In Amando Juaquico v. People of the Philippines, the Supreme Court acquitted Amando Juaquico of estafa, clarifying that for a conviction under Article 315(2)(d) of the Revised Penal Code, the prosecution must prove the accused knew the check he endorsed had insufficient funds. While Juaquico endorsed checks that bounced, the prosecution failed to prove he knew about the lack of funds. This ruling underscores that mere endorsement of a bad check is not enough for a conviction; proof of deceitful intent is crucial. Despite the acquittal, the Court held Juaquico civilly liable for the amount of the bounced checks, plus interest.

When a Customer’s Check Bounces: Did the Endorser Know?

Amando Juaquico was charged with estafa after several checks he endorsed to Robert Chan were dishonored due to insufficient funds. Juaquico, a customer of Chan, had asked to exchange checks issued by Home Bankers Trust for cash. Chan, who knew Juaquico as both a customer and a godson, agreed. However, when Chan deposited the checks, they were all returned due to insufficient funds. Chan sent a demand letter to Juaquico, which was ignored, leading to the filing of the estafa case.

Juaquico defended himself by stating that he was in the embroidery business and had been purchasing materials from Chan since 1977. He claimed that the checks were issued to him by a Korean customer, Ho Myong Ham, and he endorsed them to Chan as payment for his purchases. When the checks bounced, he tried to find Ham, but she had already left the country. The Regional Trial Court (RTC) convicted Juaquico, holding that his act of endorsing the checks with the knowledge that the drawer had insufficient funds made him liable for estafa. The Court of Appeals (CA) affirmed the RTC’s decision.

The Supreme Court, however, reversed the CA’s decision, finding that the prosecution failed to prove that Juaquico had knowledge of the insufficiency of funds. The Court cited Paragraph 2(d), Article 315 of the Revised Penal Code (RPC), which defines estafa by issuing a check without sufficient funds:

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

x x x x

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

x x x x

(d) By postdating a check, or issuing a check in payment of an obligation when the offender had no funds in the bank, or his funds deposited therein were not sufficient to cover the amount of the check. The failure of the drawer of the check to deposit the amount necessary to cover his check within three (3) days from receipt of notice from the bank and/or the payee or holder that said check has been dishonored for lack or insufficiency of funds shall be prima facie evidence of deceit constituting false pretense or fraudulent act. (As amended by R.A. 4885, approved June 17, 1967)

The elements of estafa under this provision are: (i) issuance of a check in payment of an obligation; (ii) lack of or insufficiency of funds; and (iii) the payee was not informed and did not know of the insufficiency of funds. The Court emphasized that the prosecution must prove that the accused had guilty knowledge that the drawer of the check had no funds at the time of endorsement. In this case, there was no evidence to show that Juaquico knew about the insufficiency of funds of the checks he endorsed to Chan.

Building on this principle, the Supreme Court also referenced Ilagan v. People, which highlights the necessity of proving the accused’s guilty knowledge. Furthermore, in Lim v. People, the Court reiterated that deceit and damage are essential elements of estafa and must be established with satisfactory proof to warrant a conviction. The long-standing business relationship between Juaquico and Chan also played a crucial role in the Court’s decision. The Court noted that Chan had a practice of accepting checks from Juaquico’s clients, even if he did not know them personally. This negated the necessity for Juaquico to assure Chan that the checks were sufficiently funded. It was clear that Chan was not deceived but accepted the checks based on their established business procedure.

This approach contrasts with situations where the payee is clearly deceived or assured of the check’s validity. The lack of deceit was a significant factor in the acquittal. The Court differentiated this case from others where the accused actively misrepresented the status of the check or concealed information about the lack of funds. Because the element of deceit was not proven beyond reasonable doubt, the Court acquitted Juaquico of the crime of estafa.

