The Supreme Court has clarified that liability under the Bouncing Checks Law (B.P. 22) extends to individuals who sign checks, even if they are not the owners of the account the check is drawn from. This ruling reinforces the law’s intent to deter the issuance of worthless checks and protect the integrity of financial transactions, as the court underscored that the gravamen of the offense lies in issuing a bouncing check, irrespective of the drawer’s account ownership. By focusing on the act of issuing the check, the Supreme Court ensures broader accountability and safeguards against circumvention of the law.

Signing on the Dotted Line: Can You Be Liable for Someone Else’s Bounced Check?

In Sonia P. Ruiz v. People of the Philippines, the Supreme Court addressed the issue of whether an individual can be held liable for violating B.P. 22 when they sign a check drawn against an account not belonging to them, which subsequently bounces. Sonia Ruiz was convicted of violating B.P. 22 after issuing a check for P184,000 drawn against her sister’s account, which was later dishonored due to the account being closed. Ruiz argued that since she was not the account holder, she could not be held liable under the Bouncing Checks Law. The lower courts disagreed, and the case reached the Supreme Court.

At the heart of the Bouncing Checks Law, formally known as Batas Pambansa Bilang 22, is Section 1, which states that any person who makes or draws and issues a check to apply on account or for value, knowing at the time that he does not have sufficient funds in or credit with the drawee bank for the payment of such check in full upon its presentment, which check is subsequently dishonored by the drawee bank for insufficiency of funds or credit, shall be held liable. In this case, Ruiz admitted to drawing the check and delivering it to the complainant, Norberta Mendoza, but claimed she did so with her sister’s consent and for accommodation purposes only.

The Supreme Court examined whether the elements of B.P. 22 were met in Ruiz’s case. These elements are: (1) the accused makes, draws, or issues any check to apply to account or for value; (2) the accused knows at the time of the issuance that he or she 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) the check is subsequently dishonored by the drawee bank for insufficiency of funds or credit. The Court, referencing Lozano v. Martinez, reiterated that the gravamen of the offense is the act of making and issuing a worthless check and putting it into circulation, deeming such act as a public nuisance. This law, intended to curb the harmful practice of issuing unfunded checks, classifies the offense as malum prohibitum, meaning it is wrong because it is prohibited by law.

The Court rejected Ruiz’s defense that she merely accommodated Mendoza, emphasizing that the law applies broadly to include anyone who issues a check that bounces, regardless of account ownership. To rule otherwise would allow unscrupulous individuals to circumvent the law by issuing checks drawn on other people’s accounts with insufficient funds, thus undermining the purpose of B.P. 22. Here are the arguments presented:

Petitioner’s Argument (Ruiz)	Respondent’s Argument (People of the Philippines)
B.P. 22 applies only to the maker of the check who owns the account with the drawee bank.	The law covers any check that bounces, irrespective of the account’s ownership; the act of issuing a worthless check is what B.P. 22 punishes.
She issued the check merely to accommodate the private complainant and was not the owner of the account.	Ruiz issued the check in her capacity as a drawer and represented that she would make good on the check; B.P. 22 aims to discourage the issuance of bouncing checks and restore respectability to checks.
Mendoza knew the account was closed.	The argument lacked factual and legal basis, as Mendoza believed all along that the check was drawn against Ruiz’s account.

The Supreme Court underscored the need to prevent worthless checks from polluting the channels of trade and commerce and injuring the banking system, thereby hurting the welfare of society and the public interest. The key point is that even if Ruiz was not the owner of the account, her act of signing and issuing the check made her liable under B.P. 22, provided she knew the account lacked sufficient funds.

Building on this principle, the Court found that Ruiz drew and signed the check with the knowledge and consent of her sister, Gina Parro, the account owner. Parro knew the check was to be used to pay Ruiz’s loan, thereby sanctioning Ruiz’s actions. Furthermore, Mendoza was unaware that the account belonged to Parro and believed it was Ruiz’s. The court stated there is every reason to penalize a person who indulges in the making and issuing of a check on an account belonging to another with the latter’s consent, which account has been closed or has no funds or credit with the drawee bank. Finally, the Supreme Court considered the factual findings of the lower courts, noting that when informed of the dishonored check, Ruiz promised to pay, further indicating her responsibility for the check’s validity.

FAQs

What was the key issue in this case?	The key issue was whether a person who signs a check drawn against an account not belonging to them can be held liable for violating the Bouncing Checks Law (B.P. 22) if the check is dishonored.
What is B.P. 22?	B.P. 22, or the Bouncing Checks Law, is a Philippine law that penalizes the making or issuing of a check without sufficient funds or credit with the drawee bank for the payment of such check in full upon its presentment.
What are the elements of a violation of B.P. 22?	The elements are: (1) making, drawing, or issuing any check; (2) knowing at the time of issuance that there are insufficient funds; and (3) the check is subsequently dishonored for lack of funds or credit.
Was Sonia Ruiz the owner of the account the check was drawn from?	No, Sonia Ruiz was not the owner of the account. The check was drawn from an account owned by her sister, Gina Parro.
Why did Sonia Ruiz argue she should not be held liable?	Sonia Ruiz argued that B.P. 22 applies only to the maker of the check who is also the owner of the account with the drawee bank. She claimed she merely accommodated the complainant.
What did the Supreme Court rule regarding liability under B.P. 22?	The Supreme Court ruled that liability under B.P. 22 extends to anyone who signs and issues a bouncing check, regardless of whether they own the account it is drawn from.
What was the significance of Ruiz’s promise to pay after the check bounced?	Her promise to pay after being notified that the check was dishonored was used as evidence by the court to bolster its view she was responsible for the validity of the check.
Is lack of knowledge of insufficient funds a valid defense?	No, lack of knowledge is not a valid defense because it is understood she knew it would bounce from a bank that had no relationship with the person or people signing the check, regardless of whose signature was included.
What is the main goal of the Bouncing Checks Law?	The main goal of the law is to discourage the issuance of bouncing checks, maintain the integrity of the banking system, and protect the welfare of the public by preventing the circulation of worthless commercial papers.

This case reinforces the principle that individuals cannot evade liability under B.P. 22 by issuing checks drawn against accounts they do not own. It serves as a reminder that those who sign checks bear the responsibility to ensure the validity of those checks. Ultimately, the ruling strengthens the legal framework against the issuance of worthless checks, contributing to a more stable and reliable financial environment in the Philippines.

For inquiries regarding the application of this ruling to specific circumstances, please contact ASG Law through contact or via email at frontdesk@asglawpartners.com.

Disclaimer: This analysis is provided for informational purposes only and does not constitute legal advice. For specific legal guidance tailored to your situation, please consult with a qualified attorney.
Source: Sonia P. Ruiz vs. People, G.R. No. 160893, November 18, 2005