Facts:
Petitioner Lina Lim Lao, an employee of Premiere Investment House (Premiere), was authorized to sign checks for the corporation. Due to her duties often requiring her to be away from the office, Lao signed checks in blank, which were to be later filled in by Teodulo Asprec, the head of operations. Subsequently, three checks issued to Father Artelijo Pelijo were dishonored due to insufficiency of funds.
Upon the checks being dishonored, Father Pelijo demanded payment from Premiere but to no avail, leading to the filing of an affidavit-complaint against Lao and Asprec for violation of Batas Pambansa Bilang 22 (B.P. 22). After a preliminary investigation, informations were filed, leading to Lao’s conviction by the Regional Trial Court of Manila for two of the three charges, a decision which was affirmed by the Court of Appeals.
Issues:
1. Whether the act of signing checks in blank, without knowledge of their funded status, constitutes a violation of B.P. 22.
2. Whether notice of dishonor sent to the corporation’s main office constitutes valid notice to the signatory-employee stationed at a branch office.
3. Whether the lack of actual knowledge of insufficient funds can absolve the accused from liability under B.P. 22.
Court’s Decision:
The Supreme Court ruled in favor of the petitioner, Lina Lim Lao. It emphasized that penal statutes such as B.P. 22 are strictly construed against the State and in favor of the accused. The Court found that:
1. Lao did not have actual knowledge of the insufficiency of funds, a crucial element for prosecution under B.P. 22.
2. There was no proper notice of dishonor personally served on Lao, which is essential to presume knowledge of insufficiency of funds under B.P. 22.
3. Constructive knowledge via the corporation’s receipt of notice does not suffice to meet the requirements for personal notice under B.P. 22.
Doctrine:
The Court reiterates the principles that (1) penal statutes are construed strictly against the State and liberally in favor of the accused, and (2) knowledge of the insufficiency of funds and receipt of notice of dishonor are essential elements for liability under B.P. 22.
Class Notes:
– Elements of a crime under B.P. 22 include the making, drawing, and issuance of a check for value, with knowledge at the time of issuance that there are insufficient funds, and subsequent dishonoring of the check.
– Actual knowledge of insufficient funds and proper notice of dishonor are essential for liability under B.P. 22.
– Constructive knowledge or notice to a corporation does not constitute sufficient notice to an individual employee under B.P. 22.
Historical Background:
The case illuminates the nuances in the application of B.P. 22, intended to promote confidence in the banking system through penalizing the issuance of unfunded checks. It underscores the importance of strict adherence to the elements of the crime, emphasizing the rights to due process and the presumption of innocence, especially for employees who may unwittingly be implicated in offenses under corporate settings.
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