3.3. Reyes vs. Rossi
3.3. Reyes vs. Rossi
3.3. Reyes vs. Rossi
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* FIRST DIVISION.
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VOL. 691, FEBRUARY 18, 2013 59
Reyes vs. Rossi
BERSAMIN, J.:
The rescission of a contract of sale is not a prejudicial question
that will warrant the suspension of the criminal proceedings
commenced to prosecute the buyer for violations of the Bouncing
Checks Law (Batas Pambansa Blg. 22) arising from the dishonor
of the checks the buyer issued in connection with the sale.
Antecedents
On October 31, 1997, petitioner Teodoro A. Reyes (Reyes) and
Advanced Foundation Construction Systems Corporation
(Advanced Foundation), represented by its Executive Project
Director, respondent Ettore Rossi (Rossi), executed a deed of
conditional sale involving the purchase by Reyes of equipment
consisting of a Warman Dredging Pump HY 300A worth
P10,000,000.00. The parties agreed therein that Reyes would pay
the sum of P3,000,000.00 as downpayment, and the balance of
P7,000,000.00 through four post-dated checks. Reyes complied,
but in January 1998, he requested the restructuring of his
obligation under the deed of conditional sale by replacing the four
post-dated checks with nine post-dated checks that would include
interest at the rate of P25,000.00/month accruing on the unpaid
portion of the obligation on April 30, 1998, June 30, 1998, July 31,
1998, September 30, 1998 and October 31, 1998.1
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1 Rollo, p. 27.
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2 Id., at p. 28.
3 Id.
4 Id.
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5 Id., at pp. 39-43.
6 Id., at p. 28.
7 Id., at pp. 48-51.
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8 Id., at p. 29.
9 Id., at pp. 52-55.
10 Id., at p. 30.
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11 Id., at pp. 26-35; penned by Associate Justice Josefina Guevara-Salonga
(retired), and concurred in by Associate Justice Rodrigo V. Cosico (retired) and
Associate Justice Edgardo F. Sundiam (retired/deceased).
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Issues
Hence, this appeal by Reyes.
Reyes asserts that the CA erred in ruling that there was no
prejudicial question that warranted the suspension of the criminal
proceedings against him; that the petition suffered fatal defects that
merited its immediate dismissal; that the CA was wrong in relying
on the pronouncements in Balgos, Jr. v. Sandiganbayan12 and
Umali v. Intermediate Appellate Court13 because the factual
backgrounds thereat were not similar to that obtaining here; and
that the Secretary of Justice did not commit any grave abuse of
discretion amounting to lack or excess of jurisdiction.
In his comment,14 Rossi counters that the petition for review
should be outrightly dismissed because of its fatal defect; that the
CA did not err in ruling that the action for rescission of contract
did not pose a prejudicial question that would suspend the criminal
proceedings.
Reyes submitted a reply,15 declaring that the defect in the
affidavit of service attached to his petition for review had been due
to oversight; that he had substantially complied with the rules; that
there existed a prejudicial question that could affect the extent of
his liability in light of Supreme Court Administrative Circular No.
12-2000; and that the CA erred in finding that the Secretary of
Justice committed grave abuse of discretion.
To be resolved is whether or not the civil action for rescission
of the contract of sale raised a prejudicial question that required
the suspension of the criminal prosecution for violation of Batas
Pambansa Blg. 22.
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12 G.R. No. 85590, August 10, 1989, 176 SCRA 287 (Note, however, that this
ruling was not mentioned in the decision of the CA).
13 G.R. No. 63198, June 21, 1990, 186 SCRA 680.
14 Rollo, pp. 81-88.
15 Id., at pp. 94-100.
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Ruling
The petition for review is without merit.
A prejudicial question generally comes into play in a situation
where a civil action and a criminal action are both pending, and
there exists in the former an issue that must first be determined
before the latter may proceed, because howsoever the issue raised
in the civil action is resolved would be determinative juris et de
jure of the guilt or innocence of the accused in the criminal case.16
The rationale for the suspension on the ground of a prejudicial
question is to avoid conflicting decisions.17
Two elements that must concur in order for a civil case to be
considered a prejudicial question are expressly stated in Section 7,
Rule 111 of the 2000 Rules of Criminal Procedure, to wit:
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16 Jose v. Suarez, G.R. No. 176795, June 30, 2008, 556 SCRA 773, 781; Carlos v. Court
of Appeals, G.R. No. 109887, February 10, 1997, 268 SCRA 25, 33; Tuanda v.
Sandiganbayan (Third Division), G.R. No. 110544, October 17, 1995, 249 SCRA 342, 351.
17 Beltran v. People, G.R. No. 137567, June 20, 2000, 334 SCRA 106, 110.
18 G.R. No. 124498, October 5, 2001, 366 SCRA 567, 571-572.
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the criminal prosecution would be based; (2) in the resolution of the issue
or issues raised in the civil action, the guilt or innocence of the accused
would necessarily be determined; and (3) jurisdiction to try said question
must be lodged in another tribunal.
