REPUBLIC OF THE PHILIPPINES SANDIGANBAYAN Quezon City SECOND DIVISION PEOPLE OF THE PHILIPPINES, Crim. Case No. SB-17-A/R-0001 Appellee, For: Violation of Article 214 in relation to Article 315(1)(c) of the Revised Penal Code Crim, Case No. SB-17-A/R-0002 For: Violation of Section 3(e), R.A, No. 3019, as amended = versus ~ Present: ALEX D. FONTAINA, HERRERA, JR., J., Chairperson Appellant, MUSNGI, J., Associate Justice PAHIMNA, J., Associate Justice AZ ulgated DECISION MUSNGI, J: This is an appeal from the Decision’ dated 12 August 2016 of the Regional Trial Court, Branch 33, of the City of Manila, National Capital Judicial Region, in Criminal Cases Nos. 13-298163 and 13-298164, finding appellant Alex D. Fontaina (“Fontaina”) guilty beyond reasonable of the crimes of violation of Article 214 in relation to Article 315 paragraph 1(c) of the Revised Penal Code,” and violation of Section 3(e) of Republic Act No. 3019 (“R.A. No. 3019”), as amended, otherwise known as The Anti-Graft and Corrupt Practices Act3 ANTECEDENT FACTS On 11 July 2013, two (2) separate Informations were filed against appellant Fontaina, to wit: 1 Sandiganbayan Records, pp. 64-84. 2 Criminal Case No, 298163 3 Criminal Case No, 298164.Criminal Cases Nos. SB-17-A/R-0001 to 0002 People vs. Fontaina DECISION Page 2 of 24 piece ee EL Criminal Case No. 13-298163 “That on or about July, 2009, in the City of Manila, Philippines, within the jurisdiction of this Honorable Court accused ALEX D. FONTAINA, a low ranking public officer, with Salary Grade 14, being a Barangay Chairman of Barangay 564 Zone 55, District IV, City of Manila, taking advantage of his official position, with abuse of confidence, did then and there, willfully, unlawfully, and feloniously, secure a loan from one Oscar Demetria in the amount of One Hundred Twenty Thousand Pesos (P 120,000) by taking undue advantage of the signatures of Barangay Secretary Ma. Theresa de Mesaner, Barangay Treasurer Jo-Ann P. Escurel, Members of the Barangay Council Alfonso F. Demillo, Jr., Patrocinio G. Egafia, Johnny P. Fernandez, Yvex A. Cabansag and one Revindo Alaya whom accused made to sign on a blank piece of paper and commit fraud by vriting above such signatures words that the aforementioned signatories consented to and contracted the said loan to their prejudice, as accused promised as collateral their honoraria for the 3° Quarter of 2009. CONTRARY TO LAW.” Criminal Case No, 13-298164 “That on or about August, 2010, or sometime prior or subsequent thereto, in the City of Manila, Philippines, within the jurisdiction of this Honorable Court, accused, ALEX D. FONTAINA, a low ranking public officer, Salary Grade 14 being a Barangay Chairman of Barangay 564 Zone $5 District IV, City of Manila, while in the performance of his official function, committing the offense in relation to his office, and taking advantage of his official position, acting with evident bad faith, did then and there, willfully, unlawfully, and criminally cause undue injury to the Government in the amount of Two Hundred Twenty One Thousand Two Hundred and Seventy Seven Pesos (P221,277.00) by purchasing a motor vehicle through financing despite having custody of the full purchase price of said amount, committed in this manner: making it appear that accused purchased a barangay patrol car in his name from ROJGEM Trading in cash when in truth and in fact, as accused knew fully well that the same was purchased from Megaton Motors Corporation through financing with Radiowealth Finance Corporation for One Hundred Eighty Six Thousand ‘Nine Hundred Twelve Pesos (P186,912.00) only, and covered by a Chattel Mortgage in favor of Radiowealth Finance Corporation and thereafter allowing said finance corporation to foreclose subject patrol car and to sell it subsequently to another person, to the damage and prejudice of the Government, represented by said barangay. CONTRARY TO LAW.” Finding probable cause against the appellant, the court a quo issued a warrant for his arrest on 17 July 2013. On 23 August 2013, he posted a personal bail bond for his provisional liberty. \\ aCriminal Cases Nos. SB-17-A/R-0001 t0 0002 People vs. Fontaina DECISION Page 3 of 24 evecare nenk Upon arraignment on 07 October 2013, appellant Fontaina pleaded not guilty to the offenses charged. At the Pre-Trial held on 08 November 2013, the parties stipulated on the jurisdiction of the court and on the identity of the appellant as the accused charged in the Informations. Thereafter, trial on the merits ensued. The prosecution presented as witnesses Yvex Cabansag (“Cabansag”), Johnny P. Fernandez (“Fernandez”), and Lucieta S. Estrella (“Estrella”). On the other hand, the defense presented as witnesses appellant Fontaina himself and Rebecca R. de Ocampo (“de Ocampo”), The prosecution filed its Formal Offer of Documentary Evidence on 11 August 2014, while the appellant filed his Formal Offer of Evidence on 25 January 2016. Both parties having rested their case, the court @ quo rendered the assailed Decision dated 12 August 2016, the dispositive portion thereof reads, thus: “WHEREFORE, premises considered, judgment is hereby rendered finding the accused ALEX D. FONTAINA guilty beyond reasonable doubt of crimes of Violation of Section 3(e) of RA3019 or the Anti-Graft and Corrupt Practices Act and Violation of Article 214 in relation to Article 315 paragraph 1(c) of the Revised Penal Code. Applying the provisions of the Indeterminate Sentence Law, there being no mitigating or aggravating circumstance, the Court hereby sentences him as follows: 1) In Criminal Case No. 13-298164 (sic), accused ALEX FONTAINA shall suffer an indeterminate penalty of seven (7) years as minimum, to fifteen (15) years, as maximum, with perpetual disqualification to hold public office. 