jurisdiction of this Honorable Court, the above-named accused, did then and there willfully, unlawfully and
feloniously defraud JEFFRIES C. GOLIDAN, by way of false pretenses, which are executed prior to or simultaneous with the
commission of the fraud, as follows, to wit: the accused knowing fully well that she is not (sic) authorized job recruiter for
persons intending to secure work abroad convinced said Jeffries C. Golidan and pretended that she could secure a job for
him/her abroad, for and in consideration of the sum of P70,000.00 when in truth and in fact they could not; the
said Jeffries C. Golidan deceived and convinced by the false pretenses employed by the accused parted away the total
sum of P70,000.00, in favor of the accused, to the damage and prejudice of the said Jeffries C. Golidan in the
aforementioned amount of SEVENTY THOUSAND PESOS (P70,000,00), Philippine Currency.[5]
 
 

The Informations in the five other cases for estafa contain substantially the
same allegations as the one above-quoted, except for the private complainants
names, the date of commission of the offense, and the amounts defrauded, to
wit:
 
Case No. Name of the Date of Amount Private Complainant Commission of Defrauded
the Offense 16318-R Howard C. Golidan Sometime during the P70,000.00 period from October to December 1998 16350-R Norma
Pedro Sometime in May, 1998 P65,000.00
 
16369-R Milan O. Daring Sometime during the P70.000.00
period from November
13, 1998 to December
10, 1998
 
16964-R Rizalina Ferrer Sometime in September P70,000.00
 
16966-R Marilyn Mana-a Sometime in September P70,000.00[6]
1998
 

All seven cases against Ocden were consolidated on July 31, 2000 and were tried
jointly after Ocden pleaded not guilty.
 
The prosecution presented three witnesses namely: Marilyn Mana-a (Mana-a)
and Rizalina Ferrer (Ferrer), complainants; and Julia Golidan (Golidan), mother of
complainants Jeffries and Howard Golidan.
 
Mana-a testified that sometime in the second week of August 1998, she and
Isabel Dao-as (Dao-as) went to Ocdens house in Baguio City to apply for work as
factory workers in Italy with monthly salaries of US$1,200.00. They were required
by Ocden to submit their bio-data and passports, pay the placement fee
of P70,000.00, and to undergo medical examination.
 
Upon submitting her bio-data and passport, Mana-a paid Ocden P500.00 for her
certificate of employment and P20,000.00 as down payment for her placement
fee. On September 8, 1998, Ocden accompanied Mana-a and 20 other applicants
to Zamora Medical Clinic in Manila for their medical examinations, for which each
of the applicants paid P3,000.00. Mana-a also paid to Ocden P22,000.00 as the
second installment on her placement fee. When Josephine Lawanag (Lawanag),
Mana-as sister, withdrew her application, Lawanags P15,000.00 placement fee,
already paid to Ocden, was credited to Mana-a.[7]
 
Mana-a failed to complete her testimony, but the RTC considered the same
as no motion to strike the said testimony was filed.
 
 Ferrer narrated that she and her daughter Jennilyn were interested to work
overseas. About the second week of September 1998, they approached Ocden
through Fely Alipio (Alipio). Ocden showed Ferrer and Jennilyn a copy of a job
order from Italy for factory workers who could earn as much as $90,000.00 to
$100,000.00.[8] In the first week of October 1998, Ferrer and Jennilyn decided to
apply for work, so they submitted their passports and pictures to Ocden. Ferrer
also went to Manila for medical examination, for which she
spent P3,500.00. Ferrer paid to Ocden on November 20, 1998 the initial amount
of P20,000.00, and on December 8, 1998 the balance of her and Jennilyns
placement fees. All in all, Ferrer paid Ocden P140,000.00, as evidenced by the
receipts issued by Ocden.[9]
 
Ferrer, Jennilyn, and Alipio were supposed to be included in the first batch of
workers to be sent to Italy. Their flight was scheduled on December 10, 1998. In
preparation for their flight to Italy, the three proceeded to Manila. In Manila, they
were introduced by Ocden to Erlinda Ramos (Ramos). Ocden and Ramos then
accompanied Ferrer, Jennilyn, and Alipio to the airport where they took a flight to
Zamboanga. Ocden explained to Ferrer, Jennilyn, and Alipio that they would be
transported to Malaysia where their visa application for Italy would be processed.
 
Sensing that they were being fooled, Ferrer and Jennilyn decided to get a refund
of their money, but Ocden was nowhere to be found. Ferrer would later learn
from the Baguio office of the Philippine Overseas Employment Administration
(POEA) that Ocden was not a licensed recruiter.
 
Expecting a job overseas, Ferrer took a leave of absence from her work. Thus, she
lost income amounting to P17,700.00, equivalent to her salary for one and a half
months. She also spent P30,000.00 for transportation and food expenses.[10]
 
According to Golidan, the prosecutions third witness, sometime in October 1998,
she inquired from Ocden about the latters overseas recruitment. Ocden informed
Golidan that the placement fee was P70,000.00 for each applicant, that the
accepted applicants would be sent by batches overseas, and that priority would
be given to those who paid their placement fees early. On October 30, 1998,
Golidan brought her sons, Jeffries and Howard, to Ocden. On the same date,
Jeffries and Howard handed over to Ocden their passports and P40,000.00 as
down payment on their placement fees. On December 10, 1998, Jeffries and
Howard paid the balance of their placement fees amounting
to P100,000.00. Ocden issued receipts for these two payments.[11] Ocden then
informed Golidan that the first batch of accepted applicants had already left, and
that Jeffries would be included in the second batch for deployment, while Howard
in the third batch.
 
In anticipation of their deployment to Italy, Jeffries and Howard left for Manila on
December 12, 1998 and December 18, 1998, respectively. Through a telephone
call, Jeffries informed Golidan that his flight to Italy was scheduled on December
16, 1998. However, Golidan was surprised to again receive a telephone call from
Jeffries saying that his flight to Italy was delayed due to insufficiency of funds, and
that Ocden went back to Baguio City to look for additional funds. When Golidan
went to see Ocden, Ocden was about to leave for Manila so she could be there in
time for the scheduled flights of Jeffries and Howard.
 
On December 19, 1998, Golidan received another telephone call from Jeffries who
was in Zamboanga with the other applicants. Jeffries informed Golidan that he
was stranded in Zamboanga because Ramos did not give him his passport. Ramos
was the one who briefed the overseas job applicants in Baguio City sometime in
November 1998. Jeffries instructed Golidan to ask Ocdens help in looking for
Ramos. Golidan, however, could not find Ocden in Baguio City.
 
On December 21, 1998, Golidan, with the other applicants, Mana-a and Dao-as,
went to Manila to meet Ocden. When Golidan asked why Jeffries was in
Zamboanga, Ocden replied that it would be easier for Jeffries and the other
applicants to acquire their visas to Italy in Zamboanga. Ocden was also able to
contact Ramos, who assured Golidan that Jeffries would be able to get his
passport. When Golidan went back home to Baguio City, she learned through a
telephone call from Jeffries that Howard was now likewise stranded in
Zamboanga.
 
By January 1999, Jeffries and Howard were still in Zamboanga. Jeffries refused to
accede to Golidans prodding for him and Howard to go home, saying that the
recruiters were already working out the release of the funds for the applicants to
get to Italy. Golidan went to Ocden, and the latter told her not to worry as her
sons would already be flying to Italy because the same factory owner in Italy,
looking for workers, undertook to shoulder the applicants travel expenses. Yet,
Jeffries called Golidan once more telling her that he and the other applicants were
still in Zamboanga.
 
Golidan went to Ocdens residence. This time, Ocdens husband gave
Golidan P23,000.00 which the latter could use to fetch the applicants, including
Jeffries and Howard, who were stranded in Zamboanga. Golidan traveled again to
Manila with Mana-a and Dao-as. When they saw each other, Golidan informed
Ocden regarding the P23,000.00 which the latters husband gave to her. Ocden
begged Golidan to give her the money because she needed it badly. Of
the P23,000.00, Golidan retained P10,000.00, Dao-as received P3,000.00, and
Ocden got the rest. Jeffries was able to return to Manila on January 16,
1999. Howard and five other applicants, accompanied by Ocden, also arrived in
Manila five days later.
 
Thereafter, Golidan and her sons went to Ocdens residence to ask for a refund of
the money they had paid to Ocden. Ocden was able to return
only P50,000.00. Thus, out of the total amount of P140,000.00 Golidan and her
sons paid to Ocden, they were only able to get back the sum of P60,000.00. After
all that had happened, Golidan and her sons went to the Baguio office of the
POEA, where they discovered that Ocden was not a licensed recruiter.[12]
 
The defense presented the testimony of Ocden herself.
 
Ocden denied recruiting private complainants and claimed that she was also an
applicant for an overseas job in Italy, just like them. Ocden identified Ramos as
the recruiter.
 
Ocden recounted that she met Ramos at a seminar held in St. Theresas
Compound, Navy Base, Baguio City, sometime in June 1998. The seminar was
arranged by Aida Comila (Comila), Ramoss sub-agent. The seminar was attended
by about 60 applicants, including Golidan. Ramos explained how one could apply
as worker in a stuff toys factory in Italy. After the seminar, Comila introduced
Ocden to Ramos. Ocden decided to apply for the overseas job, so she gave her
passport and pictures to Ramos. Ocden also underwent medical examination at
Zamora Medical Clinic in Manila, and completely submitted the required
documents to Ramos in September 1998.
 
After the seminar, many people went to Ocdens house to inquire about the jobs
available in Italy. Since most of these people did not attend the seminar, Ocden
asked Ramos to conduct a seminar at Ocdens house. Two seminars were held at
Ocdens house, one in September and another in December 1998. After said
seminars, Ramos designated Ocden as leader of the applicants. As such, Ocden
received her co-applicants applications and documents; accompanied her co-
applicants to Manila for medical examination because she knew the location of
Zamora Medical Clinic; and accepted placement fees in the amount of P70,000.00
each from Mana-a and Ferrer and from Golidan, the amount of P140,000.00 (for
Jeffries and Howard).
 
Ramos instructed Ocden that the applicants should each pay P250,000.00
and if the applicants could not pay the full amount, they would have to pay the
balance through salary deductions once they start working in Italy. Ocden herself
paid Ramos P50,000.00 as placement fee and executed a promissory note in
Ramoss favor for the balance, just like any other applicant who failed to pay the
full amount. Ocden went to Malaysia with Ramoss male friend but she failed to
get her visa for Italy.
 
Ocden denied deceiving Mana-a and Ferrer. Ocden alleged that she turned over
to Ramos the money Mana-a and Ferrer gave her, although she did not indicate in
the receipts she issued that she received the money for and on behalf of Ramos.
 
Ocden pointed out that she and some of her co-applicants already filed a
complaint against Ramos before the National Bureau of Investigation (NBI) offices
in Zamboanga City and Manila.[13]
On July 2, 2001, the RTC rendered a Decision finding Ocden guilty beyond
reasonable doubt of the crimes of illegal recruitment in large scale (Criminal Case
No. 16315-R) and three counts of estafa (Criminal Case Nos. 16316-R, 16318-R,
and 16964-R). The dispositive portion of said decision reads:
 
WHEREFORE, premises considered, judgment is hereby rendered as follows:
 
1.      In Criminal Case No. 16315-R, the Court finds the accused, DOLORES OCDEN, GUILTY beyond reasonable
doubt of the crime of Illegal Recruitment committed in large scale as defined and penalized under Article 13(b) in relation
to Article 38(b), 34 and 39 of the Labor Code as amended by P.D. Nos. 1693, 1920, 2018 and R.A. 8042. She is hereby
sentenced to suffer the penalty of life imprisonment and to pay a fine of P100,000.00;
 
2.      In Criminal Case No. 16316-R, the Court finds the accused, DOLORES OCDEN, GUILTY beyond reasonable
doubt of the crime of estafa and sentences her to suffer an indeterminate penalty ranging from two (2) years, eleven (11)
 months and ten (10) days of prision correccional, as minimum, up to nine (9) years and nine (9) months of prision mayor,
as maximum, and to indemnify the complainant Jeffries Golidan the amount of P40,000.00;
 
3.      In Criminal Case No. 16318-R, the Court finds the accused, DOLORES OCDEN, GUILTY beyond reasonable
doubt of the crime of estafa and sentences her to suffer an indeterminate penalty ranging from two (2) years, eleven (11)
months and ten (10) days of prision correccional, as minimum, up to nine (9) years and nine (9) months of prision mayor,
as maximum, and to indemnify Howard Golidan the amount of P40,000.00;
 
4.      In Criminal Case No. 16350-R, the Court finds the accused, DOLORES OCDEN, NOT GUILTY of the crime of
estafa for lack of evidence and a verdict of acquittal is entered in her favor;
 
5.      In Criminal Case No. 16369-R, the Court finds the accused, DOLORES OCDEN, NOT GUILTY of the crime of
estafa for lack of evidence and a verdict of acquittal is hereby entered in her favor;
 
6.      In Criminal Case No. 16964-R, the Court finds the accused, DOLORES OCDEN, GUILTY beyond reasonable
doubt of the crime of estafa and sentences her to suffer an indeterminate penalty of Four (4) years and Two (2) months
of prision correccional, as minimum, up to Twelve (12) years and Nine (9) months of reclusion temporal, as maximum,
and to indemnify Rizalina Ferrer the amount of P70,000.00; and
 
7.      In Criminal Case No. 16966-R, the Court finds the accused, DOLORES OCDEN, NOT GUILTY of the crime of
estafa for insufficiency of evidence and a verdict of acquittal is hereby entered in her favor.
 
In the service of her sentence, the provisions of Article 70 of the Penal Code shall be observed.[14]
 
 

Aggrieved by the above decision, Ocden filed with the RTC a Notice of
Appeal on August 15, 2001.[15] The RTC erroneously sent the records of the cases
to the Court of Appeals, which, in turn, correctly forwarded the said records to us.
In our Resolution[16] dated May 6, 2002, we accepted the appeal and required the
parties to file their respective briefs. In the same resolution, we directed the
Superintendent of the Correctional Institute for Women to confirm Ocdens
detention thereat.
 
Ocden filed her Appellant's Brief on August 15, 2003,[17] while the People,
through the Office of the Solicitor General, filed its Appellee's Brief on January 5,
2004.[18]
 
Pursuant to our ruling in People v. Mateo,[19] we transferred Ocdens appeal
to the Court of Appeals. On April 21, 2006, the appellate court promulgated its
Decision, affirming Ocdens conviction but modifying the penalties imposed upon
her for the three counts of estafa, viz:
 
[T]he trial court erred in the imposition of accused-appellants penalty.

 
 Pursuant to Article 315 of the RPC, the penalty for estafa is prision
correccional in its maximum period to prision mayor in its minimum period. If the
amount of the fraud exceeds P22,000.00, the penalty provided shall be imposed in its
maximum period (6 years, 8 months and 21 days to 8 years), adding 1 year for each
additional P10,000.00; but the total penalty which may be imposed shall not exceed 20
years.

Criminal Case Nos. 16316-R and 16318-R involve the amount of P40,000.00
each. Considering that P18,000.00 is the excess amount, only 1 year should be added to
the penalty in its maximum period or 9 years. Also, in Criminal Case No. 16964-R, the
amount involved is P70,000.00. Thus, the excess amount is P48,000.00 and only 4
years should be added to the penalty in its maximum period.

 
WHEREFORE, the instant appeal is DISMISSED. The assailed Decision, dated 02
July 2001, of the Regional Trial Court (RTC) of Baguio City, Branch 60 is
hereby AFFIRMED with the following MODIFICATIONS:

1.      In Criminal Case No. 16316-R, accused-appellant is sentenced to 2 years, 11

months, and 10 days of prision correccional, as minimum to 9 years
of prision mayor, as maximum and to indemnify Jeffries Golidan the amount
of P40,000.00;

2.      In Criminal Case No. 16318-R, accused-appellant is sentenced to 2 years, 11

months, and 10 days of prision correccional, as minimum to 9 years
of prision mayor, as maximum and to indemnify Howard Golidan the
amount of P40,000.00; and

3.      In Criminal Case No. 16964-R, accused-appellant is sentenced to 4 years and

2 months of prision correccional, as minimum to 12 years of prision mayor,
as maximum and to indemnify Rizalina Ferrer the amount of P70,000.00.[20]

 
 
Hence, this appeal, in which Ocden raised the following assignment of
errors:
  
I

THE TRIAL COURT ERRED IN CONVICTING ACCUSED-APPELLANT OF ILLEGAL

RECRUITMENT COMMITTED IN LARGE SCALE ALTHOUGH THE CRIME WAS NOT PROVEN
BEYOND REASONABLE DOUBT.

II

THE TRIAL COURT ERRED IN CONVICTING ACCUSED-APPELLANT OF ESTAFA IN CRIMINAL

CASES NOS. 16316-R, 16318-R AND 16[9]64-R.[21]

After a thorough review of the records of the case, we find nothing on

record that would justify a reversal of Ocdens conviction.
 
Illegal recruitment in large scale
 

Ocden contends that the prosecution failed to prove beyond reasonable doubt
that she is guilty of the crime of illegal recruitment in large scale. Other than the
bare allegations of the prosecution witnesses, no evidence was adduced to prove
that she was a non-licensee or non-holder of authority to lawfully engage in the
recruitment and placement of workers. No certification attesting to this fact was
formally offered in evidence by the prosecution.

Ocdens aforementioned contentions are without merit.

 
Article 13, paragraph (b) of the Labor Code defines and enumerates the acts
which constitute recruitment and placement:

 
(b) Recruitment and placement refers to any act of canvassing, enlisting, contracting,
transporting, utilizing, hiring, or procuring workers, and includes referrals, contract
services, promising for advertising for employment locally or abroad, whether for profit
or not: Provided, That any person or entity which, in any manner, offers or promises for
a fee employment to two or more persons shall be deemed engaged in recruitment and
placement.

The amendments to the Labor Code introduced by Republic Act No. 8042,

otherwise known as the Migrant Workers and Overseas Filipinos Act of
1995, broadened the concept of illegal recruitment and provided stiffer penalties,
especially for those that constitute economic sabotage, i.e., illegal recruitment in
large scale and illegal recruitment committed by a syndicate. Pertinent provisions
of Republic Act No. 8042 are reproduced below:

 
SEC. 6. Definition. - For purposes of this Act, illegal recruitment shall mean any
act of canvassing, enlisting, contracting, transporting, utilizing, hiring, or procuring
workers and includes referring, contract services, promising or advertising for
employment abroad, whether for profit or not, when undertaken by a non-licensee or
non-holder of authority contemplated under Article 13(f) of Presidential Decree No. 442,
as amended, otherwise known as the Labor Code of the Philippines: Provided, That any
such non-licensee or non-holder who, in any manner, offers or promises for a fee
employment abroad to two or more persons shall be deemed so engaged. It shall
likewise include the following acts, whether committed by any person, whether a non-
licensee, non-holder, licensee or holder of authority:

(a) To charge or accept directly or indirectly any amount greater than that specified in
the schedule of allowable fees prescribed by the Secretary of Labor and Employment, or
to make a worker pay any amount greater than that actually received by him as a loan
or advance;
 

(b) To furnish or publish any false notice or information or document in relation to

recruitment or employment;

(c) To give any false notice, testimony, information or document or commit any act of
misrepresentation for the purpose of securing a license or authority under the Labor
Code;

(d) To induce or attempt to induce a worker already employed to quit his employment in
order to offer him another unless the transfer is designed to liberate a worker from
oppressive terms and conditions of employment;

(e) To influence or attempt to influence any person or entity not to employ any worker
who has not applied for employment through his agency;

(f) To engage in the recruitment or placement of workers in jobs harmful to public

health or morality or to the dignity of the Republic of the Philippines;

(g) To obstruct or attempt to obstruct inspection by the Secretary of Labor and

Employment or by his duly authorized representative;

(h) To fail to submit reports on the status of employment, placement vacancies,

remittance of foreign exchange earnings, separation from jobs, departures and such
other matters or information as may be required by the Secretary of Labor and
Employment;

(i) To substitute or alter to the prejudice of the worker, employment contracts approved
and verified by the Department of Labor and Employment from the time of actual
signing thereof by the parties up to and including the period of the expiration of the
same without the approval of the Department of Labor and Employment;

 
(j) For an officer or agent of a recruitment or placement agency to become an officer or
member of the Board of any corporation engaged in travel agency or to be engaged
directly or indirectly in the management of a travel agency;

(k) To withhold or deny travel documents from applicant workers before departure for
monetary or financial considerations other than those authorized under the Labor Code
and its implementing rules and regulations;

(l) Failure to actually deploy without valid reason as determined by the Department of
Labor and Employment; and

(m) Failure to reimburse expenses incurred by the worker in connection with his
documentation and processing for purposes of deployment, in cases where the
deployment does not actually take place without the worker's fault. Illegal
recruitment when committed by a syndicate or in large scale shall be considered an
offense involving economic sabotage.

Illegal recruitment is deemed committed by a syndicate if carried out by a group of

three (3) or more persons conspiring or confederating with one another. It is deemed
committed in large scale if committed against three (3) or more persons individually or
as a group.

xxxx

Sec. 7.  Penalties.

(a) Any person found guilty of illegal recruitment shall suffer the penalty of
imprisonment of not less than six (6) years and one (1) day but not more than twelve
(12) years and a fine of Two hundred thousand  pesos (P200,000.00) nor more than Five
hundred thousand pesos (P500,000.00).

(b) The penalty of life imprisonment and a fine of not less than Five hundred thousand
pesos (P500,000.00) nor more than One million pesos (P1,000,000.00) shall be imposed
if illegal recruitment constitutes economic sabotage as defined herein.
  

Provided, however, That the maximum penalty shall be imposed if the

person illegally recruited is less than eighteen (18) years of age or committed by a non-
licensee or non-holder of authority. (Emphasis ours.)

It is well-settled that to prove illegal recruitment, it must be shown that

appellant gave complainants the distinct impression that he had the power or
ability to send complainants abroad for work such that the latter were convinced
to part with their money in order to be employed.[22] As testified to by Mana-a,
Ferrer, and Golidan, Ocden gave such an impression through the following acts:
(1) Ocden informed Mana-a, Ferrer, and Golidan about the job opportunity in Italy
and the list of necessary requirements for application; (2) Ocden required Mana-
a, Ferrer, and Golidans sons, Jeffries and Howard, to attend the seminar
conducted by Ramos at Ocdens house in Baguio City; (3) Ocden received the job
applications, pictures, bio-data, passports, and the certificates of previous
employment (which was also issued by Ocden upon payment of P500.00), of
Mana-a, Ferrer, and Golidans sons, Jeffries and Howard; (4) Ocden personally
accompanied Mana-a, Ferrer, and Golidans sons, Jeffries and Howard, for their
medical examinations in Manila; (5) Ocden received money paid as placement
fees by Mana-a, Ferrer, and Golidans sons, Jeffries and Howard, and even issued
receipts for the same; and (6) Ocden assured Mana-a, Ferrer, and Golidans sons,
Jeffries and Howard, that they would be deployed to Italy.

It is not necessary for the prosecution to present a certification that Ocden

is a non-licensee or non-holder of authority to lawfully engage in the recruitment
and placement of workers. Section 6 of Republic Act No. 8042 enumerates
particular acts which would constitute illegal recruitment whether committed by
any person, whether a non-licensee, non-holder, licensee or holder of
authority. Among such acts, under Section 6(m) of Republic Act No. 8042, is the
[f]ailure to reimburse expenses incurred by the worker in connection with his
documentation and processing for purposes of deployment, in cases where the
deployment does not actually take place without the workers fault.

Since illegal recruitment under Section 6(m) can be committed by any

person, even by a licensed recruiter, a certification on whether Ocden had a
license to recruit or not, is inconsequential. Ocden committed illegal recruitment
as described in said provision by receiving placement fees from Mana-a, Ferrer,
and Golidans two sons, Jeffries and Howard, evidenced by receipts Ocden herself
issued; and failing to reimburse/refund to Mana-a, Ferrer, and Golidans two sons
the amounts they had paid when they were not able to leave for Italy, through no
fault of their own.

 
Ocden questions why it was Golidan who testified for private complainants
Jeffries and Howard. Golidan had no personal knowledge of the circumstances
proving illegal recruitment and could not have testified on the same. Also, Jeffries
and Howard already executed an affidavit of desistance. All Golidan wants was a
reimbursement of the placement fees paid.
 

Contrary to Ocdens claims, Golidan had personal knowledge of Ocdens

illegal recruitment activities, which she could competently testify to. Golidan
herself had personal dealings with Ocden as Golidan assisted her sons, Jeffries
and Howard, in completing the requirements for their overseas job applications,
and later on, in getting back home from Zamboanga where Jeffries and Howard
were stranded, and in demanding a refund from Ocden of the placement fees
paid. That Golidan is seeking a reimbursement of the placement fees paid for the
failed deployment of her sons Jeffries and Howard strengthens, rather than
weakens, the prosecutions case. Going back to illegal recruitment under Section
6(m) of Republic Act No. 8042, failure to reimburse the expenses incurred by the
worker when deployment does not actually take place, without the workers fault,
is illegal recruitment.
 The affidavit of desistance purportedly executed by Jeffries and Howard
does not exonerate Ocden from criminal liability when the prosecution had
successfully proved her guilt beyond reasonable doubt. In People v. Romero,[23] we
held that:
 
The fact that complainants Bernardo Salazar and Richard Quillope executed a Joint Affidavit of Desistance
does not serve to exculpate accused-appellant from criminal liability insofar as the case for illegal recruitment is
concerned since the Court looks with disfavor the dropping of criminal complaints upon mere affidavit of desistance of
the complainant, particularly where the commission of the offense, as is in this case, is duly supported by documentary
evidence.
 
Generally, the Court attaches no persuasive value to affidavits of desistance, especially when it is executed as
an afterthought. It would be a dangerous rule for courts to reject testimonies solemnly taken before the courts of justice
simply because the witnesses who had given them, later on, changed their mind for one reason or another, for such rule
would make solemn trial a mockery and place the investigation of truth at the mercy of unscrupulous witness.
 
Complainants Bernardo Salazar and Richard Quillope may have a change of heart insofar as the offense
wrought on their person is concerned when they executed their joint affidavit of desistance but this will not affect the
public prosecution of the offense itself. It is relevant to note that the right of prosecution and punishment for a crime is
one of the attributes that by a natural law belongs to the sovereign power instinctly charged by the common will of the
members of society to look after, guard and defend the interests of the community, the individual and social rights and
the liberties of every citizen and the guaranty of the exercise of his rights. This cardinal principle which states that to the
State belongs the power to prosecute and punish crimes should not be overlooked since a criminal offense is an outrage
to the sovereign State.[24]
 
 

In her bid to exculpate herself, Ocden asserts that she was also just an
applicant for overseas employment; and that she was receiving her co-applicants
job applications and other requirements, and accepting her co-applicants
payments of placement fees, because she was designated as the applicants leader
by Ramos, the real recruiter.
 
Ocdens testimony is self-serving and uncorroborated. Ocdens denial of any
illegal recruitment activity cannot stand against the prosecution witnesses
positive identification of her in court as the person who induced them to part with
their money upon the misrepresentation and false promise of deployment to Italy
as factory workers. Besides, despite several opportunities given to Ocden by the
RTC, she failed to present Ramos, who Ocden alleged to be the real recruiter and
to whom she turned over the placement fees paid by her co-applicants.
 
Between the categorical statements of the prosecution witnesses, on the
one hand, and the bare denial of Ocden, on the other, the former must perforce
prevail. An affirmative testimony is far stronger than a negative testimony
especially when the former comes from the mouth of a credible witness. Denial,
same as an alibi, if not substantiated by clear and convincing evidence, is negative
and self-serving evidence undeserving of weight in law. It is considered with
suspicion and always received with caution, not only because it is inherently weak
and unreliable but also because it is easily fabricated and concocted.[25]
 
Moreover, in the absence of any evidence that the prosecution witnesses
were motivated by improper motives, the trial courts assessment of the credibility
of the witnesses shall not be interfered with by this Court.[26] It is a settled rule
that factual findings of the trial courts, including their assessment of the
witnesses credibility, are entitled to great weight and respect by the Supreme
Court, particularly when the Court of Appeals affirmed such findings. After all, the
trial court is in the best position to determine the value and weight of the
testimonies of witnesses. The absence of any showing that the trial court plainly
overlooked certain facts of substance and value that, if considered, might affect
the result of the case, or that its assessment was arbitrary, impels the Court to
defer to the trial courts determination according credibility to the prosecution
evidence.[27]
 
Ocden further argues that the prosecution did not sufficiently establish that
she illegally recruited at least three persons, to constitute illegal recruitment on a
large scale.Out of the victims named in the Information, only Mana-a and Ferrer
testified in court. Mana-a did not complete her testimony, depriving Ocden of the
opportunity to cross-examine her; and even if Mana-as testimony was not
expunged from the record, it was insufficient to prove illegal recruitment by
Ocden. Although Ferrer testified that she and Mana-a filed a complaint for illegal
recruitment against Ocden, Ferrers testimony is competent only as to the illegal
recruitment activities committed by Ocden against her, and not against Mana-
a. Ocden again objects to Golidans testimony as hearsay, not being based on
Golidans personal knowledge.
 
Under the last paragraph of Section 6, Republic Act No. 8042, illegal
recruitment shall be considered an offense involving economic sabotage if
committed in a large scale, that is, committed against three or more persons
individually or as a group.
 
In People v. Hu,[28] we held that a conviction for large scale illegal
recruitment must be based on a finding in each case of illegal recruitment of
three or more persons, whether individually or as a group. While it is true that the
law does not require that at least three victims testify at the trial, nevertheless, it
is necessary that there is sufficient evidence proving that the offense was
committed against three or more persons. In this case, there is conclusive
evidence that Ocden recruited Mana-a, Ferrer, and Golidans sons, Jeffries and
Howard, for purported employment as factory workers in Italy. As aptly observed
by the Court of Appeals:
 
Mana-as testimony, although not completed, sufficiently established that accused-appellant promised Mana-a
a job placement in a factory in Italy for a fee with accused-appellant even accompanying her for the required medical
examination. Likewise, Julia Golidans testimony adequately proves that accused-appellant recruited Jeffries and Howard
Golidan for a job in Italy, also for a fee. Contrary to the accused-appellants contention, Julia had personal knowledge of
the facts and circumstances surrounding the charges for illegal recruitment and estafa filed by her sons. Julia was not only
privy to her sons recruitment but also directly transacted with accused-appellant, submitting her sons requirements and
paying the placement fees as evidenced by a receipt issued in her name. Even after the placement did not materialize,
Julia acted with her sons to secure the partial reimbursement of the placement fees.[29]
 
 

And even though only Ferrer and Golidan testified as to Ocdens failure to
reimburse the placements fees paid when the deployment did not take place,
their testimonies already established the fact of non-reimbursement as to three
persons, namely, Ferrer and Golidans two sons, Jeffries and Howard.
 
Section 7(b) of Republic Act No. 8042 prescribes a penalty of life
imprisonment and a fine of not less than P500,000.00 nor more
than P1,000,000.00 if the illegal recruitment constitutes economic sabotage. The
RTC, as affirmed by the Court of Appeals, imposed upon Ocden the penalty of life
imprisonment and a fine of only P100,000.00.Since the fine of P100,000 is below
the minimum set by law, we are increasing the same to P500,000.00.

 
Estafa
 
We are likewise affirming the conviction of Ocden for the crime of
estafa. The very same evidence proving Ocdens liability for illegal recruitment also
established her liability for estafa.
 
