THE PEOPLE OF THE PHILIPPINE ISLANDS, PLAINTIFF AND APPELLEE, VS. RAFAEL FERNANDEZ, DEFENDANT AND APPELLANT.

In May, 1931, the appellant, Rafael Fernandez, contracted to
supply the Malabon Sugar Company 1,000 tons of sugar a month during
June and July of that year, in addition to what he had previously
agreed to supply. In order to meet this engagement it was necessary for
him, towards the end of June, to make a large purchase, or purchases,
of the same commodity. This he effected through F. C. Laing & Co.,
Ltd., of which he himself was president. Finding that the Compania
General de Tabacos had available a large quantity of sugar, the
appellant entered into negotiations with this company, and a contract
was made by which he agreed to buy, and the Companfa General agreed to
sell, sugar in the aggregate amount of 16,000 piculs, at P8.50 per
picul, payable upon delivery of the transfer documents. The contract
was closed on July 3, 1931, upon which date the appellant caused to be
delivered to the Compania General de Tabacos a check for the sum of
P112,450 drawn on the National City Bank of New York. The check was
delivered on behalf of Laing & Co. by Manuel F. Reyes, and at the
same time Reyes received a delivery order covering the sugar involved
in the transaction. When Reyes delivered the check he requested Enrique
Gonzalez Diaz, chief of the sugar department of the Compania General,
who received the check, not to deposit or cash the same for a few days,
for the reason that the appellant had not yet collected the proceeds of
the sale of the same sugar from a purchaser to whom it had already been
sold. In view of the fact that the sale was made as a cash sale and the
sugar had not yet been delivered, Diaz agreed to hold the check for a
few days and until he should be notified that it could be presented at
the bank. As a matter of fact, the check was held until the morning of
July 9, 1931, when, upon presentment at the bank, payment was denied
for lack of funds.

The proof further shows that on July 3,
when the transaction above-mentioned occurred, the appellant had on
deposit, subject to check, with the National City Bank in Manila, the
amount of only about P10,911.40, though the drawer of the check had on
deposit in the same bank the amount of P200,000, which was not subject
to check. On the same day, July 3, 1931, the appellant sold in Manila
to the Malabon Sugar Company the sugar which he was that day buying
from the Compania General, and he received from his vendee a check on
the Hongkong and Shanghai Banking Corporation for the amount of
P140,000. This check was at once deposited by him in his own account
with the Hongkong and Shanghai Banking Corporation, and on July 7,1931,
he made a deposit by check of P160,000 with the National City Bank.
This deposit, with the amount of P10,911.40, already in the account,
supplied more than enough to meet the check for P112,450 then held by
the Compania General de Tabacos. But the latter was never destined to
get any part of that money, for the reason that this check was not
presented for payment until July 9, and before banking hours on the
preceding day, the National City Bank had discovered that the quedans
which the appellant had deposited with it to secure an open credit of
about P915,000 were forged. Upon making this discovery the bank at once
stopped payment of appellant’s checks and notified him of the action
taken. On the afternoon of the same day the appellant directed Reyes to
notify the Compdnia General de Tabacos that the check held by it could
be presented. There is conflict in the proof as to the time in which
this notification was given, but this is unimportant. It is pretended
by the appellant that the message was sent before the close of banking
hours on July 7, but Diaz says it was not received until the afternoon
of July 8, when it was already too late to present the check that
afternoon. This is most probable since the check was not presented
until July 9, and it would have been unnatural for the holder of the
check to have omitted presentment of a check in this amount for more
than a day after receiving notice to present it. Of course the check
was never paid.

At the time the supposed estafa was committed, Act No.
3313 was in force, amendatory of article 535 of the old Penal Code. In
the part here material to be noted said article makes guilty of estafa:

“10. Any person who in his own name or as an
officer or member of a corporation, entity, or partnership shall issue
a check or any other commercial document against a bank established or
that may hereafter be established in these Islands in payment of a
debt, or for any other valuable consideration knowing that he does not
have at the time of its issuance sufficient provision of funds in the
bank to cover its amount, or, having such funds, shall maliciously and
feloniously sign his check differently from the signature registered at
the bank as his authentic signature, in order that the bank shall
refuse to pay the same; or shall issue a postdated check and at the
date set for the payment of it, the drawer of the check does not have
sufficient deposit in the bank to pay for the check. * * *”

This provision was carried into article 315, No. 2 (d), of the Revised Penal Code, in the following form:

“ART. 315. Swindling (estafa).—Any person who shall defraud another by any of the means mentioned hereinbelow shall be punished by:

* * * * * * *

“2. By means of any of the following false pretenses
or fraudulent acts executed prior to or simultaneously with the
commission of the fraud:

* * * * * * *

“(d) By postdating a check, or issuing
such check in payment of an obligation, the offender knowing that at
the time he had no funds in the bank, or the funds deposited by him in
the bank were not sufficient to cover the amount of the check, and
without informing the payee of such circumstances.”

Upon this provision we observe that the word “such”, as used in the first line of subsection (d),
is an error in the English translation, and the provision does not
apply exclusively to postdated checks, as is suggested in the argument
for the appellant. The Spanish original of this provision does not
countenance the interpretation suggested, and we are of the opinion
that the fraud there contemplated can be committed either upon the
issuance and delivery of a postdated check or upon the issuance and
delivery of any check.

It will be noted that Act No. 3313, which was in force when the act
with which we are here concerned was done, does not use the expression
“without informing the payee of such circumstances”, which is found at
the close of subsection (d) of No. 2 of article 315 of the Revised
Penal Code. But it is quite obvious that the meaning conveyed by these
words is really incorporated in the substance of Act No. 3313. The law
is dealing, it must be remembered, with the law of estafa,
and if the delivery of a check is accompanied by a revelation of the
fact that the drawer’s account lacks funds to meet it, no estafa is committed.

Now, as we have already stated, when the appellant caused the check
to be delivered, he caused the payee of the check to be informed in
effect that the appellant’s account did not contain the money necessary
to meet the check. These exact words were of course not used, but Diaz,
who acted for the Compaiiia General de Tabacos, was told that he should
not deposit, or cash, the check for a few days because the defendant
had not collected or received the proceeds of the sale of the same
sugar. This could not fail to carry to the mind of the person to whom
that statement was made the idea that the account upon which the check
was drawn was not then in funds, and that it would not be prepared to
meet the check until replenished with the proceeds to be received from
the actual sale of the sugar by the appellant. It results, in our
opinion, that the sanction of the penal law cannot be given to this
obligation. It was reduced to the character of a mere civil obligation
by the act of the creditor in agreeing to hold the check for a few days
without presentment, and until word should be received from the debtor
authorizing its presentment.

We note that the only controverted question in connection with the
transaction is whether notice for the encashment of the check was given
on the afternoon of July 7, as the appellant contends, or of July 8, as
the prosecution claims. The determination of this point is not really
material to this case, for the information charges an estafa
committed on July 3, when the check in question was delivered, and the
case must be determined with respect to the situation as it stood on
that date. Upon that phase of the case, we find that at the time of the
delivery of the check the payee was informed that the account was not
then in funds and the check therefore not then collectible.

It results that the appellant was improperly convicted. The
judgment must therefore be reversed and the accused absolved from the
complaint. So ordered, with costs de oficio.

Malcolm, Imperial, Butte, and Diaz, JJ., concur.