prevent the foreclosure, Mandy instructed petitioner to facilitate the
Dy v. People of the Philippines (Vi)
August 10, 2016| Jardeleza, J. | Civil liability arising from criminal case
PETITIONER: Gloria S. Dy
RESPONDENTS: People of the Philippines, Mandy Commodities Co. Inc.
(MCCI) represented by William Mandy
SUMMARY: Gloria DY was given checks to pay a loan to the ICBC but
not a check was paid. A case for estafa was filed and the RTC Manila
acquitted her because the prosecution failed to prove misappropriation
(element of estafa) but said she still had to pay the amount of the checks.
CA denied her appeal. The issue is whether Dy still had civil liability even
if she was acquitted because the prosecution was not able to prove an
element. SC ruled that Dy has no civil liability because there was no crime
of estafa in the first place since the element of misappropriation was not
proven. Dy’s civil liability arises from a contract of loan and therefore,
should not be awarded through the criminal action but must be filed
separately.
DOCTRINE: Every person criminally liable for a felony is also civilly
liable but if the person is acquitted because the elements of the crime were
not shown to exist, there is no crime and therefore, no civil liability ex
delicto. Civil liability arising from a contract of loan should be filed
separately.
FACTS:
1. Gloria Dy was the former General Manager of MCCI. She assisted
in the business involving several properties, one of which was the
construction of warehouses over Numancia Property that MCCI
leased from PNB.
2. She proposed to William Mandy the purchase of a property owned
by Pantranco and obtained a loan from International China Bank of
Commerce (ICBC) of P20,000,000 evidenced with a promissory
note. As security, MCCI also executed a chattel mortgage over the
warehouses in the Numancia Property. Mandy entrusted petitioner
with the obligation to manage the payment of the loan.
3. In Feb 1999, MCCI received a notice of foreclosure over the
mortgaged property due to its default in paying the loan. In order to
payment of the loan. MCCI, through Mandy, issued 13 Allied Bank
checks and 12 AsiaTrust Bank checks in varying amounts and in
different dates covering the period from May 18, 1999 to April 4,
2000 with a total amount of P21,706,281.00.
4. Mandy delivered the checks to Dy. Mandy claims that he delivered
the checks with the instruction that petitioner use the checks to pay
the loan. While Dy testified that she encashed the checks and
returned the money to Mandy. ICBC foreclosed the mortgaged
property as MCCI continued to default. Mandy claims that it was
only at this point discovered that not a check was paid.
5. Mandy filed a complaint-affidavit against Dy for estafa. The RTC
Manila acquitted Dy saying that she received the checks but the
prosecution failed to establish that she was under any obligation to
deliver them to ICBC in payment of MCCI's loan. The trial court
made this finding on the strength of Mandy's admission that he gave
the checks to petitioner with the agreement that she would encash
them. Dy would then pay ICBC using her own checks. The trial
court also said that Mandy and petitioner entered into a contract of
loan. Thus, it held that the prosecution failed to establish an
important element of the crime of estafa — misappropriation or
conversion. However, while the RTC Manila acquitted petitioner,
it ordered her to pay the amount of the checks.
6. Dy appealed to the CA but it found the petition without merit stating
that acquittal doesn’t necessarily absolve her civil liability. CA said
that when an accused is acquitted on the basis of reasonable doubt,
courts may still find him or her civilly liable if the evidence so
warrant. The evidence show that Dy received the checks as a loan
from MCCI and preventing to recover would be unjust enrichment.
The CA also denied her MR.
ISSUES:
1. Whether Dy has civil liability in the criminal case of estafa when
she was acquitted for failure of the prosecution to prove all
elements of the crime – NO
RATIO:
1. Criminal liability involves imprisonment and is against the State
while civil liability is compensated through damages and is to
 protect a right. The concept of civil liability ex delicto
acknowledges that every person criminally liable is civilly liable.
2. Rules of Court provide that when a criminal action is instituted, the
civil action for liability is also instituted. But these have different
standards of evidence: proof beyond reasonable doubt (criminal)
and preponderance of evidence (civil). Therefore, these cases are
separate and distinct. Extinction of criminal doesn’t necessarily
mean the extinction of the civil case. The civil case may only be
extinguished when there is a "finding in a final judgment in the
criminal action that the act or omission from which the civil
liability may arise did not exist." So, the judgment must say
whether the court failed to prove the guilt or merely failed to prove
beyond reasonable doubt.
3. In Manantan v. CA, there are 2 kinds of acquittal: 1) accused is not
the author of the act – can’t give rise to civil liability; and 2) acquittal
based on reasonable doubt – not exempt from civil liability. Hence,
while the evidence presented does not establish the fact of the crime
with moral certainty, the civil action still prevails for as long as the
greater weight of evidence tilts in favor of a finding of liability.
4. The elements of estafa are: 1) accused defrauded another by (a)
abuse of confidence or (b) deceit; and 2) damage capable of
pecuniary estimation. The Court previously held that fraud or bad
faith is indispensable. And the circumstances in Art. 315, par. 1(b)
is that the fraud considered criminal is the act of misappropriation
or conversion and if missing, no estafa.
5. In this case, the RTC Manila acquitted petitioner because there was
no adequate evidence to prove that Mandy gave the checks to
petitioner with the instruction that she will use them to pay the
ICBC loan. The RTC Manila held that when Mandy delivered the
checks to petitioner, their agreement was that it was a "sort of loan."
6. Earlier cases ordered the dismissal of the civil action for recovery
of civil liability ex delicto whenever there is a finding that there
was no estafa but rather an obligation to pay under a contract.
7. Under Pantig and Singson, whenever the elements of estafa are not
established, and that the delivery of any personal property was
made pursuant to a contract, any civil liability arising from the
estafa cannot be awarded in the criminal case. This is because the
civil liability arising from the contract is not civil liability ex delicto,
which arises from the same act or omission constituting the crime.
8. In this case, it is civil liability ex contractu and should be filed
separately. Because when the elements of estafa do not exist, there
is no crime and therefore, no civil liability ex delicto. Here, the
liability is from a contract of loan and is completely inconsistent
with the presence of estafa. A civil action for collection of sum of
money should be filed separately. The loan was also just tangentially
proven (no direct evidence since oral loan)
9. Conclusion: The lower courts erred when they ordered
petitioner to pay her civil obligation arising from a contract of
loan in the same criminal case where she was acquitted on the
ground that there was no crime. Any contractual obligation she
may have must be litigated in a separate civil action involving
the contract of loan. We clarify that in cases where the accused
is acquitted on the ground that there is no crime, the civil action
deemed instituted with the criminal case cannot prosper
precisely because there is no delict from which any civil
obligation may be sourced
10. WHEREFORE, the petition is GRANTED and the decision of the
CA REVERSED.