This case clarifies that while issuing a bouncing check is generally a violation of Batas Pambansa Blg. 22 (B.P. 22), also known as the Bouncing Checks Law, there are exceptions. Specifically, if the issuer pays the amount of the check before receiving a formal notice of dishonor, they cannot be held criminally liable under B.P. 22. The Supreme Court emphasizes the importance of notice and the opportunity to rectify the situation before criminal penalties apply, demonstrating a nuanced approach to enforcing the Bouncing Checks Law and considering circumstances beyond the mere issuance of a dishonored check.

When a Promise to Pay Meets the Harsh Reality of a Bounced Check

Felicito Abarquez was charged with multiple counts of violating B.P. 22 for issuing several checks to Fertiphil Corporation that were dishonored due to insufficient funds. Abarquez argued that some of the checks were paid before he received formal notice of dishonor, and others were not issued for value. This raised critical questions about the elements required for a B.P. 22 violation and whether subsequent payments could negate criminal liability.

The Supreme Court meticulously examined the circumstances surrounding each check. The Court emphasized that for an individual to be held liable under B.P. 22, it must be proven that they were notified of the dishonor and failed to make good the check within five banking days. This requirement stems from the principle that penal statutes should be construed strictly against the state and liberally in favor of the accused.

In Criminal Case Nos. D-8135 and D-8136, Abarquez presented evidence showing that he had paid the amounts of the dishonored checks before receiving any formal notice of dishonor from Fertiphil. Building on this principle, the Court noted the significance of the element of notice. This underscored that the law’s intent isn’t merely to penalize the issuance of a bouncing check, but also to provide an opportunity for the issuer to rectify the situation before criminal penalties are imposed.

Both the spirit and letter of the Bouncing Checks Law require, for the act to be punished under said law, not only that the accused issued a check that was dishonored, but that likewise the accused was actually notified in writing of the fact of dishonor.

Regarding Criminal Case No. D-8137, Abarquez claimed the check was dishonored due to “uncollected deposits” (DAUD) rather than “insufficient funds” (DAIF), arguing the former is not punishable under B.P. 22. The Court, however, found that the check was indeed dishonored for insufficient funds. It clarified that even with uncollected deposits, the bank can choose to honor the check, but dishonoring it can still lead to B.P. 22 liability.

In Criminal Case Nos. D-8176 and D-8177, Abarquez contended the checks were issued as advance payments pending reconciliation of accounts, not for value. The Court rejected this argument. It emphasized that the intent or purpose of issuing the check is irrelevant; the mere act of issuing a worthless check is malum prohibitum, meaning it’s wrong because the law prohibits it, regardless of intent.

The Court has consistently declared that the cause or reason for the issuance of the check is inconsequential in determining criminal culpability under BP 22… The gravamen of the offense under BP 22 is the act of making or issuing a worthless check or a check that is dishonored upon presentment for payment.

The Court also addressed the penalty imposed. While the Court of Appeals opted for a fine instead of imprisonment based on earlier administrative circulars, it incorrectly calculated the fine amounts. The Supreme Court corrected this, emphasizing that the fine should not exceed P200,000.00 per violation, as explicitly stated in Section 1 of B.P. 22. Subsidiary imprisonment was also stipulated if the fines could not be paid.

FAQs

What is Batas Pambansa Blg. 22 (B.P. 22)?	B.P. 22, also known as the Bouncing Checks Law, penalizes the issuance of checks without sufficient funds to cover them. It aims to maintain the stability and commercial value of checks as substitutes for currency.
What are the essential elements of a B.P. 22 violation?	The elements are: (1) issuing a check for account or value; (2) knowing insufficient funds exist; and (3) subsequent dishonor of the check due to insufficient funds.
What does “notice of dishonor” mean?	“Notice of dishonor” refers to the written notification given to the issuer of a check when the bank refuses to honor the check due to insufficient funds. This notice is crucial for establishing liability under B.P. 22.
Can payment of the check negate criminal liability under B.P. 22?	Yes, if the issuer pays the check’s amount before receiving a formal notice of dishonor, it can negate criminal liability under B.P. 22. This shows an effort to rectify the situation before formal charges.
Is the purpose of issuing a check relevant in determining B.P. 22 liability?	No, the purpose for issuing the check is generally irrelevant. The key factor is whether the check was dishonored due to insufficient funds, regardless of the reason for its issuance.
What is the penalty for violating B.P. 22?	The penalty includes a fine and/or imprisonment. However, courts may opt for a fine in certain circumstances, such as when the offender is a first-time violator. The maximum fine should not exceed P200,000.00.
What is the meaning of malum prohibitum in the context of B.P. 22?	Malum prohibitum means the act is wrong because a law prohibits it, irrespective of criminal intent. In B.P. 22, simply issuing a bouncing check is the prohibited act, regardless of the issuer’s intent.
What is the significance of Administrative Circular No. 12-2000?	This circular allowed courts to impose a fine instead of imprisonment for B.P. 22 violations under certain conditions, such as if the offender is a first-time violator and there’s no clear intent to defraud.

In summary, while B.P. 22 strictly prohibits the issuance of bouncing checks, the Supreme Court’s decision underscores the importance of notice and the opportunity to make good on the check before criminal liability attaches. This nuanced approach balances the need to protect the integrity of checks with considerations of fairness and individual circumstances.

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: Abarquez vs. Court of Appeals, G.R. No. 148557, August 7, 2003