We represented a client in a case filed against her before the
Metropolitan Trial Court, Branch 136 of Quezon City.
On March 30, 2022, the Court took cognizance and set it for
arraignment on May 13, 2022, the accused entered a plea of not guilty.
Preliminary conference ensued. The issue is whether or not the
accused is criminally and civilly liable. The case was referred to
Mediation Center on same date.
On July 5, 2022, the private complainant testified. She identified
the check in the amount of P150,000.00. She said that the check was
in payment of a loan. When presented to the bank in 2017, it bounced
for the reason: Account Closed. Demand letter was sent and received
by the accused.
On cross-examination , the complainant admitted that she was
handed the check in 2014 and she was the one who placed the date in
the check (May 24, 2017).
On July 26, 2022, the accused took the witness stand. She
stated that she made several payments to the complainant in the
amount of P240,000.00 more than the face value of the check.
There was no agreement as to payment of interests.
On September 21, 2022, the court issued a judgment which
states:
“Pursuant to Article 1254 of the Civil Code, the payments made by accused
should be applied first to the loan covered by Metrobank Check No. 2321812 dated
May 24, 2017 as it is the check with the higher amount and a verbal agreement on
interest hence, the most onerous.
Moreover, all payments made shall be applied first to the principal amount
of the PhP150,000.00 loan. It has been ruled that if there is no written stipulation on
the interest payment should be applied to the principal obligation covered by the
check.
Complainant admitted that the alleged agreement on the monthly interest of
five percent (5%) was verbal. It is settled that no interest shall be due unless it has
been expressly stipulated in writing.
Even if the payment of interest has been reduced in writing, a 5% monthly
interest rate on a loan is unconscionable, regardless of who between the parties
proposed the rate.
As consistently adjudged in a plethora of cases, stipulated interest rates of
3% per month and higher, are excessive, iniquitous, unconscionable and exorbitant.
Such stipulations are void for being contrary to morals, if not against the law. In such
instances, Courts shall invalidate the stipulated interest rate and the legal interest
rate shall be imposed.
In the present case, there was no specified period as to the payment of the
PhP150,000.00 loan. Hence, levying a 5% monthly or 60% interest per annum is
definitely outrageous and inordinate. The imposition of an unconscionable rate of
interest on a money debt, even if knowingly and voluntarily assumed, is immoral and
unjust. It is tantamount to a repugnant spoliation and an iniquitous deprivation of
property, repulsive to the common sense of man.
***
The full payment of the total outstanding obligation covered by the check
also discharged the civil liability or civil action deemed instituted with the herein
criminal action. Under Art. 1231 of the Civil Code, an obligation is extinguished by
payment. Since the civil liability for the amount of the check has been discharged by
payment, no right to collect was violated and thus complainant has no cause of
action against accused.
In fine, the underlying obligation represented by the face value of
Metrobank Check No. 2321812 dated May 24, 2017 having been discharged by full
payment, accused is not criminally and civilly liable.
WHEREFORE, for the absolute failure of the prosecution to prove all the
elements of the offense, accused is hereby found NOT GUILTY of Violation of
Section 1, paragraph 1 of Batas Pambansa Blg. 22. Accordingly, she is hereby
ACQUITTED of the offense charged.
For lack of cause of action, the civil action deemed instituted with the
criminal action is hereby DISMISSED with prejudice.”
The case was terminated after only 6 months of continuous
Speedy Trial. Thanks to the Presiding Judge, Lotis P. Rosario. Sana
all Judges – paris niya!