Lina Lim Lao is a junior officer at Premiere Investment House who signs checks in blank that are later filled in and also signed by the head of operations, Teodulo Asprec. Artelijop Palijo was issued several checks totaling investments made but the checks bounced once encashed due to insufficient funds. Palijo filed complaints against Lao and Asprec for violating BP 22, which makes it illegal to issue checks knowing there are insufficient funds. Lao claims she had no knowledge of the fund insufficiency as that information was only available to the treasury department office. She is ultimately acquitted because one element of BP 22 is knowledge of insufficient funds, and it was ruled she did not have
Lina Lim Lao is a junior officer at Premiere Investment House who signs checks in blank that are later filled in and also signed by the head of operations, Teodulo Asprec. Artelijop Palijo was issued several checks totaling investments made but the checks bounced once encashed due to insufficient funds. Palijo filed complaints against Lao and Asprec for violating BP 22, which makes it illegal to issue checks knowing there are insufficient funds. Lao claims she had no knowledge of the fund insufficiency as that information was only available to the treasury department office. She is ultimately acquitted because one element of BP 22 is knowledge of insufficient funds, and it was ruled she did not have
Lina Lim Lao is a junior officer at Premiere Investment House who signs checks in blank that are later filled in and also signed by the head of operations, Teodulo Asprec. Artelijop Palijo was issued several checks totaling investments made but the checks bounced once encashed due to insufficient funds. Palijo filed complaints against Lao and Asprec for violating BP 22, which makes it illegal to issue checks knowing there are insufficient funds. Lao claims she had no knowledge of the fund insufficiency as that information was only available to the treasury department office. She is ultimately acquitted because one element of BP 22 is knowledge of insufficient funds, and it was ruled she did not have
2. All the checks were issued in favor of Artelijo A.
Palijo and signed
Lim Lao v. CA (Vi) by Lao and Teodulo Asprec, who was the head of operations. June 20, 1997| Panganiban, J. | BP 22 3. When Father Palijo presented the checks for encashment, the same PETITIONER: Lina Lim Lao were dishonored for the reason 'Drawn Against Insufficient Funds'. RESPONDENTS: Court of Appeals and People of the Philippines He demanded from Premiere by going to the Binondo branch then was referred to Cubao main branch and was given P5,000 for his SUMMARY: Lina Lim Lao is a junior officer of Premiere Investment effort but no subsequent payment. He wrote a formal letter of House. She signs checks in blank which are then filled in and also signed demand. Subsequently, Premiere was placed under receivership. by Teodulo Asprec, head of operations. Artelijop Palijo was issued checks 4. Palijo filed a complaint against Lao and Asprec for violating BP 22. for investments he made (donation money) but once encashed, these were Three informations were filed by the Assistant Fiscal Caballes for dishonored for insufficient funds. He then filed complaints against Lao and violating Section 1, BP 22 (the info said that "accused did then and Asprec (escaped) for violating BP 22. Issue: Whether Lao is guilty for there willfully and unlawfully draw and issue to Artelijo A. Palijo to violating BP 22. One of the elements of BP 22 is that the person must have apply on account or for value a Traders Royal Bank Check No. knowledge of the insufficiency of funds (check Ratio #3 and #4 for full 299961 for P150,000.00 payable to Fr. Artelijo A. Palijo dated elements). Lao had no knowledge of the insufficiency of funds since it is October 7, 1983 well knowing that at the time of issue he/she did not the Treasury Department in the Cubao Office that has access to the account have sufficient funds in or credit with the drawee bank for full balances and statement of accounts. Also, the notice of dishonor was given payment of the said check upon its presentment as in fact the said to the Cubao office and the Binondo office was not even informed of the check, when presented within ninety (90) days from the date thereof, dishonor. Hence, since there was no knowledge of dishonor, the prima facie was dishonored by the drawee bank for the reason: 'Insufficient presumption of knowledge of insufficient funds does not arise. Lao was Funds'; that despite notice of such dishonor, said accused failed to acquitted because she had no knowledge of the insufficiency of funds and pay said Artelijo A. Palijo the amount of the said check or to make this was also backed up by the testimonies. arrangement for full payment of the same within five (5) banking DOCTRINE: One of the elements of a violation of BP 22 is that there days from receipt of said notice” – just change the amounts for the should be knowledge of the insufficiency of funds. There is a prima facie other infos). presumption of knowledge but this is not a complete presumption. Here, the 5. Upon arraignment, Lao pleaded not guilty and Asprec is still at large presumption also did not arise because Lao had no notice of the dishonor of (not arrested). the checks since the Binondo office was not even informed. 