JANICE RESIDE Y TAN, PETITIONER, VS. PEOPLE OF THE PHILIPPINES, RESPONDENT.

Reside versus People of the Philippines

The Case

This is the case of Janice Reside versus People of the Philippines, decided by the Supreme Court in July 2020. Janice Reside, the petitioner, was the pre-school and grade school principal of Treasury of the Golden Word School, Incorporated. She was charged with estafa under paragraph 1(b) of Article 315 of the Revised Penal Code for failing to remit tuition collections. The case matters because the Supreme Court re-drew the classic dividing line between estafa and theft: an employee who receives money only in the material or physical sense, while juridical possession stays with the employer, commits theft, not estafa. It is also a working illustration of the variance doctrine, where the accused may be convicted of a crime necessarily included in the one charged.

Procedural History

Janice Reside was arraigned before the Regional Trial Court of Las Piñas City, Branch 201, and pleaded not guilty. After trial, the Regional Trial Court convicted her of estafa under paragraph 1(b) of Article 315 of the Revised Penal Code. It sentenced her to an indeterminate penalty of eight years of prision mayor as minimum to seventeen years, four months and one day of reclusion temporal as maximum, ordered her to indemnify the school in the amount of 1,721,010 pesos and 82 centavos, and to pay attorney's fees.

She appealed to the Court of Appeals. The Court of Appeals agreed that she was guilty of estafa, but on the documentary evidence it found that the amount she failed to remit was only 134,462 pesos and 90 centavos. It affirmed the conviction with modification, lowering the minimum of the penalty to four years and two months of prision correccional and reducing the indemnity to 134,462 pesos and 90 centavos plus ten percent as attorney's fees. Her motion for reconsideration was denied. She then filed a petition for review on certiorari under Rule 45 of the Rules of Court before the Supreme Court.

Facts

From 2001 to 2005, Janice Reside served as pre-school and grade school principal of Treasury of the Golden Word School. The school president, Carmelita De Dios, entrusted her with three tasks: to collect tuition fees from parents and students, to issue official receipts for them, and to remit the collections to the school. Under a verbal agreement, she was to forward all payments together with the remittance voucher slips.

Sometime in 2005, the school treasurer noticed that Reside had stopped reporting for work. De Dios reviewed the school's books and discovered that some tuition fees received by Reside had not been remitted. Further investigation showed that Reside had been issuing temporary receipts, which the school's policy prohibited. De Dios tried to meet her but could not, so she sought the help of the barangay where Reside lived. At the barangay hall, Reside admitted that the allegations were true, and the parties agreed to settle. She signed a promissory note undertaking to pay within three months.

She failed to pay upon maturity despite demand, and the school filed a criminal complaint for estafa. In her defense, she claimed that she was allowed to acknowledge payments and issue receipts, that no discrepancy had been found when De Dios examined the receipts, and that she signed the promissory note under duress.

Issues

• Whether or not the petitioner is guilty of estafa under paragraph 1(b) of Article 315 of the Revised Penal Code, particularly whether she received the tuition collections in juridical possession, which is the first element of that crime.
• Whether or not the petitioner may instead be convicted of qualified theft, a crime necessarily included in the estafa charged in the information, under the variance doctrine.
• Whether or not the penalty and civil liability must be adjusted in light of the amendatory law adjusting the amounts on which penalties are based.

Applicable Provisions

Paragraph 1(b) of Article 315 of the Revised Penal Code, the crime charged, provides:

By misappropriating or converting, to the prejudice of another, money, goods or any other personal property received by the offender in trust, or on commission, or for administration, or under any other obligation involving the duty to make delivery of, or to return the same, even though such obligation be totally or partially guaranteed by a bond; or by denying having received such money, goods, or other property.

This is the provision under which the petitioner was charged, and its first element requires that the offender received the property in trust, on commission, or for administration, which the Court reads as requiring juridical possession.

Article 308 of the Revised Penal Code defines theft:

Theft is committed by any person who, with intent to gain but without violence, against, or intimidation of neither persons nor force upon things, shall take personal property of another without the latter's consent.

This definition supplies the elements of the crime the Court ultimately finds proved.

Article 310 of the Revised Penal Code defines qualified theft:

The crime of theft shall be punished by the penalties next higher by two degrees than those respectively specified in the next preceding article, if committed by a domestic servant, or with grave abuse of confidence, or if the property stolen is motor vehicle, mail matter or large cattle or consists of coconuts taken from the premises of a plantation, fish taken from a fishpond or fishery or if property is taken on the occasion of fire, earthquake, typhoon, volcanic eruption, or any other calamity, vehicular accident or civil disturbance.

Grave abuse of confidence is the qualifying circumstance that raises the taking to qualified theft.