It is settled that a person may be charged and convicted separately of illegal
recruitment under Republic Act No. 8042 in relation to the Labor Code, and estafa
under Article 315, paragraph 2(a) of the Revised Penal Code. We explicated
in People v. Yabut[30] that:
  
In this jurisdiction, it is settled that a person who commits illegal recruitment may be charged and convicted
separately of illegal recruitment under the Labor Code and estafa under par. 2(a) of Art. 315 of the Revised Penal
Code. The offense of illegal recruitment is malum prohibitum where the criminal intent of the accused is not necessary for
conviction, while estafa is malum in se where the criminal intent of the accused is crucial for conviction. Conviction for
offenses under the Labor Code does not bar conviction for offenses punishable by other laws.Conversely, conviction for
estafa under par. 2(a) of Art. 315 of the Revised Penal Code does not bar a conviction for illegal recruitment under the
Labor Code. It follows that ones acquittal of the crime of estafa will not necessarily result in his acquittal of the crime of
illegal recruitment in large scale, and vice versa.[31]
 
 

Article 315, paragraph 2(a) of the Revised Penal Code defines estafa as:
 
Art. 315. Swindling (estafa). - Any person who shall defraud another by any of the
means mentioned hereinbelow x x x:

xxxx

2. By means of any of the following false pretenses or fraudulent acts executed prior to
or simultaneously with the commission of the fraud:

(a) By using fictitious name, or falsely pretending to possess power, influence,

qualifications, property, credit, agency, business or imaginary transactions; or by means
of other similar deceits.

The elements of estafa are: (a) that the accused defrauded another by
abuse of confidence or by means of deceit, and (b) that damage or prejudice
capable of pecuniary estimation is caused to the offended party or third person.[32]

Both these elements are present in the instant case. Ocden represented to

Ferrer, Golidan, and Golidans two sons, Jeffries and Howard, that she could
provide them with overseas jobs. Convinced by Ocden, Ferrer, Golidan, and
Golidans sons paid substantial amounts as placement fees to her. Ferrer and
Golidans sons were never able to leave for Italy, instead, they ended up in
Zamboanga, where, Ocden claimed, it would be easier to have their visas to Italy
processed. Despite the fact that Golidans sons, Jeffries and Howard, were
stranded in Zamboanga for almost a month, Ocden still assured them and their
mother that they would be able to leave for Italy. There is definitely deceit on the
part of Ocden and damage on the part of Ferrer and Golidans sons, thus, justifying
Ocdens conviction for estafa in Criminal Case Nos. 16316-R, 16318-R, and 16964-
R.

The penalty for estafa depends on the amount of defraudation. According

to Article 315 of the Revised Penal Code:

Art. 315. Swindling (estafa). Any person who shall defraud another by any of the
means mentioned hereinbelow shall be punished by:

1st. The penalty of prision correccional in its maximum period to prision mayor in
its minimum period, if the amount of the fraud is over 12,000 pesos but does not exceed
22,000 pesos; and if such amount exceeds the latter sum, the penalty provided in this
paragraph shall be imposed in its maximum period, adding one year for each additional
10,000 pesos; but the total penalty which may be imposed shall not exceed twenty
years. In such cases, and in connection with the accessory penalties which may be
imposed and for the purpose of the other provisions of this Code, the penalty shall be
termed prision mayor or reclusion temporal, as the case may be.

The prescribed penalty for estafa under Article 315 of the Revised Penal
Code, when the amount of fraud is over P22,000.00, is prision
correccional maximum to prision mayor minimum, adding one year to the
maximum period for each additional P10,000.00, provided that the total penalty
shall not exceed 20 years.

 
 Applying the Indeterminate Sentence Law, we take the minimum term from
the penalty next lower than the minimum prescribed by law, or anywhere
within prision correccional minimum and medium (i.e., from 6 months and 1 day
to 4 years and 2 months).[33] Consequently, both the RTC and the Court of Appeals
correctly fixed the minimum term in Criminal Case Nos. 16316-R and 16318-R at 2
years, 11 months, and 10 days of prision correccional; and in Criminal Case No.
16964-R at 4 years and 2 months of prision correccional, since these are within
the range of prision correccional minimum and medium.

As for the maximum term under the Indeterminate Sentence Law, we take
the maximum period of the prescribed penalty, adding 1 year of imprisonment for
every P10,000.00 in excess of P22,000.00, provided that the total penalty shall not
exceed 20 years. To compute the maximum period of the prescribed penalty, the
time included in prision correccional maximum to prision mayor minimum shall be
divided into three equal portions, with each portion forming a period. Following
this computation, the maximum period for prision correccional maximum
to prision mayor minimum is from 6 years, 8 months, and 21 days to 8 years. The
incremental penalty, when proper, shall thus be added to anywhere from 6 years,
8 months, and 21 days to 8 years, at the discretion of the court.[34]

In computing the incremental penalty, the amount defrauded shall be

substracted by P22,000.00, and the difference shall be divided by P10,000.00. Any
fraction of a year shall be discarded as was done starting with People v. Pabalan.
[35]

In Criminal Case Nos. 16316-R and 16318-R, brothers Jeffries and Howard
Golidan were each defrauded of the amount of P40,000.00, for which the Court of
Appeals sentenced Ocden to an indeterminate penalty of 2 years, 11 months, and
10 days of prision correccional as minimum, to 9 years of prision mayor as
maximum. Upon review, however, we modify the maximum term of the
indeterminate penalty imposed on Ocden in said criminal cases. Since the amount
defrauded exceeds P22,000.00 by P18,000.00, 1 year shall be added to the
maximum period of the prescribed penalty (anywhere between 6 years, 8
months, and 21 days to 8 years). There being no aggravating circumstance, we
apply the lowest of the maximum period, which is 6 years, 8 months, and 21
days. Adding the one year incremental penalty, the maximum term of Ocdens
indeterminate sentence in these two cases is only 7 years, 8 months, and 21 days
of prision mayor.

In Criminal Cases No. 19694-R, Ferrer was defrauded of the amount

of P70,000.00, for which the Court of Appeals sentenced Ocden to an
indeterminate penalty of 4 years and 2 months of prision correccional, as
minimum, to 12 years of prision mayor, as maximum. Upon recomputation, we
also have to modify the maximum term of the indeterminate sentence imposed
upon Ocden in Criminal Case No. 19694-R. Given that the amount defrauded
exceeds P22,000.00 by P48,000.00, 4 years shall be added to the maximum period
of the prescribed penalty (anywhere between 6 years, 8 months, and 21 days to 8
years). There likewise being no aggravating circumstance in this case, we add the
4 years of incremental penalty to the lowest of the maximum period, which is 6
years, 8 months, and 21 days. The maximum term, therefor, of Ocdens
indeterminate sentence in Criminal Case No. 19694-R is only 10 years, 8 months,
and 21 days of prision mayor.

WHEREFORE, the instant appeal of accused-appellant Dolores Ocden

is DENIED. The Decision dated April 21, 2006 of the Court of Appeals in CA-G.R.
CR.-H.C. No. 00044 is AFFIRMED with MODIFICATION to read as follows:

 
 1.                 In Criminal Case No. 16315-R, the Court finds the accused, Dolores
Ocden, GUILTY beyond reasonable doubt of the crime of Illegal Recruitment
committed in large scale as defined and penalized under Article 13(b) in relation
to Articles 38(b), 34 and 39 of the Labor Code, as amended. She is hereby
sentenced to suffer the penalty of life imprisonment and to pay a fine
of P500,000.00;

2. In Criminal Case No. 16316-R, the Court finds the accused, Dolores
Ocden, GUILTY beyond reasonable doubt of the crime of estafa and sentences her
to an indeterminate penalty of 2 years, 11 months, and 10 days of prision
correccional, as minimum, to 7 years, 8 months, and 21 days of prision mayor, as
maximum, and to indemnify Jeffries Golidan the amount of P40,000.00;

3. In Criminal Case No. 16318-R, the Court finds the accused, Dolores
Ocden, GUILTY beyond reasonable doubt of the crime of estafa and sentences her
to an indeterminate penalty of 2 years, 11 months, and 10 days of prision
correccional, as minimum, to 7 years, 8 months, and 21 days of prision mayor, as
maximum, and to indemnify Howard Golidan the amount of P40,000.00; and

4. In Criminal Case No. 16964-R, the Court finds the accused, Dolores
Ocden, GUILTY beyond reasonable doubt of the crime of estafa and sentences her
to an indeterminate penalty of 4 years and 2 months of prision correccional, as
minimum, to 10 years, 8 months, and 21 days of prision mayor, as maximum, and
to indemnify Rizalina Ferrer the amount of P70,000.00.

SO ORDERED.
 

 
 

TERESITA J. LEONARDO-DE CASTRO

Associate Justice

WE CONCUR:

RENATO C. CORONA
Chief Justice
Chairperson

PRESBITERO J. VELASCO, JR. DIOSDADO M. PERALTA

Associate Justice Associate Justice

   

   
   

   
    

   

JOSE PORTUGAL PEREZ

Associate Justice
 

CERTIFICATION

Pursuant to Section 13, Article VIII of the Constitution, I certify that the
conclusions in the above Decision had been reached in consultation before the case
was assigned to the writer of the opinion of the Courts Division.
 

RENATO C. CORONA
Chief Justice
 

*
 Per Special Order No. 994 dated May 27, 2011.
[1]
 Rollo, pp. 3-20; penned by Associate Justice Noel G. Tijam with Associate Justices Elvi John S. Asuncion and
Arcangelita Romilla-Lontok, concurring.
[2]
 Records (Crim. Case No. 16964-R), pp. 253-262; penned by Judge Edilberto T. Claravall.
[3]
 Originally, Ocden was indicted for six counts of Estafa (Criminal Case Nos. 16316-R, 16318-R, 16350-R, 16369-
R, 16964-R and 16966-R).
[4]
 Records (Crim. Case No. 16315-R), p. 1.
[5]
 Records (Crim. Case No. 16316-R), p. 1.
[6]
 Rollo, p. 4.
[7]
 TSN, October 10, 2000, pp. 1-6.
[8]
 TSN, January 8, 2001, p. 4.
[9]
 Records (Crim. Case No. 16964-R), p. 179; Exhibits A, A-1 and A-2.
[10]
 TSN, January 8, 2001, pp. 1-15.
[11]
 Records (Crim. Case No. 16318-R), pp. 54-55, Exhibits A-1 and A-2.
 
[12]
 TSN, November 14, 2000, pp. 1-9; November 20, 2000, pp. 1-15.
[13]
 TSN, February 27, 2001, pp. 1-15; March 6, 2001, pp. 1-6.
[14]
 Records (Crim. Case No. 16964-R), pp. 261-262.
[15]
 Id. at 263.
[16]
 CA rollo, p. 38.
[17]
 Id. at 67-85.
[18]
 Id. at 111-134.
[19]
 G.R. Nos. 147678-87, July 7, 2004, 433 SCRA 640.
[20]
 Rollo, pp. 18-19.
[21]
 CA rollo, p. 69.
[22]
 People v. Gasacao, 511 Phil. 435, 445 (2005).
 
[23]
 G.R. Nos. 103385-88, July 26, 1993, 224 SCRA 749.
[24]
 Id. at 757.
[25]
 People v. Bulfango, 438 Phil. 651, 657 (2002).
[26]
 People v. Saulo, 398 Phil. 544, 554 (2000).
[27]
 People v. Nogra, G.R. No. 170834, August 29, 2008, 563 SCRA 723, 735.
[28]
 G.R. No. 182232, October 6, 2008, 567 SCRA 696, 705.
[29]
 Rollo, p. 16.
[30]
 374 Phil. 575 (1999).
[31]
 Id. at 586.
[32]
 People v. Ballesteros, 435 Phil. 205, 228 (2002).
[33]
 People v. Temporada, G.R. No. 173473, December 17, 2008, 574 SCRA 258, 299.
[34]
 Id.
[35]
 331 Phil. 64, 85 (1996).
 THIRD DIVISION

[G.R. No. 106357. September 3, 1998]

PEOPLE OF THE PHILIPPINES, plaintiff-appellee vs. PRISCILLA

BALASA, NORMITA VISAYA, GUILLERMO FRANCISCO,
NORMA FRANCISCO and ANALINA
FRANCISCO, accused. NORMA FRANCISCO, GUILLERMO
FRANCISCO and ANALINA FRANCISCO, accused-appellants.

[G.R. Nos. 108601-02. September 3, 1998]

PEOPLE OF THE PHILIPPINES, plaintiff-appellee vs. PRISCILLA
BALASA, NORMITA VISAYA, GUILLERMO FRANCISCO,
NORMA FRANCISCO and ANALINA
FRANCISCO, Accused. NORMA FRANCISCO, GUILLERMO
FRANCISCO and ANALINA FRANCISCO, accused-appellants.

DECISION
ROMERO, J.:

Avarice, mother of crimes, greedy for more the more she possesses, eversearching open-mouthed
for gold.[1]

Greed has always been one of mans failings. The hope of greater gain has lured many a man
to throw caution, and his common sense, to the wind. This human foible, known to many, has
been exploited throughout the ages by con men, charlatans and cheats to bilk the gullible public
of their hard-earned money. History has thus seen the unraveling of various disingenuous
stratagems which are at bottom nothing but scams. The case at hand once again proves that a
sucker is born every minute.
Totoong walang pagkaubos sa ating daigdig ang mga taong nanlilinlang. Hindi
magkakagayon naman kung walang nagpapalinlang. Dahil sa kanilang malaking hangarin na
magkamal ng kimpal kimpal na kayamanan, pinapasukan nila ang mga kaduda-dudang alok ng
mga mapagsamantala na kung sila ay mamuhunan ng kaunting salapi, ito ay tutubo ng malaki sa
ilang araw lamang. Kayat napakaraming mga tao ang nagagantso. Hindi masasabing mga hangal
o dili kayay mga maralita na walang gaanong pinag-aralan ang mga nabibiktima. Kahit ang mga
maykaya at matataas sa ating lipunan ay napaglalaruan din. Milyun-milyong salapi ang
nahuhuthot sa kanila, hindi ng mga masakim na magnanakaw, kundi ng kanila na ring mga
kasamahan sa tinatawag na alta sociedad. Mismong mga kaibigan at kapanatag ng loob ang
naguudyok sa kanilang sumali sa mga pakana na magpapayaman sa kanila. Higit namang
nakakaawa kapag ang naloloko ay iyong nangungutang lamang at nagbabakasakali na ang ilang
daan nila ay magiging libo.
Itong kapasiyahang ito ng Mataas na Hukuman ay nagbababalang muli. Magpakaingat-ingat
ang lahat. Ang naghahangad ng kagitna, isang salop ang nawawala.
Iyon namang nanlilinlang. Walang gawaing masama na hindi nabubunyag rin. Totoong
mahigpit ang ating batas na pumaparusa sa mga ganyang hindi na natututo, lalot higit kung ang
mga salarin ay mga sindikato.
Tunghayan natin kung papaano naganap ang gawang panloloko sa mga taga Palawan ng
mga dayo lamang.
On July 6, 1989, the Panata Foundation of the Philippines, Inc., a non-stock, non-profit
corporation with principal address at San Miguel, Puerto Princesa, Palawan, was registered with
the Securities and Exchange Commission, under S.E.C. Reg. No. 165565. Its ten incorporators
were Priscilla Balasa, Normita Visaya, Analina Francisco, Lolita Gelilang, Cynthia Ang, Norma
Francisco, Purabel Espidol, Melinda Mercado, Rodolfo Ang, Jr. and Teresa G. Carandang. Five
incorporators, namely, Priscilla Balasa, Normita Visaya, Analina Francisco, Lolita Gelilang and
Cynthia Ang were named first trustees.
In addition, the management of the foundation was entrusted to Priscilla Balasa, as president
and general manager; Normita Visaya as corporate secretary and head comptroller; Norma
Francisco as cashier; Guillermo Francisco as the disbursing officer; and Analina Francisco as
treasurer. The latter also doubled as a typist of the Foundation.
On the other hand, the employees of the foundation were the tellers Rosemarie Balasa,
Sylvia Magnaye, Judith Ponciano, Jessica Buaya, Rosario Arciaga, Paul Francisco, Enriquita
Gabayan and Anita Macmac. The comptrollers, Ruth Jalover, Almarino Agayo, and Avelina Yan
were under the supervision of Normita Visaya. Nelia Daco, one of the clerks assigned outside,
was the one in direct contact with the depositors.
The Foundations purposes, as stated in its by-laws, were as follows:
1. Uplift members economic condition by way of financial or consultative basis (sic);
2. To encourage members in a self-help program;
3. To grant educational assistance;
4. To implement the program on the Anti-Drug campaign;
5. To acquire facilities either by or through purchase, lease, bequest of donations, equipments
(sic), machineries (sic) and supplies for purposes of carrying out its business operation or
hold such real or personal properties as may be convenient and proper in order to achieve the
purpose of this corporation;
6. To cooperate with other organizations, institutions with similar activities for purposes of
carrying out its business; and
7. To organize seminars or conferences specially in the rural areas and other selected cities.[2]
After obtaining its SEC registration, the foundation immediately swung into operation. It
sent out brochures soliciting deposits from the public, assuring would-be depositors that their
money would either be doubled after 21 days or trebled after 30 days. Priscilla Balasa also went
around convincing people to make deposits with the foundation at their office at the Diaz
Apartment, Puerto Princesa.
The modus operandi for investing with the foundation was as follows:
When a person would deposit an amount, the amount would be taken by a clerk to be given
to the teller. The teller would then fill up a printed form called a slot. These slots were part of a
booklet, with one booklet containing one hundred slots. A slot, which resembled a check,
contained the following data:
PANATA FOUNDATION Control No. ___33____
(Logo) OF THE PHILIPPINES INC. Date 12-5-87 / Dec. 26, 1987
PFOPI Puerto Princesa, Palawan Amount P__500.00
SEC Reg. No. 165565
M__CHESTER MONREAL______________________________
Address___RPC_____________________________________________
Share____FIVE___
 Amount in words ___FIVE HUNDRED PESOS Only_____
(Sgd.) __(Sgd.)____________
Signature of Member PRISCILLA BALASA
President / Manager
No. 30333[3]
The control number indicated the number of the slot in a booklet, while the space after date
would contain the date when the slot was acquired, as well as the date of its maturity. The
amount deposited determined the number of shares, one share being equivalent to one hundred
pesos. The depositor had the discretion when to affix his signature on the space provided
therefor. Some would sign their slot only after payment on maturity, while others would sign as
soon as they were given the slot. However, without the control number and the stamp of the
teller, duly signed or initialed, no depositor could claim the proceeds of his deposit upon
maturity.[4]
After the slot had been filled up by the teller, he would give it to the clerk assigned
outside. The clerk would then give the slot to the depositor. Hence, while it was the teller who
prepared and issued the slot, he had no direct contact with the depositor. The slots handed to a
depositor were signed beforehand by the president of the foundation.
Every afternoon, the comptrollers would take the list of depositors made by the tellers with
the amounts deposited by each, and have these typed. Norma Francisco would then receive from
the tellers the amounts deposited by the public. It was also her job to pay the salaries of the
foundations employees. For his part, Guillermo Francisco would release money whenever a
deposit would mature as indicated in the slots.
According to the foundations rules, an investor could deposit up to P5,000.00 only, getting a
slot corresponding thereto. Anyone who deposited more than that amount would, however, be
given a slot but the slot had to be in the name of another person or several other persons,
depending upon the amount invested.[5] According to Sylvia Magnaye, a foundation teller, all
deposits maturing in August 1989 were to be tripled. For such deposits, the slots issued were
colored yellow to signify that the depositor would have his deposit tripled. Deposits that would
mature subsequent to August were only given double the amount deposited.[6] However, there
were times when it was the depositor who would choose that his deposit be tripled, in which
case, the deposit would mature later.[7]
The amounts received by the foundation were deposited in banks. Thus, a foundation teller
would, from time to time, go to PNB, PCI Bank, DBP and the Rural Bank of Coron to deposit
the collections in a joint account in the names of Priscilla Balasa and Norma Francisco.
Initially, the operation started with a few depositors, with most depositors investing small
amounts to see whether the foundation would make good on its promise. When the foundation
paid double or triple the amounts of their investment at maturity, most not only reinvested their
earnings but even added to their initial investments. As word got around that deposits could be
doubled within 21 days, or tripled, if the period lasted for more than 30 days, more depositors
were attracted. Blinded by the prospect of gaining substantial profits for nothing more than a
minuscule investment, these investors, like previous ones, were lured to reinvest their earnings, if
not to invest more.
 Most would invest more than P5,000.00, the investment limit set by the foundation. Priscilla
Balasa would, however, encourage depositors to invest more than P5,000.00, provided that the
excess was deposited under the name of others. She assured the depositors that this was safe
because as long as the depositor was holding the slots, he was the owner of the amount
deposited. Most investors then deposited amounts in the names of their relatives.
At the outset, the foundations operations proceeded smoothly, as satisfied investors collected
their investments upon maturity. On November 29, 1989, however, the foundation did not
open. Depositors whose investments were to mature on said date demanded payments but none
was forthcoming. On December 2, 1989, Priscilla Balasa announced that since the foundations
money had been invested in the stock market, it would resume operations on December 4,
1989. On that date, the foundation remained closed. Depositors began to demand reimbursement
of their deposits, but the foundation was unable to deliver.
Consequently, sixty-four informations, all charging the offense of estafa, as defined in
Presidential Decree No. 1689, were filed against Priscilla Balasa, Normita Visaya, Norma
Francisco, Guillermo Francisco, Analina Francisco and eight other persons, mostly incorporators
and employees of the Panata Foundation, before the Regional Trial Court of Palawan. Fourteen
cases, including Criminal Case Nos. 8429 and 8751, were raffled off to Branch 52. Two more
cases, Criminal Case Nos. 8704 and 8749, were similarly assigned to it. Of the sixteen cases
assigned to Branch 52, eight were, with the consent of the accused, provisionally dismissed for
lack of evidence.
In Criminal Case No. 8429, the information charging the accused with the crime of estafa as
amended by PD 1689 was filed on December 12, 1989. The accused in this case were: Priscilla
Balasa, Almarino Agayo, Norma Francisco, Normita Visaya, Paul Francisco, Nelia Daco, Ruth
Jalover,[8] Guillermo Francisco, Candido Tolentino, Jr., Rosemarie Balasa,[9] Ricardo del Rosario,
Emelita Gabayan, Rosario Arciaga, Jessica Buaya, Avelina Yan, Anita Macmac, Gina Gabaldon,
Ronaldo Belo, Fernando Cadauan, Lolita Gelilang, Cynthia Ang, Judith Ponciano, Sylvia
Magnaye,[10] Analina Francisco and Sulpio Nabayan. As amended on February 16, 1990, the
information in this case reads as follows:

That sometime on (sic) December, 1989, the above-named accused being the Manager
and employees of the PANATA Foundation of the Philippines, Inc., with office at No.
20 Diaz Apartment, Manalo Extension, Puerto Princesa City, Philippines, and within
the jurisdiction of this Honorable Court, the said accused conspiring and
confederating with one another and operating as a syndicate, did then and there
wilfully, unlawfully and feloniously defraud one Estrella San Gabriel y Lacao by
means of false representation and fraudulent means which they made to said Estrella
San Gabriel to the effect that as an investor/subscriber to the PANATA Foundation,
Inc. which is a non-stock corporation allegedly registered with the SEC under
Registration No. 165565 and by means of other similar deceit induce the said Estrella
San Gabriel to give and deliver to the said accused the amount of P5,500.00 as her
investment in said foundation, and by manifestation and misrepresentation by the said
accused that the said invested amount will be doubled or tripled within a certain
period of days said accused knowing fully well that their manifestation and
representations were false and fraudulent as they are made only for the purpose of
obtaining as in fact they obtained the amount with intent to defraud misapply,
misappropriate and convert the said amount for their own personal use and benefit, to
the damage and prejudice of said Estrella San Gabriel in the amount of P5,500.00,
Philippine Currency.

CONTRARY TO LAW and penalized under Presidential Decree No. 1689.

Likewise, in Criminal Case No. 8704, the information, filed on May 23, 1990, charged
Priscilla Balasa, Norma Francisco, Guillermo Francisco, Normita Visaya, Analina Francisco,
Lolita Gelilang, Cynthia Ang, Rodolfo Ang, Jr., Purable Espidol, Melinda Mercado, Almarino
Agayo, Candido Tolentino, Jr., Ricardo del Rosario, Fernando Caduan, Paul Francisco and
Teresita Carandang with the crime of estafa as amended by Presidential Decree No. 1689 as
follows:

That sometime in July, 1989 to December 1989, the above-named accused being then
the Manager, incorporators, members of the board of trustees, officers and employees
of the PANATA FOUNDATION OF THE PHIL., INC. with Office No. 20 Diaz
Apartment, Manalo Extension, Puerto Princesa City, Philippines and within the
jurisdiction of this Honorable Court, the said accused conspiring, confederating
together and mutually helping one another, and operating as a syndicate, did then and
there wilfully, unlawfully and feloniously defraud, the complainant Conchita
Bigornia, by means of false pretenses/representation and fraudulent means which they
made to said Conchita Bigornia to the effect that as depositor/subscriber to the
PANATA FOUNDATION OF THE PHIL., INC., which is a non-stock corporation
allegedly registered with the SEC under Registration No. 165565 and by means of
other similar deceit induce the said Conchita Bigornia, to give and deliver to the said
accused the amount of TWENTY FOUR THOUSAND ONE HUNDRED
(P24,100.00) PESOS, Philippine Currency, as his/her deposit/subscription in said
Foundation, and by manifestation and misrepresentation by the said accused that the
said deposited/subscription amount will be doubled or tripled within a certain period
of days said accused knowing fully well that this manifestation were (sic) false and
fraudulent as they are made only for the purpose of obtaining as in fact they obtained
the amount of TWENTY FOUR THOUSAND ONE HUNDRED PESOS
(P24,100.00) from the said (Conchita Bigornia) and the said accused once in
possession of the said amount with intent to defraud, misapply, misappropriate and
convert the said amount for their own personal use and benefit, to the damage and
prejudice of the said Conchita Bigornia in the amount aforestated.

CONTRARY TO LAW and penalized under P. D. No. 1689.

Similar informations were filed against the same persons in Criminal Cases Nos. 8749 and
8751. The complainant in Criminal Case No. 8749, complainant Shiela San Juan, was allegedly
defrauded of P25,800.00 while in Criminal Case No. 8751, the amount of P6,800.00 was
allegedly defrauded from Benjamin Yangco.
In like manner, similarly worded informations in Criminal Case Nos. 8734 and 8428, raffled
off to Branch 50, alleged that Elisia Mensias was defrauded in the amount of P4,500.00 and
Alfonso and Prescilla Lacao defrauded in the amount of P58,850.00, respectively.
After the filing of the informations, warrants for the arrest of the defendants in the
corresponding criminal cases were issued. However, only Priscilla Balasa, Normita Visaya,
Guillermo Francisco, Norma Francisco and Analina Francisco were arrested, the rest of the
defendants having gone into hiding.
On arraignment, the arrested defendants all pleaded not guilty to the crimes charged but
before the presentation of prosecution evidence, Priscilla Balasa and Normita Visaya escaped
from police custody.With their escape, only the spouses Guillermo and Norma Francisco were
called to present evidence on behalf of the defense. Analina Francisco, being a deaf-mute, was
not called to the witness stand due to the lack of a competent interpreter. The spouses, in denying
criminal liability, presented the following facts:
Priscilla Balasa, Normita Visaya, and Analina Francisco, full-blooded sisters, are the
common children of appellant spouses Guillermo and Norma Francisco. Before the Panata
Foundation started operations in July 1989, Priscilla had been living with her parents in San
Mateo, Isabela. Analina, on the other hand, was living with their elder sister, Normita, in
Manila. Priscilla, however, left for Palawan in June 1989.
Sometime thereafter, Guillermo Francisco received a letter from Priscilla asking him to
come to Palawan to provide her company, the latters husband having left for abroad as a
seaman. Consequently, Francisco came to Palawan sometime in August 1989 to live with
Priscilla at the Diaz Apartment in Puerto Princesa. Norma Francisco also came to Palawan in
August, purportedly to visit Priscillas daughter, whom she missed. Analina likewise came to
Palawan from Manila in August.
Guillermo denies participation in the commission of the crime charged. In his testimony, he
limits his participation in the foundations activities to paying the holders of matured slots. It was
the comptroller, Ruth Jalover, who would give him the record on which to base the remittances
he would make.[11] The money he disbursed was not always in his possession, as it would have to
come from the bank. It was Sylvia Magnaye who would withdraw the money from the bank
while it was Nelia Daco who would directly receive money from the people. Thus, not even once
did he participate in the process of receiving money. His daughters Priscilla Balasa and Normita
Visaya performed other jobs in the operation of the foundation while his other daughter, Analina
Francisco, only typed documents. He knew that the foundation helped people who received
money from it.[12] Although the primary purpose of the foundation was to help the needy,
Guillermo testified having knowledge of only one recipient thereof, the church of Aborlan.
In her testimony, Norma Francisco also denied complicity in the crime charged, claiming
that she only did household chores in Puerto Princesa. She alleged that sometimes, she would
help the tellers.However, because Ruth Jalover was educated and she was not, the former would
sometimes become the acting manager of her daughter. Sylvia Magnaye, her daughters sister-in-
law and a permanent employee of the foundation, was one of the tellers who would deposit and
withdraw from the bank. The eight tellers of the foundation all applied for their jobs with
Priscilla but it was Normita who interviewed them. However, Normita was only a clerk in the
foundation while Analina would type whatever work Ruth Jalover would give her. While Norma
had no official position in the foundation, her husband, Guillermo, was the paymaster. During
her stay in Puerto Princesa, she knew of no other business that her daughter Priscilla was
engaged in except the foundation and a paluwagan, which she ran together with a certain Manny
Diaz. Norma knew that the foundation was a charitable institution that had helped a lot of
people. She did not help Ruth Jalover in the same way that she helped Sylvia Magnaye with her
job as teller, but she had nothing to do with the keeping of records. She knew that money came
from the tellers, who got the money from Nelia Daco, the one receiving money from prospective
investors.[13]
On March 31, 1992, Branch 50 of the Regional Trial Court of Palawan issued a joint
decision in Criminal Case Nos. 8734 and 8428 finding the accused guilty of the crime charged
and of having acted in conspiracy in committing the same. Finding no aggravating or mitigating
circumstances in the commission of the crime, the trial court decreed thus:

WHEREFORE, AND IN VIEW OF THE FOREGOING CONSIDERATIONS,

judgment is hereby rendered finding all the accused in the 2 above-entitled cases
guilty as principals of the crime of estafa as the same is defined and penalized under
the Revised Penal Code.

a. In Criminal Case No. 8428 accused Priscilla Balasa, Normita Visaya, Analina
Francisco, Guillermo Francisco and Norma Francisco are hereby sentenced to
suffer the penalty of reclusion perpetua as well as to pay the costs. The accused
are jointly and severally ordered to pay the offended party Alfonso Lacao the sum
of Fifty Eight Thousand Eight Hundred Fifty (P58,850.00) Pesos and to pay the
further sum of Thirty Thousand Pesos (P30,000.00) as and for moral damages;

b. In Criminal Case No. 8734, accused Normita Visaya, Analina Francisco, Norma
Francisco and Guillermo Francisco are hereby sentenced to suffer the penalty of
reclusion perpetua as well as to pay the costs. They are furthermore ordered jointly
and severally to indemnify the offended party Elisea Mensias the sum of Four
Thousand Five Hundred (P4,500.00) Pesos as well as to pay the additional sum of
Fifteen Thousand (P15,000.00) Pesos as and for moral damages.

The cases against the accused Almarino Agayo, Paul Francisco, Candido Tolentino,
Jr., Ricardo del Rosario, Jessica Buaya, Fernando Cadauan, Lolita Gelilang, Cynthia
Ang, Rodolfo Ang, Jr., Purable Espidol, Melinda Mercado, and Teresit Carandang
who remained at large up to the present time are hereby ordered archived to be
reinstated in the docket of this Court as soon as they shall have been arrested or
surrendered voluntarily to the jurisdiction of this Court.