6. Defense: In her regular course of duties as junior officer, it is normal for her to sign checks in blank without the names of the payees and FACTS: the amounts and dates of maturity. Mr. Asprec decides to whom it is to be issued and delivered. She has no actual knowledge of the 1. Lina Lim Lao is a junior officer of Premiere Investment House, funds available and it is the Treasury Department in the Cubao main Binondo Branch. She was authorized to sign checks for and in behalf office, headed by Ms. Ocampo who has the duty of monitoring and of the corporation. In the course of the business, she met assessing the balances. All bank statements were sent to Cubao. complainant, Father Artelijo Palijo, the provincial treasurer of the 7. Circumstances in issuance of checks: Palijo dealt with Lachenal, Society of the Divine Word through Mrs. Rosemarie Lachenal, a a trader connected with the corporation, never knew or dealt with trader for Premiere. Father Palijo was authorized to invest donations Lao before or during issuance. When the checks were co-signed, to the society and had been investing the society's money with they were signed in advance and in blank and Asprec filled it up. Premiere. He had invested a total of P514,484.04 and was also Lao was not involved in completion and delivery of the check, issued Traders Royal Bank (TRB) checks in payment of interest (3 no knowledge of insufficiency of funds, and was not part of her checks worth P150K, P150K, and P26, 010.73). duties to make sure it was funded. Only the Treasury Department had access to info on the account balances and funding. The notice Two hundred thousand pesos, or both such fine and imprisonment of dishonor was also sent to the Cubao Main Office. at the discretion of the court. 8. Ms. Ocampo testied that it was the office in Cubao which received notice of dishonor of the checks. The dishonor of the check came in Where the check is drawn by a corporation, company or entity, the the wake of the assassination of the late Sen. Benigno Aquino, as a person or persons who actually signed the check in behalf of such consequence of which event a majority of the corporation's clients drawer shall be liable under this Act. pre-terminated their investments. A period of extreme illiquidity and Section 2: Evidence of knowledge of insufficient funds. — The financial distress followed, which ultimately led to the corporation's making, drawing and issuance of a check payment of which is being placed under receivership by the Securities and Exchange Commission. Despite the dishonor, they never informed the refused by the drawee because of insufficient funds in or credit with Binondo office (futile because of financial distress). such bank, when presented within ninety (90) days from the date of 9. RTC found her guilty, CA affirmed. the check, shall be prima facie evidence of knowledge of such insufficiency of funds or credit unless such maker or drawer pays ISSUES: the holder thereof the amount due thereon, or makes arrangements 1. Whether Lina Lim Lao can be held criminally liable for the for payment in full by the drawee of such check within five (5) dishonor of the checks – NO banking days after receiving notice that such check has not been paid by the drawee. RATIO: 3. Elements of BP 22: (1) the making, drawing and issuance of any 1. Lao contends that CA erred that lack of actual knowledge of check to apply to account or for value; (2) the knowledge of the insufficiency of funds is not a defense. Also, notice to the main maker, drawer or issuer that at the time of issue he does not have office is not notice mandated in Sec 22, BP 22, hence no sufficient funds in or credit with the drawee bank for the presumption that she had knowledge of insufficient funds. Penal payment of such check in full upon its presentment; and (3) statutes are strictly construed against the state, liberally for accused. subsequent dishonor of the check by the drawee bank for 2. IMPORTANT PROVISIONS insufficiency of funds or credit or dishonor for the same reason Section 1: Checks without sufficient funds. — Any person who had not the drawer, without any valid cause, ordered the bank makes or draws and issues any check to apply on account or for to stop payment. value, knowing at the time of issue that he does not have sufficient 4. Reyes elements: 1)person makes or draws and issues any check; funds in or credit with the drawee bank for the payment of such 2)check is made or drawn and issued to apply on account or for check in full upon its presentment, which check is subsequently value; 3) person who makes or draws and issues the check knows at dishonored by the drawee bank for insufficiency of funds or credit the time of issue that he does not have sufficient funds in or credit or would have been dishonored for the same reason had not the with the drawee bank for the payment of such check in full upon its drawer, without any valid reason, ordered the bank to stop payment, presentment; 4)the check is subsequently dishonored by the drawee shall be punished by imprisonment of not less than thirty days but bank for insufficiency of funds or credit, or would have been not more than one (1) year or by a fine of not less than but not more dishonored for the same reason had not the drawer, without any than double the amount of the check which ne shall in no case exceed valid reason, ordered the bank to stop payment. 5. Petitioner raised lack of knowledge but CA reasoned that knowledge of insufficiency is presumed from the dishonor of checks. CA also said it is malum prohibitum. 6. There is a prima facie presumption but this is not a conclusive presumption. Lao did not have actual knowledge. Her duties were limited to the marketing department. She signed the checks in blank without knowledge of the transaction for which they were issued. She did not even know the identity of the payee and it was Asprec who filled in the details (check the testimonies). Since she had no knowledge, she cannot be liable under BP 22. 7. There can be no prima facie evidence of dishonor since they received no notice of dishonor since it was sent to the Cubao office and they were not informed (Lao’s testimony). Full payment within 5 banking days is a compromise to prevent criminal action and is a complete defense. 8. Social justice aspect: Lao is a minor employee who has nothing to do with the issuance, funding and delivery of the checks and because of this case, was imprisoned for over a decade while Asprec, the one responsible, escaped prosecution because he was not arrested. (OMG kawawa naman 10 yrs nakulong pero innocent T_T) 9. WHEREFORE, the decision of the CA is REVERSED and SET ASIDE. Lim Lao is ACQUITTED.