G.R. No. 192150 - SABAY vs. People

Case Summary (G.R. No. 192150)

Factual Background

The Information charged K.T. Lim with violation of B.P. 22, alleging that on January 10, 1985 he made, drew and issued Philippine Trust Company Check No. 117383 dated February 9, 1985 in the amount of P143,000.00 to Fatima Cortez Sasaki, knowing at the time of issue that he did not have sufficient funds or credit with the drawee bank; that the check was subsequently dishonored for insufficiency of funds; and that despite receipt of notice, the accused failed to pay or arrange for full payment within five banking days.

Motion to Quash and Trial Court Ruling

On July 18, 1986 private respondent moved to quash the Information on two grounds: that B.P. 22 was unconstitutional and that the instrument issued was a memorandum check in the nature of a promissory note, hence civil in character and outside the penal reach of the statute. On September 1, 1986 the respondent judge ruled that B.P. 22 was unconstitutional and issued an order quashing the Information.

Petition for Review

The Solicitor General filed a petition for review on certiorari in behalf of the government assailing the order of September 1, 1986. The constitutional validity of B.P. 22 had previously been upheld by this Court in Lozano v. Martinez and related cases, leaving for determination whether a memorandum check issued postdated in partial payment of a pre-existing obligation falls within the coverage of B.P. 22.

Issue Presented

The principal issue was whether a memorandum check, issued postdated and in partial payment of a pre-existing obligation and marked as memorandum, is outside the penal scope of B.P. 22 because it is in substance a promissory note and therefore civil in nature.

Parties' Contentions

Private respondent argued, relying on the United States decision U.S. v. Isham, that a memorandum check, despite resembling an ordinary check, functions as a memorandum of indebtedness and partakes of the nature of a promissory note, and should thus be litigated in a civil action rather than prosecuted under B.P. 22. The government, through the Solicitor General, contended that a memorandum check remained a check within the definition of the Negotiable Instruments Law and therefore fell squarely within B.P. 22.

The Court’s Analysis on the Nature of a Memorandum Check

The Court reviewed authorities defining a memorandum check as an instrument in the form of an ordinary check with the words memorandum, memo or mem written across its face to signify that the drawer engages to pay the bona fide holder absolutely without condition as to presentment. The Court explained that although a memorandum check may serve as evidence of debt and may not be intended for presentment, it has the same legal effect as an ordinary check and, if negotiated to a third person, is valid in his hands. The Court contrasted such a check with a promissory note, which is merely a promise to pay and is not drawn on a bank payable on demand.

Legislative History and Purpose of B.P. 22

The Court examined the legislative history of B.P. 22, including debates and amendments in the Batasang Pambansa, and noted the sponsors’ intent that the bill target drafts or orders addressed to banks and that language technically referring to promissory notes be removed so as to focus on checks drawn against banks. The Court concluded that the framers intended a comprehensive reach to include all checks drawn on banks. The Court emphasized the statute’s remedial and preventive purpose to curb the circulation of unfunded checks.

Legal Basis and Reasoning

Relying on the Negotiable Instruments Law definition (citing Sec. 185) and standard dictionary definitions of a check as a draft drawn on a bank payable on demand and containing an unconditional promise to pay, the Court held that a memorandum check falls within the ambit of B.P. 22. The Court reasoned that the law punishes the act of issuing a check that is subsequently dishonored for insufficiency of funds, irrespective of the drawer’s declared purpose or private arrangements regarding non-presentation or partial payment. The Court explained that private understandings that a memorandum check will be redeemed by the maker cannot be allowed to defeat the statutory penal scheme. To inquire into the terms or purpose underlying issuance would unde

Case Syllabus (G.R. No. 192150)

Parties and Procedural Posture

PEOPLE OF THE PHILIPPINES filed a petition for certiorari by the Solicitor General to review an order quashing an Information for violation of B.P. 22.
Hon. David G. Nitafan, Presiding Judge of the Regional Trial Court, Branch 52, Manila, issued the order quashing the Information on 1 September 1986.
K.T. Lim alias Mariano Lim was the private respondent and accused in the criminal Information charging a bouncing check offense.
The respondent judge quashed the Information after a motion to quash by the accused that attacked B.P. 22 as unconstitutional and characterized the instrument as a memorandum check akin to a promissory note.

Key Factual Allegations

K.T. Lim allegedly issued Philippine Trust Company Check No. 117383 dated February 9, 1985 in the amount of P143,000.00 to Fatima Cortez Sasaki on January 10, 1985.
The Information alleged that the drawer knew at the time of issue that he did not have sufficient funds or credit with the drawee bank.
The check was subsequently dishonored by the drawee bank for insufficiency of funds and the accused allegedly failed to pay or arrange full payment within five banking days after notice.

Issues Presented

Whether B.P. 22 is unconstitutional as contended by the accused, given earlier decisions sustaining its constitutionality.
Whether a memorandum check, issued postdated in partial payment of a pre-existing obligation, falls within the coverage of B.P. 22 or is in the nature of a promissory note exempt from criminal sanction.

Contentions of the Parties

The private respondent contended that the instrument was a memorandum check that partook of the nature of a promissory note and was therefore civil in nature.
The private respondent additionally argued that B.P. 22 was unconstitutional as one of the bases to quash the Information.
The petitioner contended that B.P. 22 was constitutional and that memorandum checks, being in form and effect checks, fell squarely within the statute.

Statutory Framework

B.P. 22 punished any person who made or drew and issued any check knowing at the time of issue that he did not have sufficient funds in or credit with the drawee bank and whose check was subsequently dishonored, citing Sec. 1, B.P. 22.
Sec. 185 of the Negotiable Instruments Law defined a check as a bill of exchange drawn on a bank payable on demand and the Court relied on that definition to interpret the term check.
The Court referenced dictionary and judicial definitions that described a check as a written order to a bank, a draft drawn upon a bank, and an unconditional promise payable on demand.

Legislative History

The Court noted the legislative intent of the Batasang Pambansa drafte