Good faith as a defense in the felony of Estafa

For legal research purposes, may we share with our readers the jurisprudential part of a counter-affidavit
our law office has prepared for a client who was sued for Estafa by her company (a cooperative) based
on allowances she received prior to the approval of the budget and which were later ratified by the board
and the general assembly of the cooperative after the date of receipt thereof. We deleted all references to
the parties and the like.

COUNTER-AFFIDAVIT

Respondent x x x (“Respondent x x x”), of legal age, and a resident of x x x City, under oath, respectfully
states:

x x x.

APPLICABLE JURISPRUDCE

1. INNOCENCE is presumed in our Constitution and the Rules of Evidence, unless the contrary is clearly,
positively and convincingly proved by the complainant. In case of doubt, INNOCENSE being presumed by
our Constitution, the Rules of Evidence, and existing criminal laws, the scale of justice thus tilts in favor of
the ACCUSED. This is the EQUIPOISE RULE in the Rules of Evidence.

2. In the case of JOSE BERNARDO vs. RAFAEL T. MENDOZA, G.R. No. L-37876, May 25, 1979, it was
held that although “prosecutors are endowed with ample powers in order that they may properly fulfill their
assigned role in the administration of justice x x x, (it) should be realized, however, that when a man is
haled to court on a criminal charge, it brings in its wake problems not only for the accused but for his
family as well” and that “therefore, it behooves a prosecutor to weigh the evidence carefully and to
deliberate thereon to determine the existence of a prima facie case before filing the information in court”,
otherwise, it, held that, it “would be a dereliction of duty”.

3. In the case of “SUSANA B. CABAHUG, petitioner, vs. PEOPLE OF THE PHILIPPINES,

SANDIGANBAYAN, 3rd Division, and OFFICE OF THE SPECIAL PROSECUTOR, respondents”, G.R.
No. 132816. February 5, 2002, the Supreme Court ”(admonished) agencies tasked with the preliminary
investigation and prosecution of crimes that the very purpose of a preliminary investigation is to shield the
innocent from precipitate, spiteful and burdensome prosecution”. It added that such investigating
agencies were “duty-bound to avoid, unless absolutely necessary, open and public accusation of crime
not only to spare the innocent the trouble, expense and torment of a public trial, but also to prevent
unnecessary expense on the part of the State for useless and expensive trials”. It held that “when at the
outset the evidence cannot sustain a prima facie case or that the existence of probable cause to form a
sufficient belief as to the guilt of the accused cannot be ascertained, the prosecution must desist from
inflicting on any person the trauma of going through a trial”.

4. As to the defense of GOOD FAITH being raised herein by respondent X x x , it will be noted that GOOD
FAITH IS PRESUMED by law and the Rules of Evidence.

5. In the case of FRANCISCO M. LECAROZ, et. al. vs. SANDIGANBAYAN, et. al., G.R. No. 130872,
March 25, 1999, it was held “the rule is that any mistake on a doubtful or difficult question of law may be
the basis of good faith. (Mendiola v. People, G.R. Nos. 89983-84, 6 March 1992, 207 SCRA 85, 96)”. It
added that in Cabungcal v. Cordova, No. L-16934, 31 July, 1964, 11 SCRA 584, the Supreme Court
“affirmed the doctrine that an erroneous interpretation of the meaning of the provisions of an ordinance by
a city mayor does not amount to bad faith that would entitle an aggrieved party to damages against that
 official”. It “reiterated the principle in Mabutol v. Pascual, G.R. No. 60898, 29 September 1983, 124
SCRA 867, which held that public officials may not be liable for damages in the discharge of their official
functions absent any bad faith”. It stressed that “Sanders v. Veridiano II, G.R. No. 60898, 29 September
1983, 124 SCRA 867, expanded the concept by declaring that under the law on public officers, acts done
in the performance of official duty are protected by the presumption of good faith”.