SO ORDERED.
 On the other hand, Branch 52 rendered separate decisions in the cases assigned to it. Thus,
on October 14, 1991, the trial court, in Criminal Case No. 8429 rendered a decision, the
dispositive portion of which reads as follows:

WHEREFORE, premises considered, judgment is hereby rendered finding co-accused

PRISCILLA BALASA, NORMITA VISAYA, GUILLERMO FRANCISCO, and
NORMA FRANCISCO guilty beyond reasonable doubt as co-principals of the crime
of estafa committed by a syndicate in violation of Section 1 of Presidential Decree
No. 1689, and each of the aforenamed accused is sentenced to reclusion perpetua; to
pay to Estrella Lacao San Gabriel, jointly and severally, by way of restitution, the sum
of P5,500.00.00, with interest thereon of 12% per annum from December, 1989, until
fully paid; and to pay the costs.

On grounds of reasonable doubt engendered by lack of sufficiently clear and

convincing evidence as against her, co-accused Analina Francisco is acquitted of the
offense charged.

SO ORDERED.

Although Branch 52 rendered separate decisions in the cases assigned to it, all had
essentially the same disposition imposing the penalty of reclusion perpetua upon each of the
convicted accused only the name of the offended party and the amount to be restituted
varied. Thus, in Criminal Case No. 8704,[14] the trial court ordered the accused to pay Conchita
Bigornia by way of restitution, the amount of P24,200.00 with interest thereon of 12% per
annum from December 1989. In Criminal Case No. 8749,[15] the same convicted accused were
ordered to restitute Shiela San Juan the amount of P25,800.00 plus 12% per annum from
December 1989. In Criminal Case No. 8751,[16] the convicted accused were ordered to restitute
Benjamin Yangco the amount of P6,800.00 with 12% interest per annum from December 1989.
Guillermo and Norma Francisco filed notices of appeal in Criminal Case Nos. 8429, 8704,
8749 and 8751. Their appeal was docketed as G.R. No. 106357. Likewise, the joint decision in
Criminal Case Nos. 8734 and 8428 was appealed to this Court by Guillermo Francisco, Norma
Francisco, Analina Francisco, and Normita Visaya, docketed herein as G.R. Nos. 108601-02.
Noting Normita Visayas escape from police custody after arraignment, the Court, on August 15,
1994, and pursuant to Section 8, Rule 124 of the Revised Rules of Court, ordered the dismissal
of her appeal on the ground of abandonment. The Court also considered Priscilla Balasas
conviction to be final and executory, in light of her escape from police custody. It also ordered
the issuance of a warrant for the arrest of Normita Visaya and an alias warrant of arrest against
Priscilla Balasa.
On October 16, 1993, appellants counsel, Atty. Agustin Rocamora, filed an appellants brief
in G.R. No. 106357. Thereafter, appellants appointed the Maramba and Mamauag Law Office as
new counsel in substitution of Atty. Rocamora. On November 2, 1994, new counsel filed a
motion to consolidate G.R. No. 106357 and G. R. Nos. 108601-02. On December 7, 1994, the
Court granted the motion and ordered the consolidation of the two cases. On the same day,
counsel for appellants submitted a consolidated appellants brief.
 In G.R. No. 106357, counsel for appellants raise the following errors:
1.The trial court erred in convicting the appellants despite the total absence of evidence against
them;
2.The trial court erred in ruling that conspiracy existed on the basis of the relationship of the
appellants to the principal accused; and
3.The trial court erred in convicting appellants despite their prior conviction for the same
offense in Criminal Case No. 8429.
On the other hand, the brief filed by appellants in the consolidated cases mainly argues that
they cannot be convicted of the crime defined in Presidential Decree No. 1689 because the
informations filed against them alleged prejudice against the complaining witnesses, not against
the national, provincial, or city economy nor was evidence presented therefor.
Appellants conviction must, however, be sustained, the issues raised being devoid of
merit. The number and diversity of issues raised by appellants impel us to discuss the points
raised seriatim.
For the first assignment of error, we hold that the elements of the crime defined and
penalized by P.D. No. 1689 have been proven beyond reasonable doubt in these appealed
cases. The informations filed against appellants alleged that by means of false representation or
false pretenses and through fraudulent means, complainants were defrauded of various amounts
of money by the accused. Article 315, paragraph 2 (a) of the Revised Penal Code provides that
swindling or estafa by false pretenses or fraudulent acts executed prior to or simultaneously with
the commission of the fraud is committed by using fictitious name, or falsely pretending to
possess power, influence, qualifications, property, credit, agency, business or imaginary
transactions, or by other similar deceits. The elements of estafa under this penal provision are:
(1) the accused defrauded another by means of deceit and (2) damage or prejudice capable of
pecuniary estimation is caused to the offended party or third party.[17] It is indisputable that the
foundation failed to return the investments of the complaining witnesses, hence it is undeniable
that the complainants suffered damage in the amount of their unrecouped investments. What
needs elucidation is whether or not the element of defraudation by means of deceit has been
established beyond reasonable doubt.
Fraud, in its general sense, is deemed to comprise anything calculated to deceive, including
all acts, omissions, and concealment involving a breach of legal or equitable duty, trust, or
confidence justly reposed, resulting in damage to another, or by which an undue and
unconscientious advantage is taken of another.[18] It is a generic term embracing all multifarious
means which human ingenuity can device, and which are resorted to by one individual to secure
an advantage over another by false suggestions or by suppression of truth and includes all
surprise, trick, cunning, dissembling and any unfair way by which another is cheated.[19] On the
other hand, deceit is the false representation of a matter of fact whether by words or conduct, by
false or misleading allegations, or by concealment of that which should have been disclosed
which deceives or is intended to deceive another so that he shall act upon it to his legal injury.[20]
In pursuit of their agenda, appellants established a foundation which, by its articles of
incorporation, was established, allegedly to uplift members economic condition by way of
financial or consultative basis. Organized as a non-stock, non-profit charitable institution, its
funds were to be obtained through membership dues and such other assessments as may be
agreed upon by its board of directors.[21]Furthermore, the modus operandi[22] of the foundation,
duly signed by Priscilla Balasa, provided that:

Funding

Any funding requirements to finance the operation of the association shall be done
through the collection of membership fees, dues, donations, bequests and other
assessments. The amount of which shall be subject to the approval of the general
membership of the association.

Likewise, all funds in-flows would be used exclusively to carry out the purposes for
which the FOUNDATION is established and would not inure to the benefit of any
single member of the FOUNDATION.

The operations personnel shall come from volunteers among its members and should
the need arise, hiring of additional personnel be resorted to.

In contravention of these by-laws and modus operandi, the people behind the foundation
enticed people to deposit or invest funds in the foundation under a double or treble your deposit
scheme. These investment activities were clearly ultra vires acts or acts beyond the foundations
authority. Evidently, SEC registration was obtained only for the purpose of giving a semblance
of legitimacy to the foundation; that the foundations business was sanctioned by the government;
and that it was allowed by law to accept deposits. This pretension was carried out even on the
slots it issued, the foundations S.E.C. registry number being indicated thereon.
In carrying out the charade, the manager went to the extent of delivering a speech and
personally encouraging people to deposit or invest in the foundation. Alfonso Lacao, a
complainant and prosecution witness, testified:
Q: Have you heard of this so called Panata Foundation?
A: Yes, maam I heard it from my friends who are talking about this Panata Foundation they even
informed me that the manager of this Panata Foundation is calling for a meeting for all depositors
and prospective depositors on Saturday afternoon.
Q: With that information did you get interested in the proposed meeting being called by this Panata
Foundation?
A: I was curious and came Saturday I went to the office of the Panata Foundation to attend the
meeting.
Q: And at that time where was this office located?
A: At Diaz Apartment, Manalo Extension, Puerto Princesa City.
Q: Did you attend that meeting?
A: Yes maam.
Q: Whom did you see sponsoring that meeting on that particular day?
 A: Upon arrival I saw a woman delivering her message to the depositors and to the prospective
depositors. I asked a friend of me (sic) who is that woman and he informed me that she is the
manager of the Panata Foundation Priscilla Balasa.
x x x x x x x x x
Q: What was Priscilla Balasa doing if any in that particular meeting?
A: In her message she was convincing all the people there to make their deposit to the Panata
Foundation because according to her they were sent here to help the people of Puerto Princesa
City and the people of Palawan.
Q: Aside from that what did Priscilla Balasa tell those people who attended the meeting?
A: She was assuring the people that they must not be afraid to deposit their money because they will
not be fooling around with them.
x x x x x x x x x
Q: And did Priscilla Balasa tell those persons attending the meeting what would happen with the
money they will deposit with the Panata Foundation?
A: She was telling the people that you could deposit the money and it will be doubled within 21 days.
I was further informed that the maximum amount to be deposited is P5,000.00.
Q: You stated a while ago that the amount deposited will be doubled after 21 days?
A: Yes maam.
Q: Aside from that what else if any did Priscilla Balasa tell the public who attended that meeting?
A: She was telling the public to make ease with their deposit because they were sent here to help the
people of Puerto Princesa City and Palawan.
Q: Did she tell the public as to where the money would be coming from?
A: Right that moment she was not able to tell the public.[23]
On cross-examination, Mr. Lacao testified:
Q: But did it not occur to your mind considering your past experience to investigate or cause the
investigation of this Panata Foundation considering your connection as to whether they are in a
position to make double your money investment specially so they are not engage (sic) in
business, so to speak?
A: Once I overheard the manager say when she was there telling the people around the
depositors that their money is being invested in a world bank.[24]
Priscilla Balasa, thus, promised the credulous public quick financial gains on
their investments. The foundation even printed brochures proclaiming the merits of the
foundations investment scheme.[25]Likewise, to bolster the illusion that indeed, the foundation
was legitimate, the claim was made that deposits would be invested abroad in a world bank, with
said transactions allegedly enabling the foundation to double or treble depositors investments.
The evidence, however, proves the contrary. Sylvia Magnaye, one of the tellers, testified:
Q: Other than to issue slots, do you know what other phase of operation in running the Panata
Foundation during the time that you were employed?
 A: No sir, I can only observe that issuing of slots.
Q: Madam Witness, aside from issuing slots, there is only the activity of the foundation that you are
well aware of?
A: Sometimes they also sent me to deposit.
Q: The deposit of the amount collected in the bank, is that correct?
A: I do not know but they just send me to deposit amounts.
Q: But you do not know in what other business activity other than the matter of collecting money and
issuance of slots you do not know if the Panata Foundation is involved in any business activity?
A: Yes, sir.
Q: You do not know whether the foundation receives money regularly from any other source?
A: I do not know sir.[26]
On cross-examination, she testified:
Q: You mentioned Madam Witness, that on several occasions you were asked to deposit certain
amounts in the bank, do you remember having told the Court that?
A: Right, sir.
Q: Do you remember how many banks these deposited amounts were if you remember?
A: I deposited at PNB, PCIBank, and DBP and Rural Bank of Coron.
Q: Do you remember in whose names you deposited these amounts you deposited?
A: In the name of the joint account of Priscilla Balasa and Norma Francisco.[27]
The testimonial evidence presented by the prosecution proves that appellants employed
fraud and deceit upon gullible people to convince them to invest in the foundation. It has been
held that where one states that the future profits or income of an enterprise shall be a certain sum,
but he actually knows that there will be none, or that they will be substantially less than he
represents, the statement constitutes actionable fraud where the hearer believes him and relies on
the statement to his injury.[28] That there was no profit forthcoming can be clearly deduced from
the fact that the foundation was not engaged nor authorized to engage in any lucrative business to
finance its operation. It was not shown that it was the recipient of donations or bequest with
which to finance its double or triple your money scheme, nor did it have any operating capital to
speak of when it started operations.
Parenthetically, what appellants offered the public was a Ponzi scheme, an investment
program that offers impossibly high returns and pays these returns to early investors out of the
capital contributed by later investors.[29] Named after Charles Ponzi who promoted the scheme in
the 1920s, the original scheme involved the issuance of bonds which offered 50% interest in 45
days or a 100% profit if held for 90 days. Basically, Ponzi used the money he received from later
investors to pay extravagant rates of return to early investors, thereby inducing more investors to
place their money with him in the false hope of realizing this same extravagant rate of return
themselves. This was the very same scheme practiced by the Panata Foundation.
 However, the Ponzi scheme works only as long as there is an ever-increasing number of new
investors joining the scheme. To pay off the 50% bonds Ponzi had to come up with a one-and-a-
half times increase with each round. To pay 100% profit he had to double the number of
investors at each stage, and this is the reason why a Ponzi scheme is a scheme and not an
investment strategy. The progression it depends upon is unsustainable. The pattern of increase in
the number of participants in the system explains how it is able to succeed in the short run and, at
the same time, why it must fail in the long run. This game is difficult to sustain over a long
period of time because to continue paying the promised profits to early investors, the operator
needs an ever larger pool of later investors.[30] The idea behind this type of swindle is that the
con-man collects his money from his second or third round of investors and then absconds before
anyone else shows up to collect. Necessarily, these schemes only last weeks, or months at most.
[31]

Note should also be taken of the fact that appellants used slots in their operation. These slots
are actually securities,[32] the issuance of which needs the approval of the Securities and Exchange
Commission. Knowing fully well that the S.E.C. would not approve the issuance of securities by
a non-stock, non-profit organization, the operators of the Ponzi scheme, nevertheless, applied for
registration as a foundation, an entity not allowed to engage in securities.
Finally, if the foundation were indeed legitimate, the incorporators, outside of the members
of the Francisco family, would not have escaped from the clutches of the law. If the foundation
and its investment scheme were legal, then it behooved them to come out and testify for their
own exoneration. The wicked flee when no man pursueth: but the righteous are bold as a lion.[33]
In their defense, appellants would shift the blame on the investors. Invoking the legal
principle of caveat emptor, they maintain that it was the investors own greed that did them in,
implying that the depositors should have known that no sensible business could afford to pay
such extravagant returns. Having investigated the foundation and its activities, the investors
should fault themselves, not the appellants, for investing in the foundation despite the patent
impossibility of its claims.
The contention is untenable. The fact that the buyer makes an independent investigation or
inspection has been held not to preclude him from relying on the representation made by the
seller where the seller has superior knowledge and the falsity of such representation would not be
apparent from such examination or inspection, and, a fortiori, where the efforts of a buyer to
learn the true profits or income of a business or property are thwarted by some device of the
seller, such efforts have been held not to preclude a recovery. [34] It has often been held that the
buyer of a business or property is entitled to rely on the sellers statements concerning its profits,
income or rents. The rule that where a speaker has knowingly and deliberately made a statement
concerning a fact the falsity of which is not apparent to the hearer, and has thus accomplished a
fraudulent result, he cannot defend against the fraud by proving that the victim was negligent in
failing to discover the falsity of the statement is said to be peculiarly applicable where the owner
of the property or a business intentionally makes a false statement concerning its rents, profits or
income. The doctrine of caveat emptor has been held not to apply to such a case.[35]
The second assignment of error is likewise devoid of merit. Appellants deny the existence of
a conspiracy in the perpetration of the fraudulent scheme, charging that mere relationship does
not prove conspiracy. Guillermo Francisco further maintains that he was not even an
incorporator of the foundation.
 The evidence adduced by the prosecution confirms the existence of a conspiracy among the
appellants in committing the crime charged. The fact that Guillermo Francisco was not an
incorporator of the foundation does not make him any less liable for the crime charged. By his
own admission, he participated in the foundations activities by serving as its paymaster. Because
he is father and husband to three of the organizers of the foundation, it is not farfetched to
presume that he was aware of its operations. By his active cooperation, he showed a community
of design with the incorporators of the foundation, thereby making him a co-conspirator and
equally liable for the crime charged. His voluntary and indispensable cooperation was a
concatenation of the criminal acts performed by his co-accused.[36] In this regard, appellant
Guillermo Francisco is not being implicated as a co-conspirator solely because he is the father of
the principal proponent of the Ponzi scheme. He is held liable as a conspirator because of his
indispensable act of being the paymaster of the foundation.
Likewise, Norma Franciscos bare denial cannot exempt her from complicity. Denials of an
accused cannot be accorded greater evidentiary weight than the positive declarations of credible
witnesses who testify on affirmative matters.[37] Moreover, her efforts to show that she was a
mere housewife who simply helped in her daughters business is refuted by the prosecution
witnesses. Ruth Jalover testified:
Q: Madam Witness, do you know a person by the name of Norma Francisco?
A: Yes sir.
Q: And how did you come to know her Madam Witness?
A: She is my co-employee at the Panata Foundation sir.
Q: What was her job in the Panata Foundation?
A: She was the one who received the money from our tellers every afternoon.[38]
Sylvia Magnaye, on the other hand, testified:
Q: Madam Witness, do you know a person by the name of Norma Francisco?
A: Yes sir.
Q: How did you come to know her Madam Witness?
A: She is our former cashier sir.
Q: In the Panata Foundation?
A: Yes sir.[39]
On cross-examination, she further testified:
Q: Now, I would like to direct your attention also to the other accused, Norma Francisco. You stated
that she is your cashier, do you remember having done that?
A: Yes sir.
Q: When you say she is the cashier, do you mean to say that she is the one who pays out money or
amounts to the employees Madam Witness?
A: Yes sir.[40]
 Aside from being the cashier, Norma Francisco was also an incorporator of the
foundation. Likewise, the money invested in the foundation was deposited in joint bank accounts
in Priscilla Balasas name and hers. Norma Franciscos activities would thus show a community of
design with the other accused making her a co-conspirator and equally liable for the crime
charged. Her voluntary and indispensable cooperation concurred with the criminal acts
performed by her co-accused.
As for Analina Francisco, however, the evidence adduced as to her complicity in the
nefarious scheme is far from conclusive. While she was an incorporator and treasurer of the
foundation, there is no denying the fact that she is a deaf-mute. As such, she is incapable of
communicating and conveying her thoughts to the complaining witnesses and other
depositors. This casts serious doubt on whether she could be deemed to have similarly conspired
and confederated with the other accused. As Branch 52 pointed out, on paper she might have
been in the thick of the foundations operation being an incorporator and treasurer. We are not,
however, convinced that she was actually involved in the sinister scheme. In fact, she was given
the manual task of typing papers, despite her being the treasurer of the foundation.Her disability
might have been the principal reason for giving her that job she was literally deaf and mute to the
nefarious activities going on in the foundation that she did not pose a danger to it. Furthermore, it
is well settled that where the acts of an accused are capable of two interpretations, that which is
in consonance with innocence should prevail.
With respect to the third assignment of error, appellants cannot raise the defense of double
jeopardy for which the following requisites must concur: (1) a first jeopardy must have attached
prior to the second; (2) the first jeopardy must have been validly terminated; (3) the second
jeopardy must be for the same offense, or the second offense includes or is necessarily included
in the offense charged in the first information, or is an attempt to commit the same or a
frustration thereof.[41] In the instant case, the offense charged in Criminal Case No. 8429 is
different from the offense charged in the other cases. While these cases arose out of the same
scheme, the fraudulent acts charged were committed against different persons, hence they do not
constitute the same offense.
Lastly, appellants assert that they cannot be convicted under P.D. No. 1689. They contend
that the following requisites must concur for conviction under P.D. No. 1689: (1) that estafa is
committed under Articles 315 or 316 of the Revised Penal Code; (2) by a syndication of five or
more persons; (3) against a) stockholders or members of rural banks, cooperatives, or samahang
nayon; b) corporations or associations the funds of which are solicited from the general public;
and (4) such defraudation erodes the confidence of the public in the banking and cooperative
systems, contravenes public interest, and (5) constitutes economic sabotage that threatens the
stability of the nation.[42]
In support of their argument, appellants point out that there could not have been economic
sabotage under the facts of the case because the total amount of P125,400.00 allegedly
embezzled by the other accused (not herein appellants), did not weaken or threaten national
economic stability. To emphasize that point, appellants enumerate the revenue collections of
Palawan and Puerto Princesa City, for dearth of a better reference, from 1987 to 1992 showing
that the revenue collections for 1989 alone amounted to P75,002,499,19. Appellants assert that
as compared to such revenue collection in 1989, the amount allegedly embezzled was
negligible. As such, the crime committed in this case was not of the same genre as the Agrix and
Dewey Dee scams that spurred the birth of P.D. No. 1689.[43]
Appellants, in a desperate attempt to avoid conviction, grasp at straws. The law upon which
appellants have been charged and convicted reads as follows:

PRESIDENTIAL DECREE NO. 1689

INCREASING THE PENALTY FOR CERTAIN FORMS OF SWINDLING OR

ESTAFA.

WHEREAS, there is an upsurge in the commission of swindling and other forms of

frauds in rural banks, cooperatives, samahang nayon(s), and farmers associations or
corporations/associations operating on funds solicited from the general public;

WHEREAS, such defraudation or misappropriation of funds contributed by

stockholders or members of such rural banks, cooperatives, samahang nayon(s), or
farmers associations, or of funds solicited by corporations/associations from the
general public, erodes the confidence of the public in the banking and cooperative
system, contravenes the public interest, and constitutes economic sabotage that
threatens the stability of the nation;

WHEREAS, it is imperative that the resurgence of said crimes be checked, or at least

minimized, by imposing capital punishment on certain forms of swindling and other
frauds involving rural banks, cooperatives, samahang nayon(s), farmers associations
or corporations/associations operating on funds solicited from the general public;

NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines, by

virtue of the powers vested in me by the Constitution, do hereby decree and order as
follows:

SEC. 1. Any person or persons who shall commit estafa or other forms of swindling
as defined in Article 315 and 316 of the Revised Penal Code, as amended, shall be
punished by life imprisonment to death if the swindling (estafa) is committed by a
syndicate consisting of five or more persons formed with the intention of carrying out
the unlawful or illegal act, transaction, enterprise or scheme, and the defraudation
results in the misappropriation of moneys contributed by stockholders, or members of
rural banks, cooperatives, samahang nayon(s), or farmers associations, or of funds
solicited by corporations/associations from the general public.

When not committed by a syndicate as above defined, the penalty imposable shall
be reclusion temporal to reclusion perpetua if the amount of the fraud exceeds
100,000 pesos.
SEC. 2. This decree shall take effect immediately.

DONE in Manila, Philippines, this 6th day of April, in the year of Our Lord, nineteen
hundred and eighty.

Under this law, the elements of the crime are: (a) estafa or other forms of swindling as
defined in Articles 315 and 316 of the Revised Penal Code is committed; (b) the estafa or
swindling is committed by a syndicate, and (c) defraudation results in the misappropriation of
moneys contributed by stockholders, or members of rural banks, cooperatives, samahang
nayon(s), or farmers associations, or of funds solicited by corporations/associations from the
general public. These are the only elements of the crime under Section 1 of the decree. The two
other ingredients added by appellants to constitute the crime of economic sabotage under P.D.
No. 1689 have been taken from the whereas clause or preamble of the law. A preamble is not
exactly an essential part of an act as it is an introductory or preparatory clause that explains the
reasons for the enactment, usually introduced by the word whereas.[44] In People v. Purisima,
[45]
 we explained that the preamble serves as the key to the intent and spirit of the decree. It
enumerates the facts or events justifying the promulgation of the decree and the sanctions for the
acts prohibited therein. As such, although it is an aid in interpretation, the preamble of an act or
decree is not the law subject thereof. Appellants novel theory must, therefore, be given short
shrift by this Court.
Assuming arguendo that the preamble was part of the statute, appellants contention that they
should not be held criminally liable because it was not proven that their acts constituted
economic sabotage threatening the stability of the nation remains too flimsy for extensive
discussion. As the preamble of P.D. No. 1689 shows, the act prohibited therein need not
necessarily threaten the stability of the nation. It is sufficient that it contravenes public
interest. Public interest was affected by the solicitation of deposits under a promise of substantial
profits, as it was people coming from the lower income brackets who were victimized by the
illegal scheme.
Similarly, the fact that the entity involved was not a rural bank, cooperative, samahang
nayon or farmers association does not take the case out of the coverage of P.D. No. 1689. Its
third whereas clause states that it also applies to other corporations/associations operating on
funds solicited from the general public. The foundation fits into these category as it operated on
funds solicited from the general public.To construe the law otherwise would sanction the
proliferation of minor-league schemers who operate in the countryside. To allow these crimes to
go unabated could spell disaster for people from the lower income bracket, the primary target of
swindlers.
Again, P.D. No. 1689 penalizes offenders with life imprisonment to death regardless of the
amount involved, provided that a syndicate committed the crime. A syndicate is defined in the
same law as consisting of five or more persons formed with the intention of carrying out the
unlawful or illegal act, transaction, enterprise or scheme. If the offenders are not members of a
syndicate, they shall nevertheless be held liable for the acts prohibited by the law but they shall
be penalized by reclusion temporal to reclusion perpetua if the amount of the fraud is more than
one hundred thousand pesos (P100,000.00).
 In the instant case, a syndicate perpetrated the Ponzi scheme. The evidence shows that at
least five persons Priscilla Balasa, Normita Visaya, Norma Francisco, Guillermo Francisco, and
the other incorporators of the foundation collaborated, confederated and mutually helped one
another in directing the foundations activities.
In its decision in Criminal Case Nos. 8428 and 8734, Branch 50 found that the accused
numbering 5 who composed the Francisco Family together with others acted and operated as a
syndicate as defined under P.D. No. 1689 and should be held liable therefor. [46] However, it
imposed the penalty of reclusion perpetua, the penalty imposable under the second paragraph of
Section 1 of P.D. No. 1689 where the offenders are not members of a syndicate and the amount
involved is more than P100,000.00. The existence of a syndicate having been proved, the crime
falls under the first paragraph of Section 1 of P.D. No. 1689, with an imposable penalty of life
imprisonment to death. Hence, the imposition of reclusion perpetua is incorrect. Given the
absence of aggravating or mitigating circumstances, the lesser penalty, or life imprisonment,
should have been meted out.[47]
Branch 52, likewise, ruled that the accused committed the offense of estafa by a syndicate
under P.D. No. 1689. Therefore appellants, due to the absence of mitigating or aggravating
circumstances, should have been punished with life imprisonment. However, in the dispositive
portion of its decision in the four cases assigned to it, Branch 52 imposed the penalty
of reclusion perpetua instead.
The Court finds this an opportune time to restate that the penalties of life imprisonment
and reclusion perpetua are not the same. Thus:

While `life imprisonment may appear to be the English translation of reclusion perpetua, in
reality, it goes deeper than that. First, `life imprisonment is invariably imposed for serious
offenses penalized by special laws, while reclusion perpetua is prescribed under The Revised
Penal Code. Second, `life imprisonment, unlike reclusion perpetua, does not carry with it any
accessory penalty. Third, `life imprisonment does not appear to have any definite extent or
duration, while reclusion perpetua entails imprisonment for at least thirty (30) years after which
the convict becomes eligible for pardon, although the maximum period thereof shall in no case
exceed forty (40) years.[48]

WHEREFORE, premises considered, the decisions appealed from are

hereby AFFIRMED in so far as appellants GUILLERMO and NORMA FRANCISCO are
convicted for violation of the first paragraph of Section 1 of Presidential Decree No. 1689 and
ordered to restitute to complainants the amounts they have been defrauded, subject to
the MODIFICATION that appellants GUILLERMO and NORMA FRANCISCO shall each
suffer the penalty of life imprisonment for each violation of the same law under the
corresponding criminal cases. Appellant ANALINA FRANCISCO is hereby ACQUITTED of
the crimes charged under Criminal Case Nos. 8428 and 8734 on ground of reasonable doubt and
her immediate release from custody is ordered unless she is being held on other legal grounds.
Let a copy of this Decision be furnished the Department of Justice and the Philippine
National Police in order that the arrest of Priscilla Balasa, Normita Visaya and the others who
have so far eluded the law shall be effected with dispatch.
SO ORDERED.
 Narvasa, C.J., (Chairman), Kapunan, and Purisima, JJ., concur.
 

[1]
 Claudian, De Consulatu Stilichonis. Bk. ii, l. 111.
[2]
 Exh. J, Crim. Case No. 8428.
[3]
 Exh. F (Crim. CaseNo. 8428)
[4]
 Sylvia Magnaye, TSN, February 12, 1991, pp. 18-53.
[5]
 Ibid., pp. 29-30.
[6]
 Sylvia Magnaye, TSN, July 25, 1991, pp. 6 & 20-22.
[7]
 Sylvia Magnaye, TSN, February 12, 1991, p. 50
 Ruth Jalover, together with Rosemarie Balasa and Sylvia Magnaye turned state witnesses and were consequently
[8]

excluded from the informations.

[9]
 Supra.
[10]
 See Note 8.
[11]
 TSN, September 13, 1991, p. 11.
[12]
 Ibid., pp. 9-15.
[13] 
TSN, September 13, 1991, pp. 2-9.
[14]
 Promulgated on December 23, 1991.
[15]
 Promulgated on February 19, 1992.
[16]
 Promulgated on October 14, 1991.
[17]
 De la Cruz vs. CA, 265 SCRA 299 (1996); People v. Bautista, 241 SCRA 216 (1995).
[18]
 CIR vs. CA, 257 SCRA 200 (1996).
[19]
 Alleje vs. CA, 240 SCRA 495 (1995), citing Blacks Law Dictionary, 4th ed.
[20]
 People v. Castillo, 76 Phil. 72 (1946).
[21]
 Article VII of Panata Foundation Inc. By-laws provides as follows:
Section 1. Funds The funds of the association shall be derived from admission fees, annual dues and special
assessments of members, gifts, donations or benefits.
Section 2. Fees and Dues Every member of the association shall, in addition to the membership fee pay dues and/or
assessments that may be imposed by the association from time to time.
Section 3. Disbursements Withdrawal from the funds of the association, whether by check or any other instrument
shall be signed by the Treasurer and countersigned by the President. If necessary, the Board of Trustees may
designate other signatories.
 Exh. J-14. The modus operandi or a detailed explanation as to how the foundation shall carry out its objectives, is
[22]

a SEC requirement which must be submitted by non-stock corporations (See SEC Quarterly Bulletin No. 3,
September 1982, p. 77).
[23]
 TSN, April 11, 1991, pp. 3-6.
[24]
 Ibid., p. 23.
[25]
 Sylvia Magnaye, TSN, February 12, 1991, p. 27.
[26]
 TSN, March 15, 1991, pp. 36-37.
[27]
 Ibid., pp. 39-40.
[28]
 37 Am. Jur. Fraud and Deceits 130.
[29]
 http://risk.ifci.ch.
 This ever increasing base of investors is the reason why a Ponzi scheme is alternatively known as a pyramid
[30]

scheme or pyramiding scheme. Technically speaking, however, a pyramid scheme is different from a Ponzi scheme.
A pyramid sales scheme as defined in Section 53 of R.A. 7394, known as the Consumer Act of the Philippines,
involves:
x x x sales devices whereby a person, upon condition that he makes an investment, is granted by the manufacturer or
his representative a right to recruit for profit one or more additional persons who will also be granted such right to
recruit upon condition of making similar investments: Provided, That, the profits of the person employing such a
plan are derived primarily from the recruitment of other persons into the plan rather than from the sale of consumer
products, services and credit; Provided, further, That the limitation on the number of participants does not change
the nature of the plan.
In the classic pyramid scheme 10 people say, make an investment and each in turn gets 10 additional people to
invest, who in their turn must each get 10, and so on. The money for the first 10 investors comes from the 10 they
enroll, and the money for the second group of 10 comes from the 10 investors that each of them enrolls, and so on.
This type of scheme involves a geometric increase in the number of investors. The interesting thing about a
geometric progression like this is that starting with only 10 investors, by the 10th round of such a scheme the number
of participants would have to be twice as large as the total population of the earth. Diagrammatically, such a
scheme looks like a pyramidhence its name.
[31] 
http://199.173.224.3/history/Ponzi.html.
 Sec. 2 (a) of The Revised Securities Act (B.P. Blg. 178) defines securities as including bonds, debentures, notes,
[32]

evidences of indebtedness, shares in a company, preorganization certificates or subscriptions, investment contracts,

certificates of interest or participation in a profit sharing agreement, collateral trust certificates, equipment trust
certificates (including conditional sale contracts or similar interests or instruments serving the same purpose), voting
trust certificates, certificates of deposit for a security, x x x.
[33]
 Proverbs 28:1.
[34]
 37 Am. Jur. Fraud and Deceits 234.
[35]
 Ibid., 277.
[36]
 Subayco v. Sandiganbayan, 260 SCRA 798 (1996).
[37]
 People v. Pabalan, 262 SCRA 574 (1996).
[38]
 TSN, March 13, 1991, pp. 6-7.
[39]
 TSN, March 15, 1991, p. 11.
[40]
 Ibid., p. 39.
[41]
 Guerrero vs. CA, 257 SCRA 703 (1996).
[42]
 Rollo, pp. 109-110.
[43]
 Ibid., pp. 111-114.
[44]
 Viray v. Amnesty Commission, 85 Phil. 354 (1950).
[45]
 86 SCRA 542 (1978).
[46]
 Decision, p. 10.
[47]
 Art. 65, Revised Penal Code.
[48]
 People vs. Ballabare 264 SCRA 350 (1996), citing People vs. Retuta, 234 SCRA 645 (1994).