2) In Criminal Case No. 13-298165 (sic), accused ALEX FONTAINA shall suffer an indeterminate penalty of four (4) years and two (2) months of prision correctional, as minimum, to seventeen (17) years of reclusion temporal, as maximum. In addition, the accused shall suffer the penalty of perpetual special disqualification, pursuant to Article 214 of the Revised Penal Code. Costs against the accused, SO ORDERED.” The promulgation of judgment was dispensed with after the appellant twice failed to appear thereat due to a stroke he suffered sometime in June see Ae if(Criminal Cases Nos. SB-17-A/R-0001 to 0002 People vs. Fontaina DECISION Page 4 of 24 — eeceeneeneeneenX On 02 September 2016, appellant Fontaina filed with the court a quo his Notice of Appeal. In an Order dated 06 September 2016, the court a quo gave due course to the same and ordered to elevate the entire records of these cases to the Court of Appeals. On 31 January 2017, the Court of Appeals granted the Motion to Endorse Case to the Sandiganbayan dated 23 November 2016. Hence, the complete records of these cases were forwarded to and received by the Sandiganbayan on 06 April 2016. After the appellant's several Motions for Extension‘ of time to file his Appellant’s Brief,’ the same was finally admitted by the Court on 04 September 2017. Upon the appellee’s manifestation that it did receive a copy of the Appellant's Brief, which was inadvertently filed with the pleadings in its other cases, the Court admitted the Appeliee’s Brief on 16 November 2017. ASSIGNMENT OF ERRORS, ‘The appellant makes the following assignment of errors: 1. “The lower court committed a reversible error when it ruled that accused-appellant is guilty of violation of Article 214 (other Frauds) in relation to Article 315 (Estafa), paragraph 1 (c) of the Revised Penal Code of the Philippines; and 2. The lower court committed a reversible error when it ruled that accused-appellant is guilty for violation of Republic Act 3019, section 3 (e) or the Anti-Graft and Corrupt Practices Act.” He asserts that not all the elements for the crime of Estafa are present, He claims that he did not defraud the private complainants because the latter were fully aware that the instrument they signed will be utilized to secure a loan. The appellant further states that “it is downright incredible for the private-complainants, who are evidently intelligent, and experienced elective public officials, to affix their signatures thoughtlessly on a blank document, whose material particulars are lacking, At the very least, their experience as public officials and members of the bids and awards committee must impel them to examine the contents of the document and obtain full knowledge of its import before affixing their signature thereto, especially in this case where huge sum of money is involved.” 4 Supra note 1, pp. 97-98; 110-112. 3 Bid, pp. 116-135, * Mid, pp. 160-181.Criminal Cases Nos. SB-17-A/R-0001 to 0002 People vs. Fontaina DECISION Page 5 of 24 — pneneeeX Appellant Fontaina claims that the second element for violation of Article 214 of the Revised Penal Code — that the accused takes advantage of his/her official capacity — is absent because he incurred the loan in his personal and private capacity. Moreover, the appellant reiterates that he made full payment of the amount loaned out of his personal funds. Hence, the act complained of did not result to any damage or prejudice to the private complainants. The appellant likewise asserts that not all the elements for violation of Section 3(e) of R.A. No. 3019, as amended, are present and states that: a) He is not the custodian of the funds used to purchase the subject barangay patrol car and no part thereof was released to him; b) Compliance with the bidding procedure for the procurement of the subject barangay patrol car negates the element of manifest partiality, evident bad faith or gross inexcusable negligence on his part; c) The Barangay Council is fully aware that the purchased vehicle is under a Chattel Mortgage Contract as found by the trial court that he was pressured by the former and his constituents to enter into the same; d) The inaction of the Barangay Council is the proximate cause of the loss of the subject vehicle. Despite having brought to their attention the insufficiency of funds therefor, the Barangay Council refused to exercise its authority to defer the purchase and, instead, forced him to proceed with the purchase of the barangay patrol car; e) His exercise of good faith in paying the initial monthly installment payments for the subject vehicle, until such time that he can no longer bear the same, negates the allegation of deliberate intent to cause undue injury to the government; and £) The prosecution failed to provide competent proof of the true purchase price of the barangay patrol car. APPELLEE’S ARGUMENTS On the other hand, the appellee raises the following arguments against the appeal: a eeCriminal Cases Nos. SB-17-A/R-0001 to 0002 People vs. Fontaina DECISION Page 6 of 24 ec ey, “(A) The court a quo correctly found accused-appellant Fontaina guilty of committing Other Frauds in relation to Estafa by his acts of making the Barangay Council members sign a blank document and subsequently using the same to obtain a personal loan — under the guise of a legitimate government project — further maliciously using the Barangay Council members’ honoraria as collateral therefor without the latter’s knowledge and consent. @) The court a quo correctly found accused-appellant Fontaina guilty of violating Section 3 () of RA 3019. @) Accused-appellant, with evident bad faith, entered into a Chattel Mortgage Agreement with Radiowealth, without the knowledge and consent of the Barangay Council members, using the barangay patrol car purchased with public funds as collateral. (e) Accused-appellant, with gross inexcusable negligence, failed to ascertain the full purchase price for the barangay patrol vehicle and other expenses incidental to such purchase, resulting in the appropriation of insufficient funds therefor. (©) Accused-appellant’s acts resulted in the foreclosure of the chattel mortgage on, and the repossession by Radiowealth of, the barangay patrol car —depriving the barangay of its use and services thereby causing undue damage and injury to the barangay constituency.” The appellee contends that appellant Fontaina’s imputation of error against the court a quo is hollow and baseless. It asserts that putting the blame on the Barangay Council members’ imprudence in affixing their signatures on a blank piece of paper is misplaced and self-serving, and does not absolve him of his acts of defrauding them, According to the appellee, the following acts of the appellant, which constitute a violation of Article 214 in relation to Article 315 paragraph 1(c) of the Revised Penal Code, belie his claims: ewCriminal Cases Nos. SB-17-A/R-0001 10 0002 People vs. Fontaina DECISION 1. “Eirst, he took advantage of his official position as Barangay Chairman of Barangay 564 to secure the signatures of the Barangay Council members — during a council meeting - on the pretext that the same will be used to facilitate the accomplishment of barangay projects; v . Second, he also took advantage of the signatures of the Barangay Council members by writing a veritable promissory note above the latter’s signatures in blank without their knowledge and consent; and 3. Third, his acts caused the Barangay Council members prejudice, moreso when he wrote as collateral the signatories” honoraria.” The appellee emphasizes that the gravamen of the offense defined and penalized