However, the Court clarified that the acquittal from criminal liability did not absolve Juaquico from civil liabilities. The trial court, as affirmed by the CA, found that Juaquico obtained P329,000 from Chan through the endorsed checks. The Supreme Court thus held Juaquico civilly liable for this amount. The Court also imposed legal interest on the amount, applying the principles outlined in Nacar v. Gallery Frames, et al., and Resolution No. 796 of the Bangko Sentral ng Pilipinas Monetary Board. This means that Juaquico was ordered to pay P329,000 plus interest at 12% per annum from October 17, 1991, and 6% per annum from July 1, 2013, until full satisfaction.

The legal discussion highlights that while criminal liability for estafa requires proof of deceitful intent, civil liability can arise from the same set of facts. This distinction is crucial in understanding the implications of the ruling. Even if the prosecution cannot prove deceit beyond a reasonable doubt, the defendant may still be liable to compensate the plaintiff for the damages suffered. The Court’s decision underscores the importance of establishing all elements of estafa beyond reasonable doubt to secure a conviction. It also serves as a reminder that business practices and relationships can influence the determination of deceit in check-related transactions.

The court’s emphasis on the absence of deceit significantly shaped the ruling. The prosecution’s inability to prove that Juaquico knowingly endorsed checks with insufficient funds was decisive. The long-standing business relationship between the parties further weakened the claim of deceit. This case sets a precedent for future cases involving estafa and bad checks, emphasizing the need to prove intent to deceive.

FAQs

What was the key issue in this case?	The key issue was whether Amando Juaquico was guilty of estafa for endorsing checks that were later dishonored due to insufficient funds, and whether the prosecution proved that he knew about the lack of funds.
What is required to prove estafa under Article 315(2)(d) of the RPC?	To prove estafa under Article 315(2)(d), the prosecution must show that the accused issued a check in payment of an obligation, the check lacked sufficient funds, and the payee was not informed and did not know about the insufficiency. Crucially, the prosecution must prove that the accused had knowledge of the insufficient funds at the time of endorsement.
Why was Juaquico acquitted of estafa?	Juaquico was acquitted because the prosecution failed to prove that he had knowledge of the insufficiency of funds of the checks he endorsed to Robert Chan. The Supreme Court emphasized that proof of deceit is essential for a conviction, and that element was missing in this case.
What was the significance of the business relationship between Juaquico and Chan?	The long-standing business relationship and Chan’s practice of accepting checks from Juaquico’s clients without personally knowing them negated the element of deceit. This showed that Chan accepted the checks based on their established business procedure, not because he was deceived by Juaquico.
Was Juaquico completely free from liability?	No, while Juaquico was acquitted of the criminal charge of estafa, he was still held civilly liable for the amount of P329,000 that Chan lost due to the dishonored checks. He was also ordered to pay legal interest on this amount.
What is the difference between criminal and civil liability in this case?	Criminal liability requires proof beyond reasonable doubt of all the elements of the crime, including deceit. Civil liability, on the other hand, only requires preponderance of evidence to show that the defendant caused damages to the plaintiff, even if there was no criminal intent.
What does this case imply for future estafa cases involving checks?	This case sets a precedent emphasizing the need to prove the element of deceit in estafa cases involving checks. It clarifies that simply endorsing a check that bounces is not enough for a conviction; the prosecution must prove that the accused knew the check had insufficient funds.
What interest rates were applied to the civil liability in this case?	The Court applied a legal interest rate of 12% per annum from October 17, 1991 (when the demand letter was issued), and 6% per annum from July 1, 2013, until the full satisfaction of the judgment, in accordance with prevailing jurisprudence.

In conclusion, the Supreme Court’s decision in Amando Juaquico v. People underscores the importance of proving the element of deceit in estafa cases involving dishonored checks. While Juaquico was acquitted due to the lack of evidence showing his knowledge of the insufficient funds, he remained civilly liable for the damages caused. This case serves as a reminder of the nuances of estafa law and the distinction between criminal and civil liabilities.

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: Amando Juaquico v. People, G.R. No. 223998, March 05, 2018