In People vs. Mario Myrno Tan, the Supreme Court acquitted the accused of estafa, emphasizing the critical element of consideration in contracts. The Court held that for estafa to be proven under Article 315 (2)(d) of the Revised Penal Code, it must be established that the accused received something of value in exchange for the issued check. The absence of proof that the accused or his authorized representatives received the merchandise ordered meant that the element of damage was not sufficiently proven, leading to the acquittal. This decision underscores the importance of proving all elements of a crime beyond reasonable doubt, particularly the element of damage in estafa cases involving checks.

Bounced Check Blues: Did the Goods Reach Their Destination?

The case revolves around Mario Myrno Tan, who was accused of estafa for issuing a post-dated check to New Durawood Company, Inc. The prosecution alleged that Tan issued Security Bank and Trust Company (SBTC) Check No. 293232 for P254,037.00 in payment for construction materials. When the check was presented for payment, it was dishonored due to insufficient funds. The core of the dispute lies in whether the construction materials, supposedly purchased using the check, were actually delivered to and received by Tan or his authorized representatives. This point became the central legal question in determining Tan’s guilt or innocence.

The prosecution presented evidence that deliveries were made, evidenced by invoices, but the receipts were signed by individuals who were not explicitly authorized by Tan. Wilson Gaw, the branch manager of New Durawood Company, admitted during cross-examination that the materials were received by Ernie Conwi, Nards Gabatin, and an unidentified person, none of whom Tan had authorized. This admission significantly weakened the prosecution’s claim that Tan had received consideration for the check he issued. The contract of sale between New Durawood Company and Tan was reciprocal, meaning New Durawood was obligated to deliver the goods, and Tan was obligated to pay for them. However, without proof of delivery to Tan or his authorized agent, the obligation to pay could not be enforced in a criminal case for estafa.

The Revised Penal Code’s Article 315 (2)(d) outlines the elements of estafa involving the issuance of bad checks, which include (1) issuing a check in payment of an obligation; (2) lack of sufficient funds to cover the check; and (3) damage to the payee. The Supreme Court emphasized that deceit and damage are essential elements that must be proven beyond reasonable doubt. In People vs. Chua, the Supreme Court reiterated that the false pretense or fraudulent act must occur before or simultaneously with the issuance of the bad check. In this case, the lack of proof that Tan received the goods meant that the element of damage was missing. This absence of damage was a critical factor in the Supreme Court’s decision to acquit Tan, reinforcing the necessity of proving all elements of a crime beyond a reasonable doubt.

Moreover, the invoices presented as evidence indicated that the materials were marked as paid by checks not belonging to Tan. The invoices bore the stamp “PAID” and notations referencing Metropolitan Bank and Trust Company (MBTC) checks. Tan testified that he did not have an account with MBTC, and the prosecution did not dispute this claim. This evidence suggested that the materials were paid for by someone else, further undermining the prosecution’s case that Tan had defrauded New Durawood Company by issuing a bad check. The fact that the materials were delivered to Conwi’s apartment, rather than Tan’s warehouse or construction site, also supported Tan’s defense that he did not receive the goods.

The Supreme Court concluded that the prosecution failed to prove that Tan received something of value from New Durawood Company. Without this proof, Tan had no obligation to pay for the materials or make good on the SBTC check. The evidence of the invoices, deliveries of materials, and the bouncing MBTC checks was insufficient to incriminate Tan. The Court also reiterated that:

There is actual delivery when the thing sold is placed in the control and possession of the buyer or his agent.^[11]

In light of these findings, the Supreme Court acquitted Tan of the charge of estafa, emphasizing the necessity of proving all elements of the crime beyond a reasonable doubt, including the element of damage, which was lacking in this case. The acquittal underscores the importance of establishing a clear link between the issuance of the check and the receipt of goods or services by the accused in estafa cases.

FAQs

What was the key issue in this case?	The key issue was whether the prosecution sufficiently proved that Mario Myrno Tan received consideration for the check he issued, which is a critical element in estafa cases. The Court focused on whether the construction materials were actually delivered to and received by Tan or his authorized representatives.
What is estafa under Article 315 (2)(d) of the Revised Penal Code?	Estafa under Article 315 (2)(d) involves defrauding another by issuing a post-dated or bad check in payment of an obligation when the offender lacks sufficient funds in the bank. The elements include issuing the check, lack of funds, and damage to the payee, all of which must be proven beyond reasonable doubt.
Why was Mario Myrno Tan acquitted?	Tan was acquitted because the prosecution failed to prove that he or his authorized representatives received the construction materials for which the check was issued. The lack of proof of delivery meant that the element of damage, an essential element of estafa, was missing.
What is the significance of ‘consideration’ in this case?	Consideration refers to something of value received in exchange for the check. In this case, it was the construction materials. The absence of proof that Tan received the materials meant there was no consideration, and thus, no basis for a conviction of estafa.
Who received the materials according to the evidence presented?	According to the evidence, the materials were received by Ernie Conwi, Nards Gabatin, and an unidentified person. None of these individuals were authorized by Tan to receive the materials on his behalf.
What role did the invoices play in the court’s decision?	The invoices showed that the materials were marked as paid by checks from Metropolitan Bank and Trust Company (MBTC), not by Tan’s check. This evidence suggested that the materials were paid for by someone else, further undermining the prosecution’s case.
What did the court say about the delivery of the materials?	The court emphasized that actual delivery occurs when the goods are placed in the control and possession of the buyer or their authorized agent. Since the materials were not delivered to Tan or someone he authorized, there was no valid delivery.
What is the legal implication of this decision?	This decision underscores the importance of proving all elements of estafa beyond a reasonable doubt, particularly the element of damage. It also clarifies that delivery must be made to the buyer or their authorized agent for there to be valid consideration in a contract of sale.

The People vs. Mario Myrno Tan case serves as a reminder of the stringent burden of proof in criminal cases, particularly in estafa, where every element must be established beyond reasonable doubt. The decision reinforces the necessity of proving that the accused received something of value in exchange for the check, emphasizing the importance of actual delivery to the buyer or their authorized representative. It highlights the practical importance of ensuring proper documentation and verification in commercial transactions to prevent misunderstandings and potential legal disputes.

For inquiries regarding the application of this ruling to specific circumstances, please contact ASG Law through contact or via email at frontdesk@asglawpartners.com.

Disclaimer: This analysis is provided for informational purposes only and does not constitute legal advice. For specific legal guidance tailored to your situation, please consult with a qualified attorney.
Source: People vs. Tan, G.R. No. 120672, August 17, 2000