under Article 214 in relation to Article 315 paragraph 1(c) of the Revised Penal Code is the offender’s abuse of confidence of the offended party by taking undue advantage of the latter’s signature in blank and writing a document above such signature without the latter’s knowledge and consent. As regards appellant Fontaina’s assignment of errors on his conviction for violation of Section 3(e) of R.A. No. 3019, as amended, the appellee insists that the same does not find support in law and jurisprudence. It points out that the elements of the said offense do not include that the offender be a custodian of funds or property subject thereof. The appellee highlights the following circumstances and acts of the appellant which unmistakably point to his criminal liability: 1. “First, there is no question that he was a public officer, having been the Barangay Chairman of Barangay 564 at the time material to the criminal cases; 2. Second, it is also undisputed that the acts constitutive of the criminal indictment were committed by accused-appellant in his official capacity as Barangay Chairman of Barangay 564; 3. Third, Fontaina’s act of purchasing the barangay patrol vehicle through a financing scheme, using the said vehicle as collateral under a Chattel Mortgage Agreement with Radiowealth Finance Corporation (sic) — without the knowledge and consent of the Barangay Council members — constitutes evident bad faith;Criminal Cases Nos. SB-17-A/R-0001 to 0002 People vs. Fomtaina DECISION Page 8 of 24 es x 4, Fourth, Fontaina’s admitted lack of adequate information as to the other expenses (i.e., Value Added Tax on the purchase, insurance and other registration requirements, efc.) incidental to the procurement of the barangay patrol vehicle resulting in the inadequacy of the appropriations therefor also constitutes gross inexcusable negligence. x xx 5. Fifth, his acts consequently resulted in the repossession of the barangay patrol vehicle by Radiowealth on account of the barangay’s failure to settle its outstanding obligation thereon, thus depriving the barangay of the vehicle’s use and services — and the loss of public funds utilized for its purchase — thus causing the government undue injury.” Moreover, the appellee argues that the appellant’s reliance on the regular conduct of public bidding relative to the purchase of the subject vehicle, as well as his claims of innocence and good faith, fail against the categorical testimonies of the prosecution witnesses and its documentary evidence on record. According to the appellee, the conduct of public bidding is immaterial to this particular offense charged because it was never the subject of the Information filed against him, since it was his acts subsequent to such public bidding that are put in issue in his criminal indictment. Likewise, it posits that the alleged inaction of the Barangay Council members ‘on the proposal to enact a supplemental budget to augment the insufficient funds is not a justification for his unilateral act of entering into a financing agreement with a private entity. THE FACTS OF THE CASE Culled from the records of the cases at bar are the following undisputed facts: i Violation of Article 214 in relation to Article 315, paragraph 1(c) of the Revised Penal Code During one of their Council Meetings sometime in 2008, appellant Fontaina requested the members of the Barangay Council — private complainants herein — of Barangay 564, Zone 55, District IV, Sampaloc, Manila (“Barangay 564”) to sign a blank sheet of paper. He explained to them that the same will be used to authorize the expeditious release of funds for the projects of the barangay in instances when they are not available to affix their signatures on a certain document. aaCriminal Cases Nos. SB-17-A/R-0001 to 0002 People vs. Fontaina DECISION Page ofA a od However, unknown to the members of the Barangay Council, their signatures in blank were subsequently used by the appellant in securing a loan in the total amount of Php120,000.00 from a certain Oscar Demetrio (“Demetri”) by writing above said signatures a promissory note (Exhibit “K”) dated 03 July 2009, which reads in part: “Tuly 3, 2009 Mr. Demetrio, Oscar, On behalf of Barangay Officials of Brgy 564, Zone 55, Dist. IV, ‘Manila, we are requesting for a loan amounting 120,000. And promise to Pay upon release of our 3" Quarter Honoraria on or before Sept. 30" of 2009. ‘Thanks and more power!” The Barangay Council members discovered such act of appellant Fontaina only when one of them, namely private complainant Fernandez, had a chance encounter with the Liaison Officer of Atty. Jun Icaonapo (“Atty. Icaonapo”), lawyer of Demetrio, who was tasked to deliver the demand letter dated 27 May 2010 (Exhibit “K-1”), which reads in part: “May 27, 2010 ALEX D. FONTAINA Chairman Brgy. 564, Zone 55, District 4 1082 Samar St., Sampaloc, Manila Dear Chairman Fontaina, We write on behalf of our client, MR. OSCAR DEMETRIO to demand the immediate payment of your long overdue obligation with him. According to our said client, you approached and borrowed from him cash amount and as a guaranty payment you issued a barangay check with the corresponding promissory note, your barangay ID. and LD.s of your barangay officials. The promissory note you and your barangay officials executed dated July 3, 2009 id P120.004 ith 20% interest promising to pay_on or before September 30, 2009, copy of promissory note is hereto attached for your reference and guidance, Our client further intimated that despite repeated ‘ou failed and continuously fails (sic) to pay the including your baran; icials mentioned in our said letter to the damage and prejudice of our client. are giving you and your barangay officials the Jast opportunit to settle your obligation within five (5) days from receipt hereof, otherwise, much to our regret, we shall be constrained to file any and all appropriate legal action... x x x” (emphasis supplied) M eeCriminal Cases Nos. SB-17-A/R-0001 to 0002 People vs. Fontaina DECISION Page 10 of 24 Xeneeeneranernene x Thereafter, the private complainants immediately went to the office of Atty. Icaonapo to inform him that they did not know anything about the promissory note. They subsequently confronted appellant Fontaina about the loan which prompted the latter to execute two (2) separate letters both dated 20 August 2010 (Exhibits “M” and “M-2”). In said letters, the appellant admitted to having contracted the loan from Demetrio for his personal needs and relieved the private complainants from any obligation arising therefrom. He also admitted therein that he used the Barangay Council members’ signatures and I.D.s to obtain the loan without their knowledge, and