6. In the case of MAGSUCI vs. SANDIGANBAYAN, GR 101545, Jan. 3, 1995¸ where the Supreme Court
was confronted with the question of whether or not criminal responsibility may be incurred by a head of
office who, in the discharge of his official duties, has relied on an act of his subordinate, it held that “there
is conspiracy when two or more persons come to an agreement concerning the commission of a felony
and decide to commit it. (Art. 8, Rev .Penal Code)”. It stressed, “conspiracy is not presumed”. The
elements of conspiracy must be proven beyond reasonable doubt, it added. It held that “the evidence
therefore must be reasonably strong enough to show a community of criminal design. (People
vs. Manuel, GR k93926-28, July 28, 1994)”.

7. Herein respondent X x x raises the defense that there is no iota of evidence that would inculpate her as a
conspirator with the other two (main) respondents. In fact, the affidavits of the complaining witness do not
show any specific, clear, positive, convincing or particular acts or physical participatory activities
on her part as to the alleged felonious payment of the RATA of respondents and the area
managers.

8. In the aforecited MASUCI case, the Supreme Court noted that the accused Magsuci only involvement in
the alleged conspiracy “was his having (1) noted the accomplishment report and certification submitted by
Enriquez; (2) signed the disbursement voucher with the usual certification on the lawful incurrence of the
expenses to be paid; and (3) co-signed four checks for the payment of P352,217.16 to Ancla”.

The Supreme Court held therein: “The actions taken by Magsuci involved the very performance of his
official duties. There has been no intimation at all that he had knowledge of any irregularity committed by
either Enriquez and Ancla. Petitioner might have been lax and administratively remiss in placing too
much reliance on the official reports submitted by his subordinate Enriquez, but for conspiracy to exist, it
is essential that there must be a conscious design to commit an offense. Conspiracy is not the product of
negligence but of intentionality on the part of the cohorts”.

In fact the Supreme Court stated in the said case: “We would be setting a bad precedent if a head of
office plagued by all too common problems – dishonest or negligent subordinates, overwork, multiple
assignments or positions, or plain incompetence – is suddenly swept into a conspiracy conviction simply
because he did not personally examine every single detail, painstakingly trace every step from inception,
and investigate the motives of every person involved in a transaction before affixing his signature as the
final approving authority. (Arias vs. Sandiganbayan, 180 SCRA 309).”

The Supreme Court further held therein: “We are not unaware of an observation made in People
vs. Rodis, 105 Phil. 1294, to the effect that a person may be so held liable as a co-principal if he, by an
act of reckless imprudence, has brought about the commission of estafa thru falsification, without which
(reckless negligence) the crime could not have been accomplished (citing Samson vs. CA, 103
Phil. 277). When, however, that infraction consists in the reliance in good faith, albeit misplaced, by a
head of office on a subordinate upon whom the primary responsibility rests, absent a clear case of
conspiracy, the Arias Doctrine must be held to prevail.”

9. The felony of Estafa was clarified by the Supreme Court in the case of PEOPLE OF THE PHILIPPINES
vs. CORA ABELLA OJEDA, G.R. Nos. 104238-58, June 2004, where it held that DECEIT AND
DAMAGE were indispensable elements of the said crime. It held that “the prosecution failed to prove
deceit in this case. The prima facie presumption of deceit was successfully rebutted by appellant’s
evidence of GOOD FAITH, a defense in estafa x x x.” It added that “our Revised Penal Code was enacted
to penalize unlawful acts accompanied by evil intent denominated as crimes mala in se. The principal
 consideration is the existence of malicious intent”. There is a concurrence of freedom, intelligence and
intent which together make up the “criminal mind” behind the “criminal act,” it. Thus, to constitute a crime,
the act must, generally and in most cases, be accompanied by a criminal intent, it stressed. The rule
is: Actus non facit reum, nisi mens sit rea. That is, “no crime is committed if the mind of the person
performing the act complained of is innocent”. (citing Tabuena vs. Sandiganbayan, 268 SCRA 332
[1997]). “Ordinarily, evil intent must unite with an unlawful act for there to be a crime. Actus non facit
reum, nisi mens sit rea. There can be no crime when the criminal mind is wanting,” the Supreme Court
said in the previously mentioned case. Citing American jurisprudence, the Court held that “criminal intent
in embezzlement is not based on technical mistakes as to the legal effect of a transaction honestly
entered into, and there can be no embezzlement if the mind of the person doing the act is innocent or if
there is no wrongful purpose”. In fine, the Court said, the accused may thus prove “that he acted in good
faith and that he had no intention to convert the money or goods for his personal benefit”.

