criminal cases nos. sb-12- crm-0027 and 0028 for...

REPUBLIC OF THE PHILIPPINESSANDIGANBAYAN

Quezon City

PEOPLE OFPHILIPPINES,

Criminal Cases Nos. SB-12-CRM-0026For. Violation of Section 3(i) of

Republic Act fR. A.] No. 3019

Criminal Cases Nos. SB-12-CRM-0027 and 0028For. Violation of paragraph 2(a),

Article 315 of the RevisedPenal CodefEstafa/ Swindling]

VITALIANONANAGAS II,

CABOTAJE-TANG, P.J.,ChairpersonMARTIRES, J.QUIROZ, J.

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For resolution are the followingmotions filed by accusedVitaliano Navarette Nailagas:

1. Motion for Reconsideration dated March 28, 2016,which seeks to reconsider the Court's Decision promul ted onMarch 10, 2016 convicting him of violation of Secti n 3(i) ofRepublic Act (R.A.) No. 3019 and estafa on two (2) nts ~

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paragraph 2(a), Article 315 of the Revised Penal Code (RPC);1and

2. Supplemental Motion for Reconsideration with Requestto be Allowed to Present Evidence in Support of the Motion datedMay 13, 2016.2

In his subject motion for reconsideration, the accusedinvokes good faith and lack of criminal intent or mens rea tocommit the offenses charged. Applyingby analogy Estrada vs.Sandiganbayan,3 the accused argues that while R. A.No. 3019is a special law, the act punished therein is mala in se becauseit is inherently immoral or inherently wrong. Also, the avermentin the Informations that accused committed the offense"willfully,unlawfully and feloniously' alleges guilty knowledge.Thus, the accused concludes that proof beyond reasonabledoubt of mens rea is therefore necessary to hold one liableunder Section 3(i) of R. A. No. 3019 as well as estafa underArticle 315 which is punished under the RPC. Since criminalintent is required, the accused claims that good faith and lackof criminal intent are therefore valid defenses in these cases.4

The accused insists that the prosecution failed to prove theexistence of mens rea or criminal intent because of the followingcircumstances which allegedly show his good faith and lack ofcriminal intent or mens rea to commit the offenses charged: (1)he did not take part in the action of the Board in approving hisofficial and personal leave and travel to the United States ofAmerica [USA];(2) the Development Bank of the Philippines[DBP] approved his requests for reimbursement; (3) theCommission on Audit [COAl did not issue any notice ofdisallowance [ND]on the said reimbursements; (4) e is willingto refund the amount if, indeed, the C finds nlpp. 75-129, Record, Vol. III / /p,r2 pp. 159-229, Record, Vol. III3369 SeRA 394 (2001)4 at pp. 4-7

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reimbursements improper; (5) the government incurred lessexpenses specificallyfor the plane fare because he opted to stayin the USAfrom May 22, 2004 to June 8, 2004, or in betweenhis official engagements; (6) he paid for his own lodging andaccommodations in between his official engagements; and (7)he only requested for reimbursements of his meal andtransportation expenses in relation to his meeting with officersfrom various international financial institutions while onpersonal leave and for the purchase of occasional nominal giftshe gave on behalf of the DBP, which were allegedly allowableexpenses because he never stopped being the DBPChairpersoneven if he was on personalleave.5

Insofar as his conviction for violation of Section 3(i) ofR. A. No. 3019 is concerned, the accused argues that theprosecution failed to prove beyond reasonable doubt thefollowingelements required for conviction under the said law:(1) that the accused is directly or indirectly interested forpersonal gain or has material interest in the transaction or actwhich requires approval of the said board, panel or group ofwhich he is a member; (2) that the board, panel or groupexercises discretion in the approval of the said transaction; and(3)that the accused took advantage of his position.6