that the blank sheet of paper they signed was supposed to be used for the barangay projects in cases when they are not around. Violation of Section 3(e) of R.A. No. 3019, as amended In the deliberation for Barangay 564’s 2010 budget, the proposal to obtain and the appropriation for a barangay patrol vehicle was duly approved. Hence, on 15 March 2010, the Barangay Council and the Sangguniang Kabataan (SK) jointly issued “A BARANGAY AND SK COUNCIL RESOLUTION APPROVING THE JOINT PROJECT OF BDF & SK 2010 FOR BARANGAY PATROL, AMOUNTING TO TWO HUNDRED TWENTY ONE THOUSAND TWO HUNDRED SEVENTY SEVEN PESOS ONLY” (Exhibit “L”). Thereafter, Barangay 564 conducted the bidding process for the procurement of the subject vehicle. Based on the minutes of the opening of bids/canvass (Exhibit “2”), three (3) contractors submitted their bid proposals namely, ROJGEM Trading (“ROGJEM”), DANRENZ Enterprises, and JEREVIER Enterprises. Having submitted the lowest proposal in the amount of Php221,277.00, ROGJEM was declared the winning bidder. The Request for Obligation Allotment (Exhibit “3”) and Disbursement Vouchers (Exhibits “4,” “5,” and “6”) were subsequently prepared. However, from the appropriated amount of Php221,277.00, only Php209,422.87 was released to and received by ROGJEM because the five percent (5%) Value Added Tax worth Php9,878.44 and the one percent (1%) Expanded Value Added Tax worth Php1,975.69 were deducted by the barangay. Upon receiving the abovementioned amount, ROGJEM informed appellant Fontaina that the same was insufficient to purchase the barangay patrol vehicle. According to the appellant, there was a remaining balance of Php70,000.00 that has yet to be paid. He brought the matter to the attention of the Barangay Council members and asked for a supplemental budget which the latter did not agree to. uf mMCriminal Cases Nos. SB-17-A/R-0001 to 0002 People vs. Fontaina DECISION Page 11 of 24 eee Allegedly pressed for time and pressured by the Barangay Council members and their constituents, appellant Fontaina heeded the advice of ROGJEM to pay the remaining balance of the purchase price of the barangay patrol vehicle through a financing scheme. Hence, without authority from the Barangay Council, the appellant entered into a Chattel Mortgage Agreement (Exhibit “S”) with Radiowealth Financing Company (“Radiowealth”) on 31 August 2010, which provides that the mortgagor — appellant Fontaina — conveys and mortgages to the mortgagee ~ Radiowealth — the barangay patrol vehicle as security for the loan of Php186,912.00. The Chattel Mortgage Agreement authorizes the mortgagee to immediately foreclose the mortgage upon default by the mortgagor in the payment of the loan. On 22 September 2010, appellant Fontaina executed a Deed of Absolute Sale of Motor Vehicle (Exhibit “U”) with Megaton Motor Corporation (“Megaton”) for the purchase of the barangay patrol car. The subject vehicle was subsequently delivered to Barangay 564 sometime in the same month. Only upon inquiring as to the whereabouts thereof, after noticing that the barangay patrol vehicle was nowhere to be found, did the Barangay Council members find out that the same was taken by Radiowealth pursuant to the Chattel Mortgage Agreement for failure of appellant Fontaina to pay the remaining installments. It was also only then that they found out that the subject vehicle was registered under the name of the appellant and not in the name of Barangay 564. As a result of the foreclosure of the mortgage, Radiowealth sold the subject vehicle to one Allan M. Orense (“Orense”) as evidenced by a Deed of Absolute Sale dated 22 July 2011 (Exhibit “R”). The Release of Chattel Mortgage Contract (Exhibit “Q”) was executed on even date. RULING The appeal is without merit. After carefull consideration of the parties’ respective briefs, as well as the records of these cases, the Court finds that the same are replete with evidence, both testimonial and documentary, that fully establish appellant Fontaina’s guilt beyond reasonable doubt for the offenses charged.Criminal Cases Nos. SB-17-A/R-0001 to 0002 People vs. Fontaina DECISION Page 12 of 24 x x There is evidence to’ sustain the conviction of appellant Fontaina for violation of Article 214 in relation to Article 315, paragraph 1(c) of the Revised Penal Code The court a quo convicted appellant Fontaina of the crime of violation of Article 214 in relation to Article 315 paragraph 1(c) of the Revised Penal Code holding, thus: “As for the other charge in Criminal Case No. 13-298163, evidence presented by the prosecution shows that accused committed the charge for ‘Violation of Art. 214 (Other Frauds) in relation to Art. 315 (Estafa) par. 1(c) of the Revised Penal Code beyond reasonable doubt. x x x xxx The Court strongly believes that accused Alex Fontaina took advantage of his official position and committed fraud when as Barangay Chairman, he used a blank piece of paper containing the signatures of his kagawads to secure a P120,000.00 personal loan from Oscar Demetrio, making the 3° Quarter Honoraria of his kagawads as collateral (Exhibit “F”) for the said loan. Accused likewise issued a check with a promissory note to secure the loan, Complainants claimed that they only signed the document with the understanding that it would facilitate the accomplishment of barangay projects in case their signatures are needed and they are not available for signature. xxx , ‘The explanation given by the accused failed to convince the Court. He justified his actions by claiming that he and his kagawads usually obtain loans and at some point, some of the kagawads discontinued from their loans which made the loans pending. Still, failure on the part of the kagawads to continue with their loans did not authorize him to make use of their signatures in obtaining a personal loan under the guise of a legitimate barangay project. Neither did payment of the whole amount of loan by himself exonerate him for any criminal liability.” Article 214 of the Revised Penal Code reads, thus: “Art, 214, Other frauds. — In addition to the penalties prescribed in the provisions of Chapter Six, Title Ten, Book Two of this Code, the penalty of temporary special disqualification in its maximum period to perpetual special disqualification shall be imposed upon any public officer who, taking advantage of his official position, shall commit any of the frauds or deceit enumerated in said provisions.” ae(Criminal Cases Nos. SB-17-A/R-0001 to 0002 People vs. Fontaina DECISION Page 13 of 24 Culled from the above-quoted provision, the elements of a violation thereof are: 1. That the offender is a public officer; 2. That he takes advantage of his official position; and 3. That he commits any of the frauds or deceits enumerated in Articles 315 to 318 of the Revised Penal Code.” According to Article 315 paragraph 1(c) of the Revised Penal Code, the crime of Estafa may be committed by the following means, among others: “1. With unfaithfulness or abuse of confidence, namely: xxx (c) By taking undue advantage of the signature of the offended party in blank, and by writing any document above such signature in blank, to the prejudice of the offended party or any third person.” Hence, the elements of Estafa by taking undue advantage of the signature in blank are the following: 1. That the paper with the signature of the offended party be in blank; 2. That the offended party should have delivered it to the offender; 3. That above the signature of the offended party, a document is written by the offender without authority to do so; and 4, That the document so written creates a liability, or causes damage to, the offended party or any third person.’ All the elements for violation of Article 214 in relation to Article 315, paragraph 1(c) of the Revised Penal Code are present herein. First, it is undisputed that appellant Fontaina was a public officer at the time of the commission of the offense charged, being then the Barangay Chairman of Barangay 564. This fact was stipulated upon by the parties at the Pre-Trial held on 08 November 2013. 7 Luis B. Reyes, The Revised Penal Code Criminal Lav, Seventeenth Edition (2008), p. 419. * Ibid, p. 809.Criminal Cases Nos. SB-17-A/R-0001 to 0002 People vs. Fontaina DECISION Page 14 of 4 eek Second, it was established that the appellant committed fraud by taking advantage of his official position. To recall, he asked his Barangay Council members, including private complainants herein, to affix their signatures on a blank piece of paper and stated as reason therefor that the same will be used to facilitate the expeditious release of funds for their barangay projects in instances that the Barangay Chairman cannot get a hold of them because all or some of them are still at work. This incident was categorically narrated in the testimony of prosecution witness Cabansag,’ and was corroborated by the testimony of prosecution witness Fernandez.'? Undoubtedly, it was on account of his being the Barangay Chairman at the time that the Barangay Council members reposed confidence in him by affixing their signatures on a blank piece of paper when asked to do so. They confided with the utmost good faith in the statement of their Barangay Chairman that it will be used for the benefit of their constituents. Third, upon delivery by the Barangay Council members of their signatures in blank, appellant Fontaina took undue advantage of the same by writing above said signatures a promissory note without the authority of the signatories. He used the same to obtain a loan in the amount of Php120,000.00 from Demetrio. In trying to exonerate himself from criminal liability, the appellant claimed that it was already a usual practice in their barangay to use the signatures in blank of the Barangay Council members in contracting loans from rural banks. However, this statement of the appellant remains uncorroborated. In fact, prosecution witnesses Cabansag and Fernandez testified during their respective cross-examinations that they do no remember any other instance when they were made to sign another blank document to secure a loan, to wit: ‘CROSS-EXAMINATION OF CABANSAG!! “ATTY. DE ANDRES, JR.: Q Prior to this signing of this blank paper, previously Mr. Witness, ‘were there any instance wherein you were also induced or made to sign a blank piece of paper and later on it was used for a loan not only by Alex Fontaina but by your fellow councilmen, previously previous to this? ‘WITNESS: A None, sit.” ° ‘Transeript of Sienographic Notes (TSN) dated 24 January 2014, p. 18-20. "TSN dated 06 June 2014, p. 9. "TSN dated 30 April 2014, p. 14. "1 LeCriminal Cases Nos. SB-17-A/R-0001 t0 0002 People vs. Fontaina DECISION Page 15 of 24 ane eee eee ee CROSS-EXAMINATION OF FERNANDEZ? “Q Mr. Witness, can you recall any instant (sic) as your stiff (sic) as a Barangay Kagawad that you contractive (sic) alone (sic) together with other Barangay Officials? A There was not, sir.” In stating that it was already a usual practice to use the Barangay Council members’ signatures in blank when contracting a loan from rural banks, appellant Fontaina sought to convince the Court that the Barangay Council members knew that their signatures in blank will be used for the same purpose. However, it has already been clearly established that the private complainants were made to affix their signatures on a blank piece of paper for the purpose of expediting the release of funds for certain barangay projects in times when they are not available to sign the document. Assuming arguendo that it was indeed usual practice for the Barangay Council members to affix their signatures in blank, the purpose for obtaining the loan is to fund the projects of the barangay, and not to apply the same for their personal use. In fact, the evidence (Exhibit “F”) on record reveals that he obtained the same on behalf of the Barangay Officials of Barangay 564 and even offered as collateral therefor their 3“ Quarter Honoraria, thereby giving the impression that it was contracted for the benefit of the barangay. However, appellant Fontaina himself admitted (Exhibits “H” and “M”) that he contracted the loan in his personal capacity.'? Hence, he appropriated the money to his personal use. Writing a document above the signatures in blank for a purpose which is not according to the instruction or intendment of the signatory is Estafa.'* Lastly, the document written by the appellant above the signatures of the Barangay Council members (Exhibit “F”) created a liability on their part to the damage or prejudice of the latter because Demetrio could make them pay the amount loaned. To reiterate, the appellant wrote in the promissory ~ note that the same was contracted on behalf of the Barangay Officials, including private complainants herein, wherein they promised to pay Demetrio the amount of Php120,000.00 upon the release of their 3" Quarter Honoraria. © TSN dated 06 June 2014, p. 21 © TSN dated 15 April 2015, pp.17-19. Florenz D. Regalado, Criminal Law Conspectus, Fourth Edition, p. 717.