FIRST DIVISION

[G.R. No. 159280. May 18, 2004]

AUGUSTO SIM, JR., petitioner, vs. HON. COURT OF APPEALS and

The PEOPLE OF THE PHILIPPINES, respondents.

DECISION
YNARES-SANTIAGO, J.:

On appeal by petition for review on certiorari under Rule 45 of the 1997 Rules of

Civil Procedure is a Decision  by the Court of Appeals (CA) dated May 21, 2003
[1]

affirming with modification the Decision  of the Regional Trial Court (RTC) of Manila,
[2]

Branch 34, finding petitioner Augusto Sim, Jr. and co-accused Elison Villaflor guilty
beyond reasonable doubt of estafa under Article 315, paragraph 2 (a) of the Revised
Penal Code, instead of Article 315, paragraph 1 (b) thereof, as well as its
Resolution  dated [3]
August 1, 2003 denying appellants Motion for
Reconsideration. Petitioner and co-accused Elison Villaflor were sentenced to suffer an
indeterminate prison term of four (4) years and two (2) months of prisin correccional, as
minimum, to twenty (20) years of reclusin temporal, as maximum, and to indemnify the
private complainant Jay Byron Ilagan the sum of P480,000.00 representing the amount
paid for the purchase of the car that was impounded by the authorities.
Elison Villaflor and Augusto Sim, Jr., were formally charged with the crime of Estafa
in an Information dated September 6, 1999 which reads: [4]

That on or about May 2, 1998, in the City of Manila, Philippines, the said accused,
conspiring and confederating together and mutually helping one another, did then and
there willfully, unlawfully and feloniously defraud Jay Byron Ilagan in the following
manner, to wit: the said accused by means of false manifestations which they made to
said Jay Byron Ilagan to the effect that they are selling one (1) colored green Nissan
Pathfinder pick-up with motor number PD27-555735 bearing Plate No. BCF-620 in
the amount of P480,000.00 registered in the name of Henry Austria, and by means of
other similar deceits, induced and succeeded in inducing said Jay Byron Ilagan to give
and deliver, as in fact he gave and delivered to said accused the amount of
P480,000.00 on the strength of said manifestations and representations, said accused
well knowing that the same were false and fraudulent, as the said car is a stolen car
and they are not the owner, and were made solely, to obtain, as in fact they did obtain
the amount of P480,000.00 which amount once in their possession, with intent to
defraud, willfully, unlawfully and feloniously misappropriated, misapplied and
converted to their own personal use and benefit, to the damage and prejudice of said
Jay Byron Ilagan in the aforesaid amount of P350,000.00, Philippine currency.

Contrary to law.

Private complainant Jay Byron Ilagan is a tire supplier whose store, Marfi Tire
Supply, is located along the highway at San Pablo City, Laguna. He had been dealing
with accused Elison Villaflor for twenty years, as the latter is engaged in the same
business of selling tires and rims at 39 C-3 Road, Dagat-Dagatan, Caloocan City.
In March 1998, private complainant talked to Elison somewhere in Tondo, Manila,
and expressed his interest in buying a vehicle. Elison told him that he knew someone
who sells vehicles at a cheap price, and that he had bought a Toyota Tamaraw FX at
lower than the market price. Private complainant then asked Elison to ask if there was
an Isuzu pick-up for sale. A month later, Elison called private complainant to inform him
that he was able to find a 1997 Nissan Pathfinder. They agreed to inspect the vehicle
together as private complainant wanted to buy it before his birthday on May 31, 1998. [5]

On April 30, 1998, only Elison went to Dagupan City to get the Nissan Pathfinder
from his friend, petitioner Augusto Sim, Jr. Petitioner told Elison that the Nissan
Pathfinder was given to him by a customer in payment of a debt and had been used
only for a year.
Elison brought the 1997 Nissan Pathfinder to San Pablo City. Private complainant at
first did not like the vehicle since it was not the brand he was looking for. Elison said
that his kumpadre would look at the vehicle as the latter was also interested in it.
[6]
 Private complainant decided to buy the 1997 Nissan Pathfinder at the agreed price
of P480,000.00. The amount was paid in five checks issued by Fe Ilagan under her
account at Solidbank-San Pablo Branch. One check was dated May 6, 1998 in the sum
of P350,000.00, and four checks in the sum of P32,500.00 each was dated June 6, July
6, August 6 and September 6, all in 1998. [7]

Elison gave private complainant photocopies of the Certificate of Registration (C.R.)

and Official Receipt (O.R.) issued by the Land Transportation Office (LTO) showing the
name of the owner as one Henry Austria. While waiting for the processing of the papers,
the vehicle was parked at private complainants place. After a week, Elison brought the
deed of sale which private complainant signed without the signature of the owner, Henry
Austria. After private complainant signed the deed of sale, he gave it back to Elison to
be brought back to Dagupan City for signing by the owner/vendor and transfer of
registration in the name of private complainant.[8]

On June 7, 1998, Elison returned and delivered to private complainant the deed of
sale signed by the owner/vendor, together with the new C.R. and O.R. issued by the
LTO of Lingayen, Pangasinan in the name of private complainant. [9]

The checks given by private complainant in payment of the vehicle were deposited
by petitioner in his name at Solidbank-Dagupan Branch. All five checks were debited in
favor of petitioner. After receiving the registration papers from Elison, private
complainant was eventually able to use the Nissan Pathfinder. [10]

On October 28, 1998, private complainants vehicle was apprehended by Anti-

Carnapping operatives of the Philippine National Police (ANCAR NCRTMO). The
vehicle and its registration papers were inspected and thereafter brought to Camp
Crame. It turned out that the vehicle was a hot car as it had been reported stolen on
November 29, 1997 by its real owner, Golf Construction of the Philippines, Inc. pursuant
to the Alarm Sheet issued by the PNP Traffic Management Group. [11]

Private complainant accompanied the ANCAR operatives to the residence of Elison.

He went with them to Camp Crame, and named petitioner as the owner of the
vehicle. However, they were not able to locate petitioner right away. Meanwhile, the
vehicle was impounded by the authorities. The investigation revealed that its original
motor and chassis numbers were replaced and/or tampered but its Production Number
remained intact. Eventually, the real description of the vehicle was fully established and
identified by no less than the manufacturer/assembler of the unit, Universal Motors
Corporation.[12]

Private complainant spoke with Elison about the possible recovery of the money
paid by him for the confiscated vehicle. On November 30, 1998, private complainant
met petitioner for the first time. Petitioner signed a Promissory Note with Deed of
Undertaking whereby he obligated himself to pay private complainant the amount of
P480,000.00 plus attorneys fees of P50,000.00 in scheduled installments. Petitioner
issued a check in the amount of P75,000.00 but private complainant did not encash it,
thinking that if he does, petitioner would not pay him anymore. Private complainant was
unable to recover the money paid by him to petitioner. [13]
 Thereafter, Elison and petitioner were charged with estafa under a criminal
information dated September 6, 1999. Elison was arraigned on September 17, 1999;
while petitioner was arraigned on June 1, 2000. Both pleaded not guilty.
After trial, the trial court convicted both Elison and petitioner of the crime of estafa
under Art. 315, par. 1 (b) of the Revised Penal Code. On appeal, the Court of Appeals
affirmed the trial courts judgment with the modification that appellants should be
convicted of estafa under Art. 315, par. 2 (a).
Hence, this petition for review on certiorari, assigning the following errors:
I
THE HONORABLE COURT OF APPEALS, WITH DUE RESPECT, COMMITTED
REVERSIBLE ERROR WHEN IT RULED THAT CONSPIRACY IS PRESENT
CONTRARY TO THE EVIDENCE ON RECORD.
II
THE HONORABLE COURT OF APPEALS, WITH DUE RESPECT, COMMITTED
REVERSIBLE ERROR WHEN IT FAILED TO RULE ON THE ACQUITTAL OF
HEREIN PETITIONER.
Two issues are presented before this Court: (1) Whether there was conspiracy
between petitioner and Elison Villaflor in defrauding private complainant Jay Byron
Ilagan; and (2) Whether petitioner is guilty beyond reasonable doubt of the crime of
estafa under Art. 315, par. 2 (a) of the Revised Penal Code.
On the first assignment of error, petitioner argues that there is no conspiracy
between him and co-accused. He points that it was only co-accused Elison Villaflor who
dealt with private complainant. The latter had not even met him before he was allegedly
forced to sign the amicable agreement.
Petitioner further alleges that contrary to the findings of the appellate court, there is
no convincing evidence to show that petitioner performed any previous or simultaneous
act with Elison in committing the offense against private complainant. The witnesses
presented by the prosecution did not show or prove that petitioner directly participated
in the commission of the offense or performed an act which would show community of
purpose with Elison.
Petitioners argument is bereft of merit.
Even in the absence of direct evidence of prior agreement to commit the crime,
conspiracy may be deduced from the acts of the perpetrators before, during and after
the commission of the crime, which are indicative of a common design, concerted action
and concurrence of sentiments.  Conspiracy is deemed implied when the malefactors
[14]

have a common purpose and were united in its execution. Spontaneous agreement or

active cooperation by all perpetrators at the moment of the commission of the crime is
sufficient to create joint criminal responsibility. [15]

In Erquiaga v. Court of Appeals,  we ruled that conspiracy, as a rule, has to be

[16]

established with the same quantum of proof as the crime itself and shown as clearly as
the commission of the crime. However, conspiracy need not be shown by direct
evidence, but may take the form of circumstances which, if taken together, would
conclusively show that the accused came to an agreement to commit a crime and
decided to carry it out with their full cooperation and participation.
As correctly pointed out by the appellate court, petitioners actions in relation to the
fraudulent sale of the Nissan Pathfinder to private complainant clearly established
conspiracy as alleged in the information, which acts transcend mere knowledge or
friendship with co-accused Elison.  Notwithstanding the fact that it was only Elison who
[17]

dealt with or personally transacted with private complainant until the time the sale was
consummated, by his own testimony petitioner admitted all the acts by which he actively
cooperated and not merely acquiesced in perpetrating the fraud upon private
complainant.  That petitioner is a conspirator having joint criminal design with Elison is
[18]

evident from the fact that as between them, both knew that petitioner was the person
selling the vehicle under the false pretense that a certain Henry Austria was the
registered owner.  Petitioner, together with Elison, clearly deceived private complainant
[19]

in order to defraud him in the amount of P480,000.00, to the latters damage and
prejudice. In addition, the acts of petitioner in deliberately misrepresenting himself to
private complainant as having the necessary authority to possess and sell to the latter
the vehicle so that he could collect from him P480,000.00 only to renege on that
promise and for failure to reimburse the said amount he collected from private
complainant, despite demand, amount to estafa punishable under Art. 315, par. 2 (a).
The Court of Appeals, in affirming the findings of fact of the trial court, aptly
observed: [20]

That conviction under the afore-cited provision is more proper is evident from the trial
courts finding that appellant Augusto Sim, Jr. from the very beginning was aware that
the subject vehicle was not his nor given to him in payment of debt as he made
appellant Villaflor to believe. Nonetheless, appellant Villaflor was not absolved from
liability, having actively conspired with appellant Augusto Sim, Jr. to convince
private complainant to purchase the Pathfinder upon their false pretense and
representation that said vehicle was being sold by its real owner, Henry Austria, the
name appearing in the registration papers and deed of sale under circumstances clearly
showing their knowledge that the status of said vehicle is dubious or anomalous, as in
fact it turned out to be a hot car or had been stolen/carnapped from its true owner. The
totality of the evidence indicates a common or joint design, purpose and objective of
the accused-appellants to defraud private complainant who parted with his money
upon the belief that there is no problem regarding the ownership of the Pathfinder sold
to him by the appellants.

The trial court rejected the argument of the defense that it was private complainant
who supposedly had the vehicle and its registration papers checked at Camp Crame
before buying the same. It pointed out that verification would have been difficult
considering that the motor and chassis numbers in the registration papers are correct
but the name of the owner appearing therein is false.
 Elisons false pretense in holding out that he had authorization from the owner to sell
the 1997 Nissan Pathfinder was made in conjunction with petitioners fraudulent
misrepresentation that he was legally entitled to possess the aforesaid vehicle. The
evidence shows that petitioner and Elison acted in conspiracy to deceive private
complainant into buying a stolen Nissan Pathfinder, thereby defrauding the latter in the
amount of P480,000.00, and upon their false pretense and representation as to the real
status of the vehicle, i.e., that said unit is in fact being sold by its true owner Henry
Austria and that Augusto Sim, Jr. in whose name the checks were issued had the
authority or right to sell the same. After a few months, the vehicle sold was
apprehended and impounded by police authorities for being stolen or carnapped which
resulted in pecuniary damage to private complainant who had demanded the return of
his money from petitioner and Elison.  The evidence of the prosecution satisfactorily
[21]

established the fraudulent acts and representations which induced private complainant
to part with his money for which he suffered damage and loss when the vehicle sold to
him by petitioner and Elison was recovered by its true owner through operatives of the
police anti-carnapping group.[22]

On the second assignment of error, petitioner contends that the evidence is not
sufficient to prove petitioners guilt beyond reasonable doubt for the crime of estafa
under Art. 315, par. 2 (a) of the Revised Penal Code.
Petitioners contention is untenable.
While the trial court charged and convicted petitioner and his co-accused of estafa
under Art. 315, par. 1 (b) of the Revised Penal Code, the appellate court modified the
lower courts decision by convicting them of the same crime under Art. 315, par. 2 (a).
Regardless of whether petitioner is charged or convicted under either par. 1 (b) or
par. 2 (a) of Art. 315 of the Revised Penal Code, he would still be guilty of estafa
because damage and deceit, which are essential elements of the crime, have been
established by proof beyond reasonable doubt. False pretenses or fraudulent acts were
committed prior to or simultaneous with the commission of the fraud by falsely
pretending to possess property. In this case, false pretenses or fraudulent acts were
employed prior to or simultaneously with the commission of the fraud by falsely
pretending to possess the 1997 Nissan Pathfinder, where damage and deceit have
been established by proof beyond reasonable doubt.
Fraud, in its general sense, is deemed to comprise anything calculated to deceive,
including all acts, omissions and concealment involving a breach of legal or equitable
duty, trust or confidence justly reposed, resulting in damage to another, or by which an
undue and unconscientious advantage is taken of another. It is a generic term
embracing all multifarious means which human ingenuity can device, and which are
resorted to by one individual to secure an advantage over another by false suggestions
or by suppression of truth and includes all surprise, trick, cunning, dissembling and any
unfair way by which another is cheated. Deceit is a species of fraud.[23]

Swindling or estafa by means of false pretenses or fraudulent acts executed prior to

or simultaneously with the commission of the fraud is committed [b]y using fictitious
name, or falsely pretending to possess power, influence, qualifications, property, credit,
agency, business or imaginary transactions, or by other similar deceits.[24]

The elements of estafa under Art. 315, par. 2 (a) are: (1) There must be a false
pretense, fraudulent act or fraudulent means; (2) Such false pretense, fraudulent act or
fraudulent means must be made or executed prior to or simultaneously with the
commission of the fraud; (3) The offended party must have relied on the false pretense,
fraudulent act or fraudulent means, that is, he was induced to part with his money or
property because of the false pretense, fraudulent act or fraudulent means; (4) As a
result thereof, the offended party suffered damage. [25]

These four elements are present in the instant case: (1) False pretenses were
employed by petitioner and his co-accused to deceive private complainant into
purchasing the stolen Nissan Pathfinder; (2) False pretenses were employed prior to,
and simultaneously with, the fraudulent sale of the Nissan Pathfinder; (3) Private
complainant relied on false pretenses of petitioner and co-accused, inducing him to part
with his money due to the misrepresentation employed by the perpetrators of the fraud;
and (4) As a result of false pretenses and misrepresentations by petitioner and co-
accused, private complainant suffered damages in the amount of P480,000.00.
Furthermore, we find no cogent reason to disturb the findings of the trial court,
which is in the best position to make an assessment of the witnesses credibility and to
appreciate complainants truthfulness, honesty and candor.  Factual findings of trial
[26]

courts, as well as their assessment of the credibility of witnesses, are entitled to great
weight and respect by this Court more so when these are affirmed by the Court of
Appeals.  As against the positive and categorical testimonies of the complainant,
[27]

petitioners mere denial cannot prevail.

The proper imposable penalty for the crime of estafa under Art. 315, par. 2 (a)
is prisin correccional in its maximum period to prisin mayor in its minimum period, if the
amount of the fraud is over P12,000.00 but does not exceed P22,000.00, and if such
amount exceeds the latter sum, the penalty shall be imposed in its maximum period,
adding one (1) year for each additional P10,000.00; but the total penalty which may be
imposed shall not exceed twenty (20) years. In such cases, the penalty shall be
termed prisin mayor or reclusin temporal, as the case may be.
Under the Indeterminate Sentence Law,  if the offense is punished by the Revised
[28]

Penal Code, the court shall sentence the accused to an indeterminate penalty, the
maximum term of which shall be that which, in view of the attending circumstances,
could be properly imposed under the rules of the Revised Penal Code, and the
minimum term of which shall be within the range of the penalty next lower to that
prescribed by the Code for the offense. The penalty next lower should be based on the
penalty prescribed by the Code for the offense, without first considering any modifying
circumstance attendant to the commission of the crime. The determination of the
minimum penalty is left by law to the sound discretion of the court and can be anywhere
within the range of the penalty next lower without any reference to the periods into
which it might be subdivided. The modifying circumstances are considered only in the
imposition of the maximum term of the indeterminate sentence.
 In the present case, petitioner defrauded private complainant in the amount of
P480,000.00. The fact that the amount involved in the case at bar exceeds P22,000.00
should not be considered in the initial determination of the indeterminate penalty;
instead, the matter should be so taken as analogous to modifying circumstances in the
imposition of the maximum term of the full indeterminate sentence. This legal
interpretation accords with the rule that penal laws should be construed in favor of the
accused. [29]

The maximum penalty to be imposed on petitioner should be taken from the

maximum period of the penalty under Art. 315, which is reclusin temporal, since the
amount defrauded exceeds P22,000.00, adding one year for each additional
P10,000.00, but the total penalty which may be imposed should not exceed twenty (20)
years.
Since the penalty prescribed by law for the crime of estafa under Art. 315  is prisin
[30]

mayor in its minimum period if the amount of the fraud exceeds P22,000.00, the
minimum term should be within the range of the penalty next lower to that prescribed by
the Code for the offense, which is prisin correccional in its maximum period. Hence, the
minimum period of the penalty should be from four (4) years, two (2) months and one
(1) day to six (6) years. The determination of the minimum penalty is left by law to the
sound discretion of the court and can be anywhere within the range of the penalty next
lower without any reference to the periods into which it might be subdivided.
We are convinced that the appropriate penalty in accordance with law that can best
serve the ends of justice in the case at bar should range from four (4) years, two (2)
months and one (1) day of prisin correccional, as minimum, to twenty years of reclusin
temporal, as maximum, for the crime of estafa under Art. 315, par. 2 (a) of the Revised
Penal Code.
WHEREFORE, the May 21, 2003 Decision and August 1, 2003 Resolution of the
Court of Appeals is AFFIRMED with MODIFICATION as to the penalty
imposed. Appellant Augusto Sim, Jr. is sentenced to an indeterminate prison term of
four (4) years, two (2) months and one (1) day of prisin correccional, as minimum, to
twenty (20) years of reclusin temporal, as maximum, for the crime of estafa under Art.
315, par. 2 (a). He is further ordered to indemnify the private complainant Jay Byron
Ilagan, jointly and severally with Elison Villaflor, the sum of P480,000.00 with interest of
twelve percent (12%) per annum until fully paid.
Costs against petitioner.
SO ORDERED.
Panganiban, (Working Chairman), Carpio and Azcuna, JJ., concur.
Davide, Jr., C.J., (Chairman), on official leave.
[1]
 Decision penned by Associate Justice Martin S. Villarama, Jr. of the Third Division of the Court of
Appeals. Concurred in by Associate Justices Eubulo G. Verzola (Chairman) and Mario L. Guaria
III.
[2]
 Decision penned by Judge Romulo A. Lopez.
[3]
 Resolution penned by Associate Justice Martin S. Villarama, Jr. as Acting Chairman of the Special Third
Division of the Court of Appeals. Concurred in by Associate Justices Elvi John S. Asuncion and
Mario L. Guaria III.
[4]
 Original Records, pp. 1-2. See CA Rollo, p. 9.
[5]
 CA decision, p. 1. See Rollo, p. 18.
[6]
 Id.
[7]
 Id. at 2. See Rollo at 19.
[8]
 Id.
[9]
 Id.
[10]
 Id.
[11]
 Id. at 2. See Rollo at 19-20.
[12]
 Id. at 3. See Rollo at 20.
[13]
 Id.
[14]
 People v. Mendoza, G.R. No. 128890, 31 May 2000, 332 SCRA 485, 496, citing People v. Parungao,
G.R. No. 125812, 28 November 1996, 265 SCRA 140, 149.
[15]
 Luis B. Reyes, The Revised Penal Code, Book One (15th Ed., 2001), p. 498.
[16]
 G.R. No. 124513, 17 October 2001, 367 SCRA 357, 363.
[17]
 CA decision, supra note 5 at 13-14. See Rollo, pp. 30-31.
[18]
 Id.
[19]
 Id.
[20]
 Id. at 9. See Rollo at 26.
[21]
 Id. at 14. See Rollo at 31.
[22]
 Id.
[23]
 Garcia v. People, G.R. No. 144785, 11 September 1985, citing People v. Hernando, 375 Phil. 1078,
1091 (1999).
[24]
 Art. 315, No. 2 (a), Revised Penal Code.
[25]
 L. B. Reyes, Revised Penal Code, Book Two (14th Ed., 1998), p. 763.
[26]
 People v. Cabais, G.R. No. 129070, 16 March 2001, 354 SCRA 553, 562.
[27]
 People v. Gulion, G.R. No. 141183, 18 January 2001, 349 SCRA 610, 620.
[28]
 Sec. 1, Indeterminate Sentence Law.
[29]
 Garcia v. People, supra note 23; Montano v. People, G.R. No. 141980, 7 December 2001, 371 SCRA
655, 662.
[30]
 Art. 315. Swindling (estafa). Any person who shall defraud another by any of the means mentioned
hereinbelow shall be punished by:
1st. The penalty of prisin correccional in its maximum period to prisin mayor in its minimum period, if the
amount of the fraud is over 12,000 but does not exceed 22,000 pesos, and if such amount
exceeds the latter sum, the penalty provided in this paragraph shall be imposed in its maximum
period, adding one year for each additional 10,000 pesos; but the total penalty which may be
imposed shall not exceed twenty years. In such case, and in connection with the accessory
penalties which may be imposed and for the purpose of the other provisions of this Code, the
penalty shall be termed prisin mayor or reclusin temporal, as the case may be.

 
 
 
THIRD DIVISION
 
 
RAMON L. UY,   G.R. No. 174899
Petitioner,  
  Present:
  CARPIO MORALES,* J.,
  TINGA,**
  CHICO-NAZARIO,
- versus - Acting Chairperson,
  VELASCO,**and
  REYES, JJ.
   
  Promulgated:
   
PEOPLE OF THE PHILIPPINES, September 11, 2008
Respondent.
 x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x
 
 
DECISION
 
 
CHICO-NAZARIO, J.:
 
 
Before Us is a Petition for Review on Certiorari which seeks to set aside the
Decision[1] of the Court of Appeals in CA-G.R. CR No. 28581 dated 2 March 2006
which affirmed with modification the Decision[2] of the Regional Trial Court (RTC) of
Makati City, Branch 64, in Criminal Case No. 98-1065, finding petitioner Ramon L.
Uy guilty of Estafa as defined and penalized under Article 315, paragraph 2 of the
Revised Penal Code, and its Resolution[3] dated 9 October 2006 denying petitioners
Motion for Reconsideration.
 
On 19 May 1998, petitioner was charged before the RTC of Makati City
with Estafa under Article 315, par. 2 of the Revised Penal Code, allegedly
committed as follows:
 
That sometime in November 1995, in the City of Makati, Metro Manila,
Philippines, a place within the jurisdiction of this Honorable Court, the above-
named accused, did then and there willfully, unlawfully and feloniously defraud
Mr. Eugene Yu, as follows, to wit: The said accused under false and fraudulent
representations which he made to said Eugene Yu convinced said Eugene Yu to
invest in the said low cost housing project in the amount of P3,500,000.00 and by
means of other similar deceit, which representations he well knew were false and
fraudulent and were only made to induce the aforementioned Eugene Yu to give
and deliver as in fact the said Eugene Yu gave and delivered the said amount
of P3,500,000.00 to the accused, to the damage and prejudice of said Mr. Eugene
Yu in the said amount of P3,500,000.00, Philippine Currency.[4]
 
 
On the same date, the case was docketed as Criminal Case No. 98-1065 and raffled
to Branch 64. Finding reasonable ground to believe that a criminal act had been
committed and that petitioner was probably guilty thereof, the trial court issued a
warrant for his arrest.[5] On 31 August 1998, considering that the warrant of arrest
had been returned unserved, the case was archived and an alias warrant of arrest
was issued.[6]
 
On 27 June 2000, petitioner submitted himself to the jurisdiction of the trial court
and filed a bailbond for his provisional liberty.[7]
 
When arraigned on 4 June 2000, appellant, with the assistance of counsel de
parte, pleaded not guilty to the crime charged.[8]
 
For failure of petitioner to appear in the scheduled pre-trial on 7 September
2000 despite notice, his bailbond was cancelled and an order of arrest was issued
against him.[9]
 
On 28 September 2000, the trial court, upon motion of private complainant
Eugene Yu, issued a Hold Departure Order against accused-appellant.[10]
 
On 16 November 2000, the pre-trial conference of the case proceeded
without the presence of the petitioner or his counsel de parte. A counsel de
oficio was appointed only for the purpose of pre-trial.[11]
 
On 12 December 2000, the trial court, upon motion of petitioner, lifted the
order of arrest and confiscation of bailbond.[12]
 
The prosecution presented the following witnesses, namely: (1) private
complainant Eugene Yu;[13] (2) Patricia L. Yu, spouse of private complainant;
[14]
 and (3) Atty. Wilfredo I. Imperial, Director, Executive Services Group, Housing
and Land Use Regulatory Board (HLURB).[15]
 
The version of the prosecution is as follows:
 
Private complainant Eugene Yu first met petitioner Ramon L. Uy
in Bacolod City in 1993 during a convention of the Chamber of Real Estate and
Builders Association, Inc. (CREBA, INC.), of which they were both
members. Petitioner represented himself as a businessman and developer of low-
cost housing and President of Trans-Builders Resources and Development
Corporation. Becoming friends, petitioner and private complainant entered into a
business venture in 1995 involving a project in Paraaque City, with the former as
developer and the latter as exclusive marketer.
 
Thereafter, petitioner proposed to private complainant a plan to develop low-
cost housing in Cagayan de Oro. Initially, petitioner attempted to convince private
complainant to agree to jointly develop the project, but the proposed scheme did
not materialize. Eventually, however, petitioner was able to get private
complainant to agree to an investment portfolio, whereby private complainant was
to give the amount of P3,500,000.00 to petitioner who, in turn, would pay private
complainant the amount of P4,500,000.00 by the end of May 1996. The
additional P1,000,000.00 was the interest on his investment.
 
Petitioner proposed to come up with an investment agreement. Private
complainant requested his lawyer, Atty. Dennis Perez, to prepare an investment
agreement containing the suggestions of petitioner.[16] On 28 October 1995, in the
office of Atty. Perez, private complainant and petitioner signed an undated
Investment Agreement.[17]Before signing the document, petitioner went over the
same thoroughly. The agreement contained, among other provisions, the following:
WHEREAS, FIRST PARTY is the registered owner and developer of
parcel of land located at Agusan, Cagayan de Oro City covered by Transfer
Certificate of Title No. 61746 issued by the Register of Deeds of Cagayan de Oro
and which is more particularly described as follows:
 
xxxx
 
WHEREAS, the FIRST PARTY wishes to develop the above parcel [of] land into
a low-cost housing subdivision;
 
WHEREAS, the SECOND PARTY is willing to invest in the development of the
above parcel of land;
 
WHEREAS, the parties desire to execute this Investment Agreement for the
purpose of investing in the development of the above parcel of land;
  
NOW, THEREFORE, for and in consideration of the foregoing premises and the
mutual covenants and stipulations hereinafter set forth, the parties hereto have
agreed, and as they hereby agree, as follows:
 
Section 1. The FIRST PARTY shall develop the above parcel of land in a low-
cost housing subdivision;
 
Section 2. The SECOND PARTY agrees to invest the amount of Three Million
Five Hundred Thousand Pesos (P3,500,000.00), Philippine Currency, in the
construction and development costs of the FIRST PARTY, which amount shall be
remitted to it immediately upon the signing of this Investment Agreement;
 
Section 3. For and in consideration of the investment referred to in Section 2, the
FIRST PARTY shall pay the amount of Four Million Five Hundred Thousand
Pesos (P4,500,000.00), Philippine Currency to the SECOND PARTY payable
after six (6) months from the execution of this Investment Agreement. For this
purpose, the FIRST PARTY shall issue post-dated check no. CD00371579951
drawn on Metrobank, Cagayan de Oro Branch in favor of the SECOND PARTY;
 
In the event that the amount due the SECOND PARTY or any part thereof is
unpaid, the FIRST PARTY shall pay compounded interest at the rate of six
percent (6%) on such amount or balance. The SECOND PARTY shall also have
the option to acquire a portion(s) of the low-cost housing subdivision in lieu of
payment of any unpaid amount or balance. Should the SECOND PARTY choose
this option, the FIRST PARTY shall convey to the SECOND PARTY that portion
which he chooses.
 
Section 4. It is hereby understood by the parties that Transfer Certificate of Title
No. 61746, the Site Development Plan, House Plans and the Special Power of
Attorney executed by Patricio Quisumbing, copies of which are hereto attached as
Annexes A, B, C and D, shall form integral parts of this Investment Agreement.
 
 
The signing was witnessed, among others, by Patricia Yu, wife of private
complainant, and Atty. Perez. Simultaneous with the signing of the agreement,
private complainant issued Asiatrust Bank Check No. 087918 dated 30 October
1995 payable to Trans-Builders Resources and Development Corporation in the
amount of P3,500,000.00.[18] Petitioner, in turn, issued in favor of private
complainant Metrobank Check No. 0371579951 dated 30 May 1995 in the amount
of P4,500,000.00.[19]
 
 The amount of P3,500,000.00 covered by Asiatrust Bank Check No. 087918
was debited against the account of private complainant and credited to the account
of Trans-Builders Resources and Development Corporation. When private
complainant deposited petitioners Metrobank check to his savings account with
Asiatrust Bank, the check was dishonored because it was Drawn Against
Insufficient Funds (DAIF).[20] It was at this time that private complainant noticed
that the check issued to him was dated 30 May 1995 instead of 30 May 1996.
 
