G.R. No. 114823 - Diongzon vs. Court of Appeals

Petitioner Nilo B. Diongzon was charged with violation of B.P. Blg. 22 (Bouncing Checks Law) before the Regional Trial Court (RTC), Branch 43, Bacolod City.
The charge concerned issuance of three checks in August and September 1981 to Filipro, Inc., represented by its Area Sales Manager, Anacleto Palisoc, totaling ₱298,119.75.
The checks were postdated September 15, September 16, and October 3, 1981, respectively, and were dishonored by the Allied Banking Corporation for differing signatures and insufficient funds.
Petitioner did not redeem or pay the checks despite notice and demands within five banking days after dishonor.

Petitioner was a sales supervisor of Filipro Inc., responsible for authorizing withdrawal of goods and remittance of payments through the company’s depository bank.
Filipro’s accounting department found irregularities with delivery orders signed by petitioner, prompting an investigation by Palisoc into deliveries and collections.
Dealers named in the delivery orders (Queensland, Queendies, and Cokins) denied receiving goods; petitioner then offered to assist in collecting outstanding payments.
Petitioner presented three checks as payment for allegedly delivered goods; checks were deposited at Filipro’s depository bank but were dishonored when presented at the drawee bank.

Upon confrontation, petitioner admitted issuing the checks and responsibility for the irregular deliveries, explaining that he practiced "credit riding" where unauthorized dealers used credit lines of authorized dealers, allegedly allowed unofficially to meet sales targets.
During trial, petitioner initially denied issuing the first two checks but later admitted issuing the third check to replace the second.
The trial court found petitioner guilty of violating B.P. Blg. 22, a conviction affirmed by the Court of Appeals.

Petitioner raised defenses of signature forgery, lack of issuance "on account or for value," and argued novation of obligation by issuance of the third check replacing the second.
The Court of Appeals rejected these defenses, modified the penalty by removing subsidiary imprisonment due to the absence of its provision under B.P. Blg. 22, and denied petitioner’s motion for reconsideration.
Petitioner filed a petition for review arguing novation prevented criminal liability, based on a partial payment and written undertaking allegedly executed.

Whether the issuance of the third check in replacement of the second check constituted novation extinguishing petitioner’s original obligation and criminal liability under B.P. Blg. 22.
Whether petitioner’s defenses that the first two checks were not issued by him and that the checks were not issued "on account or for value" negate the elements of the offense under B.P. Blg. 22.
Whether subsidiary imprisonment may be imposed in case of insolvency when the special law (B.P. Blg. 22) does not expressly provide for such penalty.