Section 4 of Rule 120 of the Revised Rules on Criminal Procedure, on variance between allegation and proof, provides:

When there is variance between the offense charged in the complaint or information and that proved, and the offense as charged is included in or necessarily includes the offense proved, the accused shall be convicted of the offense proved which is included in the offense charged, or of the offense charged which is included in the offense proved.

This is the procedural basis for convicting the petitioner of qualified theft even though the information charged estafa.

Section 5 of Rule 120, on when an offense includes another, provides:

An offense charged necessarily includes the offense proved when some of the essential elements or ingredients of the former, as alleged in the complaint or information, constitute the latter. And an offense charged is necessarily included in the offense proved, when the essential ingredients of the former continue or form part of those constituting the latter.

This provision explains why qualified theft is necessarily included in the estafa charged.

Article 309 of the Revised Penal Code, as amended by Republic Act Number 10951, provides:

The penalty of prision correccional in its minimum and medium periods, if the value of the property stolen is more than Twenty thousand pesos but does not exceed Six hundred thousand pesos.

This amended penalty bracket governs the amount involved in this case.

Article 65 of the Revised Penal Code provides:

In cases in which the penalty prescribed by law is not composed of three periods, the courts shall apply the rules contained in the foregoing articles, dividing into three equal portions of time included in the penalty prescribed, and forming one period of each of the three portions.

This rule was used to compute the periods of the adjusted penalty.

Ruling

On the first issue, the Court held that the petitioner is not guilty of estafa. The first element of estafa under paragraph 1(b) of Article 315 requires that the offender received the money in trust, on commission, or for administration, which means acquiring both material or physical possession and juridical possession. Juridical possession is possession that gives the transferee a right over the thing transferred, which he may set up even against the owner. The Court recalled its ruling in Guzman versus Court of Appeals that a receiving teller is a mere custodian of funds, while an agent may assert an independent right to retain the money received. It applied the same principle from Chua-Burce versus Court of Appeals, Roque versus People, and Benabaye versus People. Here, the money merely passed into the petitioner's hands, and her custody lasted only until remittance to the school. As principal and temporary cash custodian, she acquired only material possession, so she cannot be convicted of estafa as charged.

On the second issue, the Court held that the petitioner is guilty of qualified theft. The information alleged that she was authorized to collect payments, misappropriated and converted them to her own use, and failed to return them despite demand. Under the variance doctrine, qualified theft is necessarily included in the estafa charged. The Court found all the elements of qualified theft present: there was a taking of money belonging to the school, without the school's consent, with intent to gain, without violence or intimidation or force upon things, and with grave abuse of confidence, since her position of trust as principal was gravely abused when she failed to remit the collections. The Court noted that there may be theft even if the accused had possession of the property, if the possession was only material or physical.

On the third issue, the Court applied Republic Act Number 10951, which took effect on September 16, 2017. Under Article 309 as amended, qualified theft involving 134,462 pesos and 90 centavos is punishable by prision mayor in its medium and maximum periods. Computing the periods under Article 65, with no aggravating or mitigating circumstance, the imposable penalty is from nine years, four months and one day to ten years and eight months. Applying the Indeterminate Sentence Law, the Court set a maximum of nine years, four months and one day of prision mayor and a minimum of five years, five months and eleven days of prision correccional. It also imposed legal interest at six percent per annum on the actual damages from finality of judgment until full payment.

Doctrine

Estafa under paragraph 1(b) of Article 315 of the Revised Penal Code requires that the offender received the money or property in trust, on commission, or for administration, which means acquiring both material and juridical possession. An employee who receives funds on behalf of the employer acquires only material or physical possession; juridical possession remains with the employer. If such an employee misappropriates the funds, the crime is theft, qualified when committed with grave abuse of confidence under Article 310, not estafa. Under the variance doctrine in Sections 4 and 5 of Rule 120, an accused charged with estafa may be convicted of qualified theft because it is necessarily included in the crime charged. Finally, the penalty for qualified theft is governed by Article 309 as amended by Republic Act Number 10951, with the periods computed under Article 65.

Disposition

The petition was denied, and the Court of Appeals decision was affirmed with modification: the petitioner was sentenced to an indeterminate penalty of five years, five months and eleven days of prision correccional as minimum to nine years, four months and one day of prision mayor as maximum, and ordered to pay the school 134,462 pesos and 90 centavos as actual damages, with interest at six percent per annum from finality of judgment until fully paid.

Remember This

Memorize this line: an employee who receives money for the employer has only material possession, so misappropriation is qualified theft, not estafa. Examiners use this case to test the material versus juridical possession distinction and the variance doctrine, where the crime proved is necessarily included in the crime charged.