Lozano v. Martinez

These were consolidated petitions arising from prosecutions under Batas Pambansa Blg. 22, approved April 3, 1979. In each case the accused moved to quash the information on the ground that the statute was unconstitutional, so the acts charged were no offense. The checks involved were postdated, present-dated, or a mix. The trial courts denied the motions, with one exception. In G.R. No. 75789, the RTC of Manila declared the law unconstitutional and dismissed the case, and the People petitioned. The Solicitor General argued that review was premature because denials of motions to quash are interlocutory. Because of the issue's importance, the Court resolved the constitutional question.

1. 1Whether BP 22 violates the constitutional prohibition against imprisonment for debt.
2. 2Whether it impairs freedom of contract, denies equal protection, or unduly delegates legislative or executive power.
3. 3Whether its enactment violated the prohibition on amending a bill on Third Reading.

BP 22 is constitutional (Yap, J.). The Court described the law. It punishes making or issuing a check knowing at the time of issue that funds are insufficient, if the check is later dishonored. It also punishes failing to keep sufficient funds for 90 days from the check's date. Knowledge is presumed prima facie from dishonor within 90 days, unless the drawer pays or arranges payment within five banking days of notice of dishonor. Under the Revised Penal Code, estafa through a bad check did not reach checks issued for pre-existing obligations, because the deceit must precede or accompany the fraud. People v. Sabio held this even after R.A. 4885. The Batasan therefore made issuing a worthless check malum prohibitum, detached from estafa. The gravamen of the offense is the act of making and issuing a worthless check. It is not the non-payment of an obligation, and the law is not designed to coerce payment. The act is punished as an offense against public order, not property. Under Ganaway, the constitutional ban on imprisonment for debt covers liabilities ex contractu, not penalties for crimes. A check is not a mere promise to pay. It is an order on a bank that represents funds on deposit. Worthless checks erode the confidence that makes checks a substitute for currency and harm the banking system and the public. The Court likened them to “pouring garbage into the bloodstream of the nation's economy.” The statute is a valid exercise of police power, and the Court did not need to decide whether police power could override the ban. The other objections failed. Freedom of contract protects only lawful contracts. Punishing the drawer and not the payee is a reasonable classification, like punishing the swindler and not the swindled. The payee's choice whether to present the check delegates no power to define crimes. The legislative record showed that the challenged text was the one approved on Second Reading, as a Special Committee had confirmed. The petition in G.R. No. 75789 was granted, the other petitions were dismissed, and the temporary restraining order was lifted.