(Criminal Cases Nos. SB-17-A/R-0001 t0 0002 People vs. Fontaina DECISION Page 16 of 24 ene Appellant Fontaina tries to exculpate himself by insisting that no damage was suffered by the private complainants since he absolved them from any liability arising from the loan document and that he paid for the Php120,000.00 himself. However, it is already a well-settled rule in this jurisdiction that payment made subsequent to the commission of the crime of Estafa does not alter the nature of the offense committed, nor does it relieve the defendant from the penalty prescribed by law.' There is evidence to sustain the conviction of appellant Fontaina for violation of Section 3(e) of R.A. No. 3019, as amended In finding appellant Fontaina guilty of violating Section 3(e) of R.A. No. 3019, as amended, the court a quo held that all the elements of the said offense are present as follows: “There is no question that the accused is a public officer, being the former Punong Barangay of Barangay 564, Zone 55, District IV of Manila at the time of the commission of the crimes charged. It is also beyond dispute that the acts being complained of were committed in his official capacity as the Punong Barangay of Barangay 564. ‘The core issue now boils down as to whether or not accused’s act of purchasing a barangay patrol car through a financing scheme despite the allocation and release of the full amount of P221,277.00 budget constituted bad faith, manifest partiality or gross inexcusable negligence on his part and whether or not his actions caused undue injury to the government. xxx It is without doubt that the bidding procedure was duly complied with. As testified to by witness Rebecca de Ocampo, the documents submitted by the officials of Barangay 564 were complete and so, the City Accounting Office proceeded with the release of the budget for the purchase of barangay patrol car of Barangay 564, District 4, Manila. Being the winning bidder, ROJGEM Trading was awarded of the said project in the amount of P221,277.00. The check voucher and checks were issued in the name of ROJGEM Trading. It tured out, however, that the appropriated amount was not sufficient to cover the purchase price of the patrol car. Pressured by the Barangay Council and his constituents, the accused, upon the advise of ROJGEM Trading, entered into a Chattel Mortgage Contract with Radiowealth Finance Corporation to finance the full payment of the purchase price. 'S Alejandro Javier vs. The People of the Philippines, G.R. No, L-47083, 18 November 1940. oeCriminal Cases Nos. SB-17-A/R-0001 10 0002 People vs. Fontaina DECISION Page 17 of 4 ee x The subject vehicle was thus, purchased from Megaton Motors Corporation, through financing with Radiowealth Finance Corporation. The vehicle’s Certificate of Registration dated October 14, 2010 showed that the registered owner of the Suzuki multi-cab is accused Alex Fontaina, encumbered with Radiowealth Finance Corporation (Exhibit “B”), Accused categorically admitted that his Kagawads were not aware of his plans of purchasing the barangay vehicle through financing. x x x xxx From the foregoing, it is thus apparent that the actions of accused Alex Fontaina constitute evident bad faith when he purchased the barangay vehicle through financing, contrary to the Government Procurement Reform Act (RA9184). There was also bad faith on his part when he failed to inform the barangay officials that the barangay patrol car was mortgaged (Chattel Mortgage dated August 31, 2010, Exhibit “S”) in favor of Radiowealth Finance Company for the sum of P186,912.00, as security for the unpaid balance of the purchased vehicle. It was also gross inexcusable neglect on his part in not acquainting himself with the basic knowledge accompanying the purchase of a barangay patrol car, as to the total purchase price, as well as other expenses to be paid to the contractor and/or taxes to the government, The appropriation of budget for barangay projects should be meticulously and carefully planned since it will be paid from the taxes paid by constituents from their hard earned (sic) earnings. ‘The accused failed to exercise due care when he did not inquire as to the definite purchase price of the barangay patrol and the other expenses appurtenant thereto. Considering that it passed the bidding process and the project was awarded to ROJGEM Trading in the amount of its bid price, it is the obligation of the winning bidder to deliver the patrol car having been paid of the purchase price already. However, instead of insisting on the - winning bidder to deliver the patrol car, he opted to accommodate the advice of the winning bidder to enter into a financing scheme, knowing fully well that the government/ City of Manila has appropriated a budget for the full purchase price of the patrol ear. Accused, for his part, explained that he received continuous pressure from his constituents and kagawads to produce the vehicle even without the additional funding. He also said that he can not (sic) back out from the project because he needs approval of the council members. This is unacceptable. He, being the Barangay Chairman, should have brought the matter to the Barangay Council, forthe latter to deliberate ‘on what proper action to do, or defer the purchase of the patrol car until such time that sufficient fund is allocated. xxx Obviously, his actions caused injury/damage to the government in the amount of P221,277.00 representing the allocated budget for the purchase of the patrol car, and specifically to the constituents of Barangay 564, when the vehicle was repossessed by Radiowealth Finance Compnay, for failure to pay the undue balance of the purchase price, which vehicle te aCriminal Cases Nos. SB-17-A/R-0001 to 0002 People vs. Fontaina DECISION Page 18 of 24 Xe ey, ‘was subsequently sold to Allan Orense (Exhibit “R”). The barangay was able to utilize said vehicle for only two to four months because it was foreclosed, to its damage and prejudice. Because of this, the barangay was deprived of the use of the barangay patrol car, which is intended for the use of the entire barangay.” Sec. 3(e) of R.A. No. 3019, as amended, reads in part, thus: “Section 3. Corrupt practices of public officers. In addition to acts or omissions of public officers already penalized by existing law, the following shall constitute corrupt practices of any public officer and are hereby declared to be unlawful. xxx (©) Causing any undue injury to any party, including the Government, or giving any private party any unwarranted benefits, advantage or preference in the discharge of his official, administrative or judicial functions through ‘manifest partiality, evident bad faith or gross inexcusable negligence. This provision shall apply to officers and employees of offices or government corporations charged with the grant of licenses or permits or other concessions.” Culled from the above-quoted provision are the following essential elements of the offense: 1. The accused must be a public officer discharging administrative, judicial or official functions; 2. He must have acted with manifest partiality, evident bad faith or inexcusable negligence; and 3. His action caused any undue injury to any party, including the government, or he gave any private party unwarranted benefits, advantage or preference in the discharge of his functions.'