G.R. No. 119239 & 119285. May 9, 2000.
FRANCISCO ENRIQUEZ y CRUZ, petitioner, vs. PEOPLE OF THE PHILIPPINES, and SANDIGANBAYAN, respondents. / CARMENCITA G. ESPINOSA, petitioner, vs. The HONORABLE SANDIGANBAYAN, and PEOPLE OF THE PHILIPPINES, respondents.

FACTS

Petitioners Francisco Enriquez, the Municipal Treasurer of Pasig, and Carmencita Espinosa, the Administrative Officer and acting Municipal Cashier, were convicted of malversation of public funds by the Sandiganbayan. An audit for the period May to November 1987 revealed a shortage of over P3.1 million in Enriquez’s accounts, primarily attributed to a dishonored China Banking Corporation check for P3.26 million. This check, payable to the Municipal Treasurer and drawn by “D. Noble,” had been deposited with the Quezon City District Treasury as part of Pasig’s collections. It was dishonored for multiple reasons, including being drawn against insufficient funds and under a garnished account. The check bore Enriquez’s endorsement. A casual janitor testified that Enriquez instructed him to deliver bundled checks, which included the subject check, to the Quezon City Treasury.

ISSUE

Whether the prosecution proved beyond reasonable doubt that petitioners are guilty of malversation of public funds under Article 217(4) of the Revised Penal Code.

RULING

No. The Supreme Court reversed the Sandiganbayan’s decision and acquitted the petitioners. The legal logic centers on the insufficiency of evidence to establish criminal liability for malversation. For conviction under Article 217, the prosecution must prove that the accused received public funds and that they could not account for them upon demand, having appropriated or permitted their misappropriation. Here, the Court found the evidence did not establish that the petitioners personally misappropriated the missing amount. The presence of the dishonored check, while indicating a shortage, does not by itself constitute proof of conversion or misappropriation by the accountable officers. The check was a private instrument, not public cash, and its inclusion in the deposit bundle did not conclusively prove the petitioners engineered a scheme to cover a theft. The audit revealed procedural lapses and deficiencies in fund handling, but these administrative failings do not equate to the criminal intent required for malversation. Proof beyond reasonable doubt was not met, as the evidence did not rule out other possibilities, such as the check being accepted in good faith. The acquittal is based on the constitutional presumption of innocence and the prosecution’s failure to overturn it with conclusive proof of guilt.