Relying on DOJ Opinion Nos. 059 and 072, the accusedargues that the "transaction or act" requiring the Board'sapproval under Section 3(i) refers to a contract or transactionwith third parties. It does not apply in this case because thetransaction involved routine actions on internal matters thatare done in the ordinary course of personal management likeapproval of application for leaves and travels which requiresapproval of the Board as a matter of course'? He contends thatto extend the application of Section 3(i)to ordinary and routineinternal matter like approval of leaves and travels would resultin an absurd situation where the grant of leaves for the high-ranking officers who are part of the Board would nowautomatically become criminal in nature. He also claims thatthe third element of violation of Section 3(i) is wanting in hiscase allegedly because the DBP Board does not have thediscretion and can

5 at pp. 7-10; pp. 78-81, Record, Vc6at pp. 11-13, 24 and 26; pp.85-87,98, Record, Vol. III7 at pp. 11-15, 21-23; pp. 85-89, 95-97, Record, Vol. III

RESOLUTIONPeople vs. Naiiagas IICriminal Cases Nos. SB-12-CRM-0026 to 0028Page 14

attending to personal matters. He further claims that there isno evidence that he took advantage of his official position inhaving the Board approve his leave and travel because he didnot take part in the voting that approved his official leave andtravel to the USA. Furthermore, he insists that while the Boardapproved his travel entitling him to bank privileges andallowances, the grant of the same was still subject to the COArules.8

The accused also assails his conviction for estafa underparagraph 2(a), Article 315 of the RPC. He argues that theCourt's finding that he employed deceit simultaneous with hisrequests for reimbursement when he issued a certification thatall expenses were authorized, necessary, lawful and incurred inthe discharge of his official duties is baseless. The accusedrelies on the admissions ofthe prosecution witness AimeeLiezelR. Tan that the COAdid not conduct further investigation todetermine whether the expenses subject of the reimbursementswere incurred in the discharge of his officialduties. Allegedly,the prosecution merely presumed that the said certification isfalse because the expenses were incurred in the Philippineswhile he was in the USAor that the items he purchased are toopersonal to be given as corporate gifts. He claims that heauthorized representatives to attend the meetings in thePhilippines on his behalf while he was abroad and that theitems which the prosecution claims as too personal to be givenas corporate gifts constitute only an insignificant portion of thewhole amount subject of these cases.9

Moreover, the accused argues that the said certification isentitled to the presumption of regularity because he issued it inthe course of the performance of his official functions. Sincethe prosecution claims that the said expenses were non-official,it has allegedly the burden to prove such negative allegation.He further argues that there is no evidence that the governmentsuffered damage. He claims that of the total amount ofP310,665.73 covered by nineteen (19)receipts which is subjectof SB-12-CRM-0028, the prosecution points to only one (1)receipt covering the purchase of a lingerie which it assumed istoo personal for a corporate gift. In SB-1 -C -0027, hemaintains that there is no evidence that t governme~

',t pp. 20-30; pp. 94-104, Recmd, Vol. "' / !J~.J9 pp. 32-34; pp. 106-108, Record, Vol. III M

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suffered damages in the amount of P66,374.28 since theprosecution evidence was based on the assumption that thesaid expenses incurred in the Philippines were not for an officialpurpose because the accused was in the USAat the time.lO

Likewise, the accused asserts that State Auditor DelaCruz's testimony that the person who incurred the expensesmust make the request for reimbursement should not be givenweight because he did not have personal knowledge of thecircumstances at that time since he was assigned to the DBPonly in 2010; and, that the prosecution failed to cite any rule orany basis which requires that the person who incurred theexpenses is the only one authorized to reimburse.ll

Finally, the accused claims a violation of his right tospeedy disposition of cases because of the alleged delay in thefiling of the Informations in these cases. He claims that theacts subject of these cases supposedly occurred in 2004 but theInformations were filed only in 2011. Allegedly,the delay ofalmost seven (7) years made it difficult for him to procurewitnesses and necessary documents to adequately defendhimself. He also claims a violation of his right to due processallegedly because (1) the prosecution merely assumed that thephysical presence of the accused would supposedly determinethe nature of the transaction to be reimbursed; and (2) theOffice of the Ombudsman denied his request for subpoenaduces tecum preventing him from having access to the DBPrecords.12

