BP 22

Section 1. Checks without sufficient funds. - Any person who makes or

draws and issues any check to apply on account or for value, knowing at
the time of issue that he does not have sufficient funds in or credit with
the drawee bank for the payment of such check in full upon its
presentment, which check is subsequently dishonored by the drawee
bank for insufficiency of funds or credit or would have been dishonored
for the same reason had not the drawer, without any valid reason,
ordered the bank to stop payment, shall be punished by imprisonment of
not less than thirty days but not more than one (1) year or by a fine of not
less than but not more than double the amount of the check which fine
shall in no case exceed Two Hundred Thousand Pesos, or both such fine
and imprisonment at the discretion of the court.

The same penalty shall be imposed upon any person who, having
sufficient funds in or credit with the drawee bank when he makes or
draws and issues a check, shall fail to keep sufficient funds or to
maintain a credit to cover the full amount of the check if presented
within a period of ninety (90) days from the date appearing thereon, for
which reason it is dishonored by the drawee bank.

Where the check is drawn by a corporation, company or entity, the

person or persons who actually signed the check in behalf of such
drawer shall be liable under this Act.

Section 2. Evidence of knowledge of insufficient funds. - The making,

drawing and issuance of a check payment of which is refused by the
drawee because of insufficient funds in or credit with such bank, when
presented within ninety (90) days from the date of the check, shall be
prima facie evidence of knowledge of such insufficiency of funds or
credit unless such maker or drawer pays the holder thereof the amount
due thereon, or makes arrangements for payment in full by the drawee
of such check within (5) banking days after receiving notice that such
check has not been paid by the drawee.

Section 3. Duty of drawee; rules of evidence. - It shall be the duty of the

drawee of any check, when refusing to pay the same to the holder
thereof upon presentment, to cause to be written, printed, or stamped in
plain language thereon, or attached thereto, the reason for drawee's
dishonor or refusal to pay the same: Provided, That where there are no
sufficient funds in or credit with such drawee bank, such fact shall
always be explicitly stated in the notice of dishonor or refusal. In all
prosecutions under this Act, the introduction in evidence of any unpaid
and dishonored check, having the drawee's refusal to pay stamped or
written thereon or attached thereto, with the reason therefor as aforesaid,
shall be prima facie evidence of the making or issuance of said check,
and the due presentment to the drawee for payment and the dishonor
thereof, and that the same was properly dishonored for the reason
written, stamped or attached by the drawee on such dishonored check.

Not with standing receipt of an order to stop payment, the drawee shall
state in the notice that there were no sufficient funds in or credit with
such bank for the payment in full of such check, if such be the fact.

Section 4. Credit construed. - The word "credit" as used herein shall be

construed to mean an arrangement or understanding with the bank for
the payment of such check.

APPLIES TO CHECKS GIVEN AS COLLATERAL

Law:

Sec. 14. Blanks; when may be filled. - Where the instrument is wanting
in any material particular, the person in possession thereof has a prima
facie authority to complete it by filling up the blanks therein. And a
signature on a blank paper delivered by the person making the
signature in order that the paper may be converted into a negotiable
instrument operates as a prima facie authority to fill it up as such for
any amount. In order, however, that any such instrument when
completed may be enforced against any person who became a party
thereto prior to its completion, it must be filled up strictly in
accordance with the authority given and within a reasonable time. But
if any such instrument, after completion, is negotiated to a holder in
due course, it is valid and effectual for all purposes in his hands, and
he may enforce it as if it had been filled up strictly in accordance with
the authority given and within a reasonable time.

Jurisprudence:

The gravamen of the offense punished by BP 22 is the act of making and

issuing a worthless check; that is, a check that is dishonored upon its
presentation for payment. The mere act of issuing a worthless check is
malum prohibitum Lozano v. Martinez,[has declared that it is not the
nonpayment of the obligation that is being punished, but the making of
worthless checks. In People v. Nitafan, this Court has ruled that a check
issued as an evidence of debt -- though not intended to be presented for
payment -- has the same effect as an ordinary check and would fall
within the ambit of BP 22. Que v. People has affirmed the application of
BP 22 to cases in which dishonored checks have been issued in the form
of deposit or guarantee. Indeed, the law does not make any distinction
between checks issued in payment of an obligation and those made
merely to guarantee that obligation. (Ngo vs People, G.R. No. 155815, July
14, 2004) It should be noted that BP Blg. 22 punishes the making or
drawing and issuing of any check that is subsequently dishonored, even
in payment of pre-existing obligation, as indicated in Section 1 thereof by
the phrase to apply on account. Section 1 also punishes the making or
drawing and issuing of a check that is subsequently dishonored, in
payment of an obligation contracted at the time of the issuance of the
check, as indicated by the words for value.

In Llamado vs. CA, G.R. No. 99032, March 26, 1997, the Supreme Court
ruled that, “True, it is common practice in commercial transactions to
require debtors to issue checks on which creditors must rely as guarantee
of payment, or as evidence of indebtedness, if not a mode of payment.
But to determine the reason for which checks are issued, or the terms
and conditions for their issuance, will greatly erode the faith the public
reposes in the stability and commercial value of checks as currency
substitutes, and bring about havoc in trade and in banking communities.
So, what the law punishes is the issuance of a bouncing check and not
the purpose for which it was issued nor the terms and conditions
relating to its issuance. The mere act of issuing a worthless check
is malum prohibitum.”

At any rate, we have pronounced that the clear intention of the framers
of B.P. 22 is to make the mere act of issuing a worthless check malum
prohibitum. The agreement surrounding the issuance of the checks need
not be first looked into since the law itself provides that regardless of the
intent of the parties, the mere issuance of any kind of check which is
subsequently dishonored makes the person who issued the check liable.
(Claro Narte vs. CA, GR No. 132552, July 14, 2004)