G.R. No. 99032 March 26, 1997
RICARDO A. LLAMADO, petitioner, vs. COURT OF APPEALS and PEOPLE OF THE PHILIPPINES, respondents.

FACTS

Petitioner Ricardo Llamado, Treasurer of Pan Asia Finance Corporation, and its President Jacinto Pascual were charged with violating Batas Pambansa Blg. 22 (Bouncing Checks Law). Private complainant Leon Gaw delivered P180,000.00 to the corporation with the assurance of repayment with interest. In his presence, Llamado and Pascual signed a Philippine Trust Company check for P186,500.00, postdated November 4, 1983, representing the principal and interest. Upon presentment, the check was dishonored for payment stopped and insufficiency of funds. Gaw notified Llamado, who subsequently offered in writing to pay 10% by November 14 or 15, 1983, and to roll over the balance for 90 days. Gaw accepted, but Llamado failed to fulfill this new agreement.
Llamado’s defense presented a different narrative. He claimed it was corporate practice for him to sign blank checks left with President Pascual for disbursements. The subject check was one such blank check later filled out and issued to Gaw. He argued the check was merely a contingent payment for an investment, not issued for value, and that he signed it only in his corporate capacity without personal involvement in the underlying transaction.

ISSUE

The primary issues were: (1) whether the check was issued “for value” under BP 22, given its alleged contingent nature; (2) whether Llamado, as a corporate officer who signed the check, incurred personal criminal liability; and (3) whether the subsequent agreement between Llamado and Gaw novated the obligation and extinguished the criminal liability.

RULING

The Supreme Court denied the petition and affirmed the conviction. On the first issue, the Court ruled that the law punishes the mere issuance of a worthless check. The purpose for its issuance or the terms of the underlying transaction is immaterial. A check is presumed issued for value, and its function as a currency substitute would be eroded by inquiring into the conditions of its issuance. The offense is malum prohibitum.
On the second issue, the Court held Llamado personally liable. Under Section 1 of BP 22, where a check is drawn by a corporation, the person who actually signed the check on its behalf is liable. His defense of merely signing a blank check in a corporate capacity does not absolve him, as he admitted to signing the instrument. The cited case of Dingle v. IAC was distinguished, as it involved different factual circumstances.
Finally, the Court found the novation theory inapplicable. The subsequent agreement to pay in installments was an empty promise that merely delayed prosecution. Novation of an obligation does not extinguish criminal liability for an already consummated violation of BP 22. The offense was complete upon the issuance and subsequent dishonor of the check for insufficiency of funds. The subsequent civil agreement did not undo the criminal act.