10. In the landmark case of LUIS A. TABUENA vs. SANDIGANBAYAN and PEOPLE OF THE
PHILIPPINES, EN BANC, G.R. No. 103501-03, February 17, 1997; and accompanying case:
ADOLFO M. PERALTA vs. SANDIGANBAYAN and PEOPLE OF THE PHILIPPINES, G.R. No. 103507,
February 17, 1997, the Supreme Court held that “good faith in the payment of public funds relieves a
public officer from the crime of malversation”; “not every unauthorized payment of public funds is
malversation”; It held: “x x x. Where the payment of public funds has been made in good faith, and
there is reasonable ground to believe that the public officer to whom the fund had been paid was
entitled thereto, he is deemed to have acted in good faith, there is no criminal intent, and the
payment, if it turns out that it is unauthorized, renders him only civilly but not criminally liable.”

The doctrinal part of the aforecited case of LUIS A. TABUENA vs. SANDIGANBAYAN and PEOPLE OF
THE PHILIPPINES, EN BANC, G.R. No. 103501-03, February 17, 1997; and accompanying case:
ADOLFO M. PERALTA vs. SANDIGANBAYAN and PEOPLE OF THE PHILIPPINES, G.R. No. 103507,
February 17, 1997, is more extensively quoted hereinbelow:

“X x x. Even assuming that the real and sole purpose behind the MARCOS Memorandum was to siphon-
out public money for the personal benefit of those then in power, still, no criminal liability can be imputed
to Tabuena. There is no showing that Tabuena had anything to do whatsoever with the execution of the
MARCOS Memorandum. Nor is there proof that he profited from the felonious scheme. In short, no
conspiracy was established between Tabuena and the real embezzler/s of the P55 Million. In the cases
of “US v. Acebedo” and “Ang v. Sandiganbayan”, both also involving the crime of malversation, the
accused therein were acquitted after the Court arrived at a similar finding of non-proof of conspiracy. In
“Acebedo”, therein accused, as municipal president of Palo, Leyte, was prosecuted for and found guilty
by the lower court of malversation after being unable to turn over certain amounts to the then justice of
the peace. It appeared, however, that said amounts were actually collected by his secretary Crisanto
Urbina. The Court reversed Acebedo’s conviction after finding that the sums were converted by his
secretary Urbina without the knowledge and participation of Acebedo. The Court said, which we herein
adopt:
“No conspiracy between the appellant and his secretary has been shown in this case, nor did such
conspiracy appear in the case against Urbina. No guilty knowledge of the theft committed by the
secretary was shown on the part of the appellant in this case, nor does it appear that he in any way
participated in the fruits of the crime. If the secretary stole the money in question without the knowledge
or consent of the appellant and without negligence on his part, then certainly the latter cannot be
convicted of embezzling the same money or any part thereof.”
In “Ang”, accused-petitioner, as MWSS bill collector, allowed part of his collection to be converted into
checks drawn in the name of one Marshall Lu, a non-customer of MWSS, but the checks were
subsequently dishonored. Ang was acquitted by this Court after giving credence to his assertion that the
conversion of his collections into checks were thru the machinations of one Lazaro Guinto, another
MWSS collector more senior to him. And we also adopt the Court’s observation therein, that:
“The petitioner’s alleged negligence in allowing the senior collector to convert cash collections into checks
may be proof of poor judgment or too trusting a nature insofar as a superior officer is concerned but there
must be stronger evidence to show fraud, malice, or other indicia of deliberateness in the conspiracy
cooked up with Marshall Lu. The prosecution failed to show that the petitioner was privy to the
 conspirational scheme. Much less is there any proof that he profited from the questioned acts. Any
suspicions of conspiracy, no matter how sincerely and strongly felt by the MWSS, must be converted into
evidence before conviction beyond reasonable doubt may be imposed.”