° The Court likewise finds that all the elements mentioned above are present herein. First, the fact that appellant Fontaina was a public officer at the time pertinent to these cases has already been established from the foregoing discussion. Verily, his acts subject of the complaint were performed in his official capacity as Barangay Chairman of Barangay 564. Second, the court a quo correctly found that the appellant acted with evident bad faith and gross inexcusable negligence in purchasing the subject "8 Consigna vs, People, eta, G.R. No. 175750-51, 02 April 2014. -——(Criminal Cases Nos. SB-17-A/R-0001 t0 0002 People vs. Fontaina DECISION Page 19 of 24 x x vehicle through a financing scheme and using the same as collateral therefor. Jurisprudence defines the three modes of committing a violation of Section 3(e) of R.A. No. 3019, as amended, thus:!7 “Partiality is synonymous with bias which excites a disposition to see and report matters as they are wished for rather than as they are. Bad faith does not simply connote bad judgment or negligence; it imputes a dishonest purpose or some moral obliquity and conscious doing of a wrong; a breach of swom duty through some motive or intent or ill will; it partakes of the nature of fraud. Gross negligence has been so defined as negligence characterized by the want of even slight care, acting or omitting to act in a situation where there is a duty to act, not inadvertently but wilfully and intentionally with a conscious indifference to consequences in so far as other persons may be affected. It is the omission of that care which even inattentive and thoughtless men never fail to take on their own property. x xx” (citation omitted) Here, the appellant's acts and admissions relative to the procurement of the subject barangay patrol vehicle strongly support the conclusion that he was remiss in the exercise of even the slightest care in the discharge of his duty as the head of the procuring entity of Barangay 564 and was consciously indifferent to the consequences of his actions. Under Republic Act No. 7160 (“R.A. No. 7160”), otherwise known as The Local Government Code of 1991, among the powers, duties, and functions of the Barangay Chairman are to (a) enforce all laws and ordinances which are applicable within the barangay;'* (b) prepare the annual executive and supplemental budgets of the barangay in coordination with the barangay development council;'? (c) negotiate, enter into, and sign contracts for and in behalf of the barangay, upon authorization of the Sangguniang Barangay; and (d) approve vouchers relating to the disbursement of barangay funds.”" It bears stressing that the preparation of a barangay’s annual executive and supplemental budget is a very important undertaking that should be judiciously and meticulously handled because it involves the utilization of hard-earned taxpayers’ money for the delivery of basic services to its constituents. By express mandate of R.A. No. 7160, the responsibility for the execution of the annual and supplemental budgets of the barangay, and the accountability therefor is vested primarily in the Barangay Chairman.” 1 Sison v. People of the Philippines, G.R. No. 170339, 170398-403, 09 March 2010. Section 389(b)(1), Chapter II, Title I, Book III of R.A. No. 7160, ® pbid., Section 389(b)(7) 2 rbid, Section 389(b}(2). 2" phi, Section 389(bX8) ® Section 332, Article Il, Chapter II, Title V, Book Il of R.A. No. 7160, i aeCriminal Cases Nos. SB-17-A/R-0001 10 0002 People vs. Fontaina DECISION Page 20 of 4 x x ‘When asked who authorized him to enter into a Chattel Mortgage Agreement with Radiowealth for the purchase of the subject vehicle, appellant Fontaina answered that it was the contractor, ROJGEM Trading — the winning bidder in the bidding conducted for the procurement of the barangay patrol vehicle. In his testimony, the appellant admitted that he decided to enter into the financing agreement with Radiowealth on his own because he was pressured by his Barangay Council members and constituents to proceed with the purchase of the barangay patrol vehicle.» However, the records of these cases are bereft of any evidence which proves appellant’s claim of being pressured. Nevertheless, assuming for the sake of argument, that he was indeed pressured, the same does not strip him off his duty as Barangay Chairman to know that it is only the Sangguniang Barangay who may authorize him to negotiate, enter into, and sign a contract. No such authority was given to him. It was gross inexcusable negligence for the appellant to heed the advice of the contractor to proceed with the financing agreement despite knowing that the Barangay Council will not authorize a supplemental budget to address the insufficiency of the funds for the purchase of the barangay patrol vehicle. Assuming arguendo that the Barangay Council was aware of the Chattel Mortgage Agreement as claimed by the appellant, such awareness is not tantamount to the authority prescribed by law for entering into contracts. Appellant Fontaina cannot absolve himself from liability by blaming the alleged inaction of the Barangay Council in enacting the supplemental budget. Just like the preparation of the barangay’s annual budget, the introduction of changes therein has to undergo a certain process. Section 321, Article I, Chapter Ill, Title V of R.A. No. 7160 is instructive, thus: “SECTION 321. Changes in the Annual Budget. ~ All budgetary proposals shall be included and considered in the budget preparation process. After the local chief executive concerned shall have submitted the executive budget to the sanggunian, no ordinance providing for a supplemental budget shall be enacted, except when supported by funds actually available as certified by the local treasurer or by new revenue sources, A supplemental budget may also be enacted in times of public calamity by way of budgetary realignment to set aside appropriations for the purchase of supplies and materials or the payment of services which are exceptionally urgent or absolutely indispensable to prevent imminent danger to, or loss of, life or property in the jurisdiction of the local ‘government unit or in other areas declared in a state of calamity by the President. Such ordinance shall clearly indicate the sources of funds available for appropriations, as certified under oath by the local treasurer and local accountant and attested to by the local chief executive, and the various items of appropriations affected and the reasons for the change.” 