Facts:

This case involves petitioners Albenson Enterprises Corporation, Jesse Yap, and Benjamin Mendiona and respondent Eugenio S. Baltao. The dispute originates from a transaction that began in September 1980, wherein Albenson delivered mild steel plates to Guaranteed Industries, Inc., a company for which Baltao was the president. As part of the payment, Albenson received a check amounting to P2,575.00 from Pacific Banking Corporation, drawn against the account of E.L. Woodworks, which later bounced due to 'Account Closed.' Upon investigation, Albenson discovered that Baltao was the president of the corporation that received the goods and found discrepancies connecting him to the bounced check. After Baltao denied issuance of the check and claimed that Guaranteed was defunct, Albenson pursued a criminal complaint against him for violation of Batas Pambansa Bilang 22, which seeks to penalize the act of issuing checks without sufficient funds. The Provincial Fiscal initially fil

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Facts:

Transaction and Payment

• In September, October, and November 1980, Albenson Enterprises Corporation delivered mild steel plates to Guaranteed Industries, Inc. located at 3267 V. Mapa Street, Sta. Mesa, Manila.
• The delivery was part payment for the goods; payment was made via Pacific Banking Corporation Check No. 136361 in the amount of P2,575.00.
• Upon presentation for payment, the check was dishonored with the remark “Account Closed.”

Discovery of Potential Identity Issues

• Albenson Enterprises, through their counsel, traced the origin of the dishonored check.
• They obtained records from the Securities and Exchange Commission indicating that the president of Guaranteed was “Eugenio S. Baltao.”
• An inquiry with the Ministry of Trade and Industry disclosed that E.L. Woodworks was registered in the name of “Eugenio Baltao.”
• Verification with Pacific Banking Corporation confirmed that the signature on the check was that of “Eugenio Baltao.”
• These inquiries raised concerns regarding the identity of the check issuer, given the existence of persons with similar names (including a younger Eugenio Baltao, later identified as the son).

Extrajudicial Demand and Criminal Complaint

• Albenson’s counsel subsequently sent a letter to private respondent Eugenio S. Baltao demanding that he replace or make good the dishonored check.
• Private respondent denied issuing the check or that the signature was his, further alleging that Guaranteed Industries was defunct.
• On February 14, 1983, Albenson filed a complaint before the Office of the Provincial Fiscal of Rizal charging Eugenio S. Baltao with violation of Batas Pambansa Bilang 22.
• An affidavit by Albenson employee Benjamin Mendiona detailed the circumstances surrounding the check and the ensuing transaction.

Fiscal Investigation and Subsequent Developments

• Assistant Fiscal Ricardo Sumaway filed an information against Eugenio S. Baltao on September 5, 1983, based on the initial complaint.
• Private respondent, claiming ignorance, requested a reinvestigation, arguing that he was never afforded an opportunity to be heard.
• On January 30, 1984, Provincial Fiscal Mauro M. Castro reversed Fiscal Sumaway’s findings, exonerating Baltao by noting that the signature on the check did not belong to him and that there was a lack of proper notice during the investigation.
• Fiscal Castro instructed the dismissal of the information, castigating Fiscal Sumaway for his lack of due care.

Civil Action for Damages

• Citing the unjust filing of the criminal case for a bounced check (a minor amount of P2,575.00), respondent Baltao later filed a complaint for damages against Albenson Enterprises, its owner Jesse Yap, and employee Benjamin Mendiona before the Regional Trial Court of Quezon City.
• The trial court ruled in favor of respondent Baltao, awarding:
• Actual or compensatory damages of P133,350.00;
• Moral damages of P1,000,000.00;
• Exemplary damages of P200,000.00;
• Attorney’s fees of P100,000.00; and
• Costs.
• The Court of Appeals modified the trial court’s decision by reducing moral damages to P500,000.00 and attorney’s fees to P50,000.00 while affirming the rest, with costs against the appellants.
• Petitioners (Albenson Enterprises, Jesse Yap, and Benjamin Mendiona) subsequently filed a petition assailing the appellate court’s ruling on various grounds, including:
• The purported mischaracterization of the cause of action as one for abuse of rights under Article 21 of the Civil Code instead of malicious prosecution.
• The assertion that the investigation and subsequent filing of a criminal case were conducted in good faith and without malice, based on a mistaken identity.
• The propriety of the award of damages and attorney’s fees despite the apparent error in identifying the proper issuer of the check.

Issue:

Whether the filing of the criminal case for a bounced check, based on the mistaken identity of “Eugenio Baltao,” constitutes abuse of rights (or malicious prosecution) warranting the award of damages under Articles 19, 20, and 21 of the Civil Code.

• Whether there was any evidence of bad faith or malice in the filing of the criminal complaint by Albenson Enterprises.
• Whether the error in identifying the correct “Eugenio Baltao” could be attributed to negligence or constituted a deliberate attempt to harm the private respondent.

Whether the awarded damages (actual or compensatory, moral, exemplary, and attorney’s fees) had sufficient evidentiary basis, particularly in the absence of proven pecuniary loss or demonstrated bad faith.

• The legitimacy of relying on Articles 19, 20, and 21 as the basis for awarding damages in a case involving a mistaken identity.
• Whether the elements required for malicious prosecution—lack of probable cause and legal malice—were met by the petitioners.

Ruling:

• (Subscriber-Only)

Ratio:

• (Subscriber-Only)

Doctrine:

• (Subscriber-Only)