The prosecution claims that the Officeof the Ombudsmancan conduct its own investigation independent from the COAforthe purpose of determining whether criminal charges should befiled. Thus, it is not precluded from conductin its owninvestigationof the transactions subject of these ases ~

lO/bid. ~11 at p. 52; 126, Record, Vol III12 at pp. 46 and 51; pp. 120 and 125, Record, Vol. III

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without any NDissued by the COA. Based on its investigation,it was established that the DBP corporate secretary did notexamine each receipt attached to the claims forreimbursements. She merely relied on the evaluation of theassistant corporate secretary who, in turn, relied heavily on therepresentations made by the accused on the certifications thatthe expenses subject of the reimbursements were authorized,necessary, lawful and incurred in the discharge of his officialduties. 13

The prosecution also claims that the second paragraph ofSection 3(i) of R. A. No. 3019 provides for a disputablepresumption of interest for personal gain against those publicofficers responsible for the approval of manifestly unlawful,inequitable, or irregular transaction or acts by the board, panelor group to which they belong. The prosecution contends thatthe said presumption applies to these cases because theaccused himself requested and submitted his itinerary for histravel to the USA from May 15, 2004 to June 11, 2004,including attending to personal matters from May 22, 2004 toJune 8, 2004. According to the prosecution, this also showsthat the accused had an interest for personal gain in theapproval of his travel because he will still be entitled to bankprivileges and allowances even during the time that he was onpersonal leave. It argues that whether the accused spared thegovernment from incurring more expenses by staYing in theUSAbetween his two (2)officialbusiness trips is irrelevant andwill not excuse him from liability under Section 3(i)of R. A.No.3019.14

On the accused's claim for reimbursement representingexpenses incurred in the Philippines while the accused wasactually abroad, the prosecution argues that there was noshowing of any authorization from the accused or list of DBPofficers whom he authorized to represent him in the saidmeetings. The prosecution also points to the fact that thereceipts attached to the requests for the said reimbursement donot even show that the payee was DBP or a DBP Officer.Regarding the reimbursement of expenses incurred in the USAwhile the accused was attending to personal matters, theprosecution argues that the gifts he purch~ed allegedly ~

13 at pp. 2-3; pp. 150-151, Record, Vol. III ~I··. / !JAil"at pp. 3-4; pp. 151-152, Reoo'd, Vol. "' 1\ M

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bank officials he had meetings with were questionable becausesome of the items purchased were too personal to be given ascorporate gifts. IS

Further, the prosecution adverts to the fact that theaccused raises the issue of inordinate delay in the conduct ofthe investigation in his cases only after his conviction. Allegedly,this makes his claim a mere afterthought. As to the denial ofthe accused's request for subpoena duces tecum, theprosecution counters that the accused could have easilyrequested from the DBP the documents he needed for hisdefense since they are also public documents. But he failed todo SO.16

The accused filed a Reply dated May 24, 2016 insistingthat all the expenses involved in the reimbursements subject ofthese cases were allowed under DBP Board Resolution Nos.0241 and 0242, that the requests for reimbursements were dulyapproved by the corporate secretary, and that the COA did notissue any ND. The accused maintains that there is nothingirregular in assigning members of his staff to attend officialmeetings on his behalf while he was in the USAand to thereafterseek reimbursements for the expenses incurred in the saidmeetings. Insofar as some expenses for personal items areconcerned, the accused claims that the receipts for the saiditems were inadvertently attached to the request forreimbursements and the corporate secretary should have notconsidered them. The accused thus claims that he did notemploy deceit in the request for reimbursements because thecorporate secretary knew his itinerary and travel schedule andyet she approved the said reimbursements. 17

