G.R. No. L-30165. February 23, 1971.
THE PEOPLE OF THE PHILIPPINES, plaintiff-appellant, vs. ROSENDO RESUELLO, ET AL., defendants, ROSENDO RESUELLO, defendant-appellee.

FACTS

An information was filed charging Rosendo Resuello and others with estafa. It alleged that in October 1962, Resuello, representing himself as president and general manager of Security Credit and Acceptance Corporation, together with other unidentified officers, received from Florentina G. Limpin the amount of P800.00 for deposit. The accused had the obligation to return the amount upon demand but, conspiring and with intent to defraud, they instead willfully misappropriated and converted the money to their own personal use and benefit, to the damage and prejudice of Limpin.
Resuello moved to quash the information, arguing the facts charged did not constitute an offense. The Court of First Instance of Pampanga granted the motion and dismissed the case. The lower court reasoned that the transaction, as described, constituted a simple loan or deposit governed by Article 1980 of the Civil Code, making the relationship purely that of creditor and debtor. It held that the presence of fraud gave rise only to a civil action, not to the crime of estafa, and that any violation of banking laws by the corporation would not warrant prosecution under the Revised Penal Code.

ISSUE

Whether the lower court erred in dismissing the information for estafa on the ground that the facts alleged constitute only a civil obligation arising from a simple loan.

RULING

Yes, the Supreme Court reversed the order of dismissal and remanded the case for further proceedings. The lower court erred in characterizing the transaction as a simple loan based on Article 1980 of the Civil Code, which governs deposits in banks and similar institutions. The information did not allege a deposit with the corporation per se. Instead, it specifically averred that the accused individuals—Resuello and his co-defendants—personally received the money from Limpin with the personal obligation to return it upon demand. It further alleged that these same individuals conspired to misappropriate and convert the funds for their own personal use and benefit.
In a motion to quash based on the insufficiency of the facts charged, the truth of the allegations in the information is hypothetically admitted. The lower court therefore departed from these allegations by re-characterizing the transaction. The legal relationship described is between Limpin and the accused individuals in their personal capacities, not between Limpin and the corporation as a banking entity. Consequently, Article 1980, which pertains to the civil effects of deposits with banks, is not applicable to determine the criminal liability of the individuals accused of personally defrauding the complainant.
Furthermore, the Court clarified that even if the corporation was operating in violation of banking laws, this does not preclude the criminal prosecution of its officers under the Revised Penal Code for their personal acts of misappropriation. Individuals who receive money in trust with an obligation to return it and who then misappropriate it for their own use commit estafa under Article 315, paragraph 1(b). The order of dismissal was set aside.