If both civil and criminal cases have similar issues or the issue in one is
intimately related to the issues raised in the other, then a prejudicial
question would likely exist, provided the other element or characteristic is
satisfied. It must appear not only that the civil case involves the same facts
upon which the criminal prosecution would be based, but also that the
resolution of the issues raised in the civil action would be necessarily
determinative of the guilt or innocence of the accused. If the resolution of
the issue in the civil action will not determine the criminal responsibility
of the accused in the criminal action based on the same facts, or there is
no necessity “that the civil case be determined first before taking up the
criminal case,” therefore, the civil case does not involve a prejudicial
question. Neither is there a prejudicial question if the civil and the
criminal action can, according to law, proceed independently of each
other.
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The injured party may choose between the fulfilment and the rescission
of the obligation, with the payment of damages in either case. He may also
seek rescission, even after he has chosen fulfilment, if the latter should
become impossible.
The court shall decree the rescission claimed, unless there be just cause
authorizing the fixing of a period.
This is understood to be without prejudice to the rights of third persons
who have acquired the thing, in accordance with Articles 1385 and 1388
and the Mortgage Law.
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19 4 Tolentino, Commentaries and Jurisprudence on the Civil Code of the
Philippines, 1987 Edition, p. 175.
20 Id., at p. 180.
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issue he does not have sufficient funds in or credit with the drawee
bank for the payment of the check in full upon its presentment; and
(3) the subsequent dishonor of the check by the drawee bank for
insufficiency of funds or credit or dishonor for the same reason had
not the drawer, without any valid cause, ordered the bank to stop
payment.21 The issue in the criminal actions upon the violations of
Batas Pambansa Blg. 22 is, therefore, whether or not Reyes issued
the dishonoured checks knowing them to be without funds upon
presentment. On the other hand, the issue in the civil action for
rescission is whether or not the breach in the fulfillment of
Advanced Foundation’s obligation warranted the rescission of the
conditional sale. If, after trial on the merits in the civil action,
Advanced Foundation would be found to have committed material
breach as to warrant the rescission of the contract, such result
would not necessarily mean that Reyes would be absolved of the
criminal responsibility for issuing the dishonored checks because,
as the aforementioned elements show, he already committed the
violations upon the dishonor of the checks that he had issued at a
time when the conditional sale was still fully binding upon the
parties. His obligation to fund the checks or to make arrangements
for them with the drawee bank should not be tied up to the future
event of extinguishment of the obligation under the contract of sale
through rescission. Indeed, under Batas Pambansa Blg. 22, the
mere issuance of a worthless check was already the offense in
itself. Under such circumstances, the criminal proceedings for the
violation of Batas Pambansa Blg. 22 could proceed despite the
pendency of the civil action for rescission of the conditional sale.
Accordingly, we agree with the holding of the CA that the civil
action for the rescission of contract was not determinative of the
guilt or innocence of Reyes. We consider the exposition by the CA
of its reasons to be appropriate enough, to wit:
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21 Tan v. Mendez, Jr., G.R. No. 138669, June 6, 2002, 383 SCRA 202, 210.
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x x x x
We find merit in the petition.
A careful perusal of the complaint for rescission of contract and
damages reveals that the causes of action advanced by respondent Reyes
are the alleged misrepresentation committed by the petitioner and AFCSC
and their alleged failure to comply with his demand for proofs of
ownership. On one hand, he posits that his consent to the contract was
vitiated by the fraudulent act of the company in misrepresenting the
condition and quality of the dredging pump. Alternatively, he claims that
the company committed a breach of contract which is a ground for the
rescission thereof. Either way, he in effect admits the validity and the
binding effect of the deed pending any adjudication which nullifies the
same.
Indeed, under the law on contracts, vitiated consent does not make a
contract unenforceable but merely voidable, the remedy of which would
be to annul the contract since voidable contracts produce legal effects until
they are annulled. On the other hand, rescission of contracts in case of
breach pursuant to Article 1191 of the Civil Code of the Philippines also
presupposes a valid contract unless rescinded or annulled.
As defined, a prejudicial question is one that arises in a case, the
resolution of which is a logical antecedent of the issue involved therein,
and the cognizance of which pertains to another tribunal. The prejudicial
question must be determinative of the case before the court but the
jurisdiction to try and resolve the question must be lodged in another court
or tribunal.
It is a question based on a fact distinct and separate from the crime but
so intimately connected with it that it determines the guilt or innocence of
the accused, and for it to suspend the criminal action, it must appear not
only that said case involves facts intimately related to those upon which
the criminal prosecution would be based but also that in the resolution of
the issue or issues raised in the civil case, the guilt or innocence of the
accused would necessarily be determined. It comes into play generally in
a situation where a civil action and a criminal action are both pending and
there exists in the former an issue which must be preemptively resolved
before the criminal action may proceed, because howsoever the issue
raised in the civil action is resolved would be determinative juris et de jure
of the guilt or innocence of the accused in the criminal case.
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70 SUPREME COURT REPORTS ANNOTATED
Reyes vs. Rossi
In this light, it is clear that the pendency of the civil case does not bar
the continuation of the proceedings in the preliminary investigation on the
ground that it poses a prejudicial question. Considering that the
contracts are deemed to be valid until rescinded, the consideration
and obligatory effect thereof are also deemed to have been validly
made, thus demandable. Consequently, there was no failure of
consideration at the time when the subject checks were dishonored.
(Emphasis supplied)
x x x x
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