IRMA IDOS, petitioner

Versus
COURT OF APPEALS and PEOPLE OF THE PHILIPPINES,
respondents
G.R. No. 110782 September 25, 1998

Facts:

Irma Idos, the petitioner, formed for short live partnership which engage for
leather tanning business with Eddie Alarilla, respondent which the partnership was
short lived. On January 1986, parties agreed to terminate their partnership. Upon
liquidation of the business the partnership had as of May 1986 receivables and
stocks worth P1,800,000. For the share of Alarilla for the assets it worth P900,000
wherein Idos issued four post-dated checks of which Alarilla was able to encash
only three out of four checks and the third check was dishonored on October 14,
1986 for insufficiency of funds. When the Idos refused to pay the value of the
check after the Alarilla has demanded for it, it impelled Alarilla to file a complaint
in the office of the provincial Fiscal of Bulacan which on August 22, 1988 filed an
information for violation of BP Blg. 22 against Idos. On her defense, Idos claimed
that the check served only as an “assurance” of Alarilla’s share in the partnership
and that it was not supposed to be deposited until the stocks have been sold. This
was refuted by Alarilla and subsequently Idos was convicted by the trial court of
the offense charged. The Court of Appeals affirmed the decision of the trial court.

Issue:

Whether or not Idos violated the BP Blg. 22 for the issuance of dishonored
check to Alarilla?
Held:

No. One of the elements of the offense penalized under BP 22 is “the

making, drawing and issuance of any check to apply for any account or for
value.”Therefore, in this case, Idos showed enough evidence that the check issued
to his partner was to be funded from receivables to be collected and goods to be
sold by the partnership. First, only one of the fours check were not encashed and
second, even Alarilla himself admitted that there was no consideration for the
issuance of the check. Hence the check in question was not issued for any debt of
or any account due and payable by the petitioner. Moreover, Idos and Alarilla were
still in the “winding up” of the affairs of the partnership when the check was issued
as evidenced by the fact that they still had to sell the goods on hand and collect the
receivables from debtors. As provided by the Civil Code the three final stages of a
partnership are dissolution, winding-up and termination. These stages are
distinguished, to wit:

Dissolution is the change in the relation of the partners caused by any

partner ceasing to be associated in the carrying on of the business (Art. 1828). It is
that point of time the time the partners cease to carry on the business together.

Winding-up is the process of settling business affairs after dissolution, i.e.

collecting of assets previously demandable.

Termination is the point in time after all the partnership affairs have been
wound up.

Thus, since that partnership has not been terminated, the petitioner and
private complainant remained as co-partners. The check was thus issued by the
petitioner to complainant as would a partner to another and not as payment from a
debtor to a creditor. Idos did not violate BP 22.