Furthermore, the accused argues that the pre mption of"interest for personal.gain" in Section 3(i) . 1\. No. ~

lSat pp. 4-6; pp. 152-154, Record, Vol. III fkI16at pp. 5-6; pp. 153-154, Record, Vol. III17at pp. 2-15; pp. 321-334, Record, Vol. III


does not apply in his case allegedly because the transactionwhich required the Board's approval was not a contractinvolvingthird parties but approval ofhis travel and leave whichare routine actions of the Board on internal matters.l8 Finally,the accused insists that the denial ofhis motion for the issuanceof subpoena duces tecum was a substantial violation of hisconstitutional right to compulsory processes to ensureproduction of evidence on his behalf. He points out that he fileda motion for reinvestigation on the basis of the said denial whichonly shows that he did not sleep on his right. 19

The prosecution filed its rejoinder claiming that theaccused's arguments in his reply are mere reiterations of hismotion for reconsideration. However, it insists that theissuance by the COAof an NDis not required before a case canbe filed against the accused. It also insists that the accused wasgiven every opportunity to examine the prosecution evidence,confront the witnesses and was afforded every right during thetrial. Thus, it argues that the accused cannot now claim thathis right to compulsory processes was violated.20

THE ACCUSED'S SUPPLEMENTAL MOTION FORRECONSIDERATION

The accused filed a Supplemental Motion forReconsideration with Request to be Allowed to Present Evidencein Support of the Motion alleging that the judgment against himis null and void allegedly because of violation of hisconstitutional rights. Thus, he prays to be low d to present

~~18at pp. 16-18; pp. 335-337, Record, Vol. III19at pp. 19-21; pp. 338-340, Record, Vol. III20 pp. 346-347, Record, Vol.lll


witnesses who allegedly appeared recently to testify on factsthat will completely exculpate him from any liability.21

In particular, the accused claims a violation of thefollowing rights: (1) his right to speedy disposition of casesbecause of the inordinate delay of seven [7]years from the timethe alleged acts were committed until the filing of theInformations against him; (2) his right to have compulsoryprocess to secure the production of evidence when the Officeofthe Ombudsman denied his motion for the issuance ofsubpoena duces tecum considering that he was no longerconnected with the DBP at that time; (3) his right to fair andimpartial judge because of the denial of his motion for theissuance of subpoena duces tecum and the reliance by theinvestigators on assumptions instead of facts during the trial;(4) his right to confront his accuser because there was nocomplaint-affidavit or swom statement submitted by a"complainant" which initiated the investigation before the Officeof the Ombudsman; and (5)his right to be presumed innocentuntil the contrary is proved because his conviction was notbased on the strength of the prosecution evidence.22

According to the accused, the prosecution admitted that itdid not conduct further investigation on the nature of theexpenses incurred in the Philippines while he was abroad. Itallegedly merely made the following assumptions: that theexpenses in the Philippines were not officiallyincurred becausehe was still in the USA;that a lingerie is too personal to be givenas a corporate gift; that the expenses were not officialbecausethey were incurred when he was supposedly on his personaltime; and, that the meetings in the Philippines did not pushthrough because he was in the USAat that time.23

The accused argues that the Court's observations that hefailed to givedetails ofhis supposed officialactivities even whenhe was supposedly on personal leave and the officialnature ofsome of the reimbursements are not fatal to his cases becausehe was no longer connected with the DBPmaking it i:r;npossiblefor him to procure witnesses and necessary PieCeSjr. evidence.Allegedly,he cannot be faulted if he was not able t present as--- (\ ~

P~21 pp. 159-229, Record, Vol. III22at pp. 10-20, 24-26; pp. 168-178, 182-184, Record, Vol. III23at p. 27; p. 185, Record, Vol. III

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witness any representative who attended the meetings on hisbehalf while he was abroad or the minutes of the said meetingsbecause the same were in the possession of the DBP. He wasnot able to secure the same documents because the Officeofthe Ombudsman denied his motion for the issuance ofsubpoena duces tecum. 24

