G.R. No. 152666 . April 23, 2008.
MARCIANO TAN, petitioner, vs. PHILIPPINE COMMERCIAL INTERNATIONAL BANK, respondent.

FACTS

Petitioner Marciano Tan, as executive vice-president of Master Tours and Travel (MTT), applied for a usance letter of credit with respondent PCIB to import tourist buses. As part of the financing arrangement, MTT issued post-dated checks. One check was dishonored, and MTT also agreed to pay an exchange rate differential. To cover the resulting total obligation, MTT issued fourteen post-dated checks. The first five were honored, but the subsequent nine checks were dishonored, leading to the filing of nine counts for violation of B.P. Blg. 22 against Tan.
Meanwhile, MTT, facing financial difficulties, voluntarily surrendered the imported buses to PCIB in 1991 and 1992 pursuant to the trust receipt agreement. PCIB accepted the buses. Subsequently, PCIB’s counsel demanded payment from Tan for a substantial sum, claiming outstanding obligations. Tan’s counsel replied that the surrender of the buses extinguished MTT’s liability, rendering the dishonored checks without valuable consideration.

ISSUE

Whether petitioner Marciano Tan can be validly convicted for violation of Batas Pambansa Blg. 22 (the Bouncing Checks Law) under the circumstances of this case.

RULING

No. The Supreme Court reversed the Court of Appeals and acquitted Tan. The legal logic centers on the element of “valuable consideration” under B.P. Blg. 22. For a check to be considered issued for valuable consideration, there must be an existing debt or obligation at the time of its issuance. The Court found that the nine subject checks were issued to cover the exchange rate differential and the unpaid amount from the earlier dishonored check. However, the underlying obligation was secured by a trust receipt over the imported buses. When MTT surrendered and PCIB accepted the buses—the very trust property—the principal obligation was extinguished by the act of surrender, an alternative mode of payment stipulated in the trust receipt. Consequently, at the time the nine checks were presented for payment and dishonored, the debt they were meant to secure had already been satisfied. The checks therefore became devoid of valuable consideration. Applying penal laws mechanically is impermissible; they must be interpreted in light of their purpose and the factual context. Since the checks were not supported by any valuable consideration at the time of dishonor, an essential element of the offense under B.P. Blg. 22 is absent, warranting acquittal.