2 TSN dated 28 November 2014, p. 18 and TSN dated 15 Aprit 2015, pp. 26-27. ae ee(Criminal Cases Nos. SB-17-A/R-0001 to 0002 People vs. Fontaina DECISION Page 2\ of 24 ae x Moreover, appellant Fontaina’s inconsistent and unsupported statements are contrary to his claim of good faith. Noteworthy is the glaring fact that the amount of Php209,422.87 which was released to ROGJEM was not properly accounted for. In his initial testimony, the appellant stated that there was a remaining unpaid balance of Php70,000.00 for the purchase price of the subject vehicle. This would mean that the total purchase price of the barangay patrol vehicle is Php279,422.87. However, the loan he contracted from Radiowealth was for Php186,912.00, which amount was paid to Megaton for the purchase of the subject vehicle. If this were so, then the total purchase price thereof would be Php396,334.87 — a questionably big amount for a multi-cab. The appellant admitted that he did not know the actual purchase price of the barangay patrol vehicle, He also stated that he was not aware of the other taxes and fees, such as the contractor’s fee, which had to be paid to ROGJEM for the purchase of the subject vehicle. The question that remains then is, what happened to the remaining disbursed amount of Php209,422.87? Appellant Fontaina’s claims remain unsubstantiated. He failed to present proof of payment to ROGJEM for the contractor's fee, as well as proof of payment to Megaton for the subject vehicle. No receipts formed part of the defense evidence, neither were there testimonies from ROGJEM and Megaton that their respective payments were received. Third, appellant Fontaina’s gross inexcusable negligence undeniably caused undue injury to the government in the sum of Php221,277.00 pertaining to the total amount disbursed by the barangay for the procurement of the subject vehicle. The barangay suffered said damage when the vehicle was foreclosed by Radiowealth pursuant to the Chattel Mortgage Agreement between the latter and the appellant, and when the same was subsequently sold by Radiowealth to Orense. Consequently, Barangay 564 was deprived of the use of its barangay patrol vehicle. As correctly pointed out by the appellee, being a custodian of the fund used to purchase the subject barangay patrol vehicle is not an element of violation of Section 3(¢) of R.A. No. 3019, as amended. As such, the appellant cannot escape liability by arguing that he never received the fund released by the barangay. In all, the prosecution witnesses were positive and categorical in their statements in both cases. The testimonies of both prosecution witnesses and private complainants Cabansag and Fernandez vis-d-vis the documentary evidence presented were consistent and corroborative of one another on material points, Between the categorical statements of the private complainants, on the one hand, and the bare denial of the appellant, on the other, the former must perforce prevail. An affirmative testimony is far stronger than a negative testimony especially when the former comes from the Tee hCriminal Cases Nos. SB-17-A/R-0001 to 0002 People vs. Fontaina DECISION Page 22 of 24 — a —x mouth of a credible witness. Denial, if unsubstantiated by clear and convincing evidence, is negative and self-serving evidence undeserving of weight in law. It is considered with suspicion and always received with caution, not only because it is inherently weak and unreliable, but also because it is easily fabricated and concocted." Section 2, Rule 133 of the Revised Rules of Evidence specifies the quantum of proof required in criminal cases, to wit: Section 2. Proof beyond reasonable doubt. — In a criminal case, the accused is entitled to an acquittal, unless his guilt is shown beyond reasonable doubt. Proof beyond reasonable doubt does not mean such a degree of proof, excluding possibility of error, produces absolute certainly. Moral certainly only is required, or that degree of proof which produces conviction in an unprejudiced mind. The above rule places upon the prosecution the duty to establish the guilt of the accused. The Court is convinced that the prosecution ably discharged its burden and proved each and every element of the offenses charged against appellant Fontaina. WHEREFORE, in light of the foregoing, the Decision dated 12 August 2016 of the Regional Trial Court, Branch 33, of the City of Manila, National Capital Judicial Region, convicting appellant ALEX D. FONTAINA of the crimes of violation of Article 214 in relation to Article 315 paragraph 1(c) of the Revised Penal Code, and of violation of Section 3(e) ‘of Republic Act No. 3019, as amended, otherwise known as the Anti-Graft and Corrupt Practices Act, is hereby AFFIRMED with modifications as to the penalty imposed. Applying the provisions of the Indeterminate Sentence Law and Republic Act No. 10951, there being no mitigating or aggravating circumstances attendant in these cases, the appellant is sentenced as follows: 1, In Criminal Case No. SB-17-A/R-0001, appellant Alex D. Fontaina shall suffer the indeterminate penalty of four (4) months and one (1) day of arresto mayor, as minimum, to one (1) year and eight (8) months of prision correccional, as maximum; and 2. In Criminal Case No. SB-17-A/R-0002, appellant Alex D. Fontaina shall suffer the indeterminate penalty of imprisonment of nine (9) years and twenty-one (21) days, as minimum, to twelve (12) years and ten (10) days, as maximum, ™ People of the Philippines v. Angelita I. Daud, et al, G.R. No. 197539, 02 June 2014 citing People v, Ocden, G.R. No, 173198, 01 June 2011 Ww ernCriminal Cases Nos. SB-17-A/R-0001 to 0002 People vs. Fontaina DECISION Pursuant to Article 214 of the Revised Penal Code, appellant Fontaina shall likewise suffer the penalty of Temporary Special Disqualification of from eleven (11) years and one (1) day up to twelve (12) years. SO ORDERED. MICHAEL » MUSNGI Associate Justide LORIFEL eee Askociaté Justice Associgth Justice —————_ Chairperson is WE CONCUR: ATTESTATION I attest that the conclusions in the above Decision were reached in consultation before the case was assigned to the writer of the opinion of the Court’s Division.Criminal Cases Nos. SB-17-A/R-0001 to 0002 People vs. Fontaina DECISION Page 24 of 24 eect CERTIFICATION Pursuant to Article VIII, Section 13 of the Constitution, and the Division Chairperson’s Attestation, it is hereby certified that the conclusions in the above decision were reached in consultation before the case was assigned to the writer of the opinion of the Court’s Division Presiding Justice