The accused also argues that these cases should havebeen suspended on the ground of prejudicial question.Allegedly,there is no adverse finding yet by the COA. Grantingthat the COAis not precluded from issuing an NDat this time,then the Court should have deferred its issuance of a warrantof arrest and suspend the proceedings until the accused couldhave exhausted the available administrative remedies and beallowed to present evidence.25

For his conviction in the estafa cases, the accusedreiterates the same his arguments he raised in his motion forreconsideration.26

Further, the accused argues that granting arguendo thatthere is basis for his indictment, the prosecution engaged inselective prosecution because it only zeroed in on him. He alsoargues that the prosecution did not give any reason why theother DBP officials responsible for the reimbursements andapproval ofhis trip were not even investigated or included in theInformations. Allegedly,their non-inclusion in the investigationis fatal to the cause of the prosecution as it is highly incrediblethat he could have single-handedly tricked the government intoreimbursing his own expenses. He claims that to enforce theequal protection of the law, all directors of government-ownedand controlled corporations who have taken personal leaves as'approved by the Board. of which they are part of, shouldallegedlynow be criminally prosecuted similar to the accused.27

Finally, the accused prays that he be allowed to presentthe followingalleged material witnesses who recently appearedand who executed their respective judicial affidavits which heattached to the 8Ubje~:,:otion:(1) MinerV>f'M(irtliCiO,8/7

~at pp. 20-24 ~\ fb126 at pp. 40-4927at pp. 49-55 '

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assistant to the accused from March 2005 to June 2006.Allegedly, she will be presented to prove the character of theaccused, that the procedure of the DBP in the processing ofallowances through reimbursements of receipts was strictlyobserved, that all receipts for reimbursements were scrutinized,and that the COAdid not issue any ND; and (2) Sonia Casten,retired Chief Management Specialist of the DBP and secretaryassigned to the Officeof the Chairman, DBP from 2000 until thetermination of the accused from service. She will allegedlytestify that there was no deliberate intent to mislead thegovernment regarding the liquidation report during theaccused's travel in 2004, the questioned receipts for liquidationwere attached through plain inadvertence, and it is the Officeofthe corporate secretary that informs them which receipts wouldbe approved and liquidated or reimbursed.28

The prosecution opposed the aforesaid supplementalmotion on the ground that the same motion is actually a motionfor new trial which was filed beyond the allowed period.Moreover, it argues that the grounds which the accused raisedin his supplemental motion do not justify a new trial.Furthermore, there is no showing that the intended witnesseswere not accessible or available during the trial of these casesor before the promulgation of the assailed Decision in thesecases.29

After a painstaking re-examination of the records of thesecases and an assiduous evaluation of the parties' arguments,the Court resolves to grant the accused's motion forreconsideration.

Violation of Section 3(i)of R. A. No. 3019

28at pp. 56-5829 pp. 316-319, Record, Vol. 3

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To secure a conviction for violation of Section 3(i) of R. A.No. 3019, the prosecution must establish the followingelements:

1. The accused must be a public officerwho is amember of a board, panel or group;

2. He is directly or indirectly interested, forpersonal gain, or has a material interest in the transactionor act which requires approval of the said board, panel orgroup ofwhich he is a member; and

3. The board, panel or group exercises discretionin the approval of the transaction or act.

The Court maintains its findings in Criminal Case No. SB-12-CRM-0026 that the above-enumerated first and thirdelements are present. However, after a second hard look at thefacts of the case vis-a -vis the relevant jurisprudence, the Courtfinds that the accused's request for the Board's approval of hisapplication for official travel and for personal leave cannot beconsidered a "transaction or act" contemplated under Section3(i) of R. A. No. 3019.