From that time on, petitioner could no longer be located, and he ignored
private complainants efforts to collect on his investment. On 16 October 1996,
private complainant, through his lawyer, sent a demand letter to petitioner to make
good on his bounced check.[21]
 
Upon inquiry from the HLURB, private complainant learned that Trans-
Builders Resources and Development Corporation had no ongoing low-cost
housing project in Agusan, Cagayan de Oro City, as represented by petitioner and
contained in the Investment Agreement. Atty. Wilfredo I. Imperial, Director,
Executive Services Group of the HLURB, said that Trans-Builders Resources and
Development Corporation had only three projects in Region 10, namely: (1)
Transville Oroquieta 1- Oroquieta City, Misamis Occidental; (2) Transville
Oroquieta 2 - Oroquieta City, Misamis Occidental; and (3) Transville Homes
Quezon, Bukidnon.[22]
 
Patricia Yu testified on the circumstances regarding the execution of the
Investment Agreement and the issuance of the checks by private complainant and
petitioner. She corroborated the statements of private complainant on these
matters. Atty. Wilfredo I. Imperial testified that Trans-Builders Resources and
Development Corporation did not have any ongoing low-cost housing project in
Agusan, Cagayan de Oro City.
 
On 30 April 2002, the prosecution made its Formal Offer of Exhibits (with
Motion for Additional Time to File HLURB Certification) consisting of Exhibits A
to G, inclusive, with sub-markings.[23] The trial court noted the offer and granted
the motion.[24] On 24 May 2002, the prosecution made a Supplemental Offer of
Evidence consisting of the HLURB certification which was marked Exhibit H.
[25]
 The trial court admitted the exhibits offered on 5 July 2002.[26]
 
For the defense, petitioner[27] took the stand.
 
Petitioner testified that his first business transaction with private
complainant involved real property development in Paraaque in the middle of
1995, he being the developer and private complainant the exclusive marketer. In
the middle of the planning of the Paraaque project, he, being in need of funds,
offered private complainant a joint-venture agreement for his project in Cagayan
de Oro. Nothing came out of this proposal. Petitioner likewise sought
rediscounting of his check by private complainant, but the same did not
materialize. Instead, private complainant made a counter-proposal wherein he
would finance the P3,500,000.00 petitioner needed, payable within six to seven
months with P1,000,000.00 interest.
 
Private complainant instructed his Makati-based lawyer to draft an
agreement whereby he was to give petitioner the amount of P3,500,000.00 in
exchange for the check he had earlier received from petitioner in the amount
of P4,500,000.00, to be deposited at least six (6) months after petitioner had
already encashed the P3,500,000.00 check given to him by private complainant on
28 October 2005.
 
Petitioner went to the law office of private complainants lawyer
in Makati and signed the Investment Agreement.[28] Before signing said document,
petitioner told private complainant: Pare utang lang ito, I issued a check, bakit
kailangan pa natin itong investment agreement.[29] Private complainant replied that
the document was just a formality.
 
 Six months after the delivery of private complainants Asiatrust check
for P3,500,000.00 to petitioner, private complainant deposited the latters
Metrobank check for P4,500,000.00, which he had received in exchange for private
complainants Asiatrust check. The P4,500,000.00 Metrobank check deposited in
private complainants account was dishonored. Petitioner denied having received a
demand letter from private complainants lawyer.[30]
 
Petitioner declared that the contract between him and private complainant
was a simple loan to finance his project in Mindanao.[31]
 
On 23 September 2003, the defense formally offered its
evidence[32] consisting of Exhibits 1 to 5. On 9 October 2003, the prosecution
formally offered petitioners counter-affidavit as Exhibit I, with sub-
markings. On 29 October 2003, the trial court admitted all the exhibits of the
defense as well as the additional exhibit of the prosecution.[33]
 
On 17 June 2004, the trial court promulgated its decision convicting
petitioner of the crime charged. The decretal portion of the decision reads:
 
WHEREFORE, judgment is rendered finding accused RAMON UY GUILTY
beyond reasonable doubt of the crime of Estafa and sentencing him to suffer the
indeterminate imprisonment of TEN (10) YEARS prision mayor medium, as
minimum, to TWENTY (20) YEARS of prision temporal, as maximum.
 
The accused is ordered to pay complainant Eugene Yu the sum of P4,500,000 and
plus twelve percent (12%) interest per annum from May 30, 1996 until payment is
made, and to pay the cost of suit.[34]
 
 
In convicting petitioner, the trial court explained:
 
The fact remains that the complainant and the accused signed an agreement which
they denominated as Investment Agreement. The Agreement, having been signed
by complainant and the accused is evidence of what is contained therein (Exh.
A). The document speaks for itself. x x x.
 
xxxx
 
Complainant Eugene Yu would not have agreed to part with his money or
investment were it not for the representation of accused that Trans-Builders
Resources and Development Corporation of which the accused is the President,
has a low-cost housing project at Barrio Agusan, Cagayan de Oro City. The
complainants investment is therefore for a specific purpose which is to develop a
low cost housing project in Barrio Agusan, Cagayan de Oro City over a property
owned and registered in the name of Trans-Builders under Transfer Certificate of
Title no. 61746 issued by the Register of Deeds of Cagayan de Oro City.
 
The complainant gave to accused his investment thru ASIATRUST Check no.
087918 P3,500,000. He received from the accused the latters check, Metrobank
check no. CDO0371579951 in the amount of P4,500,000. Simultaneously with
the exchange of the checks, the accused and complainant signed the Investment
Agreement.
 
In sum, complainant Eugene Yu would not have agreed to part with his money or
investment were it not for the following false pretenses and misrepresentations:
 
a) He represented that the 3.5 Million pesos will be invested in a
low-cost housing project in Barrio Agusan, Cagayan de Oro.
 
b) He promised to pay the private complainant 4.5 Million pesos
after six months from the execution of the investment agreement.
 
c) He promised that in the event that the 4.5. Million pesos is not
paid, he shall pay the private complainant compounded interest at
the rate of six percent (6%) on such amount.He also gave the
private complainant the option to acquire a portion(s) of the low-
cost housing in lieu of payment of any unpaid amount or balance.
 
d) He issued in favor of the private complainant Metrobank check
no. CDO0371579951 worth 4.5 million pesos.
 
As the events would later on disclose, the accused or his company Trans
Builders had no low cost housing project in Barrio Agusan Cagayan de Oro
(Exhs. G and H). Likewise, at the appointed time, the accused failed to return the
investment of complainant. Neither was the accused able to pay complainant the
compounded interest at the rate of six percent (6%) on such amount or balance,
nor did he allow complainant to acquire a portion(s) of the low cost housing
subdivision in lieu of payment of any unpaid amount or balance . . . . (Sec. 3
Investment Agreement, Exhibit A).
 
The check which the accused issued to complainant turned out to be a bum
check because it was dishonored when presented for payment for the reason
drawn against insufficient fund (DAIF).
  
xxxx
 
From the foregoing, this court finds that the accused employed deceit upon
complainant who relied upon said deceitful representations, and which deceitful
acts occurred prior and/or simultaneous to the damage.
 
Thus, the accused Ramon Uy is GUILTY of ESTAFA as defined under
Article 315 par. 2(a).[35]
 
 
On 21 June 2004, petitioner filed a Motion to Admit Bail[36] and a Notice of
Appeal.[37]
 
The trial court approved the surety bond posted by petitioner and directed the
latters release from custody unless further detention was warranted in any other
case.[38]
 
On 23 June 2004, the trial court ordered the transmittal of the records of the case to
the Court of Appeals.[39]
On 2 March 2006, the Court of Appeals rendered its decision upholding
petitioners conviction, but reduced the minimum of the indeterminate sentence
imposed on him.The dispositive portion of the decision reads:
 
WHEREFORE, the appeal is DENIED and the appealed Decision is
AFFIRMED but with MODIFICATION on the minimum of the indeterminate
sentence imposed which is hereby reduced to two (2) years and four (4) months
of prision correccional.[40]
 
 
Petitioner filed a Motion for Reconsideration of the decision, but the
appellate court denied it in its resolution dated 9 October 2006.
 
Hence, this Petition for Review on Certiorari.
 
As required by the Court, respondent, through the Office of the Solicitor
General, and private complainant filed their comments on 19 March 2007 and 12
March 2007, respectively.[41] As directed, petitioner filed his consolidated reply to
the comments.[42]
 
On 23 July 2007, the Court gave due course to the petition and required the
parties to submit their respective memoranda.[43] All the parties filed their
respective memoranda.[44]
 
Petitioner raises the following issues:
 
I. Whether or not (the) Court of Appeals erred in finding the petitioner-
appellant guilty of the crime of estafa punishable under Art. 315, Par 2(a) of the
Revised Penal Code instead of violation of B.P. Blg. 22;
 
II. Whether or not the Court of Appeals (erred) in not finding that the true
nature of the Agreement between petitioner-appellant and the private complainant
was that of a simple loan;
 
III. Whether or not the Court of Appeals erred in giving credence to the
private complainants version of why the check issued by the petitioner-appellant
was dated May 1995 instead of May 1996.
 
 
We first rule on the issue of whether or not the contract between petitioner and
private complainant was one of loan. Private complainant maintains that what they
entered into was an Investment Agreement, while petitioner claims that the
contract between them was a contract of loan.
 
After going over the records and testimonies of the witnesses, we are convinced
that the transaction that was entered into was an Investment Agreement and not a
simple loan.
 
It is very clear from the document[45] signed by both petitioner and private
complainant that private complainant shall invest P3,500,000.00 in the
development of parcel of land (owned by petitioner and located at Agusan,
Cagayan de Oro City covered by Transfer Certificate of Title No. 61746) into a
low-cost housing subdivision to be undertaken by petitioner. It is apparent from the
face of the document that the land to be developed is located in Agusan, Cagayan
de Oro.
 
Petitioner tries to alter or contradict their agreement by claiming that their true
intention was to have a simple loan agreement. He alleged that before signing the
document, he even told private complainant: Pare utang lang ito, I issued a check,
bakit kailangan pa natin itong investment agreement.[46] Private complainant then
replied that the document was just a formality.
 
We do not give credence to petitioners allegations. He is thus denying entering into
an investment agreement. His denial will not prevail over the clear and
unequivocal provisions of the investment contract. As testified to by private
complainant, it was petitioner who had proposed the investment agreement and the
document contained the latters suggestions. Because they have reduced their
agreement into writing, whatever previous or contemporaneous agreements they
had, whether verbal or in writing, are merged in said written agreement.
 
Petitioner argues that the appellate court erred in convicting him of estafa,
punishable under Article 315, par. 2(a), instead of violation of Batas Pambansa
Blg. 22.[47] He claims that only the fourth element of the crime charged damage
may have been established.
 
Estafa, under Article 315, par. 2, of the Revised Penal Code, is committed by any
person who defrauds another by using a fictitious name; or falsely pretends to
possess power, influence, qualifications, property, credit, agency, business or
imaginary transactions; or by means of similar deceits executed prior to or
simultaneously with the commission of fraud.[48] Under this class of estafa, the
element of deceit is indispensable.[49]
 
The elements of Estafa by means of deceit as defined under Article 315(2)(a) of
the Revised Penal Code are as follows: (1) there must be false pretense, fraudulent
act or fraudulent means; (2) such false pretense, fraudulent act or fraudulent means
must be made or executed prior to or simultaneously with the commission of the
fraud; (3) the offended party must have relied on the false pretense, fraudulent act
or fraudulent means, that is, he must have been induced to part with his money or
property because of the false pretense, fraudulent act or fraudulent means; and (4)
as a result thereof, the offended party suffered damage.[50]
 
Fraud, in its general sense, is deemed to comprise anything calculated to deceive,
including all acts, omissions and concealment involving a breach of legal or
equitable duty, trust or confidence justly reposed, resulting in damage to another;
or by which another is unduly and unconscientiously taken advantage of another. It
is a generic term embracing all multifarious means which human ingenuity can
device, and which are resorted to by one individual to secure an advantage over
another by false suggestions or by suppression of truth; and includes all forms of
surprise, trick, cunning, dissembling and any other unfair way by which another is
cheated. Deceit is a species of fraud.[51] And deceit is the false representation of a
matter of fact, whether by words or conduct, by false or misleading allegations; or
by concealment of that which should have been disclosed, which deceives or is
intended to deceive another so that he shall act upon it, to his legal injury. The
false pretense or fraudulent act must be committed prior to or simultaneously with
the commission of the fraud, it being essential that such false statement or
representation constitutes the very cause or the only motive which induces the
offended party to part with his money.[52] In the absence of such requisite, any
subsequent act of the accused, however fraudulent and suspicious it might appear,
cannot serve as basis for prosecution for estafa under the said provision.[53]
 
The prosecution has established the presence of all the elements of the
offense. Petitioner falsely represented to private complainant that he had an on
going low-cost housing project in Agusan, Cagayan de Oro. Relying on petitioners
fraudulent misrepresentations, private complainant invested P3,500,000.00 in said
project. Said amount was given by means of a check and handed over to petitioner
simultaneously with the signing of the Investment Agreement. As it turned out, per
certification from the HLURB, petitioner did not have any low-cost housing
project in Agusan, Cagayan de Oro. Private complainant indeed suffered
damage. He did not get his return of investment because the check he received
from petitioner in the amount of P4,500,000.00 was dishonored. Moreover,
petitioner neither paid private complainant the 6% compounded interest on said
amount or balance thereon, nor did he allow private complainant to acquire a
portion or portions of the low-cost housing subdivision in lieu of the payment of
any unpaid amount or balance. To date, the amount private complainant invested in
said low-cost housing has not been returned. Without a doubt, petitioner is guilty
of estafa.
 
Petitioner contends he was denied due process of law when he was
convicted of estafa instead of violation of Batas Pambansa Blg. 22. An
examination of the private complainants demand letter, he said, indicates that the
demand was for alleged violation of Batas Pambansa Blg. 22.
 
We find his contention untenable.
 
Under Section 5, Rule 110 of the Revised Rules of Criminal Procedure,
criminal actions shall be prosecuted under the direction and control of the
prosecutor. In the case before us, the prosecutor, after going over the complaint
found probable cause to charge him with estafa. This was the prosecutors
prerogative, considering that he was the one who would prosecute the case. The
prosecuting attorney cannot be compelled to file a particular criminal information.
[54]
 The fact that the demand letter may suggest a violation of Batas Pambansa Blg.
22 cannot control his action as to what charge he will file, if he sees evidence
showing probable cause to charge an accused for another crime. It is the
prosecutors assessment of the evidence before him which will prevail, and not
what is contained in a demand letter.
 
Moreover, there can be no denial of due process because petitioner was
informed of the nature and cause of the accusation against him when he was
arraigned. He was charged with estafa, and he pleaded not guilty thereto. He was
given the opportunity to disprove the evidence against him. The fact that he was
arraigned and was tried according to the rules of court undeniably shows he was
accorded due process.
 
Petitioner asserts that the Investment Agreement upon which his conviction
seemed to have been anchored should not have been considered because said
document is a contract of adhesion.
 
Such assertion will not exonerate him.
A contract of adhesion is so-called because its terms are prepared by only
one party, while the other party merely affixes his signature signifying his adhesion
thereto.[55]A contract of adhesion is just as binding as ordinary contracts. It is true
that we have, on occasion, struck down such contracts as void when the weaker
party is imposed upon in dealing with the dominant bargaining party and is
reduced to the alternative of taking it or leaving it, completely deprived of the
opportunity to bargain on equal footing. Nevertheless, contracts of adhesion are not
invalid per se; they are not entirely prohibited. The one who adheres to the contract
is in reality free to reject it entirely; if he adheres, he gives his consent.[56]
 
In the case at bar, we find the Investment Agreement entered into by
petitioner and private complainant valid. Although the Investment Agreement was
prepared by private complainants lawyer, this circumstance will not invalidate
it. The document was prepared with the suggestions of petitioner being
considered. We find it far-fetched to presume that petitioner did not know anything
about the preparation of said document considering that the details contained
therein are informations known only to the owner of the property to be
developed. Furthermore, as a businessman who is engaged in real estate
development, we have no doubt that he knew what he was doing when he signed
the Investment Agreement.
 
Petitioner argues that his Metrobank check was dated May 1995 instead of
1996, because the same was not issued in relation to the Investment Agreement.
  
His argument does not persuade. It is clear from the document itself that the
check was issued in consideration of the investment made by private
complainant. Section 3 of said document provides:
 
Section 3. For and in consideration of the investment referred to in Section
2, the FIRST PARTY shall pay the amount of Four Million Five Hundred
Thousand Pesos (P4,500,000.00), Philippine Currency to the SECOND PARTY
payable after six (6) months from the execution of this Investment
Agreement. For this purpose, the FIRST PARTY shall issue post-dated check no.
CD00371579951 drawn on Metrobank, Cagayan de Oro Branch in favor of the
SECOND PARTY.[57]
 
 
Moreover, we agree with the trial courts reasoning why petitioners check
was dated 30 May 1995, to wit:
 
It could not have been the intention of the parties in the Investment
Agreement (Exh. A) that the repayment of the investment, which was made on
October 30, 1995 and payable with interest after six (6) months from date of
execution of the Agreement as stipulated in the agreement be done by way of a
check drawn five (5) months earlier. Obviously, the intention is to postdate the
check. This circumstance should not adversely affect the cause of action of
complainant because as regard the complainant, the check he received from the
accused in exchange [for] the check he gave the latter, is due six months from the
signing of the Investment Agreement.[58]
 
 
Finally, petitioner claims private complainant committed a violation of the
provisions of the Anti-Usury Law.
 
We do not agree. First, petitioner failed to specify which provision of said
law was violated by private complainant. Second, the effectivity of the Usury Law
has been suspended by Central Bank Circular No. 905, s. 1982 effective 1 January
1983.[59]
 
We now go to the penalty.
 
 The trial court sentenced petitioner to suffer the indeterminate penalty of ten
(10) years of prision mayor, as minimum, to twenty (20) years
as prision (sic) temporal, as maximum.[60] It also ordered petitioner to pay the
private complainant the amount of P4,500,000.00 plus twelve percent (12%)
interest per annum from 30 May 1996 until fully paid, and to pay the costs of
suit. The Court of Appeals affirmed the conviction but modified the penalty
imposed, more particularly the minimum of the indeterminate sentence, which was
reduced to two (2) years and four (4) months of prision correccional.
 
The penalty for estafa by means of deceit is provided in Article 315 of the
Revised Penal Code:
 
1st. The penalty of prision correccional in its maximum period to prision mayor in
its minimum period, if the amount of the fraud is over 12,000 pesos but does not
exceed 22,000 pesos, and if such amount exceeds the latter sum, the penalty
provided in this paragraph shall be imposed in its maximum period, adding one
year for each additional 10,000 pesos; but the total penalty which may be
imposed shall not exceed twenty years. In such case, and in connection with the
accessory penalties which may be imposed and for the purpose of the other
provisions of this Code, the penalty shall be termed prision mayor or reclusion
temporal, as the case may be.
 
 
Under this paragraph, the penalty of prision correccional in its maximum
period to prision mayor in its minimum period is the imposable penalty if the
amount defrauded is over P12,000.00 but not over P22,000.00. If the amount
defrauded exceeds P22,000.00, the penalty provided shall be imposed in its
maximum period, with one year added for each additional P10,000.00. The total
penalty, however, shall not exceed twenty years.
 
Under the Indeterminate Sentence Law, the maximum term of the penalty
shall be that which in view of the attending circumstances, could be properly
imposed under the Revised Penal Code and the minimum shall be within the range
of the penalty next lower to that prescribed for the offense.
 
 The range of the penalty provided for in Article 315 is composed of only
two periods, thus, to get the maximum period of the indeterminate sentence, the
total number of years included in the two periods should be divided into
three. Article 65 of the same code requires the division of the time included in the
prescribed penalty into three equal periods of time, forming one period for each of
the three portions. The maximum, medium and minimum periods of the prescribed
penalty are therefore:
 
Minimum period - 4 years, 2 months and 1 day to 5 years, 5 months and
10 days
 
Medium period - 5 years, 5 months and 11 days to 6 years, 8 months and
20 days
 
Maximum period - 6 years, 8 months and 21 days to 8 years
 
 
The amount defrauded being in excess of P22,000.00, the penalty imposable
should be the maximum period of six years, eight months, and twenty-one days to
eight years of prision mayor.  However, Art. 315 also provides that an additional
one year shall be imposed for each additional P10,000.00.  The penalty should be
termed as prision mayor or reclusion temporal, as the case may be. Here,
considering that the total amount of the fraud is P3,500,000.00, the corresponding
penalty obviously reaches the twenty-year limit. Thus, the correct imposable
maximum penalty is twenty years of reclusion temporal.
 
The minimum period of the indeterminate sentence, on the other hand,
should be within the range of the penalty next lower than that prescribed by Article
315(2)(a), Revised Penal Code, for the crime committed. The penalty next lower
than prision correccional maximum to prision mayor minimum is prision
correccional minimum (six months and one day to two years and four months)
to prision correccional medium (two years, four months and one day to four years
and two months).
 
 The Court of Appeals thus correctly reduced the minimum of the
indeterminate penalty imposed on petitioner.
 
We agree with both lower courts that petitioner should be ordered to pay
private complainant the amount of P4,500,000.00 as actual damages representing
private complainants investment and unrealized profit pursuant to the Investment
Agreement. The 12 % interest per annum on said amount as imposed by the lower
courts from 30 May 1996 should be reduced to 6% per annum in accordance with
the Investment Agreement. After this decision has become final, the interest
thereon shall be 12% per annum.
 
WHEREFORE, premises considered, the decision of the Court of Appeals
in CA-G.R. CR No. 28581 dated 2 March 2006 is AFFIRMED with
the MODIFICATION that the interest on the amount of P4,500,000.00 shall be
6% per annum computed from 30 May 1996. Upon the finality of this decision, the
interest on said amount shall be 12% per annum.
 
SO ORDERED.
 
 
 
MINITA V. CHICO-NAZARIO
Associate Justice
Acting Chairperson
 
 
 
WE CONCUR:
 
 
 
 
CONCHITA CARPIO MORALES
Associate Justice
 
 
  
 
DANTE O. TINGA PRESBITERO J. VELASCO, JR.
Associate Justice Associate Justice
 
 
 
 
RUBEN T. REYES
Associate Justice
 
 
 
 
 
 
ATTESTATION
 
I attest that the conclusions in the above Decision were reached in consultation
before the case was assigned to the writer of the opinion of the Courts Division.
 
 
 
MINITA V. CHICO-NAZARIO
Associate Justice
Acting Chairperson, Third Division
 
 
 
CERTIFICATION
 
Pursuant to Section 13, Article VIII of the Constitution, and the Division
Chairpersons Attestation, it is hereby certified that the conclusions in the above
Decision were reached in consultation before the case was assigned to the writer of
the opinion of the Courts Division.
 
 
 
REYNATO S. PUNO
Chief Justice
  
 

*
 Justice Conchita Carpio Morales was designated to sit as additional member replacing Justice Antonio Eduardo B.
Nachura per Raffle dated 3 September 2008.
**
 Per Special Order No. 517, dated 27 August 2008, signed by Chief Justice Reynato S. Puno, designating Associate
Justices Dante O. Tinga and Presbitero J. Velasco, Jr. to replace Associate Justices Consuelo Ynares-
Santiago and Ma. Alicia Austria-Martinez, who are on official leave.
[1]
 Penned by Associate Justice Roberto A. Barrios with Associate Justices Mario L. Guaria III and Santiago Javier
Ranada, concurring. CA rollo, pp. 119-127.
[2]
 Records, pp. 350-358.
[3]
 CA rollo, pp. 197-199.
[4]
 Records, p. 1.
[5]
 Id. at 34.
[6]
 Id. at 39.
[7]
 Id. at 58.
[8]
 Id. at 62.
[9]
 Id. at 75.
[10]
 Id. at 95.
[11]
 Id. at 109.
[12]
 Id. at 123.
[13]
 TSN, 28 September 2000 (Motion for Issuance of Hold Departure Order); 9 January 2001; 13 February 2001; 13
March 2001).
[14]
 TSN, 24 May 2001.
[15]
 TSN, 11 April 2002.
[16]
 TSN, 29 March 2001, pp. 68-70.
[17]
 Exh. A; records, pp. 217-220.
[18]
 Exh. B; id. at 221.
[19]
 Exh. C; id. at 222.
[20]
 Exhs. D and E; id. at 223-224.
[21]
 Exh. F; id. at 225.
[22]
 Exhs. G and H; id. at 226 and 233.
[23]
 Records, pp. 210-216.
[24]
 Id. at 227.
[25]
 Id. at 229-232.
[26]
 Id. at 244.
[27]
 TSN, 27 March 2003 and 19 June 2003.
[28]
 Exh. A; Records, pp. 217-220.
[29]
 TSN, 27 March 2003, p. 16.
[30]
 TSN, 19 June 2003, p. 10.
[31]
 TSN, 27 March 2003, p. 11.
[32]
 Records, pp. 281-282.
[33]
 Id. at 294.
[34]
 Id. at 358.
[35]
 Id. at 355-357.
[36]
 Id. at 362-382.
[37]
 Id. at 383-384.
[38]
 Id. at 385.
[39]
 Id. at 386.
[40]
 CA rollo, p. 127.
[41]
 Rollo, pp. 152-169, 170-191.
[42]
 Id. at 198-208.
[43]
 Id. at 210.
[44]
 Id. at 215-232, 239-260, 330-353.
[45]
 Exh. A.
[46]
 TSN, 27 March 2003, p. 16.
[47]
 Bouncing Checks Law.
[48]
 R.R. Paredes v. Calilung, G.R. No. 156055, 5 March 2007, 517 SCRA 369, 393.
[49]
 People v. Billaber, 465 Phil. 726, 744 (2004).
[50]
 Cosme, Jr. v. People, G.R. No. 149753, 27 November 2006, 508 SCRA 190, 203-204.
[51]
 Sim, Jr. v. Court of Appeals, G.R. No. 159280, 18 May 2004, 428 SCRA 459, 468.
[52]
 Alcantara v. Court of Appeals, 462 Phil. 72, 89 (2003).
[53]
 Preferred Home Specialties, Inc. v. Court of Appeals, G.R. No. 163593, 16 December 2005, 478 SCRA 387, 411-
412.
[54]
 People v. Pineda, 127 Phil. 150, 156-157 (1967).
[55]
 Ermitao v. Court of Appeals, 365 Phil. 671, 678-679 (1999).
[56]
 Rizal Commercial Banking Corporation v. Court of Appeals, 364 Phil. 947, 953-954 (1999).
[57]
 Records, p. 218.
[58]
 Id. at 357.
[59]
 Ruiz v. Court of Appeals, 449 Phil. 419, 434 (2003).
[60]
 CA rollo, p. 75.
 THIRD DIVISION

[G.R. No. 125903. November 15, 2000]

PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs. ROMULO

SAULO, AMELIA DE LA CRUZ, and CLODUALDO DE LA
CRUZ, accused.
ROMULO SAULO, accused-appellant.

DECISION
GONZAGA-REYES, J.:

Accused-appellant, together with Amelia de la Cruz and Clodualdo de la Cruz, were

charged with violation of Article 38 (b) of the Labor Code  for illegal recruitment in large
[1]

scale in an information which states

CRIM. CASE NO. Q-91-21911

The undersigned Assistant City Prosecutor accuses ROMULO SAULO,

AMELIA DE LA CRUZ and CLODUALDO DE LA CRUZ, of the crime of
ILLEGAL RECRUITMENT IN LARGE SCALE (ART. 38(b) in relation to Art.
39(a) of the Labor Code of the Philippines, as amended by P.D. No. 2018,
committed as follows:
That on or about the period comprised from April 1990 to May 1990 in Quezon
City, Philippines, and within the jurisdiction of the Honorable Court, the above-
named accused, conspiring together, confederating with and mutually helping
one another, by falsely representing themselves to have the capacity to
contract, enlist and recruit workers for employment abroad, did, then and
there, wilfully, unlawfully and feloniously for a fee, recruit and promise
employment/job placement abroad to LEODEGARIO MAULLON, BENY
MALIGAYA and ANGELES JAVIER, without first securing the required license
or authority from the Department of Labor and Employment, in violation of
said law.

That the crime described above is committed in large scale as the same was
perpetrated against three (3) persons individually or as [a] group penalized
under Articles 38 and 39 as amended by PD 2018 of the Labor Code (P.D.
442).

CONTRARY TO LAW. [2]

In addition, accused were charged with three counts of estafa (Criminal Case Nos.
Q-91-21908, Q-91-21909 and Q-91-21910). Except for the names of the complainants,
the dates of commission of the crime charged, and the amounts involved, the
informations  were identical in their allegations
[3]

CRIM. CASE NO. Q-91-21908

The undersigned Assistant City Prosecutor accuses ROMULO SAULO,

AMELIA DE LA CRUZ AND CLODUALDO DE LA CRUZ of the crime of
ESTAFA (Art. 315, par. 2 (a) RPC), committed as follows:

That on or about the period comprised from April 1990 to May 1990, in
Quezon City, Philippines, and within the jurisdiction of this Honorable Court,
the above-named accused, conspiring together, confederating with and
mutually helping one another, with intent of gain, by means of false pretenses
and/or fraudulent acts executed prior to or simultaneously with the
commission of the fraud, did, then and there wilfully, unlawfully and feloniously
defraud one BENY MALIGAYA, in the following manner, to wit: on the date
and in the place aforementioned, accused falsely pretended to the offended
party that they had connection and capacity to deploy workers for overseas
employment and that they could secure employment/placement for said Beny
Maligaya and believing said misrepresentations, the offended party was later
induced to give accused, as in fact she did give the total amount of
P35,000.00, Philippine Currency, and once in possession of the said amount
and far from complying with their commitment and despite repeated demands
made upon them to return said amount, did, then and there wilfully, unlawfully
and feloniously and with intent to defraud, misappropriate, misapply and
convert the same to their own personal use and benefit, to the damage and
prejudice of said offended party in the aforementioned amount and in such
amount as may be awarded under the provisions of the Civil Code.

CONTRARY TO LAW.

Upon arraignment, accused-appellant pleaded not guilty to all the charges against
him. Meanwhile accused Amelia de la Cruz and Clodualdo de la Cruz have remained at
large.
During trial, the prosecution sought to prove the following material facts and
circumstances surrounding the commission of the crimes:
Benny Maligaya, having learned from a relative of accused-appellant that the latter
was recruiting workers for Taiwan, went to accused-appellants house in San Francisco
del Monte, Quezon City, together with Angeles Javier and Amelia de la Cruz, in order to
discuss her chances for overseas employment. During that meeting which took place
sometime in April or May, 1990, accused-appellant told Maligaya that she would be able
to leave for Taiwan as a factory worker once she gave accused-appellant the fees for
the processing of her documents. Sometime in May, 1990, Maligaya also met with
Amelia de la Cruz and Clodualdo de la Cruz at their house in Baesa, Quezon City and
they assured her that they were authorized by the Philippine Overseas Employment
Administration (POEA) to recruit workers for Taiwan. Maligaya paid accused-appellant
and Amelia de la Cruz the amount of P35,000.00, which is evidenced by a receipt dated
May 21, 1990 signed by accused-appellant and Amelia de la Cruz (Exhibit A in Crim.
Case No. Q-91-21908). Seeing that he had reneged on his promise to send her to
Taiwan, Maligaya filed a complaint against accused-appellant with the POEA. [4]

Angeles Javier, a widow and relative by affinity of accused-appellant, was told by

Ligaya, accused-appellants wife, to apply for work abroad through accused-
appellant. At a meeting in accused-appellants Quezon City residence, Javier was told
by accused-appellant that he could get her a job in Taiwan as a factory worker and that
she should give him P35,000.00 for purposes of preparing Javiers passport. Javier gave
an initial amount of P20,000.00 to accused-appellant, but she did not ask for a receipt
as she trusted him. As the overseas employment never materialized, Javier was
prompted to bring the matter before the POEA. [5]

On April 19, 1990, Leodigario Maullon, upon the invitation of his neighbor Araceli
Sanchez, went to accused-appellants house in order to discuss his prospects for
gaining employment abroad. As in the case of Maligaya and Javier, accused-appellant
assured Maullon that he could secure him a job as a factory worker in Taiwan if he paid
him P30,000.00 for the processing of his papers. Maullon paid P7,900.00 to accused-
appellants wife, who issued a receipt dated April 21, 1990 (Exhibit A in Crim. Case No.
Q-91-21910). Thereafter, Maullon paid an additional amount of P6,800.00 in the
presence of accused-appellant and Amelia de la Cruz, which payment is also evidenced
by a receipt dated April 25, 1990 (Exhibit B in Crim. Case No. Q-91-21910). Finally,
Maullon paid P15,700.00 to a certain Loreta Tumalig, a friend of accused-appellant, as
shown by a receipt dated September 14, 1990 (Exhibit C in Crim. Case No. Q-91-
21910). Again, accused-appellant failed to deliver on the promised employment.
Maullon thus filed a complaint with the POEA. [6]

The prosecution also presented a certification dated July 26, 1994 issued by the
POEA stating that accused are not licensed to recruit workers for overseas employment
(Exhibit A in Crim. Case No. Q-91-21911). [7]

In his defense, accused-appellant claimed that he was also applying with Amelia de
la Cruz for overseas employment. He asserts that it was for this reason that he met all
three complainants as they all went together to Amelia de la Cruz house in Novaliches,
Quezon City sometime in May, 1990 in order to follow up their applications. Accused-
appellant flatly denied that he was an overseas employment recruiter or that he was
working as an agent for one. He also denied having received any money from any of the
complainants or having signed any of the receipts introduced by the prosecution in
evidence. It is accused-appellants contention that the complainants were prevailed upon
by accused-appellants mother-in-law, with whom he had a misunderstanding, to file the
present cases against him. [8]

The trial court found accused-appellant guilty of three counts of estafa and of illegal
recruitment in large scale. It adjudged:

WHEREFORE, this Court finds the accused Romulo Saulo:

A. In Criminal Case No. Q-91-21908, guilty beyond reasonable doubt of

Estafa under Article 315, paragraph 2(a) of the Revised Penal Code as
amended, without any mitigating or aggravating circumstances, and this Court
hereby sentences the accused Romulo Saulo to suffer the indeterminate
penalty of imprisonment of three (3) years, four (4) months and one (1) day
of prision correccional as minimum to seven (7) years and one (1) day
of prision mayor as maximum, and to indemnify the complainant Beny
Maligaya in the amount of P35,000.00, with interest thereon at 12% per
annum until the said amount is fully paid, with costs against the said accused.

