THIRD DIVISION

[G.R. No. 50173. September 21, 1993.]

HANIEL R. CASTRO and PIO C. CASTRO, petitioners, vs. HON. RAFAEL T.

MENDOZA, Judge of the Court of First Instance of Cebu, Branch VI, and
THE PEOPLE OF THE PHILIPPINES, respondents.

Enrique Y. Tandem for petitioners.

The Solicitor General for respondents.

DECISION

VITUG, J :p

Father and son, Pio Castro and Haniel Castro, filed this Petition for Review on
Certiorari which prays for the reversal of the decision [1] of the court a quo finding them
guilty of estafa penalized under the provisions of Article 315, paragraph 2 (d), of the
Revised Penal Code, as amended by Republic Act 4885 and Presidential Decree No. 818,
for issuing a "bad check". The information [2] reads:
"That on or about the 21st day of April, 1975, and for sometime prior and
subsequent thereto, in the City of Cebu, Philippines, and within the jurisdiction of this
Honorable Court, the said accused, conniving and confederating together and
mutually helping each other, with deliberate intent of gain and by means of false
pretenses or fraudulent acts executed prior to or simultaneously with the commission
of the fraud, to wit: knowing fully well that they did not have sufficient funds
deposited with the Insular Bank of Asia and America, Tagbilarang Branch, and
without informing complainant Victor Elipe of that circumstance, with intent to
defraud said Victor Elipe, did then and there wilfully, unlawfully and feloniously issue
or make out a check dated April 21, 1975, bearing No. TAG 1600-702, in the amount
of P18,200.00, in payment of construction materials, and when said check was
presented for encashment with the said bank, the same was dishonored for the
reason that they had no funds deposited thereat, and despite notice and repeated
 demands made upon them by Victor Elipe to make good said check, have failed and
refused and still fail and refuse to make good said check, to the damage and
prejudice of Mr. Victor Elipe in the amount aforestated.
cdphil

CONTRARY TO LAW."

The facts of the case that led to the filing of the criminal information arose prior to
the enactment on 03 April 1979 of Batas Pambansa Blg. 22. [3]
A chance meeting between Pio Castro and Victor Elipe in October, 1974, on board a
boat bound for Surigao from Cebu City got them to converse. Castro learned that Elipe
had just opened in Cebu City a hardware store. Castro, on the other hand, needed to
procure materials for the construction of his apartment house at Tagbilaran City. He
proposed to buy, and Elipe agreed to sell, the items that the latter could supply on cash
basis.
As orders were placed on different dates by Pio Castro, so also were deliveries
made by Elipe between 09 October 1974 and 25 November 1974. Each time, no payment
was made; deliveries, however, continued until the total unpaid account reached
P18,081.15. Elipe kept on making demands for payment but Castro, on every such
occasion, would ask for an extension of time within which to pay.
Finally, on 21 April 1975, Haniel Castro, a son of Pio Castro, went to see Elipe in
Cebu City. The young Castro issued on even date an Insular Bank of Asia and America
check No. TAG 1600702 for the entire amount due from his father. When presented for
encashment, the check was dishonored because the bank account had by then already
been closed.
Demands for payment of the due obligation were again made by Elipe. In return, he
got either excuses or promises from the two Castros. Exasperated, Elipe filed his
complaint that led to the filing of the estafa case against both Pio and Haniel Castro.

On 06 February 1979, the court a quo, after due hearing, rendered judgment [4] ,
finding the two accused guilty of estafa as charged, and the two were accordingly
sentenced; thus —
WHEREFORE, IN VIEW OF ALL THE FOREGOING, the Court finds both
accused, Pio Castro and Haniel Castro, GUILTY beyond reasonable doubt of the
crime of Estafa, having confederated and connived in the commission thereof, and
hereby sentences each of them to suffer imprisonment of an indeterminate penalty
of ONE (1) YEAR, EIGHT (8) MONTHS AND TWENTY-ONE (21) DAYS as minimum
to FIVE (5) YEARS, TWO (2) MONTHS and TWENTY (20) DAYS as maximum; to
suffer the accessory penalties provided for by law; to indemnify the complainant
 Victor Elipe the amount of P18,081.80 without subsidiary imprisonment in case of
insolvency; and, to pay the costs of the proceedings.