"Transaction" is the act or the instance of conductingbusiness or other dealings especially the formation,performance or discharge of contract. 30

In Soriano, Jr. vs. Sandiganbayan,31 the Supreme Courtheld that the term "transaction" used in Section 3(b) of R. A. No.3019 is "limited only to contracts or transactions involvingmonetary consideration where the public officer has theauthority to intervene under the law." In the said case, theHigh Court declared that the preliminary inve .igationconducted by a prosecutor is not a contract or tran action soas to bring it within the ambit of Section 3 (b) of~. . No. 3~

fb#30 Black's Law Dictionary, Eighth Edition31131 SCRA 184 (1984), cited in People V5. Sandiganbayan, 712 SCRA 359 (2013)


It is obviousthat the investigationconductedby thepetitionerwas not a contract.Neitherwas it a transactionbecause this termmust be construed as analogousto theterm whichprecedes it. A transaction, like a contract,is one which involves some consideration as in credittransactions and this element (consideration)is absentin the investigationconductedby the petitioner.32

Notably, Soriano, Jr. involved a violation of Section 3 (b)of R. A. No. 3019 which punishes any public officer who"[d]irectlyor indirectly request[s] or receiv[es] any gift, present,share, percentage, or benefit, for himself or for any otherperson, in connection with any contract or transaction betweenthe Government and any other party, wherein the public officerin his officialcapacity has to intervene under the law."

On the other hand, Criminal Case No. SB-12-CRM-0026involves a violation of Section 3(i) of R. A. No. 3019 whichpunishes any public officer who "[d]irectly or indirectlybecom[es] interested, for personal gain, or having a materialinterest in any transaction or act requiring the approval of aboard, panel or group of which he is a member, and whichexercises discretion in such approval, even if he votes againstthe same or does not participate in the action of the board,committee, panel or group."

While the prohibited acts are punished under differentparagraphs of the Anti-Graft and Corrupt Practices Law, theCourt takes the view that the restrictive definition of the term"transaction" used in Section 3(b) equally applies to this case.In Soriano, Jr., the Supreme Court held that the termtransaction as used in Section 3 (b) of R. A. No. 3019 issusceptible of being interpreted both restrictively and liberally.Considering that laws creating, defining or punishing crimesand laws imposing penalties and forfeitures are to be construedstrictly against the State or against the party seeking to enforcethem,and liberallyagainstthe partysoughtto becharged'r

Pto/

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the construction more favorable to the accused must be adoptedhere.33

Thus, the words "transaction or act" requlnng theapproval of the Board contemplated under Section 3(i) of R. A.No.3019 must refer to a contract with a private person involvingmonetary consideration in which the accused is directly orindirectly interested for personal gain, or in which the accusedhas a material interest.

Here, the accused's request for the Board's approval of hisforeign travel and his application for personal leave are clearlynot contracts with a private person involving monetaryconsideration. As such, it cannot be considered a "transaction·or act" within the ambit of Section 3(i)ofR.A. No. 3019. In fact,these request and application were made pursuant to ordinaryoffice procedure which a public officer must observe beforeundertaking an officialtravel.

In any criminal prosecution, it is necessary that everyessential ingredient of the crime charged must be provedbeyond reasonable doubt in order to overcome theconstitutional right of the accused to be presumed innocent.34

In this case, the prosecution failed to prove the presence of thetransaction or act requiring the approval of the DBP Board inwhich the accused was directly interested for personal gain.Perforce, the accused's constitutional right of presumption ofinnocence until the contrary is proved has not been overcome;hence, he is entitled to an acquittal35 for the charge of violationof Section 3(i)ofR. A. No. 3019.

II. Estafa under paragraph2(a), Article 315 of theRPC

The accused is charged with estafa under p agraph 2(a),Article 315 of the RPCthrough deceit and faly retense ona33 People vs. Sandiganbayan, supra note 31 J "34 People vs. De Castro, 413 SCRA171 (2003) /J. AI35 People vs. Wagas, 705 SCRA 17 (2013) F"1

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[2] counts. These arose from his claim for reimbursementswherein he certified that the expenses were authorized,necessary, lawful and incurred in the discharge of his officialduties in the following amounts, to wit: (1) P310,665.73representing costs of gifts, representation, entertainment andtravelling expenses incurred from May 22, 2004 to June 8,2004, or during the period that he was attending to personalmatters; and (2)P66,374.28 representing expenses incurred inthe Philippines while he was abroad.

