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PEOPLE v. VICTORIA R. ARAMBULO

FACTS:

The case involves a petition to annul the decision and resolution of the Court of Appeals, which suspended the criminal proceedings in an estafa case against the respondents. The respondents are heirs of Spouses Pedro C. Reyes and Anastacia Reyes and are represented by Anaped Estate Inc., a corporation formed for the benefit of the heirs. Jose Buban, as Vice-President and General Manager of Anaped, filed a complaint for estafa against Victoria and her husband, alleging failure to remit rentals collected from the properties transferred to Anaped. The respondents filed a motion to suspend the proceedings, claiming a prejudicial question arising from two pending intra-corporate cases involving the authority of the parties to act for the corporation and the validity of Buban's demand for remittance. The trial court initially granted the motion but later set it aside and scheduled the case for pre-trial. The respondents filed an omnibus motion to file their opposition, which was denied. The respondents then filed a petition for certiorari before the Court of Appeals, which ruled in their favor and stopped the trial court from hearing the criminal case until the intra-corporate cases were resolved.

ISSUES:

  1. Whether there exists a prejudicial question in this case.

  2. Whether SEC Case No. 05-97-5659 presents a prejudicial question to the criminal case for estafa.

  3. Whether SEC Case No. 03-99-6259 presents a prejudicial question to the criminal case for estafa.

  4. Whether the demand for delivery of the rentals is valid and can give rise to a criminal prosecution for estafa.

  5. Whether the absence of misappropriation or conversion of the rentals can be a defense in estafa.

RULING:

  1. Yes, there exists a prejudicial question in this case.

  2. No, SEC Case No. 05-97-5659 does not present a prejudicial question to the criminal case for estafa.

  3. Yes, SEC Case No. 03-99-6259 presents a prejudicial question to the criminal case for estafa.

  4. The demand for delivery of the rentals is not valid if the authority of the person making such a demand is defective. In this case, the defendants are being prosecuted for estafa based on their failure to deliver the rentals. However, if their authority to demand the rentals is found to be defective, the demand is considered invalid and the prosecution for estafa cannot prosper.

  5. In a prosecution for estafa, demand is not necessary if there is evidence of misappropriation or conversion. If it is ruled in the SEC case that the defendants were not validly elected, then they may have every right to refuse remittance of the rentals. Hence, the essential element of misappropriation in estafa may be absent, and the defendants may have a valid defense against the criminal charges.

PRINCIPLES:

  • A prejudicial question is one that arises in a case the resolution of which is a logical antecedent of the issue involved therein, and the cognizance of which pertains to another tribunal.

  • In order for a civil action to be considered a prejudicial question, the following requisites must be present: (a) the civil case involves facts intimately related to those upon which the criminal prosecution would be based, (b) in the resolution of the issue or issues raised in the civil action, the guilt or innocence of the accused would necessarily be determined, and (c) jurisdiction to try said question must be lodged in another tribunal.

  • SEC Case No. 05-97-5659, which is an action for accounting of funds and assets, annulment of sale, injunction, receivership, and damages, does not present a prejudicial question to the criminal case for estafa as the resolution of the civil case will not necessarily determine the guilt or innocence of the accused in the estafa case.

  • SEC Case No. 03-99-6259, which prays for the nullification of the election of Anaped directors and officers, presents a prejudicial question to the criminal case for estafa as the issue of the authority of the officers to act for and behalf of the corporation is intimately related to the elements of estafa with abuse of confidence.

  • Failure to return the property received for administration or under an obligation to deliver does not constitute the crime of estafa; it only gives rise to a civil action. (Estafa requires misappropriation or conversion.)

  • The authority of the person making a demand on behalf of a corporation is crucial for the validity of the demand. If the authority is defective, the demand is considered invalid.

  • Misappropriation may include not only conversion to one's personal advantage but also every attempt to dispose of the property of another without right.

  • The exercise of corporate powers and control should be governed by the board of directors elected by the stockholders, ensuring accountability and legitimacy of their decisions.

  • The result of a related civil case may determine the innocence or guilt of the defendants in the criminal case.