B. In Criminal Case No. Q-91-21909, guilty beyond reasonable doubt of

Estafa under Article 315, paragraph 2(a) of the Revised Penal Code as
amended, without any mitigating or aggravating circumstances, and this Court
hereby sentences the accused Romulo Saulo to suffer the indeterminate
penalty of imprisonment of two (2) years, four (4) months and one (1) day
of prision correccional as minimum to six (6) years and one (1) day of prision
mayor as maximum, and to indemnify the complainant Angeles Javier in the
amount of P20,000.00 with interest thereon at 12% per annum until the said
amount is fully paid, with costs against said accused.

C. In Criminal Case No. Q-91-21910, guilty beyond reasonable doubt of

Estafa under Article 315, paragraph 2(a) of the Revised Penal Code as
amended, without any mitigating or aggravating circumstances, and this Court
hereby sentences the accused Romulo Saulo to suffer the indeterminate
penalty of imprisonment of two (2) years, four (4) months and one (1) day
of prision correccional as minimum to six (6) years and one (1) day of prision
mayor as maximum, and to indemnify the complainant Leodigario Maullon in
the amount of P30,400.00 with interest thereon at 12% per annum until the
said amount is fully paid, with costs against said accused.

D. In Criminal Case No. Q-91-21911, guilty beyond reasonable doubt of Illegal

Recruitment in Large Scale as defined and punished under Article 38 (b) in
relation to Article 39 (a) of the Labor Code of the Philippines as amended, and
this Court sentences the accused Romulo Saulo to suffer the penalty of life
imprisonment and to pay a fine of One Hundred Thousand Pesos
(P100,000.00).

Being a detention prisoner, the accused Romulo Saulo shall be entitled to the
benefits of Article 29 of the Revised Penal Code as amended.

SO ORDERED. [9]

The Court finds no merit in the instant appeal.

The essential elements of illegal recruitment in large scale, as defined in Art. 38 (b)
of the Labor Code and penalized under Art. 39 of the same Code, are as follows:

(1) the accused engages in the recruitment and placement of workers, as

defined under Article 13 (b) or in any prohibited activities under Article 34 of
the Labor Code;

(2) accused has not complied with the guidelines issued by the Secretary of
Labor and Employment, particularly with respect to the securing of a license
or an authority to recruit and deploy workers, whether locally or overseas; and

(3) accused commits the same against three (3) or more persons, individually
or as a group. [10]

Under Art. 13 (b) of the Labor Code, recruitment and placement refers to any act of
canvassing, enlisting, contracting, transporting, utilizing, hiring or procuring workers,
and includes referrals, contract services, promising or advertising for employment,
locally or abroad, whether for profit or not; Provided, That any person or entity which, in
any manner, offers or promises for a fee employment to two or more persons shall be
deemed engaged in recruitment and placement.
After a careful and circumspect review of the records, the Court finds that the trial
court was justified in holding that accused-appellant was engaged in unlawful
recruitment and placement activities. The prosecution clearly established that accused-
appellant promised the three complainants - Benny Maligaya, Angeles Javier and
Leodigario Maullon employment in Taiwan as factory workers and that he asked them
for money in order to process their papers and procure their passports. Relying
completely upon such representations, complainants entrusted their hard-earned money
to accused-appellant in exchange for what they would later discover to be a vain hope
of obtaining employment abroad. It is not disputed that accused-appellant is
not authorized  nor licensed  by the Department of Labor and Employment to engage
[11] [12]

in recruitment and placement activities. The absence of the necessary license or

authority renders all of accused-appellants recruitment activities criminal.
Accused-appellant interposes a denial in his defense, claiming that he never
received any money from the complainants nor processed their papers. Instead,
accused-appellant insists that he was merely a co-applicant of the complainants and
similarly deceived by the schemes of Amelia and Clodualdo de la Cruz. He contends
that the fact that Benny Maligaya and Angleles Javier went to the house of Amelia and
Clodualdo de la Cruz in Novaliches, Quezon City, to get back their money and to follow-
up their application proves that complainants knew that it was the de la Cruz who
received the processing fees, and not accused-appellant. Further, accused-appellant
argues that complainants could not have honestly believed that he could get them their
passports since they did not give him any of the necessary documents, such as their
birth certificate, baptismal certificate, NBI clearance, and marriage contract.
Accused-appellants asseverations are self-serving and uncorroborated by clear and
convincing evidence. They cannot stand against the straightforward and explicit
testimonies of the complainants, who have identified accused-appellant as the person
who enticed them to part with their money upon his representation that he had the
capability of obtaining employment for them abroad. In the absence of any evidence
that the prosecution witnesses were motivated by improper motives, the trial courts
assessment of the credibility of the witnesses shall not be interfered with by this Court.
[13]

The fact that accused-appellant did not sign all the receipts issued to complainants
does not weaken the case of the prosecution. A person charged with illegal recruitment
may be convicted on the strength of the testimonies of the complainants, if found to be
credible and convincing.  The absence of receipts to evidence payment does not
[14]

warrant an acquittal of the accused, and it is not necessarily fatal to the prosecutions
cause.[15]

Accused-appellant contends that he could not have committed the crime of illegal
recruitment in large scale since Nancy Avelino, a labor and employment officer at the
POEA, testified that licenses for recruitment and placement are issued only to
corporations and not to natural persons. This argument is specious and illogical. The
Labor Code states that any person or entity which, in any manner, offers or promises for
a fee employment to two or more persons shall be deemed engaged in recruitment and
placement.  Corrolarily, a nonlicensee or nonholder of authority is any person, corporation
[16]

or entity which has not been issued a valid license or authority to engage in recruitment
and placement by the Secretary of Labor, or whose license or authority has been
suspended, revoked, or canceled by the POEA or the Secretary.  It also bears
[17]

stressing that agents or representatives appointed by a licensee or a holder of authority

but whose appointments are not previously authorized by the POEA fall within the
meaning of the term nonlicensee or nonholder of authority.  Thus, any person, whether
[18]

natural or juridical, that engages in recruitment activities without the necessary license
or authority shall be penalized under Art. 39 of the Labor Code.
It is well established in jurisprudence that a person may be charged and convicted
for both illegal recruitment and estafa. The reason for this is that illegal recruitment is
a malum prohibitum, whereas estafa is malum in se, meaning that the criminal intent of
the accused is not necessary for conviction in the former, but is required in the latter.
[19]

The elements of estafa under Art. 315, paragraph 2 (a), of the Revised Penal Code
are: (1) that the accused has defrauded another by abuse of confidence or by deceit,
and (2) that damage or prejudice capable of pecuniary estimation is caused to the
offended party or third person.  The trial court was correct in holding accused-appellant
[20]

liable for estafa in the case at bench. Owing to accused-appellants false assurances
that he could provide them with work in another country, complainants parted with their
money, to their damage and prejudice, since the promised employment never
materialized.
Under Art. 315 of the Revised Penal Code, the penalty for the crime of estafa is as
follows:

1st. The penalty of prision correccional in its maximum period to prision

mayor in its minimum period, if the amount of the fraud is over 12,000 pesos
but does not exceed 22,000 pesos, and if such amount exceeds the latter
sum, the penalty provided in this paragraph shall be imposed in its maximum
period, adding one year for each additional 10,000 pesos; but the total penalty
which may be imposed shall not exceed twenty years. In such cases, and in
connection with the accessory penalties which may be imposed under the
provisions of this Code, the penalty shall be termed prision mayor or reclusion
temporal, as the case may be.

xxx xxx xxx
Under the Indeterminate Sentence Law, the maximum term of the penalty shall be
that which, in view of the attending circumstances, could be properly imposed under the
Revised Penal Code, and the minimum shall be within the range of the penalty next
lower to that prescribed for the offense. Since the penalty prescribed by law for the
estafa charge against accused-appellant is prision correccional maximum to prision
mayor minimum, the penalty next lower in degree is prision correccional minimum to
medium. Thus, the minimum term of the indeterminate sentence should be anywhere
within six (6) months and one (1) day to four (4) years and two (2) months.
In fixing the maximum term, the prescribed penalty of prision correccional maximum
to prision mayor minimum should be divided into three equal portions of time, each of
which portion shall be deemed to form one period, as follows

Minimum Period : From 4 years, 2 months and 1 day to 5 years, 5 months and

10 days

Medium Period : From 5 years, 5 months and 11 days to 6 years, 8 months

and 20 days

Maximum Period : From 6 years, 8 months and 21 days to 8 years

pursuant to Article 65, in relation to Article 64, of the Revised Penal Code.
When the amounts involved in the offense exceeds P22,000, the penalty prescribed
in Article 315 of the Revised Penal Code shall be imposed in its maximum period,
adding one year for each additional P10,000.00, although the total penalty which may
be imposed shall not exceed twenty (20) years. [21]

Accordingly, the following penalties shall be imposed upon accused-appellant:

In Criminal Case No. Q-91-21908 where accused-appellant defrauded Benny
Maligaya in the amount of P35,000.00, one year for the additional amount of
P13,000.00 in excess of P22,000.00 provided for in Article 315 shall be added to the
maximum period of the prescribed penalty of prision correccional maximum to prision
mayor minimum. Thus, accused-appellant shall suffer the indeterminate penalty of four
(4) years, and two (2) months of prision correccional medium, as minimum to nine (9)
years of prision mayor as maximum.  Accused-appellant shall also pay Benny Maligaya
[22]

P35,000.00 by way of actual damages.

In Criminal Case No. Q-91-21909 where accused-appellant defrauded Angeles
Javier in the amount of P20,000.00, accused-appellant shall suffer the indeterminate
penalty of one (1) year, eight (8) months and twenty-one (21) days of prision
correccional minimum to five (5) years, five (5) months and eleven (11) days of prision
correccional maximum. Accused-appellant shall also pay Angeles Javier P20,000.00 by
way of actual damages.
In Criminal Case No. Q-91-21910 where accused-appellant defrauded Leodigario
Maullon in the amount of P30,400.00, accused-appellant shall suffer the indeterminate
penalty of four (4) years and two (2) months of prision correccional medium, as
minimum to eight (8) years of prision mayor, as maximum.  Accused-appellant shall
[23]

also pay Leodigario Maullon P30,400.00 by way of actual damages.

In addition, for the crime of illegal recruitment in large scale (Criminal Case No. Q-
91-21911) and pursuant to Article 39 (a) of the Labor Code, accused-appellant shall
suffer the penalty of life imprisonment and a fine of One Hundred Thousand Pesos
(P100,000.00).
WHEREFORE, the March 6, 1996 Decision of the trial court finding accused-
appellant guilty beyond reasonable doubt of the crime of illegal recruitment in large
scale and estafa is hereby AFFIRMED subject to the following modifications:
In Criminal Case No. Q-91-21908 where accused-appellant defrauded Benny
Maligaya in the amount of P35,000.00, one year for the additional amount of
P13,000.00 in excess of P22,000.00 provided for in Article 315 shall be added to the
maximum period of the prescribed penalty of prision correccional maximum to prision
mayor minimum. Thus, accused-appellant shall suffer the indeterminate penalty of four
(4) years, and two (2) months of prision correccional medium, as minimum to nine
(9) years of prision mayor as maximum. Accused-appellant shall also pay Benny
Maligaya P35,000.00 by way of actual damages.
In Criminal Case No. Q-91-21909 where accused-appellant defrauded Angeles
Javier in the amount of P20,000.00, accused-appellant shall suffer the indeterminate
penalty of one (1) year, eight (8) months and twenty-one (21) days of prision
correccional minimum to five (5) years, five (5) months and eleven (11) days of prision
correccional maximum. Accused-appellant shall also pay Angeles Javier P20,000.00 by
way of actual damages.
In Criminal Case No. Q-91-21910 where accused-appellant defrauded Leodigario
Maullon in the amount of P30,400.00, accused-appellant shall suffer the indeterminate
penalty of four (4) years and two (2) months of prision correccional medium, as
minimum to eight (8) years of prision mayor, as maximum. Accused-appellant shall also
pay Leodigario Maullon P30,400.00 by way of actual damages.
In addition, for the crime of illegal recruitment in large scale (Criminal Case No. Q-
91-21911) and pursuant to Article 39 (a) of the Labor Code, accused-appellant shall
suffer the penalty of life imprisonment and a fine of One Hundred Thousand Pesos
(P100,000.00).
Costs against accused-appellant.
SO ORDERED.
Melo, (Chairman), Vitug, and Panganiban, JJ., concur.

[1] 
Presidential Decree No. 442.
[2] 
Rollo, 368-369.
[3] 
Ibid., 366-368.
[4] 
TSN, May 26, 1994, 2-17.
[5] 
TSN, June 16, 1994, 2-13.
[6] 
TSN, April 21, 1994, 2-15.
[7] 
TSN, August 18, 1994, 3-4.
[8] 
TSN, December 2, 1994, 2-15; TSN, December 8, 1994, 2-9; TSN, December 14, 1994, 1-12.
[9] 
Rollo, 371-372.
[10] 
People v. Sadiosa, 290 SCRA 92 (1998); People v. Benedictus, 288 SCRA 319 (1998).
[11] 
Art. 13 of the Labor Code provides
(f) Authority means a document issued by the Department of Labor authorizing a person or association to
engage in recruitment and placement activities as a private recruitment entity.
[12] 
Art. 13 of the Labor Code provides
(d) License means a document issued by the Department of Labor authorizing a person or entity to
operate a private employment agency.
[13] 
People v. Cabiles, 284 SCRA 199 (1998); People v. Obello, 284 SCRA 79 (1998).
[14] 
People v. Saley, 291 SCRA 715 (1998); People v. Sanchez, 291 SCRA 333 (1998).
[15] 
People v. Juego, 298 SCRA 22 (1998); People v. Saley, id.
[16] 
Art. 13 (b).
Abaca v. Court of Appeals, 290 SCRA 657 (1998), citing Sec. 1 (d) of the Rules Implementing P.D.
[17] 

1920 promulgated on July 12, 1984.

Id., citing Sec. 1, Rule V, Book II of the POEA Rules and Regulations on Overseas Employment
[18] 

promulgated on May 21, 1985.

[19] 
People v. Sanchez, supra; People v. Sadiosa, supra.
[20] 
People v. Saley, supra.
[21] 
Id.
[22] 
People vs. Menil, G. R. No. 115054-66, prom. September 12, 2000.
[23] 
Ibid.
Ralph is the president and CEO of Primelink, a real estate developer. On July
4, 1996, Primelink entered into a Joint Venture Agreement with Pamana
Island Resort Hotel and Marina Club to develop an exclusive residential
resort with marina an island in Subic, Zambales. Per their agreement, Paman
will keep the title to the property free from encumbrances while Primelink
will provide capital and handle marketing. Though the club was slated for
opening in July 1998, Primelink started selling membership shares.
Alfredo, through a sales agent of Primelin, bought one such membership
share, paying the reservation fee of P209,000.00 and eventually paying full
amount of P835,999.94 by April, 1998.
In March 2002, Alfredo filed a case for estafa against Ralph and the sales
agent, Joy, alleging that the club remained undeveloped and Primelink failed
to return his payment despite demand. He also discovered that Primelink had
no license to sell securities from the SEC.
A case for Estafa under Art. 315 paragraph 2(a) was eventually filed against
Ralph and Joy, but only Ralph stood trial as Joy cannot be located.
In his defense, Ralph invoked that the non-completion of the project was due
to failure on the part of Pamana to keep its obligation on their agreement, by
mortgaging the property to Westmont Bank. On the matter of sale of
unregistered securities, he alleged that it is industry practice and maintained
that he instructed his sales agents to be honest about the status of the project
to prospective buyers.
The Regional Trial Court convicted Ralph of Estafa as charged and sentenced
him to imprisonment.
His appeal to the Court of Appeals also denied, Ralph elevated his case to the
Supreme Court:
“The Code defines estafa under Article 315, paragraph 2(a), the offense for
which petitioner and Ragonjan stand accused, as follows:
Swindling (estafa). — Any person who shall defraud another x x x
xxxx
2. By means of any of the following false pretenses or fraudulent acts
executed prior to or simultaneously with the commission of the fraud:
(a) By using fictitious name, or falsely pretending to possess power,
influence, qualifications, property, credit, agency, business or imaginary
transactions, or by means of other similar deceits.
This provision lays on the prosecution the burden of proving beyond
reasonable doubt each of the following constitutive elements:
(1) The accused used fictitious name or false pretense that he possesses (a)
power, (b) influence, (c) qualifications, (d) property, (e) credit, (f) agency, (g)
business or (h) imaginary transaction, or other similar deceits;
(2) The accused used such deceitful means prior to or simultaneous with the
execution of the fraud;
(3) The offended party relied on such deceitful means to part with his money
or property; and
(4) The offended party suffered damage.”
xxx
No “False Pretense in the status of club development:
“Without need of passing upon the question whether Ragonjan’s
representations to Sy on 10 October 1996 bind petitioner, we resolve the
threshold question whether her alleged statement that the Club will be
finished by July 1998 was in the first place false. The Court of Appeals
grounded its affirmative answer on the fact that the Club remained unfinished
even after the lapse of its target completion date in July 1998. Section 2(a) of
Article 315, however, requires that the false pretense be used “prior to or
simultaneous with the execution of the fraud,” that is, on 10 October 1996.
The crux of this issue then, is whether before or at that time, Primelink
possessed no power (capability) to develop the Club, rendering Ragonjan’s
statement false.
A review of the records compels a negative answer. When Sy reserved to buy
a Club share on 10 October 1996, barely three months had passed after
Primelink, a duly incorporated real estate developer, signed the Agreement
with Pamana, another real estate developer, to develop the Club. Four months
after Sy bought a Club share, Primelink promoted the Club here and abroad
and continued selling Club shares. All the while, Primelink released funds to
finance the project’s initial expenses, a portion of which Pamana was ordered
to repay by a Makati court after the project was aborted.”
xxx
There is “false pretense” in the sale of unregistered securities to Alfred:
“First. Petitioner was no bystander in Primelink’s sale of unregistered shares.
Santiago, Primelink’s comptroller and drafter of the Agreement, testified as
witness for petitioner that after Primelink’s Board of Directors approved the
sale of the unregistered Club shares, petitioner “encouraged and instructed”
the sale of “many shares,” no doubt to raise as much capital for the Club as
possible. This was the context of Sy’s purchase of a Club share from
Primelink.
Petitioner attempts to distance himself from the transaction between
Ragonjan and Sy by claiming that Ragonjan violated standing company
policy to be “candid” to buyers by disclosing Primelink’s lack of license. We
find this unpersuasive. In the first place, petitioner failed to present
independent proof of such company policy, putting in serious doubt the
veracity of his claim. Secondly, it is improbable for Ragonjan to take it upon
herself to fabricate the serious claim that Primelink was a licensed securities
dealer in violation of company policy, in the process risking her employment.
It is more consistent with logic and common sense to hold that Ragonjan
followed company policy in giving assurances to Sy that Primelink was
licensed to sell Club shares. After all, Primelink stood to attract more
investments if it presented itself to the public as a licensed securities dealer.
Indeed, Sy was emphatic in his claim that he bought a Club share for P0.8
million because he was “convinced that there was a license to sell.”
Petitioner’s direct hand in the unlicensed selling of Club shares, coupled with
Ragonjan’s position in Primelink’s organizational and sales structure, suffices
to prove petitioner’s liability under the allegation of use of false pretense of
qualification. With Santiago’s testimony on petitioner’s central role in the
sale of unregistered Primelink shares, further proof of conspiracy between
petitioner and Ragonjan is superfluous.
Second. There is no merit in the argument that Ragonjan’s assurance to Sy of
Primelink’s status as a licensed securities dealer amounts to a warranty, and
thus required, under the warranty clause of the reservation agreement, to be
reduced in writing. The warranty clause, which provides –
Any representation or warranty made by the agent who handled this sale not
embodied herein shall not bind the company, unless reduced in writing and
confirmed by the President or the Chairman of the Board.
refers to warranties on the terms of the share sold, not to the capacity of
Primelink to sell Club shares. Indeed, the fact that “the seller has the right to
sell the thing at the time when ownership is to pass,” is implied in sales,
dispensing with the need to expressly state such in the contract. Further, the
clause operates to shield Primelink from claims of violation of unwritten
warranties, not its officers from criminal liability for making fraudulent
representation on Primelink’s authority to sell Club shares.
Third. It is futile for petitioner to recast, at this late stage of the proceedings,
the nature of the contract between Primelink and Sy as a “reservation
agreement” and not a contract of sale. At no time during the trial did the
defense present any evidence to support this theory, having consistently
characterized the contract as a “pre-selling” of Club share.Indeed, the very
warranty clause in the reservation agreement petitioner invokes to exculpate
himself refers to the transaction as “sale.”
Fourth. Contrary to petitioner’s submission, there was a law effective at the
time Sy bought the Club share on 10 October 1996, requiring sellers of
securities such as the non-proprietary membership certificate sold by
Primelink to Sy to register with the SEC the sale of such security and obtain a
permit to sell. Relevant portions of Batas Pambansa Blg. 178 (BP 178),
which took effect on 22 November 1982 and superseded by Republic Act No.
8799 only on 8 August 2000, provide:
XXXXX”
xxx
Damage was incurred by Alfred:
“Lastly, unlike estafa under paragraph 1(b) of Article 315 of the Code, estafa
under paragraph 2(a) of that provision does not require as an element of the
crime proof that the accused misappropriated or converted the swindled
money or property. All that is required is proof of pecuniary damage
sustained by the complainant arising from his reliance on the fraudulent
representation. The prosecution in this case discharged its evidentiary burden
by presenting the receipts of the installment payments made by Sy on the
purchase price for the Club share.”
Convictio affirmed.

Republic of the Philippines

SUPREME COURT
Manila

SECOND DIVISION

G.R. No. 124513            October 17, 2001

ROBERTO ERQUIAGA, and GLENN OROSCO, petitioners, 

vs.
HON. COURT OF APPEALS, REGIONAL TRIAL COURT, Branch 24, Naga City, and
PEOPLE OF THE PHILIPPINES, respondents.

QUISUMBING, J.:

For review is the decision1 dated August 30, 1995, of the Court of Appeals in CA-GR No.
14904 affirming with modification the judgment of the Regional Trial Court of Naga City,
Branch 24, dated March 31, 1993. The RTC of Naga City had found appellants guilty
of estafa.

The facts of this case are as follows:

Honesta Bal is a businesswoman who owned a bookstore. Sometime in May 1989, she was
contacted by Manuel Dayandante @ Manny Cruz who offered to buy her land in Pili,
Camarines Sur. He told Honesta that the company he represented was interested in
purchasing her property. On May 5, 1989, Honesta’s daughter, Josephine Tapang, received
a telegram from Dayandante informing Honesta that the sale had been approved and that
he would arrive with the inspection team on May 12, 1989.2 On May 19, 1989, Honesta
received a call from Dayandante. Her daughter and she met Dayandante and a certain
Lawas @ Rodolfo Sevilla at the Aristocrat Hotel. Dayandante and Lawas said they were
field purchasing representative and field purchasing head, respectively, of the Taiwanese
Marine Products. They persuaded Honesta to purchase cans of a marine preservative
which, could be bought for P1,500 each from a certain peddler. In turn, they would buy
these cans from her at P2,000 each.

The following day, May 20, 19893 Glenn Orosco, one of herein petitioners, appeared at
Honesta’s store and introduced himself as an agent, a.k.a. "Rey," who sold said marine
preservative. Like a fish going after a bait, Honesta purchased a can which she sold to
Dayandante for P1,900. The following day, May 21, Orosco brought five more cans which
Honesta bought and eventually sold to Lawas. It was during this transaction that petitioner
Roberto Erquiaga, a.k.a. "Mr. Guerrerro," was introduced to Honesta to ascertain whether
the cans of marine preservative were genuine or not.4

On May 24, Orosco delivered 215 cans to Honesta. Encouraged by the huge profits from
her previous transactions, she purchased all 215 cans for P322,500. She borrowed the
money from a Jose Bichara at 10% interest on the advice of Erquiaga who lent her
P5,000.00 as deposit or earnest money and who promised to shoulder the 10% interest of
her loan. Soon after the payment, Lawas, Dayandante, Erquiaga, and Orosco vanished.
Realizing that she was conned, Honesta reported the incident to the National Bureau of
Investigation (NBI) which, upon examination of the contents of the cans, discovered that
these were nothing more than starch. The NBI likewise uncovered that the modus
operandi and sting operation perpetrated on Honesta had been going on in other parts of
the country, in particular, Cebu, Batangas, Dagupan, Baguio and Olongapo.5

On December 4, 1989, an Information for Estafa under Article 315, paragraph 2 (a) of the

Revised Penal Code, was filed against Roberto Erquiaga, Glenn Orosco, Pastor Lawas and
Manuel Dayandante. Said information reads:

That on or about May 24, 1989, in the City of Naga, Philippines, and within the
jurisdiction of this Honorable Court, the above-named accused, confederating,
conspiring and helping one another, under a common design or scheme, did then
and there, by means of misrepresentation and deceit, wilfully, unlawfully and
feloniously defraud herein complaining witness HONESTA P. BAL, in the following
manner, to wit: accused above-named, well knowing that the two hundred fifteen
(215) sealed tins they are selling contain only starch, misrepresented to the
complaining witness that the same is made in Singapore as marine product
preservative and relying on said deceitful misrepresentation, the latter paid the value
of the two hundred fifteen (215) tins of said item at a unit price of P1,500.00 per can
or for a total price of P322,500.00, which turned out to be only starch with no
significant commercial value after the same were examined at the NBI Forensic
Chemistry Examination Division, Manila, thereby defrauding said complaining
witness in the aforesaid sum of THREE HUNDRED TWENTY TWO THOUSAND
FIVE HUNDRED (P322,500.00) PESOS, Philippine Currency, to her damage and
prejudice.

CONTRARY TO LAW.6
Upon arraignment, Erquiaga and Orosco pleaded not guilty to the offense charged.
Dayandante was apprehended only during the latter part of 1992 and was tried separately,
while Lawas is still at-large.

On March 31, 1993, the RTC promulgated its decision finding the petitioners guilty of estafa.
The dispositive portion of said decision reads:

WHEREFORE, for all the foregoing, the Court finds accused Roberto Erquiaga,
a.k.a. "Mr. Guerrero" and Glenn Orosco, a.k.a. "Rey" guilty of the offense of estafa
as defined and penalized under Article 315, paragraph 2 (a) of the Revised Penal
Code, beyond reasonable doubt and, in accordance with the provisions of the
Indeterminate Sentence Law, hereby sentences them to suffer the penalty of ten (10)
years of prision mayor in its medium period, as minimum penalty to seventeen (17)
years and four (4) months of reclusion temporal in its medium period, as maximum
penalty. The said accused are ordered to indemnify jointly and severally Honesta P.
Bal, the herein offended party, the sum of Three Hundred Twenty Two Thousand
and Five Hundred (P322,500.00) Pesos, plus interest thereon at the rate of twelve
(12%) percent per annum computed from May 24, 1989 up to the time the said
amount shall have been paid in full, and to pay the costs.

SO ORDERED.7

The Court of Appeals affirmed the decision of the trial court but modified the penalty
imposed. The dispositive portion of the appellate court’s decision reads:

THE FOREGOING CONSIDERED, the appealed Decision, while affirmed, should be

MODIFIED. The penalty should instead be FOUR (4) YEARS and TWO (2)
MONTHS of prision correccional as the minimum, to TWENTY (20) YEARS
of reclusion temporal as maximum; to indemnify, jointly and severally, Honesta Bal,
the amount of P322,500.00 with interest at 12% per annum starting May 24, 1989
until full payment; and to pay the costs.

SO ORDERED.8

Petitioners filed their separate motions for reconsideration9 which the appellate court denied
"for lack of merit".10Petitioners now raise before us the following questions of law:

(1) Can the court validly render judgment of conviction based on mere conjectures,
surmises that there was conspiracy to commit the offense, if the evidence presented
by the prosecution is not strong enough to stand the test of reason?

(2) Can the legal maxim "flight is an evidence of guilt" prevail over the constitutional
presumption of innocence accorded to all accused in criminal case?

(2.1) Are the petitioners duty bound to prove their innocence?

(3) Can the loss in a consummated sale be converted to damages in a criminal case
for estafa without violating the maxim of "caveat emptor?"11
Petitioners contend that the trial court based its decision on mere conjectures and surmises
and that it was biased against them. They likewise assail the finding of conspiracy.12 Finally,
they opine that private complainant should bear her losses under the doctrine of caveat
emptor.13

The Office of the Solicitor General (OSG), for the State, dismisses the issues raised by
petitioners as mere "rehash" of their previous arguments before the Court of Appeals,
hence redundant.14 In our view, the pertinent issue in this case is whether conspiracy to
commit estafa and estafa itself had been adequately established. That petitioners had
conspired with each other must be viewed not in isolation from but in relation to an alleged
plot, a sting, or "con operation" known as "negosyo" of their group. Further, whether such a
well-planned confidence operation resulted in the consummated crime of estafa, however,
must be established by the prosecution beyond reasonable doubt.

Conspiracy, as a rule, has to be established with the same quantum of proof as the crime
itself. It has to be shown as clearly as the commission of the offense.15 It need not be by
direct evidence, but may take the form of circumstances which, if taken together, would
conclusively show that the accused came to an agreement to commit a crime and decided
to carry it out with their full cooperation and participation.16 It may be deduced from the acts
of the perpetrators before, during and after the commission of the crime, which are
indicative of a common design, concerted action and concurrence of sentiments.17

We find that the following circumstances together, conclusively show petitioner Glenn
Orosco’s role in defrauding Honesta: (1) Glenn a.k.a. "Rey" acted as salesman of the
marine preservative. (2) He providentially surfaced after Dayandante and Lawas had
already primed up Honesta regarding profits she would make buying and selling the
product. (3) He conveniently had available a can of the marine preservative after
Dayandante and Lawas told her of the business possibility. (4) He led Honesta to believe
that the contents of the cans were indeed marine preservatives. At the very least, he kept
silent on the real contents of the cans. (5) He pretended to refuse the P5,000 down
payment from Honesta while inducing her to borrow the larger sum of P322,500. (6) He
assured Honesta he still had 50 cans and convinced her to shell out another P1,000 for him
to deliver them. (7) He disappeared with the other accused after their nefarious designs had
been unearthed.