The elements of estafa under paragraph 2(a), Article 315of the RPCare as follows:

1. The accused used fictitious name orfalse pretense that he possesses (a)power, (b)influence, (c) qualifications, (d) property, (e)credit, (f)agency, (g)business or (h)imaginarytransaction, or other similar deceits;

2. The accused used such deceitful meansprior to or simultaneous with the execution ofthe fraud;

3. The offended party relied on suchdeceitful means to part with his money orproperty; and

Deceit as an element of estafa is a specie of fraud. It isactual fraud which consists of any misrepresentation orcontrivance where a person deludes another, to his hurt. Thereis deceit when one is misled - by guile, trickery or by othermeans - to believe as true what is really false.37

The false pretense or fraudulent act must be committedprior to or simultaneously with the commission 0 the fraud, itbeing essential that such false statement or presentation

~fJkr36Lopez VS. People, 703 SCRA 118 (2013)37Dy VS. People, G751 SCRA59 (2008)

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constitutes the very cause or the only motive whichinduces the offended party to part with his money. In theabsence of such requisite, any subsequent act of theaccused, however fraudulent and suspicious it mightappear, cannot serve as basis for prosecution for estafaunder the said provision.38

Further, in Republic vs. MegaPacific eSolutions, Inc,39the Supreme explained the element of defraudation by meansof deceit:

What needs to be determined therefore is whetheror not the element ofdefraudation by means ofdeceit hasbeen established beyond reasonable doubt.

In the case of People v. Menil, Jr., the Court hasdefined fraud and deceit in this wise:

Fraud, in its general sense, is deemed tocomprise anything calculated to deceive,including all acts, omissions, andconcealment involving a breach of legal orequitable duty, trust, or confidence justlyreposed, resulting in damage to another, or bywhich an undue and unconscientiousadvantage is taken of another. It is a genericterm embracing all multifarious means whichhuman ingenuity can devise, and which areresorted to by one individual to secure anadvantage over another by false suggestionsor by suppression of truth and includes allsurprise, trick, cunning, dissembling and anyunfair way by which another is cheated. Onthe other hand, deceit is the falserepresentation of a matter of fact, whether bywords or conduct, by false or misleadingallegations, or by concealment of that whichshould have been disclosed which deceives oris intended to deceiveanother so that he shallact upon it to his legal inj,// ~

38 Ison vs. People, G.R. No. 205097, June 8,2016; emphasis supplied39 G.R. No. 184666, June 27, 2016, citing Joson vs. People, 559 SeRA 638 (2008)

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For example, in People v. Comila, both accused-appellants therein represented themselves to thecomplaining witnesses to have the capacity to send themto Italy for employment, even as they did not have theauthority or license for the purpose. It was suchmisrepresentation that induced the complainants to partwith their hard-earned money for placement and medicalfees. Both accused-appellants were criminally held liablefor estafa.

In American jurisprudence, fraud may bepredicated on a false introduction or identification. InUnion Co. v. Cobb, the defendant therein procured themerchandise by misrepresenting that she was Mrs.Taylor Ray and at another time she was Mrs. Ben W.Chiles, and she forged their name on charge slips asrevealed by the exhibits of the plaintiff. The sale of themerchandise was induced by these representations,resulting in injury to the plaintiff.

In Raser v. Moomaw,40it was ruled that theessential elements necessary to constitute actionablefraud and deceit were present in the complaint. It wasalleged that, to induce plaintiff to procure a loan,defendant introduced him to a womanwho was falselyrepresented to be Annie L. Knowles of Seattle,Washington, the owner of the property, and thatplaintiff had no means of ascertaining her trueidentity. On the other hand, defendant knew, or inthe exercise of reasonable caution should haveknown, that she was an impostor, and that plaintiffrelied on the representations, induced his client tomake the loan, and had since been compelled to repayit. In the same case, the Court ruled that falserepresentations as to the identity of a person areactionable, ifmade to induce another to act thereon, andsuch other does so act thereon to his prejudice.