SO ORDERED.

In this petition, the conviction by the court a quo is questioned basically on the
ground that the factual settings gave rise to a civil, not criminal, liability.
We agree. The Solicitor General himself recommends for acquittal.
Article 315, paragraph 2 (d) of the Revised Penal Code, as amended by Republic
Act No. 4885, for which the petitioners have been charged and convicted, penalizes estafa
when committed, among other things, —
"2. By means of any of the following false pretenses or fraudulent acts
executed prior to or simultaneously with the commission of the fraud:

xxx xxx xxx

"(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 essential requirements of the above offense are that (1) a check is drawn or
postdated in payment of an obligation contracted at the time the check was issued; (2)
there are no funds sufficient to cover the check; and (3) the payee sustains damage
thereby.
In People vs. Sabio, et al., G.R. No. L-45490; Tan Tao Liap vs. Court of Appeals,
G.R. L-45711; and Lagua vs. Cusi, G.R. L-42971 [5] , jointly decided by this Court en banc,
reiterated in People v. Tugbang [6] , we held:
. . . (W)hat is significant to note is that the time or occasion for the
commission of the false pretense or fraudulent act has not at all been changed by
the amendment (R.A. 4885). The false pretense or fraudulent act must be executed
prior to or simultaneously with the commission of the fraud. Thus, under Article 315,
paragraph 2(d) of the Revised Penal Code, as amended by Republic Act No. 4885,
the following are the elements of estafa: (1) postdating or issuance of 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. Now,
it is asked: Is there deceit and damage when a bad check is issued in payment of a
pre-existing obligation? It is clear that under the law, the false pretense or fraudulent
act must be executed prior to or simultaneously with the commission of the fraud. To
defraud is to deprive some right, interest, or property by deceitful device. 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. Since an obligation has already been contracted,
it cannot be said that the payee parted with his property or that the drawer has
obtained something of value as a result of the postdating or issuance of the bad
check in payment of a pre-existing obligation.

Finally, considering the absence of an express provision in the law, the

postdating or issuance of a bad check in payment of a pre-existing obligation cannot
be penalized as estafa by means of deceit, otherwise, the legislature could have
easily worded the amendatory act to that effect. Since the language of the law is
plain and unambiguous, We find no justification in entering into further inquiries for
the purpose of ascertaining the legislative intent. Moreover, laws that impose
criminal liability are strictly construed. The rule, therefore, that the issuance of a
bouncing check in payment of a pre-existing obligation does not constitute estafa
has not at all been altered by the amendatory act.

Evidently, 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. In the
issuance of a check to pay a pre-existing obligation, as in the instant case, the drawer
derives no such contemporary gain in return since the obligation sought to be settled is
already incurred and outstanding before the check is issued.
Elipe by continuing to still effect sales and deliveries to the petitioners even without
promptly getting paid, for all intents and purposes, had sold on credit, the amounts due
thus turning into simple money obligations. Batas Pambansa Blg. 22 which now penalizes
the mere issuance of a check by a drawer knowing that it will not be honored cannot
obviously apply retroactively to the petitioners. prcd

WHEREFORE, the judgment appealed from is REVERSED and SET ASIDE. The
petitioner are ACQUITTED of the crime charged.
SO ORDERED.
Bidin, Romero and Melo, JJ ., concur.
Feliciano, J ., is on leave.

Footnotes
1. Penned by Judge Rafael T. Mendoza of then Court of First Instance, Cebu, Branch VI.

2. Rollo 9-10.

3. "AN ACT PENALIZING THE MAKING OR DRAWING AND ISSUANCE OF A CHECK

WITHOUT SUFFICIENT FUNDS FOR CREDIT AND FOR OTHER PURPOSES", otherwise
known as the Bouncing Check Law.

4. Rollo, 9-24.

5. 86 SCRA 568/1978/.

6. G.R. No. 76212, 196 SCRA 341[1991].