Case Summary (G.R. No. 43290)
Facts of the Case
Land Bank provided a loan of ₱400 million to FWCC, secured by nine postdated checks totaling ₱465 million, issued by Jacinto. Following the execution of a Restructuring Agreement on June 3, 1998, the terms of the loan were modified after FWCC defaulted. All checks presented by Land Bank were dishonored due to “Payment Stopped” or “Drawn Against Insufficient Funds.” In response, Land Bank filed a complaint against Jacinto for violations of B.P. 22 after FWCC allegedly failed to address the dishonored checks despite demands.
Procedural History
The City Prosecutor of Makati dismissed the complaint based on findings that novation had occurred when the loan agreement was restructured, which invalidated the checks' efficacy. Land Bank’s appeals to the Department of Justice (DOJ) initially resulted in a dismissal; however, a subsequent reconsideration by the DOJ reversed this decision, finding probable cause to prosecute Jacinto. The case was brought before the Court of Appeals, which ultimately reinstated the Prosecutor's dismissal of the complaint.
Applicable Law
The primary statute involved is Batas Pambansa Blg. 22, known as the Bouncing Checks Law. Additionally, considerations of novation, the legal consequences of a Restructuring Agreement, and the implications of the order of involuntary insolvency against FWCC are significant in the analysis.
Issues Raised
The key issues presented include whether the CA erred in determining the existence of a prejudicial question that necessitated resolution before the criminal action and whether the RTC's May 28, 1998 order prohibiting FWCC from paying debts served as a justifying circumstance preventing Jacinto's criminal liability.
Court's Rulings on Prejudicial Question
The Supreme Court emphasized that a prejudicial question exists when a civil issue must be resolved before a criminal case can proceed. In this case, the determination of whether novation occurred concerning the original loan obligation under the Restructuring Agreement did not prevent the filing of criminal charges. The Court highlighted that there was no express stipulation in the Restructuring Agreement releasing Jacinto from liability for the dishonored checks.
Criminal Liability under B.P. 22
The Court established that the act of issuing a worthless check constitutes a violation of B.P. 22, regardless of the circumstances surrounding its issuance or the validity of the original obligation. The elements required for a violation include the act of creating the
...continue readingCase Syllabus (G.R. No. 43290)
Case Overview
- The case involves a petition for review on certiorari filed by the Land Bank of the Philippines against Ramon P. Jacinto.
- The petition seeks the reversal of the Court of Appeals' Decision dated November 28, 2001, and Resolution dated August 6, 2002.
- The Court of Appeals had set aside prior resolutions from the Department of Justice (DOJ) and reinstated a resolution from the City Prosecution Office of Makati dismissing the complaint against Jacinto for violations of Batas Pambansa Blg. 22 (the Bouncing Checks Law).
Background Facts
- The First Women's Credit Corporation (FWCC) borrowed ₱400 million from Land Bank, secured by nine postdated checks totaling ₱465 million.
- A Restructuring Agreement was executed on June 3, 1998, modifying the loan terms after FWCC defaulted.
- All postdated checks presented for payment were dishonored for "Payment Stopped" or "Drawn Against Insufficient Funds."
- Land Bank filed a complaint against Jacinto for violations of B.P. 22 on January 13, 1999.
- Jacinto denied the charges, asserting that the loan obligation was extinguished by payment and novation through the Restructuring Agreement.
Procedural History
- The Makati City Prosecutor’s Office dismissed the complaint on March 3, 1999, citing novation.
- The DOJ initially upheld the dismissal but later reversed its ruling, asserting that novation does not extinguish criminal liability, leading