EN BANC

G.R. No. L-7593 March 27, 1913

THE UNITED STATES, plaintiff-appellee,
vs.
JOSE M. IGPUARA, defendant-appellant.
W. A. Kincaid, Thos. L. Hartigan, and Jose Robles Lahesa for appellant.
Office of the Solicitor-General Harvey for appellee.
ARELLANO, C.J .:
The defendant therein is charged with the crime of estafa, for having swindled Juana Montilla and Eugenio Veraguth out
of P2,498 Philippine currency, which he had take on deposit from the former to be at the latter's disposal. The document
setting forth the obligation reads:
We hold at the disposal of Eugenio Veraguth the sum of two thousand four hundred and ninety-eight pesos (P2,498), the
balance from Juana Montilla's sugar. Iloilo, June 26, 1911, Jose Igpuara, for Ramirez and Co.
The Court of First Instance of Iloilo sentenced the defendant to two years of presidio correccional, to pay Juana Montilla
P2,498 Philippine currency, and in case of insolvency to subsidiary imprisonment at P2.50 per day, not to exceed one-
third of the principal penalty, and the costs.
The defendant appealed, alleging as errors: (1) Holding that the document executed by him was a certificate of deposit;
(2) holding the existence of a deposit, without precedent transfer or delivery of the P2,498; and (3) classifying the facts in
the case as the crime of estafa.
A deposit is constituted from the time a person receives a thing belonging to another with the obligation of
keeping and returning it. (Art. 1758, Civil Code.)
That the defendant received P2,498 is a fact proven. The defendant drew up a document declaring that they remained in
his possession, which he could not have said had he not received them. They remained in his possession, surely in no
other sense than to take care of them, for they remained has no other purpose. They remained in the defendant's
possession at the disposal of Veraguth; but on August 23 of the same year Veraguth demanded for him through a notarial
instrument restitution of them, and to date he has not restored them.
The appellant says: "Juana Montilla's agent voluntarily accepted the sum of P2,498 in an instrument payable on demand,
and as no attempt was made to cash it until August 23, 1911, he could indorse and negotiate it like any other commercial
instrument. There is no doubt that if Veraguth accepted the receipt for P2,498 it was because at that time he agreed with
the defendant to consider the operation of sale on commission closed, leaving the collection of said sum until later, which
sum remained as a loan payable upon presentation of the receipt." (Brief, 3 and 4.)
Then, after averring the true facts: (1) that a sales commission was precedent; (2) that this commission was settled with a
balance of P2,498 in favor of the principal, Juana Montilla; and (3) that this balance remained in the possession of the
defendant, who drew up an instrument payable on demand, he has drawn two conclusions, both erroneous: One, that the
instrument drawn up in the form of a deposit certificate could be indorsed or negotiated like any other commercial
instrument; and the other, that the sum of P2,498 remained in defendant's possession as a loan.
It is erroneous to assert that the certificate of deposit in question is negotiable like any other commercial instrument: First,
because every commercial instrument is not negotiable; and second, because only instruments payable to order are
negotiable. Hence, this instrument not being to order but to bearer, it is not negotiable.
It is also erroneous to assert that sum of money set forth in said certificate is, according to it, in the defendant's possession
as a loan. In a loan the lender transmits to the borrower the use of the thing lent, while in a deposit the use of the thing is
not transmitted, but merely possession for its custody or safe-keeping.
In order that the depositary may use or dispose oft he things deposited, the depositor's consent is required, and then:
The rights and obligations of the depositary and of the depositor shall cease, and the rules and provisions
applicable to commercial loans, commission, or contract which took the place of the deposit shall be observed.
(Art. 309, Code of Commerce.)
The defendant has shown no authorization whatsoever or the consent of the depositary for using or disposing of the
P2,498, which the certificate acknowledges, or any contract entered into with the depositor to convert the deposit into a
loan, commission, or other contract.
That demand was not made for restitution of the sum deposited, which could have been claimed on the same or the next
day after the certificate was signed, does not operate against the depositor, or signify anything except the intention not to
press it. Failure to claim at once or delay for sometime in demanding restitution of the things deposited, which was
immediately due, does not imply such permission to use the thing deposited as would convert the deposit into a loan.
Article 408 of the Code of Commerce of 1829, previous to the one now in force, provided:
The depositary of an amount of money cannot use the amount, and if he makes use of it, he shall be responsible
for all damages that may accrue and shall respond to the depositor for the legal interest on the amount.
Whereupon the commentators say:
In this case the deposit becomes in fact a loan, as a just punishment imposed upon him who abuses the sacred
nature of a deposit and as a means of preventing the desire of gain from leading him into speculations that may be
disastrous to the depositor, who is much better secured while the deposit exists when he only has a personal action
for recovery.
According to article 548, No. 5, of the Penal Code, those who to the prejudice of another appropriate or abstract
for their own use money, goods, or other personal property which they may have received as a deposit, on
commission, or for administration, or for any other purpose which produces the obligation of delivering it or
returning it, and deny having received it, shall suffer the penalty of the preceding article," which punishes such act
as the crime of estafa. The corresponding article of the Penal Code of the Philippines in 535, No. 5.
In a decision of an appeal, September 28, 1895, the principle was laid down that: "Since he commits the crime
ofestafa under article 548 of the Penal Code of Spain who to another's detriment appropriates to himself or abstracts
money or goods received on commission for delivery, the court rightly applied this article to the appellant, who, to the
manifest detriment of the owner or owners of the securities, since he has not restored them, willfully and wrongfully
disposed of them by appropriating them to himself or at least diverting them from the purpose to which he was charged to
devote them."
It is unquestionable that in no sense did the P2,498 which he willfully and wrongfully disposed of to the detriments of his
principal, Juana Montilla, and of the depositor, Eugenio Veraguth, belong to the defendant.
Likewise erroneous is the construction apparently at tempted to be given to two decisions of this Supreme Court (U.
S. vs. Dominguez, 2 Phil. Rep., 580, and U. S. vs. Morales and Morco, 15 Phil. Rep., 236) as implying that what
constitutes estafa is not the disposal of money deposited, but denial of having received same. In the first of said cases
there was no evidence that the defendant had appropriated the grain deposited in his possession.
On the contrary, it is entirely probable that, after the departure of the defendant from Libmanan on September 20,
1898, two days after the uprising of the civil guard in Nueva Caceres, the rice was seized by the revolutionalists
and appropriated to their own uses.
In this connection it was held that failure to return the thing deposited was not sufficient, but that it was necessary to prove
that the depositary had appropriated it to himself or diverted the deposit to his own or another's benefit. He was accused or
refusing to restore, and it was held that the code does not penalize refusal to restore but denial of having received. So
much for the crime of omission; now with reference to the crime of commission, it was not held in that decision that
appropriation or diversion of the thing deposited would not constitute the crime ofestafa.
In the second of said decisions, the accused "kept none of the proceeds of the sales. Those, such as they were, he turned
over to the owner;" and there being no proof of the appropriation, the agent could not be found guilty of the crime
of estafa.
Being in accord and the merits of the case, the judgment appealed from is affirmed, with costs.
Torres, Johnson and Trent, JJ., concur.