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JAIME U. GOSIACO v. LETICIA CHING

FACTS:

Petitioner Jaime Gosiaco invested P8,000,000.00 with ASB Holdings, Inc. (ASB) by way of loan. ASB issued two DBS checks in the amount of P8,000,000.00 and P112,000.00 respectively in exchange for the loan. However, when petitioner tried to deposit the checks, they were dishonored due to a stop payment order and insufficiency of funds. Petitioner notified the respondents about the dishonor of the checks and demanded replacement checks or the return of the money, but the respondents did not comply. Petitioner then filed a criminal complaint for violation of B.P. Blg. 22 (Bouncing Checks Law) against respondents Leticia Ching and Edwin Casta. Ching, a corporate officer of ASB, denied liability and claimed that she did not have knowledge of ASB's funds. The Metropolitan Trial Court acquitted Ching of criminal liability but held her civilly liable. Both petitioner and Ching appealed to the Regional Trial Court (RTC), with petitioner also seeking to implead ASB and its president as defendants. The RTC affirmed Ching's acquittal and ruled that the civil liability fell on ASB. Petitioner appealed to the Court of Appeals, which upheld the RTC's decision. Petitioner sought the reversal of the decision, arguing that Ching should be held civilly liable, ASB should be impleaded, and the corporate veil of ASB should be pierced.

ISSUES:

  1. Whether the civil liability of a corporate officer in a B.P. Blg. 22 case is extinguished with the criminal liability.

  2. Whether a separate civil action can be pursued against a juridical person, such as a corporation, for the recovery of amounts due from bounced checks.

  3. Whether or not the civil action for recovery of the amount covered by the check against the corporation is separate and independent from the criminal case for violation of B.P. Blg. 22 against the signatory.

RULING:

  1. The civil liability of a corporate officer in a B.P. Blg. 22 case is extinguished with the criminal liability. The civil liability arises from the criminal act of issuing a bouncing corporate check and is deemed to be included in the criminal action. Therefore, if the corporate officer is acquitted in the criminal charge, they cannot be held civilly liable.

  2. A separate civil action can be pursued against a juridical person, such as a corporation, for the recovery of amounts due from bounced checks. Although the Revised Rules on Criminal Procedure state that the civil action is deemed to be included in the criminal action, this provision only prohibits the reservation of a separate civil action against the natural person charged with violating B.P. Blg. 22 and not against the juridical person. The substantive right of a creditor to recover due and demandable obligations against a debtor-corporation cannot be denied or diminished by a rule of procedure.

  3. The civil action for recovery of the amount covered by the check against the corporation is separate and independent from the criminal case for violation of B.P. Blg. 22 against the signatory. The signing of the corporation's representative on the check is merely a mode of signing the document in its behalf, and does not automatically make the corporation liable for the amount of the check. The liability of the signatory and the corporation are distinct and should be adjudged according to their respective standards and merits. The civil case should determine whether or not the obligation itself is valid and demandable, while the B.P. Blg. 22 case should determine whether or not the signatory had signed the check with knowledge of the insufficiency of funds or credit in the bank account. The litigation of both questions could proceed independently and simultaneously without being ultimately conclusive on one or the other.

PRINCIPLES:

  • The interpretation of penal laws is strictly construed against the State and liberally construed against the accused.

  • The civil liability of a corporate officer in a B.P. Blg. 22 case is extinguished with the criminal liability.

  • The civil liability of a corporation for bounced checks can be pursued through a separate civil action.

  • The civil liability of the signatory of a bounced check is distinct from the civil liability of the corporation for the amount represented by the check.

  • The civil action for recovery of the amount covered by the check against the corporation is separate and independent from the criminal case for violation of B.P. Blg. 22 against the signatory.

  • The signing of a check by a corporation's representative does not automatically make the corporation liable for the amount of the check.

  • The liability of the signatory and the corporation are distinct and should be adjudged according to their respective standards and merits.

  • The civil case should determine whether or not the obligation itself is valid and demandable, while the B.P. Blg. 22 case should determine whether or not the signatory had signed the check with knowledge of the insufficiency of funds or credit in the bank account.

  • The civil action for recovery of the amount covered by the check against the corporation and the B.P. Blg. 22 case against the signatory could proceed independently and simultaneously without being ultimately conclusive on one or the other.