X x x.”

11. The aforecited TABUENA case further held thus:

“x x x.

In so far as Tabuena is concerned, with the due presentation in evidence of the MARCOS Memorandum,
we are swayed to give credit to his claim of having caused the disbursement of the P55 Million solely by
reason of such memorandum. From this premise flows the following reasons and/or considerations that
would buttress his innocence of the crime of malversation.

First. Tabuena had no other choice but to make the withdrawals, for that was what the MARCOS
Memorandum required him to do. He could not be faulted if he had to obey and strictly comply with the
presidential directive, and to argue otherwise is something easier said than done. Marcos was
undeniably Tabuena’s superior – the former being then the President of the Republic who unquestionably
exercised control over government agencies such as the MIAA and PNCC. In other words, Marcos had a
say in matters involving inter-government agency affairs and transactions, such as for instance, directing
payment of liability of one entity to another and the manner in which it should be carried out. And as a
recipient of such kind of a directive coming from the highest official of the land no less, good faith should
be read on Tabuena’s compliance, without hesitation nor any question, with the MARCOS
Memorandum. Tabuena therefore is entitled to the justifying circumstance of “Any person who acts in
obedience to an order issued by a superior for some lawful purpose.” The subordinate-superior
relationship between Tabuena and Marcos is clear. And so too, is the lawfulness of the order contained
in the MARCOS Memorandum, as it has for its purpose partial payment of the liability of one government
agency (MIAA) to another (PNCC). X x x.

X x x. What is x x x significant to consider is that the MARCOS Memorandum is patently legal (for on its
face it directs payment of an outstanding liability) and that Tabuena acted under the honest belief that the
P55 million was a due and demandable debt and that it was just a portion of a bigger liability to PNCC. X
x x.

Thus, even if the order is illegal if it is patently legal and the subordinate is not aware of its
illegality, the subordinate is not liable, for then there would only be a mistake of fact committed in good
faith. Such is the ruling in “Nassif v. People” the facts of which, in brief, are as follows:
“Accused was charged with falsification of commercial document. A mere employee of R.J. Campos, he
inserted in the commercial document alleged to have been falsified the word “sold” by order of his
principal. Had he known or suspected that his principal was committing an improper act of falsification,
he would be liable either as a co-principal or as an accomplice. However, there being no malice on his
part, he was exempted from criminal liability as he was a mere employee following the orders of his
principal.”

X x x.”

12. Finally, in G.R. No. 147328. February 20, 2002, entitled “Spouses ANTON and EILEEN
LIM, petitioners, vs. UNI-TAN MARKETING CORPORATION, respondent”, the Supreme Court held
that “those who exercise their rights properly do no legal injury”, as in the case of respondent X x x when
she received her RATA which was duly approved by the General Assembly, as recommended by the
Board, and later implemented by the president of the cooperative. The Court held in the aforecited case
that “if damages result from their exercise of their legal rights, it is damnum absque injuria -- a loss
without injury, for which the law gives no remedy”. The law always presumes good faith, it added. Thus,
any person who seeks damages because of the tortuous acts of another has the burden of proving that
the latter acted in bad faith or with ill motive, it added. Respondent X x x , in the instant case, submits that
the complainant in the instant case has not discharged this burden, and a recovery for damages under
the circumstances is unwarranted, much less the incarceration of herein respondent X x x for estafa.

PRAYER

WHEREFORE, premises considered, it is respectfully prayed that the instant Complaint be

forthwith DISMISSED as to the herein respondent X X X for being clearly unmeritorious and for utter lack
of merit.
Other reliefs in the premises are also prayed for.
Las Pinas City, April 12, 2012.

XXX
Respondent

SUBSCRIBED and SWORN to before me in Quezon City this __th day of April, 2012.

Xxx.
Assistant City Prosecutor

Annexes : “A” to “L“, supra.