In this case, the evidence show that when the accusedrequested for the reimbursement ofthe amount ofP492,259.93,several of the receipts attached to the said request in the totalamount ofP310,665.75 were issued fromMaYrt/22,2004 to June8, 2004, or when the accused was attending to per~

~ 78 W"h. 653; 139 P. 622 (1914) ~r

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matters. Likewise, when the accused requested for thereimbursement of the amounts of P215,781.18 andP144,260.08, there were receipts attached to the said requesttotaling P66,374.28 whichwere incurred in the Philippines fromMay 15,2004 to June 11,2004 while the accused was abroad.Both requests for reimbursement were accompanied by acertification issued by the accused to the effect that theexpenses subject thereof were authorized, necessary, lawful andincurred in the discharge of his officialduties.

While the accused certified that the expenses wereauthorized, necessary, lawful and incurred in the discharge ofhis officialduties, the receipts themselves, which were attachedto the requests for reimbursement and the items coveredthereby, disclose the nature and date of incurrence of theexpenses. These requests went through the regular process ofvalidation before they were approved for payment. Thus, theDBP had all the means and opportunity to verify whether theexpenses were indeed proper for reimbursement. It cannot besaid therefore that the DBP approved the accused's claims forreimbursement based solely on the certification issued by theaccused.

Also, although the receipts show that the expenses wereincurred when the accused was supposedly attending topersonal matters as indicated in his itinerary, the Court findslogical the accused's claim that it was only during that time thathe was able to purchase the items which were given toindividuals with whom he had meetings. While he was onpersonal leave, it was not improbable for accused to still havemet with other officersof different banks to optimize the use ofhis time. In fact, the summary of expenses states the name ofthe individuals with whom the accused had met. The receiptsalso include expenses for software/IT accessories as well asbooks and magazines which are allowed under DBP BoardResolution No. 0242.41

Deceit is an allegation of fact that demands clear andconvincing proof. It is a serious accusation that can be soconvenientlyand casually invoked. That is Whfr is ~

flJ141 Please refer to summary of expenses attached to the request for reimbursement; Exh'l~its A-22 to A-24,pp. 81-83, Record, Vol. III; Exhibits A-64-A-67, pp. 122-125, Record, Vol. III; Exhibits D5_\~p. 306, Record,Vol. III.

RESOLUTIONPeople vs. Nanagas IICriminal Cases Nos. SB-12-CRM-0026 to 0028P age 119

presumed.42 While some receipts, which obviously indicatepersonal items, were included in the requestedreimbursements, the Court takes the view that this was theproduct of the accused's complete reliance on his secretary inthe preparation of his request for reimbursement. Evidently, hedid not personally review the propriety of the inclusion of thereceipts in the said requests for reimbursement. For this, hewas unquestionably negligent. However,this negligence cannotbe equated with deceit.

Since the prosecution has not proven the element ofdeceitin this two (2)estafa cases, the accused deserves an acquittal. 43

WHEREFORE, the Court [1] GRANTS the Motion forReconsideration dated March 28, 2016 filed by accusedVitaliano N.Nailagas. The questioned Decision promulgated onMarch 10,2016 is REVERSEDand SETASIDEand a new oneis entered ACQUITTINGaccused Vitaliano Nailagas II ofviolation of Section 3(i) of Republic Act No. 3019 and two (2)counts of violation of paragraph 2(a) of Article 315; and [2]NOTES the Supplemental Motion for Reconsideration withRequest to be Allowed to Present Evidence in Support of theMotion dated May 13, 2016 for being moot.

• OM~JE-/ Presiding Justice

Chairperson

~·RTIRESAssociate ~tice

42 R.S. Thomas, Inc. vs. Rizal Cement Co., Inc. 668 SCRA665 (2012)43 People vs. Pagaduan, 607 SCRA308 (2010)

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