Petitioner Roberto Erquiaga, for his part, actively connived with Orosco. He did the
following: (1) He posed as "Mr. Guerrero", a "verifier" of the contents of the cans allegedly
containing marine preservative. (2) He also induced complainant to borrow more money
and to hold on to the 215 cans. (3) He offered the P5,000 as down payment for the 215
cans. (4) He made the deal more enticing for Honesta by promising to pay the 10% interest
rate on the loan himself.

Patently, each petitioner played a key role in their devious scheme to sell a useless product,
alleged to be a marine preservative, for which they got a substantial amount from Honesta
Bal.

But did the acts of petitioners constitute estafa?

The elements of estafa or swindling under paragraph 2 (a) of Article 315 of the Revised
Penal Code18 are the following:

1. That there must be a false pretense, fraudulent act or fraudulent means.

2. That such false pretense, fraudulent act or fraudulent means must be made or
executed prior to or simultaneously with the commission of the fraud.

3. That the offended party must have relied on the false pretense, fraudulent act, or
fraudulent means, that is, he was induced to part with his money or property
because of the false pretense, fraudulent act, or fraudulent means.

4. That as a result thereof, the offended party suffered damage.19

As earlier discussed, Erquiaga misrepresented himself as a "verifier" of the contents of the

cans. He encouraged Honesta to borrow money. Petitioner Orosco misrepresented himself
as a seller of marine preservative. They used aliases, Erquiaga as "Mr. Guerrero"; and
Orosco as "Rey". Honesta fell for these misrepresentations and the lure of profits offered by
petitioners made her borrow money upon their inducement, and then petitioners
disappeared from the scene after taking the money from her.

Petitioners contend that the starch is a kind of marine preservative and that the failure of the
prosecution to prove otherwise should be enough reason to acquit them.20 This argument
deserves no serious consideration by the Court. Note that what was being offered to
Honesta was a preservative from "Taiwanese Marine Products." What was delivered was
ordinary starch in sealed cans. The scam is quite obvious, though suckers still fall for it.

Petitioners suggest that damages should not be awarded because Honesta was forewarned
to buy at her own risk and because the doctrine of caveat emptor placed her on guard.
Petitioners apparently misapply the doctrine. A basic premise of the doctrine of "Let the
buyer beware" is that there be no false representation by the seller. As discussed earlier,
petitioners’ scheme involves a well-planned scenario to entice the buyer to pay for the
bogus marine preservative. Even the initial buy-and-sell transactions involving one and then
five cans were intended for confidence building before the big transaction when they
clinched the deal involving P322,500. Thereafter, they vanished from the scene. These
circumstances clearly show that petitioners’ Orosco and Erquiaga were in on the plot to
defraud Honesta. Honesta could hardly be blamed for not examining the goods. She was
made to depend on petitioners’ supposed expertise. She said she did not open the cans as
there was a label in each with a warning that the seal should not be broken.21 That Honesta
Bal thought the buy-and-sell business would result in a profit for her is no indictment of her
good faith in dealing with petitioners. The ancient defense of caveat emptor belongs to a by-
gone age, and has no place in contemporary business ethics.

It is not true that Honesta did not suffer any damage because she merely borrowed the
money, and that she showed no proof that she issued a check to pay said debt.22 The
prosecution clearly showed that Bichara had sent a demand letter to Honesta asking for
payment.23 Honesta had borrowed P322,500 from Bichara for which she assuredly must
repay. This constitutes business loses to her and, in our view, actual damages as
contemplated under Article 315, par. 2 (a).24

Given the facts established in this case, we are convinced that estafa had been
consummated by petitioners who had conspired with each other, and the guilt of petitioners
had been adequately proved beyond reasonable doubt.

WHEREFORE, the instant petition is DENIED. The appealed decision of the Regional Trial
Court as modified by the Court of Appeals is AFFIRMED. Petitioners Roberto Erquiaga and
Glenn Orosco are found guilty of estafa under Article 315, paragraph 2 (a) of the Revised
Penal Code. They are sentenced to suffer the penalty of FOUR (4) YEARS and TWO (2)
MONTHS of prision correccional as minimum, and TWENTY (20) YEARS of reclusion
temporal as maximum. Further, they are also ordered to pay jointly and severally as
indemnity to Honesta Bal the sum of P322,500 with interest of 12% per annum until fully
paid.

SO ORDERED.

Bellosillo, (Chairman), Mendoza, Buena, and De Leon, Jr., JJ., concur.

Footnotes

1
 CA Rollo, pp. 154-169.

2
 TSN, February 19, 1991, pp. 4-6; Exhibit "B".

3
 It was May 21, 1989, as per Josephine’s testimony, TSN, February 5, 1991, p. 11,
but she denied this during her cross-examination, TSN, February 5, 1991, pp. 40-41.

4
 TSN, February 19, 1991, p. 16.

5
 Rollo, pp. 44-46; TSN, October 10, 1991, pp. 9-10.

6
 Records, p. 1.

7
 Rollo, pp. 50-51.

8
 Id. at 40-41.

9
 CA Rollo, pp. 172-197.

10
 Id. at 212.

11
 Rollo, p. 10.
12
 Id. at 13-17.

13
 Id. at 20-21.

14
 Id. at 74.

15
 People vs. Legaspi, G.R. No. 117802, 331 SCRA 95, 125 (2000).

16
 Ibid.

 People vs. Mendoza, G.R. No. 128890, 332 SCRA 485, 496 (2000), citing People
17

vs. Parungao, G.R. No. 125812, 265 SCRA 140, 149 (1996).

 Art. 315. Swindling (estafa).- Any person who shall defraud another by any of the
18

means mentioned hereinbelow shall be punished by:

xxx

2. By means of any of the following false pretenses or fraudulent acts

executed prior to or simultaneously with the commission of the fraud:

(a) By using a fictitious name, or falsely pretending to possess power,

influence, qualifications, property, credit, agency, business or imaginary
transactions; or by means of other similar deceits.

xxx

19
 Luis B. Reyes, Revised Penal Code, Book 2, 14th Edition, p. 763.

20
 Rollo, pp. 160-161.

21
 TSN, March 5, 1991, p. 10.

22
 Rollo, pp. 163-165.

23
 Records, Exhibit "B".

24
 Supra, note 18.
 Republic of the Philippines
SUPREME COURT
Manila

EN BANC

G.R. No. L-9811             April 22, 1957

GEORGE L. TUBB, petitioner, 
vs.
PEOPLE OF THE PHILIPPINES and THE COURT OF APPEALS, respondents.

Office of the Solicitor General Ambrosio Padilla and Solicitor Antonio Pelaez, Jalandoni and
Eduardo D. Gutierrez for petitioner.
A. Torres for respondents.

CONCEPCION, J.:

This is a petition for review by certiorari of a decision of the Court of Appeals; The fact are
set forth, in said decision, from which we quote:

On August 15, 1947, accused George L. Tubb called on complainant William R.

Quasha at the latter's office at Dasmariñas St., Manila. The accused had known
Quasha earlier in the same year 1947 when he was defended by said Quasha in a
court-martial case. During the meeting, Tubb talked Quasha into investing in the
rattan business, and said that rattan could be bought for P0.20 a piece in Southern
Luzon and sold for P0.70 a piece in Manila. Quasha delivered the sum of P6,000.00
to the accused on the following day, August 16th, with the understanding that the
money shall be used exclusively by the accused in the purchase of rattan for resale
in Manila; that the rattan so bought shall be brought to Manila within a few days; and,
that the profit to be realized from the sale shall be divided equally between the
accused and the complainant after the capital of P6,000.00 has been returned to the
latter.

The prosecution has also shown that on August 21, 1947, complainant received a
telegram from the accused, who was in Calauag, Quezon province, asking him to
procure a license from the Bureau of Forestry for the purchase of forest products
(Exhibit C). The complainant replied in a letter (Exhibit E, dated August 22, 1947),
saying that although a license was not required to purchase forest products, he was
sending to him (Tubb) an application to cut and gather products as a lessee or
concessionaire. This letter was received by the accused, who sent back the
application, duly accomplished, in a letter of the said accused (Exhibit D, dated
August 27, 1947) through defense witness Amado Resurreccion. The license was
secured and same sent to the accused. On September 16, 1947, when the
complainant did not receive a word from accused, the said complainant sent a
telegram of inquiry (Exhibit G), but the same was answered by the postmaster of
Calauag, Quezon, whose telegram (Exhibit H) disclosed that the accused was no
longer residing in Calauag. Quasha went to the former office of the accused at the
Samanillo Building, but he was informed that the latter had not been heard from for
some time.

Sometime in 1948, Quasha met the accused at the Manila Hotel. Quasha asked the
accused what he (accused) had done with his P6,000.00. The accused merely said
that there was no use telling what happened, but that he will try to pay the
complainant back as he was then working for one Gabino Angchuan of Cebu City
and could get money from his said employer. Quasha did not hear from the accused
for a long time again after their chance meeting at the Manila Hotel. The complainant
wrote to the accused in Cebu City, care of Gabino Angchuan, but his letter was not
answered. When the complainant heard that the accused was in Cagayan de Oro,
Oriental Misamis, the complainant wrote to him, threatening him with a criminal
action if he did not pay within a period of one month (Exhibits K and J, dated July 25,
1949, and January 28,1950, respectively).

The accused did not take the witness-stand, but his counsel presented Avelino
Leyco, Amado Resurreccion and Joe Oberly, as his witnesses. It is argued by the
defense that the accused, together with Amado Resurreccion and with the
assistance of Avelino Leyco, did buy plenty of rattan in Polillo and in Calauag, but
they get drenched in the rain due to the typhoons which visited those places, so that
they become moldy and spoiled.
 The trial court convicted the accused of the crime of estafa, as defined and penalized
under Article 315, subsection 1 (b), of the Revised Penal Code, and sentenced him
to an imprisonment of one year of prison correccional, to indemnify the complainant
in the sum of P6,000.00, with subsidiary imprisonment in case of insolvency, and to
pay the costs.

In this appeal, the main question is whether appellant is criminally liable for estafa or
civilly liable only for the principal sum of P6,000.00. In support of its contention, the
defense insists that there was a lawful partnership between the appellant and the
complainant and the failure of the venture rendered the former liable only for a
liquidation of the partnership.

After carefully going over the evidence of record, we are not at all convinced that
appellant actually bought rattan out of the money entrusted to him by the offended
party for the purpose. The appellant did not advise the complainant of his
whereabouts after he left Calauag, Quezon, despite the fact that he and Amado
Resurreccion allegedly returned to Manila after leaving Calauag. After complainant
met the appellant by chance at the Manila Hotel, the latter again absconded, so that
despite the length of time given said appellant to repay the money received by him
for a specific purpose, the complainant was finally compelled to go to court. The
unexplained conduct of the appellant indicates a guilty conscience.

The conclusion reached by the Court of Appeals was:

Under the above facts and circumstances, appellant is clearly guilty of estafa under
Article 315, paragraph 2(a), of the Revised Penal Code, and not under subsection
1(b) of the Code, as correctly contended by the Solicitor General. The defense of
lawful partnership can not be sustained. There can be no legal partnership where
one of the supposed partners, taking advantage of a friendship which seemed to
have ripened into a relationship of trust, represents himself to the other as one
engaged in a business transaction when in fact he is not. Appellant's request by
telegram that complainant secured a license for the purchase of products and his
accomplishment of the application form for such license, with the request that license
be procured and sent to him as soon as possible, when such license is not required
to enable one to purchase forest products like rattan, was part of a scheme o
deceive the complainant. There is here, therefore, a perfect case of swindling by
means of false pretenses, where formal demand is not necessary (People vs. Scott,
62 Phil. 553). The cases cited by appellant's counsel in support of his contention that
a legal partnership was created between appellant and the complainant
(People vs. Clarin, 17, Phil. 84, People vs. Magdaluyo, CA-G.R. No. 9131-R, May
18, 1954, and People vs. Reyes, CA-G. R. No. 8902- R, March 19, 1953) are
inapplicable because in these cases the appellants therein actually invested or used
the money received by them from their partners in the venture.

The penalty provided by the applicable law is arresto mayor in its maximum period
to prision correccional in its minimum period, or from 4 months and 1 day to 2 years
and 4 months. There being no modifying circumstances to consider, the medium
degree of the penalty should be imposed. Applying the Indeterminate Sentence Law,
 as amended, appellant should be, as he hereby, sentenced to suffer an
indeterminate penalty of from 4 months of arresto mayor to 1 year and 1 day
of prision correccional.

Modified as above-indicated, the judgement appealed from is hereby affirmed in all

other respects, with costs.

Defendant-appellant assails the foregoing decision upon the ground that:

1. The Court of Appeals committed a grave error of law in rendering a decision which
in effect holds that a person charged in the information with estafa as defined in
Article 315, paragraph 1 (b) of the Revised Penal Code may be convicted of estafa
as defined in Article 315, paragraph 2 (a) of the same code.

2. The Court of Appeals gravely erred when, under the facts established or
undisputed on the record, it did not acquit the petitioner herein.

It is alleged in the information in the case at bar:

That on or about the 16th day of August, 1947, in the city of Manila, Philippines, the
said accused did then and there wilfully, unlawfully, and feloniously defraud one
William Quasha in the following manner, to wit: the said accused received from the
said William Quasha the sum of P6,000.00 for the purpose of buying for the latter
rattan and other forest products from the provinces, under the express obligation of
delivering the said articles, if bought on or before August 31, 1947 or to return the
said amount if unable to buy also on or before August 31, 1947, but the said
accused, once in possession of the same and far from complying with his aforesaid
obligation, and in spite of repeated demands made upon him, absconded with the
said amount of P6,000.00, and never appeared again, thereby wilfully, unlawfully
and feloniously, with intent to defraud, misappropriating, misapplying and
converting the said sum to his own personal use and in the said sum of P6,000.00,
Philippine Currency.

It is clear from the foregoing that petitioner is accused of estafa under Article 315,
paragraph 1(b) of the Revised Penal Code:

(b) By misappropriating or converting to the prejudice of another, money, goods, or

any other personal property received by the offender in trust or on commission, or for
administration, or under any other obligation involving the duty to make delivery of or
to return the same, even though such obligation be totally or partially guaranteed by
a bond; . . .

In other words, petitioner is charged with the misappropriation of funds held by him in trust
and with the obligation to return the same. Upon the other hand, the Court of
Appeals convicted him of swindling by means of false pretenses, under paragraph 2(a) of
said Article 315, which punishes estafa committed
 2. By means of any of the following false pretenses or fraudulent acts executed prior
to or simultaneously with the commission of the fraud:

(a) By using fictitious name, or falsely pretending to possess power, influence,

qualifications, property, credit, agency, business or imaginary transaction or by
means of other similar deceits.

This offense is, however, entirely different and distinct from that described in paragraph 1
(b) quoted above. Moreover, some of the essential elements of the offense defined in said
paragraph 2 (a) are not alleged in the information herein. For instance, there is no averment
therein of any "false pretenses or fraudulent acts executed prior to or simultaneously with
the commission of the fraud," which distinguishes said offense from that referred to in
paragraph 1 (b), the main characteristic of which is "unfaithfulness or abuse of confidence",
and this is the essence of the crime charged in said information. The allegations thereof are
such as not to permit petitioner's conviction for estafa under said paragraph 2 (a), without
violating his constitutional right to be informed of the nature and cause of the accusation
against him.

However, the findings of fact made in the decision of the Court of Appeals clearly show that
the sum of P6,000 belonging to Quasha had been misappropriated by petitioner herein, for
he disappeared soon after receipt of said sum, in August, 1947, and when, in 1948, Quasha
found him at the Manila Hotel and inquired what he had done with his (Quasha's) money,
petitioner merely said — in the words of the Court of Appeals — "that there was no use
telling what happened", but that he would try to pay it back. Had said money been invested
in rattan which later on was spoiled, as appellant tried to prove, he would have said so,
instead of making to Quasha said statement, which like his conduct prior and subsequently
thereto, implies that he had misappropriated the funds entrusted to his custody.

It is urged, that there can be no estafa without a previous demand, which allegedly has not
made upon herein petitioner, but the aforementioned query made to him by Quasha, in the
Manila Hotel, was tantamount to a demand. Besides, the law does not require a demand as
a condition precedent to the existence of the crime of embezzlement. It so happens only
that failure to account, upon demand for the funds or property held in trust, is circumstantial
evidence of misappropriation. The same way, however, be established by other proof, such
as that introduced in the case at bar.

The cases of People vs. Evangelista (69 Phil., 583) and U.S. vs. Bleibel (34 Phil., 227,
relied upon by the petitioner, are not in point. The offense charged in the Evangelista case
was not malversation, but of estafa, through false pretenses. The Bleibel case involved a
commission agent who received from his employer, some goods, worth P538.11, with the
obligation to return said goods, or the value thereof. Subsequently, the employer or principal
made a written demand for compliance with said obligation, but the letter of demand did not
appear to have reached the knowledge of Bleibel, He having, accordingly, failed to answer
it, the principal filed against him a complain for embezzlement. Soon thereafter, but before
the filing of the corresponding information, Bleibel delivered said sum of P538.11, to his
principal. It was held that mere delay in accounting for said amount, without competent
proof of misappropriation thereof, does not constitute embezzlement. Besides, the principal
owed Bleibel P143 for salary, and the former had no right to hold the latter criminally liable
for said P538.11, "without first having made a settlement of accounts."

Apart from the fact that none of these circumstances obtains in the case at bar, a demand
was, as above stated, made in the Manila Hotel upon the petitioner, and, worse still, the
later then impliedly, but clearly, admitted that he had spent complainant's money for his
(petitioner's) own personal benefit.

Wherefore, modified only in the sense that petitioner George L. Tubb is guilty of
embezzlement under Article 315, paragraph 1(b), of the Revised Penal Code, the decision
appealed from is hereby affirmed in all other respects, with costs against said petitioner. It is
so ordered.

Bengzon, Padilla, Montemayor, Reyes, A., Bautista Angelo, Labrador, Reyes, J.B.L.,
Endencia and Felix, JJ., concur.

Republic of the Philippines

SUPREME COURT
Manila

SECOND DIVISION

G.R. No. 199294               July 31, 2013

RALPH LITO W. LOPEZ, Petitioner, 

vs.
PEOPLE OF THE PHILIPPINES, Respondent.

DECISION

CARPIO, J.:

The Case

We review1 the ruling2 of the Court of Appeals affirming petitioner's conviction for estafa.

The Facts

Petitioner Ralph Lito W. Lopez (petitioner) was President and Chief Executive Officer (CEO)
of Primelink Properties and Development Corporation (Primelink), a real estate developer.
On 4 July 1996, Primelink entered into a Joint Venture Agreement (Agreement) with
Pamana Island Resort Hotel and Marina Club, Inc. (Pamana) to develop a P60 million
exclusive residential resort with marina (Subic Island Residential Marina and Yacht Club
[Club]), on a 15,000 square-meter portion of an island in Subic, Zambales (Club
site).3 Under the Agreement, Pamana, the Club site owner, undertook to keep the title over
the island where the Club site is located free of encumbrances. Primelink, for its part, will
provide capital and handle marketing concerns, among others.4 The Club was slated for
completion in July 1998. While promoting the Club locally5 and abroad,6 Primelink
commenced selling membership shares as stipulated in the Agreement.

On 10 October 1996, private complainant Alfredo Sy (Sy), through one of Primelink’s sales
officers, Joy Ragonjan (Ragonjan), placed a reservation to purchase one Club share
for P835,999.94 (payable in installments), executed the reservation agreement, and paid
the reservation fee of P209,000. Sy fully paid the balance by 19 April 1998.

In March 2002, Sy filed a criminal complaint against petitioner and Ragonjan in the Pasig
City Prosecutor’s Office for estafa. The complaint was grounded on the fact that the Club
remained undeveloped and Primelink failed to return Sy’s payment despite demands to do
so. Sy also discovered that Primelink had no license from the Securities and Exchange
Commission (SEC) to sell securities.

The Pasig City Prosecutor found probable cause to indict petitioner and Ragonjan for
violation of Article 315, paragraph 2(a) of the Revised Penal Code, as amended
(Code)7 and filed the Information8 with the Regional Trial Court of Pasig City (trial
court).9 Ragonjan remained at large, leaving petitioner to face trial by himself.

During trial, Sy testified that Ragonjan assured him that Primelink was licensed to sell Club
shares.10 On cross-examination. Sy admitted dealing exclusively with Ragonjan for his
reservation and purchase of the Club share.11

The defense presented Atty. Jaime Santiago (Santiago), Primelink comptroller and drafter
of the Agreement, to testify on the circumstances leading to the sale of Club shares and
petitioner’s role in Primelink’s decision to do so.

Petitioner also took the stand, testifying that the Club was a legitimate project of Primelink
and Pamana but whose completion was rendered impossible by Pamana’s breach of the
Agreement, by, among others, mortgaging the Club site to Wesmont Bank. As a result,
Primelink sued Pamana in the Regional Trial Court of Makati (Branch 59) for damages for
breach of the Agreement.12

Petitioner admitted that Primelink sold unregistered shares. He invoked the Agreement as
basis for the undertaking, adding that such is also an "industry practice."13 On Ragonjan’s
dealings with Sy, petitioner stated that Primelink’s sales agents were instructed to be
"honest and candid" with prospective buyers on the status of the project and on Primelink’s
lack of license to sell Club shares.14

The Ruling of the Trial Court

The trial court found petitioner guilty as charged, sentenced him to four years, two months
and one day of prision correccional to twenty years of reclusion temporal and to indemnify
Sy the amount of P835,999.94.15 In the trial court’s evaluation –

the evidence on record indubitably shows that the elements of the subject offense are
present in the case. Accused fraudulently offered to sell to private complainant a share over
Subic Island Club, while concealing from the former the material fact that x x x accused has
yet to secure the requisite licenses and registration with the SEC to sell shares of the
project and from the DENR and HLURB to develop and construct the same. Relying on the
accused’s misrepresentations, private complainant paid him the total amount of
Php835,999.94, as consideration but he was never able to gain possession of a Certificate
of Membership given accused’s continued failure to proceed with the project. x x x.

xxxx

The act of deliberately misrepresenting to the private complainant that Primelink had the
necessary authority or license to pre-sell shares in Subic Island Club, and the act of
collecting money from private complainant only to renege on the promise to turn over said
share and for failure to return the money collected from the private complainant, despite
several demands, are clearly acts attributable to herein accused Lopez and amount to
estafa punishable under Article 315, paragraph 2(a), of the Revised Penal Code.16

Petitioner appealed to the Court of Appeals.

The Ruling of the Court of Appeals

The Court of Appeals affirmed the trial court’s ruling in toto. According to the Court of
Appeals –

the RTC correctly found that the Accused-Appellant is guilty beyond reasonable doubt of
Estafa as all its elements are present. The Accused-Appellant made false representations,
through his marketing officer, Ragonjan, by making Sy believe that the necessary license to
sell or permit from the government agencies has been obtained by their company,
Primelink, to sell membership shares in the Club. Sy, highly trusting of the
misrepresentations of the Accused-Appellant and Ragonjan, willingly parted with his money
and bought a membership share in the same. x x x.

xxxx

Were it not for the Accused-Appellant’s fraudulent machinations and false representations,
Sy would not have parted with his money and would not be ripped-off of his hard-earned
money in the amount of P835,999.94. x x x. It is also peculiar that no refund was made to
the latter from the start of the trial until this time.17

Hence, this appeal under Rule 45.

Petitioner seeks a re-appraisal of the Court of Appeals’ factual findings, pointing to facts
allegedly overlooked which, if considered, would alter the case’s disposition. He also assails
the Court of Appeals’ appreciation of conspiracy between him and Ragonjan as speculative,
grounded on mere assumptions.18

The Office of the Solicitor General (OSG) prays for the denial of the petition. As a threshold
objection, the OSG contests the propriety of reviewing questions of fact, considering that
the office of a Rule 45 petition is limited to the review of questions of law only. On the
merits, the OSG prays for affirmance of the Court of Appeals’ ruling.

The Issue

The question is whether the Court of Appeals erred in affirming petitioner’s conviction for
estafa under Article 315, paragraph 2(a) of the Code.

The Court’s Ruling

We hold that the Court of Appeals committed no error in affirming petitioner’s conviction for
estafa.

Review of Questions of Fact Improper

We first resolve the threshold issue of the propriety of passing upon questions of fact in this
review. The narrow ambit of review prescribed under Section 1 of Rule 45,19 limiting the
scope of our inquiry to questions of law only enforces our ordinary certiorari jurisdiction
efficiently. By sparing the Court from the task of parsing through factual questions, we are
able to swiftly dispose of such appeals. This rule, of course, admits of exceptions applicable
to those rare petitions whose peculiar factual milieu justifies relaxation of the Rules such as
when the Court of Appeals made erroneous inferences, arrived at a conclusion based on
speculation or conjectures, or overlooked undisputed facts which, if duly considered, lead to
a different conclusion.20 As shown in the discussion below, however, none of these grounds
obtain here. We thus proceed with our review without disturbing the Court of Appeals’
factual findings.

Elements of Estafa Under Article 315, paragraph 2(a)

The Code defines estafa under Article 315, paragraph 2(a), the offense for which petitioner
and Ragonjan stand accused, as follows:

Swindling (estafa). — Any person who shall defraud another x x x

xxxx

2. By means of any of the following false pretenses or fraudulent acts executed prior to or
simultaneously with the commission of the fraud:

(a) By using fictitious name, or falsely pretending to possess power, influence,

qualifications, property, credit, agency, business or imaginary transactions, or by means of
other similar deceits.
This provision lays on the prosecution the burden of proving beyond reasonable doubt each
of the following constitutive elements:

(1) The accused used fictitious name or false pretense that he possesses (a) power,
(b) influence, (c) qualifications, (d) property, (e) credit, (f) agency, (g) business or (h)
imaginary transaction, or other similar deceits;

(2) The accused used such deceitful means prior to or simultaneous with the
execution of the fraud;

(3) The offended party relied on such deceitful means to part with his money or
property; and

(4) The offended party suffered damage.

Elements of Use of, and Reliance on, False Pretenses

by Petitioner and Sy, Respectively

The Information filed against petitioner and Ragonjan alleges that they conspired to use two
false pretenses on Sy to defraud him on 10 October 1996, namely, that "[1] Subic Island
Club would be developed by Primelink and that [2] the latter was duly authorized to sell
membership certificates." We find merit in petitioner’s contention that the prosecution failed
to prove the element of use of false pretense regarding the first allegation. Nevertheless, we
find the evidence sufficient to prove the use of false pretense on the second allegation.

Allegation on the Club’s Development not "False"

It is impossible to determine from the records the category of false pretense the prosecution
wished the first allegation to belong. Undoubtedly, it concerns Primelink’s capability to
develop the Club. Use of false pretense of capability is, however, not penalized under
Section 2(a) of Article 315. The category approximating the allegation in question is false
pretense of power (to develop the Club). We proceed with our analysis using such category
as frame of reference.21

Without need of passing upon the question whether Ragonjan’s representations to Sy on 10

October 1996 bind petitioner, we resolve the threshold question whether her alleged
statement that the Club will be finished by July 1998 was in the first place false. The Court
of Appeals grounded its affirmative answer on the fact that the Club remained unfinished
even after the lapse of its target completion date in July 1998. Section 2(a) of Article 315,
however, requires that the false pretense be used "prior to or simultaneous with the
execution of the fraud," that is, on 10 October 1996. The crux of this issue then, is whether
before or at that time, Primelink possessed no power (capability) to develop the Club,
rendering Ragonjan’s statement false.

A review of the records compels a negative answer. When Sy reserved to buy a Club share
on 10 October 1996, barely three months had passed after Primelink, a duly incorporated
real estate developer, signed the Agreement with Pamana, another real estate developer, to
develop the Club. Four months after Sy bought a Club share, Primelink promoted the Club
here and abroad and continued selling Club shares.22 All the while, Primelink released funds
to finance the project’s initial expenses, a portion of which Pamana was ordered to repay by
a Makati court after the project was aborted.23

These facts negate the conclusion that on or before 10 October 1996, petitioner and
Ragonjan knew that the Club was a bogus project. At that time, the Project was on-course
as far as Primelink was concerned. It was only after 10 October 1996 that Primelink
encountered problems with Pamana, rendering impossible the Club’s completion.24

False Pretense on Primelink’s Qualification to

Pre-sell Club Shares Proven Beyond Reasonable Doubt

There is no mistaking that the claim made by Ragonjan to Sy that Primelink was authorized
to sell membership shares is false - Primelink held no license to sell securities at the time
Sy bought a Club share on 10 October 1996 or afterwards. Such alleged false
representation, which Sy relied upon to buy the share, belongs to the category of false
pretense of qualification (to sell securities) under Section 2(a) of Article 315.

Petitioner seeks exculpation for the use of such false pretense by raising the following
arguments: (1) Ragonjan’s representation to Sy does not bind him for lack of proof that he
conspired with Ragonjan;25 (2) the contract Sy entered into with Primelink was not a sale of
a Club share but a reservation to buy one;26 (3) even if the contract involved the sale of a
Club share, petitioner is not liable because (a) Ragonjan’s representation amounted to a
warranty which, not having been reduced in writing as required in the reservation
agreement, does not bind Primelink,27 and (b) at the time Sy bought the Club share, there
was no law requiring Primelink to obtain a license from the SEC to sell Club shares.28

These contentions lack merit.

First. Petitioner was no bystander in Primelink’s sale of unregistered shares. Santiago,

Primelink’s comptroller and drafter of the Agreement, testified as witness for petitioner that
after Primelink’s Board of Directors approved the sale of the unregistered Club shares,
petitioner "encouraged and instructed" the sale of "many shares,"29 no doubt to raise as
much capital for the Club as possible. This was the context of Sy’s purchase of a Club
share from Primelink.

Petitioner attempts to distance himself from the transaction between Ragonjan and Sy by
claiming that Ragonjan violated standing company policy to be "candid" to buyers by
disclosing Primelink’s lack of license. We find this unpersuasive. In the first place, petitioner
failed to present independent proof of such company policy, putting in serious doubt the
veracity of his claim. Secondly, it is improbable for Ragonjan to take it upon herself to
fabricate the serious claim that Primelink was a licensed securities dealer in violation of
company policy, in the process risking her employment. It is more consistent with logic and
common sense to hold that Ragonjan followed company policy in giving assurances to Sy
that Primelink was licensed to sell Club shares. After all, Primelink stood to attract more
investments if it presented itself to the public as a licensed securities dealer. Indeed, Sy was
emphatic in his claim that he bought a Club share for P0.8 million because he was
"convinced that there was a license to sell."30
Petitioner’s direct hand in the unlicensed selling of Club shares, coupled with Ragonjan’s
position in Primelink’s organizational and sales structure, suffices to prove petitioner’s
liability under the allegation of use of false pretense of qualification. With Santiago’s
testimony on petitioner’s central role in the sale of unregistered Primelink shares, further
proof of conspiracy between petitioner and Ragonjan is superfluous.

Second. There is no merit in the argument that Ragonjan’s assurance to Sy of Primelink’s

status as a licensed securities dealer amounts to a warranty, and thus required, under the
warranty clause of the reservation agreement, to be reduced in writing. The warranty
clause, which provides –

Any representation or warranty made by the agent who handled this sale not embodied
herein shall not bind the company, unless reduced in writing and confirmed by the President
or the Chairman of the Board.31

refers to warranties on the terms of the share sold, not to the capacity of Primelink to sell
Club shares. Indeed, the fact that "the seller has the right to sell the thing at the time when
ownership is to pass," is implied in sales,32dispensing with the need to expressly state such
in the contract. Further, the clause operates to shield Primelink from claims of violation of
unwritten warranties, not its officers from criminal liability for making fraudulent
representation on Primelink’s authority to sell Club shares.

Third. It is futile for petitioner to recast, at this late stage of the proceedings, the nature of
the contract between Primelink and Sy as a "reservation agreement" and not a contract of
sale. At no time during the trial did the defense present any evidence to support this theory,
having consistently characterized the contract as a "pre-selling" of Club share.33 Indeed, the
very warranty clause in the reservation agreement petitioner invokes to exculpate himself
refers to the transaction as "sale."

Fourth. Contrary to petitioner’s submission, there was a law effective at the time Sy bought
the Club share on 10 October 1996, requiring sellers of securities such as the non-
proprietary membership certificate sold by Primelink to Sy34 to register with the SEC the sale
of such security and obtain a permit to sell. Relevant portions of Batas Pambansa Blg. 178
(BP 178), which took effect on 22 November 1982 and superseded by Republic Act No.
8799 only on 8 August 2000, provide:

Sec. 4. Requirement of registration of securities. — (a) No securities, x x x, shall be sold or

offered for sale or distribution to the public within the Philippines unless such securities shall
have been registered and permitted to be sold as hereinafter provided.

xxxx

Sec. 8. Procedure for registration. — (a) All securities required to be registered under
subsection (a) of Section four of this Act shall be registered through the filing by the issuer
or by any dealer or underwriter interested in the sale thereof, in the office of the
Commission, of a sworn registration statement with respect to such securities x x x.

xxxx
If after the completion of the aforesaid publication, the Commission finds that the
registration statement together with all the other papers and documents attached thereto, is
on its face complete and that the requirements and conditions for the protection of the
investors have been complied with, x x x, it shall as soon as feasible enter an order making
the registration effective, and issue to the registrant a permit reciting that such person, its
brokers or agents, are entitled to offer the securities named in said certificate, with such
terms and conditions as it may impose in the public interest and for the protection of
investors. (Emphasis supplied)

The registration requirement under BP 178 applies to all sales of securities "including every
contract of sale or disposition of a security,"35 regardless of the stage of development of the
project on which the securities are based. No amount of "industry practice" works to amend
these provisions on pre-sale registration.1âwphi1

Nor can petitioner rely on G.G. Sportswear Mfg. Corp. v. World Class Properties, Inc.36 to
evade criminal liability. That case involved an action for rescission and refund filed before
the Housing and Land Use Regulatory Board (HLURB) by a condominium buyer against the
developer for breach contract. The HLURB Arbiter rescinded the contract for lack of license
of the developer to sell condominium units. The HLURB Board of Commissioners modified
the Arbiter’s ruling by denying rescission, holding, among others, that the developer’s
acquisition of license before the filing of the complaint mooted the prayer for rescission. On
appeal, this Court affirmed. Here, Primelink never acquired a license to sell from the SEC,
unlike in G.G. Sportswear. Thus, G.G. Sportswear is clearly not applicable to the present
case.

On the Element of Damage Sustained by Sy

Petitioner contends that Sy sustained damage only for P209,000, the amount he paid upon
signing the reservation agreement on 10 October 1996 as alleged in the Information, and
not P835,999.94, the price of the Club share. Alternatively, petitioner argues that he neither
received nor profited from the payments made by Sy. Petitioner's contention would hold
water if Sy did not buy a Club share. Sy, however, not only paid the reservation fee, which
constituted five percent ( 5%) of the share price,37 he also paid the balance in installments,
evidenced by receipts the prosecution presented during trial.

Lastly, unlike estafa under paragraph 1 (b) of Article 315 of the Code, estafa under
paragraph 2( a) of that provision does not require as an element of the crime proof that the
accused misappropriated or converted the swindled money or property. All that is required
is proof of pecuniary damage sustained by the complainant arising from his reliance on the
fraudulent representation. The prosecution in this case discharged its evidentiary burden by
presenting the receipts of the installment payments made by Sy on the purchase price for
the Club share.

WHEREFORE, we DENY the petition. We AFFIRM the Decision dated 31 January 2011
and the Resolution dated 9 November 2011 of the Court of Appeals.

SO ORDERED.
ANTONIO T. CARPIO
Associate Justice

WE CONCUR:

ARTURO D. BRION
Associate Justice

MARIANO C. DEL CASTILLO JOSE PORTUGAL PEREZ

Associate Justice Associate Justice

ESTELA M. PERLAS-BERNABE
Associate Justice

ATTESTATION

I attest that the conclusions in the above Decision had been reached in consultation before
the case was assigned to the writer of the opinion of the Court’s Division.

ANTONIO T. CARPIO
Associate Justice
Chairperson

CERTIFICATION

Pursuant to Section 13, Article VIII of the Constitution, and the Division Chairperson's
Attestation, I certify that the conclusions in the above Decision had been reached in
consultation before the case was assigned to the writer of the opinion of the Court's
Division.

MARIA LOURDES P. A. SERENO

Chief Justice

Footnotes

1
 Under Rule 45 of the 1997 Rules of Civil Procedure.

2
 Decision dated 31 January 2011 and Resolution denying reconsideration dated 9
November 2011, penned by Associate Justice Normandie B. Pizarro with Associate
Justices Amelita G. Tolentino and Ruben C. Ayson, concurring.

3
 Referred to as Pamana Island, measuring 56,000 square meters. The Club will
include a "Clubhouse, residential units composed of low rise condominiums and
town houses, and other recreational facilities." Rollo, p. 164.
4
 Id. at 166.

 On 16 July 1996 at the Shangri La Hotel and on 11 February 1997 at the Manila
5

Peninsula Hotel, both in Makati City. Id. at 105.

6
 In an event in Singapore dubbed "Boat Asia ’96." Id. at 57.

7
 Act No. 3815.

8
 Which alleged:

On or about October 10, 1996, in Pasig City and within the jurisdiction of this
Honorable Court, the accused, conspiring and confederating together and
mutually helping and aiding one another, by means of deceit and false
pretenses executed prior to or simultaneously with the commission of fraud,
did, then and there willfully, unlawfully, and feloniously defraud the
complainant, Alfredo P. Sy, in the following manner, to wit: the said accused
convinced the complainant to purchase a Membership Share in a residential
marina and yacht club known as Subic Island Residential Marina and Yacht
Club (Subic Island) worth P835,999.94, the complainant relied on the
representation made by the accused that [1] Subic Island would be developed
by Primelink and that [2] the latter was duly authorized to sell membership
certificates. Believing in the said representation, the complainant paid the
purchase price of one Membership Certificate. However, it turned out that
accused sold to the complainant an unregistered and non-existing
membership certificate in an undeveloped marina and yacht club, and
accused once in possession of said amount, misappropriated, misapplied,
and converted the same to their own personal use and benefit, to the damage
and prejudice of the complainant, Alfredo P. Sy, in the amount of P835,
999.94. (Rollo, p. 42)

9
 Docketed as Criminal Case No. 123300 and raffled to Branch 155.

10
 TSN (Alfredo Sy), 12 December 2003, p. 8.

11
 TSN (Alfredo Sy), 27 February 2004, pp. 7-8.

12
 TSN (Ralph Lopez), 8 December 2006, pp. 14, 18-26. The case was docketed as
Civil Case No. 02-418. In its Decision dated 16 March 2006, the trial court ruled for
Primelink and ordered Pamana to pay a total of P41 million as damages. On appeal,
the Court of Appeals (CA G.R. CV No. 88775) affirmed the trial court with
modification.

13
 TSN (Ralph Lopez), 13 December 2007, pp. 17-21.

14
 Id. at 27, 30.

15
 The dispositive portion of the Decision, dated 24 August 2009, provides:
 WHEREFORE, finding accused RALPH LITO W. LOPEZ GUILTY beyond
reasonable doubt of the crime of Estafa under Article 315, par. 2(a) of the
Revised Penal Code, he is sentenced to an indeterminate prison term of four
(4) years, two (2) months and one (1) day of prison correccional, as minimum,
to twenty (20) years of reclusion temporal as maximum. He is further ordered
to indemnify the private complainant Alfredo Pe Sy the sum of
Php835,999.94, with interest of twelve percent (12%) per annum from the
date of filing of the Information in this case until the same is fully paid.

Meanwhile, considering that accused Joy Ragonjan remains at large, let an

alias warrant against her issue forthwith. (Rollo, p. 68)

16
 Id. at 73-74.

17
 Id. at 21, 24.

18
 Id. at 53-55.

19
 "Filing of petition with Supreme Court. A party desiring to appeal by certiorari from
a judgment or final order or resolution of the Court of Appeals, the Sandiganbayan,
the Regional Trial Court or other courts whenever authorized by law, may file with
the Supreme Court a verified petition for review on certiorari. The petition shall raise
only questions of law which must be distinctly set forth."

 Eugenio v. People, G.R. No. 168163, 26 March 2008, 549 SCRA 433; The Insular
20

Life Assurance Company, Ltd. v. Court of Appeals, G.R. No. 126850, 28 April 2004,
428 SCRA 79.

 The alleged false pretense could not pertain to Primelink’s business as Primelink is
21

a duly incorporated entity authorized to engage in real estate development. (Rollo, p.

38). See also Primelink Properties and Development Corporation v. Lazatin-Magat,
526 Phil. 394 (2006).

22
 See notes 5 and 6.

23
 See note 12.

 Petitioner testified that Primelink learned for the first time of the Club site’s
24

mortgage to Westmont Bank only in 1999 (TSN [Ralph Lopez], 8 December 2006, p.
22).

25
 Rollo, pp. 53, 54.

26
 Id. at 50.

27
 Id.

28
 Id. at 49-54.
29
 The relevant portions of his testimony read:

Q - Mr. Witness, this case involves the sale to the Private Complainant of a
membership share. Now, will you please tell us why did your company,
Primelink through the accused Lopez, sell this membership share to the
Private Complainant and what was the basis for such sale, if you know?

A - The JVA provides for the co-developer, Primelink Properties, and it is

authorized by the land owner to pre-sell certain condominium units and
membership shares to preferred buyers and I think this is embodied in the
JVA, sir.

Q - You also mentioned earlier that you had a hand in the preparation of this
JVA because one of your duties, among others, was to involve yourself also
in the preparation of contracts regarding the project being undertaken by your
company. Now, will you please tell us, if you know, the meaning of the word
pre-selling under Article 10 of the JVA.

xxxx

A - Pre-selling as the word connotes is the industry practice of peculiarity in

the real estate business wherein membership shares and condominium units
are offered to sell [sic] to the public to a preferred buyer prior to the
registration of the project and issuance of the license to sell. x x x.

xxxx

Q - You were the one who drafted the JVA?

A - I assisted in the preparation.

Q - You assisted in the drafting of JVA upon the Instruction of Primelink

Board of Directors and accused as President and CEO?

A - Yes, sir.

Q - Considering, Mr. Witness, that you are supposed to invest substantial

sums on this project, the stipulations that were contained in the JVA were
reached after careful study and consultation with the Board and with the
accused?

A - Yes, sir.

Q - Mr. Witness, you were careful in the drafting of the JVA since your
purpose is to see to it that the interest of Primelink is protected?

A - Yes, sir.
 Q - And, having finalized and completed the JVA, you were assured that the
terms and conditions thereof were supposed to protect Primelink’s interest?

A - Yes, sir.

Q - And, you also assured the Board of Directors of Primelink and the
accused Mr. Lopez that the JVA is in order?

A - Yes, sir.

Q - On the part of Mr. Lopez before he affix[ed] his signature on the JVA he
readily understood the terms and conditions of the JVA?

A - Yes, sir.

Q - So, Mr. Lopez is aware of the concept of pre-selling?

A - Yes, sir.

Q - So, when the JVA was signed and implemented, Primelink through the
Board of Directors, and the accused as Primelink’s CEO made its part [sic] to
sell as many shares of the subdivision units under the concept of preselling
as embodied in the JVA?

A - Yes, sir.

Q - In fact, Mr. Lopez, the accused, encouraged and instructed the selling of
many shares under the concept of pre-selling?

A - Yes, sir.

Q - And, so it is under these conditions, Mr. Witness, that the complainant

was sold with a one share, the subject share in this case?

A - Yes, sir.

xxxx

Q - As a lawyer, Mr. Witness, you are of course aware that you have first to
secure the pertinent licenses and registration with the HLURB and SEC
before you undertake the project and to sell the project?

A - Yes, sir. (TSN [Jaime B. Santiago], 16 September 2005, pp. 13, 15, 16; 2
March 2006, pp. 8-10, 14) (emphasis supplied).

30
 TSN (Alfredo Sy), 12 December 2003, p. 8.
 31
 Records, p. 171.

32
 CIVIL CODE, Article 1547(1).

 TSN (Ralph Lopez), 8 December 2006, p. 17-18; 13 December 2007, pp. 17-21;
33

TSN (Jaime Santiago), 16 September 2005, pp. 13-14, 16-17.

34
 TSN (Ralph Lopez), 28 May 2009, pp. 14-15.

35
 Section 1(c), BP 178.

36
 G.R. No. 182720, 2 March 2010, 614 SCRA 75.

37
 Records, p. 171.

1.      Define Estafa
Estafa is a criminal offense wherein a person defrauds another by the following means:

1)      By UNFAITHFULNESS or ABUSE OF CONFIDENCE;

2)      By DECEIT;

3)      By FRAUDULENT MEANS/

 
Estafa is committed by a person who defrauds another causing him to suffer damage, by
means of unfaithfulness or abuse of confidence, or of false pretense or fraudulent acts.

 
2.      Explain “Estafa through unfaithfulness or abuse of confidence.”
Estafa through unfaithfulness or abuse of confidence is done by:

(a)   Altering quality, quantity and substance of subject matter of contract;

(b)   Misappropriating or converting goods/property of another;

(c)    Taking advantage of a signature in blank

3.      Explain “Estafa through deceit or fraudulent acts.”

Estafa through deceit or fraudulent acts executed prior to or simultaneously with the
commission of the fraud is done by:

(a)   Using fictitious name as means of deceit;

(b)   Altering quality, fineness or weight of anything pertaining to art or business;

(c)    By issuing unfunded checks or postdated checks;

(d)   Availing of services of hotel, inn, restaurants etc. without paying therefor.

 
4.      Explain “Estafa through fraudulent means.”
Estafa through fraudulent means is done by:

(a)   Inducing another, by means of deceit, to sign any document;

(b)   Resorting to some fraudulent practice to ensure success in a gambling game;

(c)    Removing, concealing, or destroying, in whole or in part, any record, office files,
document and other papers.

 
5.      What are the indispensable elements of estafa?
Estafa has two indispensable basic elements:

(a)   Fraud; and

(b)   Resulting damage or intent to cause damage capable of pecuniary estimation.

 
6.      What is Fraud?
Fraud, in its general sense, is deemed to comprise anything calculated to deceive, including
all acts, omissions and concealment involving a breach of legal or equitable duty, trust or
confidence justly reposed, resulting in damage to another, or by which an undue and
unconscientious advantage is taken of another. It is a generic term embracing all
multifarious means which human ingenuity can device, and which are resorted to by one
individual to secure an advantage over another by false suggestions or by suppression of
truth and includes all surprise, trick, cunning, dissembling and any unfair way by which
another is cheated. And deceit is the false representation of a matter of fact whether by
words or conduct, by false or misleading allegations, or by concealment of that which should
have been disclosed which deceives or is intended to deceive another so he shall act upon it
to his legal injury. The false pretense or fraudulent act must be committed prior to or
simultaneously with the commission of the fraud. (Alcantara v. Court of Appeals, 416
SCRA 418 (1998))
Deceit is a species of fraud. (Garcia v. People, G.R. No. 144785, 11 September 1985)
 
7.      Is “intent to defraud” a necessary element of estafa?
Not really. Intent to defraud is not necessary in all types of estafa.

It is true that it is sometimes said that "deception with intent to defraud" is an essential
requisite of the crime of estafa, but while this is true as to estafas in general, it is not true
of those estafas mentioned in the article under consideration, except in so far the abuse of
confidence in misappropriating the funds or property after they have come to the hands of
the offender may be said to be a fraud upon the person injured thereby. (United States v.
Pascual, G.R. No. L-4265, 26 March 1908)
 
8.      What kind of damage or intent to cause damage is required in Estafa?
Damage or prejudice may consist of:

(a)   The offended party being deprived of his money or property as a result of the
defraudation;

(b)   Disturbance of property rights;

(c)    Temporary prejudice.

(Nagrampa v. People, 435 Phil. 455)

 

Certainly, disturbance of property rights is equivalent to damage and is in itself sufficient to

constitute injury within the meaning of Art. 315, par. 1 (b) of the RPC. (Batulanon v.
People, G.R. No. 139857, 15 September 2006)
 
9.      What are the elements of Estafa with unfaithfulness, under Article 315, par.
1 (a) of the Revised Penal Code?
The elements of Estafa under Article 315, 1(a) of the Revised Penal Code,
 

(a)   That the offender has an onerous obligation to deliver something of value;

(b)   That he alters its substance, quantity or quality

(c)    That damage or prejudice capable of pecuniary estimation is caused to the offended
party or third persons;

10.  What if the obligation asked is illegal?

It is still estafa even if the obligation be based is immoral or illegal.

11.  What are the elements of Estafa with abuse of confidence, under Article 315,
par. 1 (b) of the Revised Penal Code?
The elements of Estafa under Article 315, 1(b) of the Revised Penal Code,
 

(a)   That money, goods or other personal property is received by the offender in trust, or
on commission or for administration, or under any other obligation involving the duty to
make delivery of or to return the same;

(b)   That there be misappropriation or conversion of such money or property by the

offender or denial on his part of such receipt; and

(c)    That such misappropriation or conversion or denial is to the prejudice of another;

(d)   That there is demand by the offended party to the offender.

(Asejo v. People, 555 Phil. 106, (2007))

 
The second element establishes three ways in which estafa may be committed under this
category:
 1. Misappropriation of the thing received – the act of taking something for one’s own
benefit;
2. Conversion of the thing received – the act of using or disposing of another’s property
as it was one’s own;
3. Denial of the receipt of the thing received.
 

12.  What do you mean by “Misappropriation” or “conversion”?

The words "convert" and "misappropriate" as used in the aforequoted Article 315, connote
an act of using or disposing of another’s property as if it were one’s own or of devoting it to
a purpose or use different from that agreed upon. To "misappropriate" a thing of value for
one’s own use or benefit, not only the conversion to one’s personal advantage but also
every attempt to dispose of the property of another without a right. (Sy v. People, G.R.
No. 85785, 24 April 1989)
 
It is well-settled that the essence of estafa thru misappropriation is the appropriation or
conversion of money or property received to the prejudice of the owner (U.S. vs. Ramirez,
9 Phil. 67).
 

Misappropriation or conversion may be proved by the prosecution by direct evidence or by

circumstantial evidence. (Lee v. People, G.R.No. 157781, 11 April 2005)
 
Failure to account upon demand, for funds or property held in trust, is circumstantial
evidence of misappropriation. (People v. Sullano, G.R. No. L-18209, 30 June 1966)
 
13.  What do you mean by denial of the receipt of the thing received?
It means that a person who has possession of a thing, does not return or denies receiving
the thing to the owner.

There are two kinds of possession:

a)      Material Possession – The actual physical possession of personal property, where the
possessor cannot claim a better right to such a property than that of its owner.

b)      Juridical Possession – It is present when the possession of the personal property
arises from a lawful causation, contract or agreement, express or implied, written or
unwritten or by virtue of a provision of law.

When the money, goods, or any other personal property is received by the offender from
the offended party (1) in trust or (2) on commission or (3) for administration, the offender
acquires both material or physical possession and juridical possession of the thing
received. (Santos v. People, 181 SCRA 487, 1990)
 

Juridical possession means a possession which gives the transferee a right over the thing
which the transferee may set up even against the owner.

 
14.  Is there a difference between Theft and Estafa?
Yes. If the offender has been given Material Possession of the personal property and he
misappropriates the same, he is liable for the crime of THEFT.
 

However, if the offender has been given Juridical Possession and Material Possession of the
personal property and he misappropriates the same, he is liable for the crime of ESTAFA.

 
Theft should not be confused with estafa. According to Chief Justice Ramon C. Aquino in
his book on the Revised Penal Code, "The principal distinction between the two crimes is
that in theft the thing is taken while in estafa the accused receives the property and
converts it to his own use or benefit. However, there may be theft even if the accused has
possession of the property. If he was entrusted only with the material or physical (natural)
or de facto possession of the thing, his misappropriation of the same constitutes theft, but if
he has the juridical possession of the thing, his conversion of the same constitutes
embezzlement or estafa."
 
15.  What are the elements of theft as compared to Estafa?
Theft has the following elements:

(a)   That there be taking of personal property;

(b)   That said property belongs to another;

(c)    That the taking be done with intent to gain;

(d)   That the taking be done without the consent of the owner;

(e)   That the taking be accomplished without the use of violence or intimidation against
persons or force against things.

(U.S. v. De Vera, 43 Phil. 1000)

 
16.  What is the nature of Demand needed as element of Estafa?
There must be a formal demand on the offender to comply with his obligation before he can
be charged with estafa.

The following are the exceptions:

a)      When the offender’s obligation to comply is subject to a period;

b)      When the accused cannot be located despite due diligence.

 
There can be no estafa without a previous demand. Demand may be made in whatever
form. The law does not require a demand as a condition precedent to the existence of the
crime of embezzlement. It so happens only that failure to account, upon demand for funds
or property held in trust, is circumstantial evidence of misappropriation. The same however,
be established in the case at bar. (Tubb v. People, G.R. No. L-9811, 22 April 1957)
 
The word "Demand" need not be used to show that demand had, indeed, been made upon
the person charged with the offense. A query as to the whereabouts of the money is
tantamount to a demand. (Barrameda v. Court of Appeals, 313 SCRA 477)
 
No specific type of proof is required to show that there was demand. Demand need not even
be formal; it may be verbal. (Lee v. People, G.R. No. 157781, 11 April 2005)
 
In a prosecution for estafa, demand is not necessary where there is evidence of
misappropriation or conversion. (Sy v. People, G.R. No. 85785, 24 April 1989)
 
The consummation of the crime of [estafa]… does not depend on the fact that a request for
the return of the money is first made and refused in order that the author of the crime
should comply with the obligation to return the sum misapplied. The appropriation or
conversion of money received to the prejudice of the owner thereof [is] the sole essential
[fact] which constitute the crime of [estafa], and thereupon the author thereof incurs the
penalty imposed by the [RPC]. (Salazar v. People, 439 Phil. 762)
 
Even if demand is not required by law, it is necessary to prove misappropriation. Failure to
account, upon demand, is circumstantial evidence of misappropriation. (Tan v. People,
G.R. No. 153460, 29 January 2007)
 
17.  What are the elements of Estafa by taking undue advantage of the signature
in blank, under Article 315, par. 1(c) of the Revised Penal Code?
The elements of Estafa by taking undue advantage of the signature in blank are:

(a)   That the paper with the signature of the offended party be in blank;

(b)   That the offended party should have delivered it to the offender;

(c)    That above the signature of the offended party a document is written by the offender
without authority to do so;

(d)   That the document so written creates a liability of, or causes damage to the offended
party or any third person.

18.  What are the elements of Estafa by means of deceit, under Article 315, par. 2
of the Revised Penal Code?
The elements of Estafa by means of deceit are as follows:

(a)   That there must be false pretenses, fraudulent act or fraudulent means;

(b)   That such pretenses, fraudulent act or fraudulent means must be made or executed
prior to or simultaneously with the commission of the fraud;

(c)    That the offended party must have relied on the false pretense, fraudulent act or
fraudulent means, that is, he was induced to part with his money or property because of
false pretense, fraudulent act, or fraudulent means;

(d)   That as a result thereof, the offended party suffered damage.

19.  What are the acts which would constitute a deceitful act?

As a general rule, in order to constitute deceit, there must be a false representation as a
matter of fact, a positive assertion of falsehood. (People vs. Manahan, CA- G.R. No.
19602-R, 20 May 1958)
 
It might also consist in a fraudulent misrepresentation or contrivance by which one man
deceives another who has no means of detecting the fraud to the injury of another. (People
vs. Babel, 10 CAR 133)
 
There is no deceit if the complainant was aware if the fictitious nature of the pretense.

 
20.  What if the element of deceit was done AFTER the fraudulent act?
One of the elements of estafa is that “The false pretense or fraudulent act must be
committed prior to or simultaneously with the commission of the fraud.” If deceit was not
present or occurred after the commission of the fraud, there is no estafa. Likewise also, if
the deceit was not the motivating factor for the offended party to get involved in a
transaction with the offending party.

 
 21.  If there was no fraud on the part on the offending party, will the case for
Estafa prosper?
No. Fraud is an element of Estafa. Its absence is fatal to the prosecution of the case. When
the allegation of deceit has not been proven, there is no Estafa. (Candido dela Cruz, CA
37 O.G. 1958)
 

22.  How is Estafa by means of deceit committed:

Estafa by means of deceit are committed in the following ways:

a)      Art. 315, 2 (a)

i)        By using a fictitious name.

ii)      By falsely pretending to possess

1.                                                               i.      Power

2.                                                             ii.      Influence
3.                                                           iii.      Qualifications
4.                                                            iv.      Property
5.                                                              v.      Credit
6.                                                            vi.      Agency
7.                                                          vii.      Business or imaginary transactions
iii)    By means of other similar deceits

b)      Art. 315, 2 (b) – By altering the quality, fineness or weight of anything pertaining to
his business.
 

c)      Art. 315, 2 (c) – By pretending to have bribed any government employee

 

d)      Art. 315, 2 (d)

i)        That the offender post-dated a check or issued a check in payment of an obligation;

ii)      That such postdating or issuing a check was done when the offender had no funds in
the bank or his funds deposited therein were not sufficient to cover the amount of the
check.
 

e)      Art 315, 2 (e)

i)        By obtaining food, refreshment or accommodation at hotel, inn, restaurant, boarding
house, lodging house or apartment house without paying thereof, with intent to defraud the
proprietor or manager thereof;

ii)      By obtaining credit at any of the said establishments by the use of any false pretense;

iii)    By abandoning or surreptitiously removing any part of his baggage from any of the
said establishment after obtaining credit, food, refreshment or accommodation therein,
without paying thereof.

23.  Is mere issuance of a check with no funds, a crime of estafa?

No. The issuance of the check by the offender prior or simultaneous with the transaction
must be for the purpose of contracting the obligation. Otherwise if the check is issued in
payment of a pre-existing obligation, no estafa is committed.

However, if the check was issued by the debtor for the security of the creditor, but not to be
encashed, no estafa is involved.

The law penalizes the issuance of a check only if it were itself the immediate consideration
for the reciprocal receipt of benefits. In other words, the check must be issued concurrently
with, and in exchange for, a material gain to make it a punishable offense under Article 315,
paragraph 2(d) of the Revised Penal Code. (Castro v. Mendoza, G.R. No. 50173, 21
September 1993)
 
24.  I issued a check to my grocer as advance payment for the groceries he would
be delivering. Without my knowledge, my husband had emptied my account. What
will happen?
You will not be charged for the crime of estafa since there is already a pre-existing
obligation between you and your grocer, with the check as payment for the groceries he
would be delivering to you. You did not issue the check prior or simultaneous with any act of
fraud, thus it is not the cause of the fraud.

It was the rule that the mere issuance of a check with knowledge on the part of the drawer
that he had no funds to cover its amount and without informing the payee of such
circumstances, does not constitute the crime of estafa if the check was intended as payment
of a pre-existing obligation. The reason for the rule is that deceit, to constitute estafa,
should be the efficient cause of the defraudation and as such should either be prior to, or
simultaneous with the act of fraud. (People v. Lilius)
 
In the issuance of a check as payment for a pre-existing debt, the drawer derives no
material benefit in return as its consideration had long been delivered to him before the
check was issued. In short, the issuance of the check was not a means to obtain a valuable
consideration from the payee. Deceit, to constitute estafa should be the efficient cause of
the defraudation. (People v. Fortuno)
 
Good faith is a defense in a charge of estafa by postdating or issuing a check (People v.
Villapando, 56 Phil. 31)
 
25.  I sent a notice of dishonor to my cousin, who issued me a check as payment
for my catering services. I had found out that his account had no funds. Was
deceit involved?
Deceit may not be incolved as your cousin could be charged for the violation of B.P. 22, or
the Bouncing Check Law.

There is prima facie evidence of deceit when the drawer fails to pay or make arrangement
for payment three days after receiving notice of dishonor.

26.  Would charging a person for the crime of estafa and violation of the Bouncing
Check law, put him in double jeopardy?
No. A person can be charged with two (2) distinct and separate offenses, first under Section
1 of Batas Pambansa Bilang 22 or the Bouncing Check Law and another under Article 315, 2
(d) of the Revised Penal Code.

Deceit and damage are essential elements in Article 315 2(d) but are not required in B.P.
22. Under B.P.22, mere issuance of a check that is dishonored gives rise to the presumption
of knowledge on the part of the drawer that he issued the same without sufficient funds and
hence punishable which is not so under the Revised Penal Code. (Nierras v. Dacuycuy,
G.R. No. 59568-76, January 11, 1990)
 
While the filing of the two sets of Information under the provisions of Batas Pambansa
Bilang 22 and under the provisions of the Revised Penal Code, as amended, on estafa, may
refer to identical acts committed by petitioner, the prosecution thereof cannot be limited to
one offense, because a single criminal act may give rise to a multiplicity of offenses and
where there is variance or differences between the elements of an offense in one law and
another law as in the case at bar there will be no double jeopardy because what the rule on
double jeopardy prohibits refers to identity of elements in the two (2) offenses. Otherwise
stated prosecution for the same act is not prohibited. What is forbidden is prosecution for
the same offense. Hence, the mere filing of the two (2) sets of information does not itself
give rise to double jeopardy (People v. Miraflores, 115 SCRA 570).
 

27.  What are the differences between Esatafa and B.P. 22?

Other differences between the two also include the following:

(a)   Damage and deceit are essential elements in Article 315 2(d) but they are not required
in B.P. 22.

(b)   A drawer of a dishonored check may be convicted under B.P. 22 even if he had issued
the same for a pre-existing obligation, while under Article 315 2(d) of the Revised Penal
Code, such circumstance negates criminal liability;

(c)    Specific and different penalties are imposed in each of the two offenses;

(d)   Estafa is essential a crime against property, while violation of B.P. 22 is principally a
crime against public interest as it does injury to the entire banking system;
(e)   Violations of Article 315 are mala in se, while those of B.P. 22 are mala prohibita.
(Nierras v. Dacuycuy, G.R. No. 59568-76, January 11, 1990)
 
28.  What are the other ways that estafa can be done?
Estafa can be done in the following ways also:

a)      By inducing another to sign any document

The elements are:

i)        That the offender induced the offended party to sign a document;

ii)      That deceit be employed to make him sign the document;

iii)    That the offended party personally signed the document;

iv)    That prejudice be caused.

b)      By resorting to some fraudulent practice to insure success in gambling

c)      By removing, concealing or destroying document

The elements are:

a)      That there be court record, office files, documents or any other papers;

b)      That the offender removed, concealed or destroyed any of them;

c)      That the offender had intent to defraud another.

 
29.  Where can the crime of estafa be prosecuted?
The courts in the place where the crime of estafa was committed has jurisdiction over it. It
means that the place where any of the elements of estafa had occurred is where it may be
prosecuted, regardless if it is in several places at once.

The crime of estafa is a continuing or transitory offense which may be prosecuted at the
place where any of the essential elements of the crime took place. One of the essential
elements of estafa is damage or prejudice to the offended party. (Buaya v. Polo, G.R. No.
L-75079, 26 January 1989)
 
The theory is that a person charged with a transitory offense may be tried in any jurisdiction
where the offense is in part committed. In transitory or continuing offenses in which some
acts material and essential to the crime and requisite to its consummation occur in one
province and some in another, the court of either province has jurisdiction to try the case, it
being understood that the first court taking cognizance of the case will exclude the
others. (Tuzon v. Cruz, G.R. No. L-27410, 28 August 1975)